Sitting of 20 October 1998

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
Oral Answers to Questions
  ENVIRONMENT, TRANSPORT AND THE REGIONS, RELATING TO ENVIRONMENT AND THE REGIONS
  The Secretary of State was asked—
  ENVIRONMENT, TRANSPORT AND THE REGIONS, RELATING TO ENVIRONMENT AND THE REGIONS

    Wheel Clamping
    Mr. Robin Corbett: What proposals he has to regulate the use of wheel clamping on public land. [54325]
    The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Ms Glenda Jackson): The Government understand the concern of those who have felt intimidated or tricked by unscrupulous wheel dampers looking to make easy money. Such behaviour should not be allowed to continue. In our transport White Paper, "A New Deal for Transport: Better for Everyone", we announced our intention to introduce regulation of wheel clamping as part of a package of statutory measures to regulate the private security industry as a whole. My right hon. Friend the Home Secretary intends to introduce firm proposals to that end later this year.
    Mr. Corbett: I thank my hon. Friend for that reply, but I urge her not to delay bringing to an end the harassment and intimidation of motorists by cowboy dampers. One woman was threatened that her three-year-old child would be held to ransom until she paid £60; another's gold tooth was demanded in payment; and a hearse was clamped with a body still inside it. Many people in the industry observe codes of practice, and I urge the Government to act quickly, unlike the Tory Government.
    Ms Jackson: My hon. Friend listed only three activities which are utterly reprehensible and which, I am sure, the whole House abhors. Let me reassure him. The private security industry encompasses a wide range of activities and occupations that bring individuals into contact with the public, who can, as a result, be put at risk. The scope of the proposals to be contained in the White Paper will include any sector of the industry that places employees in positions of trust and the public at risk. Wheel dampers, whether employees of private security firms or operating independently, will be covered by the proposals.

    Standard Spending Assessments
    Mr. Bill Michie: What representations he has received from (a) local authorities and (b) other organisations in respect of future SSA levels. [54326]
    The Minister for Local Government and Housing (Ms Hilary Armstrong): Since February, I have received many letters from local authorities and others about standard spending assessments. Last month, I also met groups of local authority representatives to hear their views on possible changes to SSAs.
    Mr. Michie: I thank my hon. Friend for that reply, and the Government for last year's adjustment, which was most welcome. In considering the area cost adjustment, will she reject totally the Elliott general labour market approach, which in practice will shift resources from poor to rich areas, and instead go for something such as the AC18–AC19, or, if that is too radical, what about an AC14–AC16, or, if that is too narrow, what about an AC14–AC16 with an E4, an E5 and an E6? That way, perhaps some time we shall get rid of this crazy system.
    Ms Armstrong: Now, Madam Speaker, you will understand the level of technicalities that people get into when talking about SSAs. In fact, we are considering 90 different options and about 25 of those are concerned with area cost adjustments. The subject arouses a great deal of excitement in various parts of the House. We are considering all the options and expect to report back to the House around the end of November or the beginning of December.
    Mr. John Townend: Does the Minister accept that the present methodology for calculating SSAs favours urban areas at the expense of rural areas such as my constituency, which has done very badly compared with Hull, which includes the constituency of the Secretary of State? Does she accept that there is such a thing as rural poverty and that, with agriculture going the way it is, such poverty is getting worse by the month? What plans does she have to redress the unfairness in the system?
    Ms Armstrong: I do not accept that the formula is biased towards any area. All areas face difficulties caused by the complexities of the system that the hon. Gentleman's Government left us, and we are considering a range of alternatives. I need no lectures about rural areas, because I live in and represent one of the most rural areas in the country. We are as determined to represent effectively people who live in rural areas, where poverty of course exists, as we are to represent people in urban areas. I remind the hon. Gentleman that more Labour Members represent rural areas than do those Conservatives who are left.
    Mr. Bill O'Brien: May I advise my hon. Friend that the Special Interest Group of Metropolitan Authorities welcomes the Government's move towards more accountability to the electorate? Given the three-year freeze on local government finances from central Government, it is important to get the standard spending assessments right. Contrary to the comments

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    made by the hon. Member for East Yorkshire (Mr. Townend), there is a lot of poverty in urban areas, and especially in my authority area. The SSAs should be fairer to those communities that are suffering the most, and I appeal to my hon. Friend the Minister to ensure that that happens.
    Ms Armstrong: The Government are committed to a fairer distribution of the grants to local authorities and we are seeking to introduce stability. Local authorities spend a lot of money and we want them to do so as responsibly as possible. We made it clear in the White Paper published in July that we want local authorities to plan their priorities effectively and to spend money on the priorities that the electorate have determined. The three-year freeze on methodology will give the stability that local government needs.
    Mrs. Gillian Shephard: Is the Minister aware of the report published by the County Councils Network last month? Does she agree with its conclusion that it costs more to deliver social services in rural areas than in urban ones?
    Ms Armstrong: I read the report and I met the County Councils Network last month. I listened carefully to its representations, and to those of other groups, including the unitaries, the SIGOMA authorities and the Association of London Government. All those authorities have significant representations to make. The right hon. Lady will remember that her Government, when they examined the issue of sparsity, came to the conclusion that the formula was about right in its comparison of the costs created by sparsity and density. The working group—on which the County Councils Network is represented—has not undertaken specific work this year that advances the discussion of sparsity, but I am sure that the right hon. Lady will wish to put her mind to the problem during the three years of stability so that she can propose ideas in the future.
    Mrs. Shephard: The point that the County Councils Network will have made to the Minister is not about the formula that existed, but about the fact that she distorted the formula this year by switching £100 million of funding from shire areas to urban ones. I am sure that it will also have made the point that the Minister would have done better not to exercise such a blatant anti-rural bias in the first place. What is she going to do about it?
    Ms Armstrong: The right hon. Lady comments more on the actions of her Government than on those of this Government. I remind her that we did not meddle with the settlement on sparsity that her Government set out.

    Mayors (Direct Elections)
    Shona McIsaac: What assessment he has made of the level of public support for the direct election of mayors in English towns. [54327]
    Mr. Graham Stringer: What assessment he has made of the level of public support for the direct election of mayors in English cities. [54330]
    The Secretary of State for the Environment, Transport and the Regions (Mr. John Prescott): On 7 May, the people of London gave a resounding 72 per cent. yes vote in favour of a directly elected mayor. Our local government White Paper proposals will give people everywhere the opportunity to say, in a referendum, whether they want a directly elected mayor.
    Shona McIsaac: I welcome the proposals to have directly elected mayors in English towns and cities. Does my right hon. Friend have proposals that will go further towards supporting English towns and cities?
    Mr. Prescott: As my hon. Friend knows, the Select Committee on the Environment, Transport and Regional Affairs unanimously called on the Government to produce an urban White Paper. I intend to publish such a White Paper next year. It will describe how the Government will enable our towns and cities to prosper and to offer a better quality of life to all who live in them. In other words, it will facilitate more sustainable communities. Vibrant and attractive towns and cities complement thriving rural areas, but we shall pay separate attention to the specific issues affecting rural areas. I shall make an announcement on that shortly.
    Mr. Stringer: My constituents and those who live in urban areas throughout the country will welcome my right hon. Friend's statement on an urban policy White Paper. They will also welcome the opportunity for communities to elect mayors, which will lead to direct improvements in those communities. That stands in stark contrast to virtually every announcement made by the previous Conservative Government, which led to life being worse in the inner cities and in urban areas. Will my right hon. Friend tell us how the urban policy White Paper will add to the initiatives already taken?
    Mr. Prescott: The urban White Paper will take a more comprehensive view of the quality of life in towns and cities. It will show how the many initiatives that we have already taken will fit together, and will link with work on issues such as education, training, crime reduction, regional development agencies, planning, transport, housing and others. All these will contribute to ending social exclusion and to building sustainable communities.
    In answer to a written question, I shall give more details later today, and the House will have an opportunity to debate these issues on Thursday.
    Mr. Adrian Sanders: All that has nothing to do with accountability, which is reduced if power is put in the hands of one person rather than being shared among a group of councillors. The idea of elected mayors does not address the fundamental question of public disengagement with local decision making. Only proportional representation could do that. What representations has the right hon. Gentleman received against the idea of elected mayors?
    Mr. Prescott: "PR" also seems to stand for please return to the same old question. The hon. Gentleman must know that our proposals leave councils' budget and policy decisions totally with the councils. We have received very few representations against directly elected mayors.
    Mr. Richard Ottaway: While the debate on elected mayors continues, will the right

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    hon. Gentleman encourage councils not to indulge in excesses like those of Labour-controlled Hammersmith and Fulham, whose newly created executive mayor has been declared unlawful? Under Conservative pressure, the mayor's £40,000 allowance has been halved. His efforts to streamline procedures have resulted in agendas of 250 pages, and in one case of 750 pages. The number of meetings has increased, not decreased. Is that an example of how to modernise local government?
    Mr. Prescott: Our proposals for local authorities are clear. We want to give people the opportunity to have directly elected mayors. Our local authority White Paper makes clear exactly how we want to distribute decision making, budgets and accountability. The White Paper has been well received in the country, and we intend to implement it.
    Mr. Gordon Prentice: Elsewhere in the European Union, where there is experience of directly elected mayors, is it not the case that men seem to be disproportionately represented? Given that we shall not have a regional list system, because people will stand to be the directly elected mayor of Manchester, Birmingham, Edinburgh or wherever, what reassurance can the Secretary of State give that there will be even representation of the sexes when we move to having directly elected mayors?
    Mr. Prescott: That is an important point, but, as democrats, we rely on the good sense of the electorate.

    Rail Freight
    Mr. Graham Brady: What action his Department is proposing to mitigate the environmental nuisance caused by increased levels of rail freight movements through residential areas. [54329]
    The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Alan Meale): Overall, rail freight causes less pollution and noise than road traffic. It can, however, cause local environmental problems, particularly in terms of noise. We expect Railtrack and the freight operating companies to minimise the environmental impacts of their operations on their neighbours.
    Mr. Brady: I thank the Minister for his helpful response. While I welcome increased freight moving on the railways, as I am sure all hon. Members do, real problems are caused in certain communities, including one in my constituency, where rail freight is causing vibration, which damages properties, and noise, which wakes people up in the middle of the night. In many instances, the effects can be mitigated by using different types of wagon or other measures. I impress on the Minister as powerfully as I can the importance of addressing those concerns.
    Mr. Meale: I thank the hon. Gentleman for his efforts, and especially for corresponding with me to let me know about the problems. I am aware of the noise problems in relation to rail freight traffic generally and in particular in respect of the Brunner-Mond chemical plant. I am pleased to be able to inform the House that Railtrack has entered
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    into discussions with English, Welsh and Scottish Railway, the freight company involved, and the local authority to try to solve the problem.
    Dr. Rudi Vis: EWS took over the transport of spent nuclear fuel on rail privatisation. It has now been taken over by Direct Rail Services, a wholly owned subsidiary of British Nuclear Fuels plc. Is my hon. Friend aware that BNFL wrote on 25 September to the London borough of Barnet, without any negotiation or prior information, saying that it was going to use Cricklewood sidings to park spent fuel?
    Mr. Meale: I was not aware of that detail. I will gather information when I return to the Department and give my hon. Friend a full response.
    Mr. Norman Baker: While it is right to minimise the environmental impact of rail freight movements, is not far more environmental damage caused by the movement of freight by road? The Government's priority should be—as I think it is—to secure a shift of freight from road to rail, which causes less pollution and noise. I am happy to have more rail freight move through Newhaven.
    Mr. Meale: I thank the hon. Gentleman. I can enlarge on what he said. Moving freight from road to rail creates major environmental benefits. In our 18 months in power, the Government have effected a 5 per cent. growth in that transfer.

    Regional Development Agencies
    Mr. Bob Blizzard: What plans he has to encourage sub-regional structures within regional development agencies. [54332]
    The Minister for the Regions, Regeneration and Planning (Mr. Richard Caborn): In our guidance to regional development agencies on their regional strategies, we will encourage them to address the needs of the whole of their regions, but we will not prescribe what sub-regional structures they should adopt. We are publishing a draft of the guidance today; copies are in the Library.
    Mr. Blizzard: Is my hon. Friend aware of the eastern region of the Norfolk and Waveney enterprise partnership and its economic development strategic forum, which is called "Shaping the Future"? As it is a well-established body already well supported by industry, does he agree that it is ideally placed to work with the RDA for the eastern region in addressing the problems of the north and east of the region, where unemployment is highest?
    Mr. Caborn: My hon. Friend knows that, when I visited his area, I met some people from that partnership, which was impressive. Although I have not seen a document, I am sure that "Shaping the Future" reflects the partnership that I encountered. I hope that the RDAs will look seriously at sub-regional partnerships. We want to build on them. We do not want to reinvent the wheel, but to develop the best in the regions to ensure that the bottom-up process starts to address the regions' real problems.
    Mr. Owen Paterson: Is the Minister aware that, in rural areas such as Shropshire,

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    there is real alarm that RDAs will be dominated by urban interests? Can he assure the House that, in constructing these new institutions, the Government will give a strong voice to rural areas so that they will not be swamped by the urban majority?
    Mr. Caborn: We gave that, assurance on many occasions during the passage of the Regional Development Agencies Bill. We have ensured that every RDA board will have one person with responsibility for rural areas. As my right hon. Friend said, we will address rural areas as we are addressing urban areas in a White Paper. An announcement will be made on that in the near future.
    Ms Margaret Moran: Will my hon. Friend ensure that sub-regional arrangements within the regional development agencies will reflect the fact that some areas such as Luton have interests that cross RDA boundaries? For example, although we are in the eastern region, we share a great deal with London and the south-east. Will he ensure that sub-regional arrangements reflect those interests?
    Mr. Caborn: My hon. Friend has raised an important question. I want positively to encourage that relationship between the regions. In a few weeks, my hon. Friend the Minister for London and Construction and I will meet the Thames Gateway partnership to make sure that it continues in the positive work that it has done. That partnership crosses three RDAs. We shall be positively encouraging such co-operation. Administrative boundaries, not Chinese walls, surround the RDAs.

    Housing Development
    Mrs. Ann Winterton: When he last met representatives of the construction industry to discuss future housing developments; and if he will make a statement. [54333]
    The Minister for London and Construction (Mr. Nick Raynsford): My colleagues and I have frequent contacts with the construction industry to discuss a wide range of matters, including future housing developments.
    Mrs. Winterton: Bearing in mind the high level of public concern about the location of future housing development, should not the Minister, as a matter of urgency, have talks with the housebuilding industry to discuss how best it can help to regenerate our towns and cities? Would that not be better than waiting for months for Lord Rogers's task force to report?
    Mr. Raynsford: I have had frequent meetings in the past 18 months with the housebuilders and other interests to stress the importance of building as much as possible on brown-field sites.
    Mrs. Winterton: When was the last occasion?
    Mr. Raynsford: The last occasion was yesterday evening. I have to put it to the hon. Lady that, especially by comparison with the previous Government, who failed entirely in their period of office to ensure coherent
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    planning for the housing needs of our country, this Government have done more in the past 18 months than any Government could have been expected to do.
    Mr. Barry Gardiner: Is my hon. Friend aware of the problems encountered by those home owners who apply to leasehold valuation tribunals for the right to manage their own homes? Is he aware that, earlier this summer, one tribunal could not tell the difference between a manager and a managing agent, as a result of which the people concerned were forced to contract with the person who was in prison at that time for defrauding them? Will he investigate the quality of leasehold valuation tribunals and undertake to look into the backlog, which at present in London is running at more than 90 per cent?
    Mr. Raynsford: My hon. Friend has shown great ingenuity in extending the boundaries of the construction industry to embrace issues of leasehold reform, but I do not begrudge him that, because he has been an assiduous supporter of leasehold interests and has advocated reform most persuasively throughout the past 18 months. The Government are very serious about this issue. They have given extremely serious attention to it and expect to publish in the near future detailed proposals for consultation, which will deal with a range of issues relating to leasehold, including the future remit and role of leasehold valuation tribunals.
    Mr. Simon Burns: Will the Minister confirm that, yesterday, the Deputy Prime Minister issued a statement saying that he strongly welcomed the Environment, Transport and Regional Affairs Committee's report on housing? Is he aware that the Select Committee said that the Government must support local authorities when they restrict the use of green-field sites? How does he square that with his right hon. Friend's decision to force West Sussex to build 13,000 extra homes, despite the opposition of even Labour councillors and his own officials? Does he understand that the rhetoric of the Government has failed to be met by their actions, and that their green credentials are torn to shreds as a result of their ludicrous building programme?
    Mr. Raynsford: The hon. Gentleman knows only too well that the issue of West Sussex is subject to legal action. West Sussex challenged the Secretary of State unsuccessfully, but, because it may pursue an appeal, the hon. Gentleman will appreciate that I am not at liberty to say more about that. However, unlike the previous Government, who had a consistent record of allowing development, often against inspectors' decisions, on green-belt land—not just green-field land—this Government have extended the green belt and increased to 60 per cent. the target for development on brown-field sites.

    Regional Development Agencies
    Mr. Austin Mitchell: What proposals he has for giving regional assemblies an advisory role in regional development agencies. [54335]
    The Minister for the Regions, Regeneration and Planning (Mr. Richard Caborn): The Regional Development Agencies Bill currently before Parliament

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    provides for regional chambers—which are now coming together in each English region—to have an advisory role in relation to the RDAs. The establishment of regional assemblies in England is something for the future, depending on popular demand.
    Mr. Mitchell: I am delighted that, in those areas where regional assemblies have been set up thanks to local pride and local initiative, they will play a part in the chambers. I hope that my hon. Friend will pay attention to the strong feeling over the whole of the north of England that we should be moving to elected regional governments for those areas that want them during this Parliament rather than postponing the proposal to the next one. If we had elected regional government, it could give to the development of the RDAs the synergy of democracy that will exist in Scotland so that we can compete effectively, and it would also put an end to the rubbish about an English Parliament which is being talked about by the Opposition.
    Mr. Caborn: I am sure that my hon. Friend knows that we are not into gesture politics like the Opposition. In our devolution, we are managing change in concert with what the British people want. As we know, in Scotland, Wales, Northern Ireland and in London, all that has been tested by the popular vote and the electorate have said overwhelmingly that they want that devolution. In the same way, we shall manage the change for England through the regional development agencies and the chambers and, in the fulness of time, through regional assemblies. That is what we said in the manifesto and that is what we will deliver. We will keep to our election promises.
    Mr. Michael Fabricant: On the subject of what people want, exactly how much will that extra tier of bureaucracy cost?
    Mr. Caborn: I am sure that the hon. Gentleman was present during the debate on the Regional Development Agencies Bill. We said clearly in Committee and on the Floor of the House that it would be contained within present expenditure.
    Mr. Michael Clapham: Will my hon. Friend be meeting his colleagues in the Department of Trade and Industry to discuss the role of the training and enterprise councils, to ensure that they work closely with the RDAs to provide the necessary skills and training in the areas where that is required?
    Mr. Caborn: That is an important part of the remit of the RDAs. I have already announced the strategy document this afternoon—copies are in the Library—and part of that strategic overview will be to look at the skills needs of particular regions. That is important and will be carried out across all Departments of State.

    Local Authority Capping
    Dr. Vincent Cable: If he will report on his progress towards removing capping from local authorities. [54336]
    The Minister for Local Government and Housing (Ms Hilary Armstrong): Our White Paper in July announced our intention to end crude and universal capping while taking a new reserve power to limit excessive council tax increases.
    Dr. Cable: Will the Minister acknowledge that there are many councils under all three parties that cannot meet the Government's expectations for improved education standards, care in the community and the new best value requirements for replenishing reserves without much greater freedom to set expenditure and local tax levels than the Government are willing to give them?
    Ms Armstrong: In the comprehensive spending review we announced what we feel are substantial and realistic increases for Government contribution to local government spending and for overall local government spending. I am convinced that the spending limits about which we have been talking will enable local government to meet its targets and its commitment to improve services, and enable local people to take advantage of the opportunity offered by those services. We are ending crude and universal capping but, it is none the less, in the interests of the entire country for an eye to be kept on overall public spending, and that is what we intend to do.
    Mr. Andrew Lansley: Will the Minister explain how it can make sense for the forthcoming budget round to set capping criteria only after local authorities have set their budgets? Will she also explain why the Local Government Association takes the view that her proposals will lead to
    "increased uncertainty and subjective judgments"?
    Ms Armstrong: The system that we shall operate this year was introduced by the previous Administration, who changed the way in which they implemented legislation when they felt that local authorities were out of control. We cannot, this year, amend the legislation, so to end crude and universal capping we need to work within the existing legislation, which means no presignalling of individual budgets.

  ENVIRONMENT, TRANSPORT AND THE REGIONS, RELATING TO TRANSPORT
  The Secretary of State was asked—
  ENVIRONMENT, TRANSPORT AND THE REGIONS, RELATING TO TRANSPORT

    Road Congestion
    Mrs. Ann Winterton: What representations he has received on his Department's proposals to reduce congestion on Britain's roads. [54357]
    The Secretary of State for the Environment, Transport and the Regions (Mr. John Prescott): We received more than 7,000 responses to our integrated transport consultation, the great majority of which were concerned with the impacts of congestion. Since publishing the integrated transport White Paper, I have received many letters broadly welcoming our proposals.
    Mrs. Winterton: Bearing in mind the fact that 80 per cent. of goods in the United Kingdom are transported by

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    freight on the roads for the simple reason that there is no good alternative, is the right hon. Gentleman aware of the costs of congestion, for example, on the M6 around Birmingham and the M62 around Manchester? Furthermore, is he aware that a company based at Sandbach in my constituency has estimated that congestion on the M6 alone costs it £500,000 a year in vehicle and driver delays? That figure can be multiplied many times for business and industry in the north-west of England. What does the Secretary of State propose to do to assist business and industry in moving their goods?
    Mr. Prescott: The hon. Lady has given a catalogue of the disasters that we inherited after 18 years of Tory non-transport policy. We have produced a paper on integrated transport—the first for 20 years—which demonstrates how we give a higher priority to rail transport. We have doubled the amount of freight grants, which has increased freight by 5 per cent. in one year—more than the figure has increased over the past decade.
    On road congestion, we have considered the part of the M6 to which the hon. Lady referred as part of a transport corridor study to find out how we can use under-utilised rail more effectively and reduce congestion on the road. That is the intelligent approach to transport that is embodied in our White Paper.
    Ms Hazel Blears: As a keen motor cyclist, I am delighted that the White Paper recognises for the first time the role that motor cycles can play in reducing congestion, particularly in urban areas. Will my right hon. Friend encourage local councils to promote the role of motor cycling in tackling congestion in experiments such as those in Reading and Bristol, where motor cycles have been allowed to use bus lanes to great effect? Does he intend to experience the delights of motor cycling in the near future?
    Mr. Prescott: No, but I have ridden motor bikes from time to time. They have a role, which must be encouraged, in reducing congestion and providing alternative choices. My hon. Friend referred to towns where motor cycles have been given priority in bus lanes, and I am pleased to say that Hull has done the same. That is in response to the ideas in our White Paper.
    Mr. Tom Brake: Before the election, Labour promised to reduce traffic. The party's election internet site said that Labour would
    "reduce and then reverse traffic growth".
    Since the election Ministers have repeated that pledge. In June last year the Deputy Prime Minister said:
    "I will have failed if in five years time there are not far fewer journeys by car. It's a tall order but I urge you to hold me to it."
    The White Paper on integrated transport refers only to reducing traffic growth. Will the right hon. Gentleman reassure the House, business—which loses billions of pounds to congestion each year—and the one out of seven children who suffer from asthma triggered by pollution that the Government will keep their election promises and reduce traffic levels overall, not merely the growth in traffic?
    Mr. Prescott: The hon. Gentleman quoted both the question and the answer and I agree to keep to that commitment: judge my performance in five years.
    Mr. John Home Robertson: I welcome my right hon. Friend's proposal to designate the
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    A1 trunk road a core national route. Does he agree that the only way of relieving congestion on that single carriageway bottleneck in the national highway system is by dualling it? Will my right hon. Friend encourage his colleagues at the Scottish Office to follow his lead by designating the A1 in Scotland a core national route?
    Mr. Prescott: Our position on the A1 was made clear in the roads paper and announced to the House. The proposal requires a great deal of co-operation between us and the Scottish authorities, and we are working to that end.
    Mr. Bernard Jenkin: I thank the Secretary of State for the illuminating answers given by his Ministers. Despite his newly announced policy on integrated road transport, my question about reducing traffic growth forecasts over the next 20 years has received simply a holding reply. The Secretary of State repeated at the Labour party conference that the volume of traffic is expected to continue to grow, by 30 per cent. over the next 20 years. How will the Government curb congestion and pollution—that is the right hon. Gentleman's manifesto commitment—when even the slashed roads programme that he announced at the end of the summer does not contain a single start date or commitment to beginning a new roads scheme before the next general election?
    Mr. Prescott: The 30 per cent. growth figure is based on historical trends. It is estimated that, if we do not change to a better public transport system, we will face that kind of growth.
    Our policies in the integrated transport White Paper are about reducing that figure and getting people to change from using cars to public transport. Our policies, once implemented, will begin to have that effect. We face the current problem because the previous Government refused to put resources into either road or rail, and left us with a total mess and the cost of dealing with congestion.
    Mr. Ian Pearson: Is my right hon. Friend aware that the congestion problem in the west midlands involves not only the raised section of the M6 but all the roads beneath it? It is almost impossible to travel around the black country. Does my right hon. Friend accept that light rail systems are a viable way forward for the black country, where priority bus lanes are unfeasible because of general geographical problems? Will he look sympathetically at the three packages that have been submitted to him jointly by the west midlands local authorities, particularly the line 3 proposal, which involves a £20 million private sector contribution towards opening up rail transport between Walsall, Dudley and the Merry Hill shopping complex?
    Mr. Prescott: I am prepared to consider any proposals that reduce congestion and help the public transport system. I do not readily accept that there cannot be priority bus lanes in the area that my hon. Friend mentioned. I think that hon. Members recognise that light rail systems are an extremely expensive way of dealing with congestion problems. We have several of them in this country, but I think that buses can play a greater role than light rail systems.

    Heavy Freight
    Mr. David Heath: What plans he has to reduce the level of heavy freight transport using unsuitable roads in rural areas. [54358]
    The Minister of Transport (Dr. John Reid): Heavy lorries should not travel on unsuitable roads when an alternative route exists for collection or delivery. When drawing up their local transport plans, we shall expect local authorities to bring forward strategies to ensure that heavy lorries are routed away from unsuitable roads. We are examining ways of streamlining the use of local traffic authority powers to specify through routes for heavy lorries or to prohibit or restrict heavy lorry movements on particular roads.
    Mr. Heath: I welcome the opportunity to ask the right hon. Gentleman a question about roads rather than aircraft carriers. Does he agree that many rural roads in small communities were not designed for heavy lorry traffic and cannot, and should not, take it? Rather than spending Government and local authority money strengthening bridges so that they can take heavy lorries, surely the time has come to say that lorries should not use rural minor roads.
    Dr. Reid: Yes. The Government share the concerns that the hon. Gentleman outlined. That is why we are taking positive action, together with local authorities through their local transport plans; with industry, by designing a sustainable distribution and logistics policy; by means of the subsidies that we have given to rural transport—£50 million extra for rural buses—and by means of the freeze that we imposed on vehicle excise duty last year. A range of measures have therefore been taken. We share the concerns and appreciate the problems of rural areas, which is why there are now so many Labour Members representing rural areas.
    Mr. David Hinchliffe: I welcome my right hon. Friend to his position. Does he agree that one way of tackling the problem of road freight is to shift freight, wherever possible, on to inland waterways? Will he consider an example from my constituency? Sand and gravel are being extracted adjacent to the River Calder in Wakefield for use on the A1-M1 link near Leeds, and the company concerned cannot move the material by waterway simply because of the size of one lock. May we bang some heads together and get such freight off roads and on to waterways once again?
    Dr. Reid: Yes. As my hon. Friend says, we should all be keen to transfer or encourage the transfer of freight from road to waterways or rail wherever possible. On the specific case that he mentions, I believe that there are many examples throughout Europe where low-cost, high-volume goods are transferred very efficiently by waterways, so we would be keen to do anything that we can to support such transport.
    The other alternative is rail. As my right hon. Friend the Deputy Prime Minister pointed out earlier, we have been extremely successful in getting freight off roads and on to rail. Last year there was a 5 per cent. increase in rail freight, which I believe is a bigger increase than the Conservative party managed in 18 years. I am pleased that
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    that trend continues. Yesterday, Rover announced that it would put one third of its deliveries on to rail; I am sure that we all welcome that.
    Mr. Nicholas Winterton: I fully accept the need for an integrated transport strategy and I welcome the additional funds that the Government are directing to rural transport, but does the Minister accept that in some areas, such as my village of Poynton in the Macclesfield constituency, such expenditure and such an integrated transport strategy will not really help, and new roads will be required? Does he accept that the Poynton bypass, which feeds through the Manchester airport eastern link road to Manchester international airport, is a vital strategic road, and that it is no good merely reducing it from a trunk road to a county road to fob off responsibility? Will the Minister meet me to discuss that matter, which is so vital to my constituents?
    Dr. Reid: Of course I will give full consideration to that road, which is either, as the hon. Gentleman points out, vital in our strategic national interest—the Poynton bypass—or, perhaps more relevantly, vital in his future political interests. However, I shall examine it seriously. I merely point out that, in the roads announcement some months ago, I announced 15 bypasses, which I believe is three times more than the previous Government announced in five years.
    Ms Joan Walley: I welcome my right hon. Friend to his post. In his efforts to encourage the switching of more heavy freight from road to rail, will he do all that he can to take the wonderful opportunity that we now have to get piggyback on to the west coast main line? Will he give the House an assurance that he will do all that he can to bring about that switch from road to rail?
    Dr. Reid: My hon. Friend knows that we have made our views known on that. Those matters are being considered at present by Railtrack. Although I read in the newspapers speculation on the matter, no proposals have been received by our Department. I shall of course consider them sympathetically when they come in.

    Rural Motorists
    Mr. Howard Flight: If he will make a statement on the impact on motorists in rural areas of the proposals in the transport White Paper. [54359]
    The Minister of Transport (Dr. John Reid): The measures in the White Paper will produce a transport system that increases choice for all, including those who live in rural areas. As part of our strategy, my right hon. Friend the Chancellor announced in March an additional £50 million a year to improve the public transport alternative in rural areas.
    Mr. Flight: I am sure that the Minister would agree that the substantial rise in petrol taxes falls disproportionately on people in rural areas when they take children to school or go to the shops, and particularly when they travel to work. Will the Government ensure that the new taxing powers in the White Paper are used

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    to mitigate that, and will they consider tax incentives for businesses in rural areas to bus people into work, which under the present tax arrangements is taxed as a benefit in kind?
    Dr. Reid: The hon. Gentleman will know that the Government fully appreciate the benefits of car ownership, especially in rural areas. The point that we have always made is that the benefits of car ownership that have been gained by previous generations will not be gained by future generations unless we change car use. We accept that for many people in rural areas a car is a necessity. The Chancellor's announcement in the last Budget that vehicle excise duty rates would be frozen and a graduated scheme introduced for cars should help to offset higher fuel costs, especially for rural motorists with smaller, cleaner cars.
    The hon. Gentleman should remember, however, that a significant proportion of people in rural areas—upwards of 20 per cent. in rural households—have no access whatever to a car. That is why we are equally committed to providing decent, safe, reliable public transport. I am sure that the hon. Gentleman will welcome the £50 million extra that this Government have allocated, over and above any plans that his Government had.
    Mr. Lawrie Quinn: Will my right hon. Friend confirm that he understands that, in my constituency, only 57 per cent. of rural dwellers have access to a private vehicle? The initiative taken forward with the county council to introduce community transport and improvements in rural bus services will play an important part in dealing with the problems of social exclusion that manifest themselves in the north-east of England.
    Dr. Reid: Yes, indeed. My hon. Friend gives a prime example of the difficulties faced by many people in rural areas. That is why I am extremely pleased and proud that this Government have taken measures, as I mentioned earlier, to allocate an additional £50 million towards public transport in the rural areas. He will also know that the Chancellor announced an increase in bus fuel duty rebate worth £40 million to protect bus operators from the increases in diesel duty over the next 12 months. My hon. Friend can be sure that we shall continue to bear in mind the particular circumstances of people in rural areas.
    Mrs. Gillian Shephard: Earlier this afternoon, the Minister for Local Government and Housing seemed not to have understood the consequences of this Government's deliberate switch of £100 million of council funding from shire to urban areas this year. Does the Minister at least understand that that switch of funding—which is his Government's policy and nothing to do with the previous Government—has had a devastating effect on minor roads, roads maintenance and transport packages in rural areas? What does he intend to do to correct that imbalance?
    Dr. Reid: The right hon. Lady would do well to reflect on the fact that it was the destruction, division and devastating effects of 18 years of her party's government that resulted in the rural areas being so well represented on the Labour Benches.
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    As my hon. Friend pointed out earlier, the statistics and methodology that are being used to allocate that money are based on sparsity and density of population—precisely the criteria used by the previous Government. As I have pointed out, we shall provide extra finance for local transport in the rural areas. As my hon. Friend the Minister for the Regions, Regeneration and Planning stated earlier, rural areas will be an essential part of our regional development plans throughout the country. In all three respects, we are initiating plans for progress in the rural areas the like of which was never seen under the previous Government.

    School Routes
    Mr. Mike Gapes: What plans he has to introduce safer routes to school. [54360]
    Dr. Reid: High priority will continue to be given to schemes to provide safer routes to school. We are also actively encouraging schools to establish green transport plans. In addition, we are establishing the school travel advisory group, with the aim of reducing car use and improving children's safety on the journey to school.
    Mr. Gapes: I welcome my right hon. Friend to his post, and also his answer to my question. Does he agree with me that it is noticeable that when there is a school holiday, there is far less traffic on the roads at certain times of the day, and that, in cities such as London and elsewhere, pollution and congestion are much related to very short journeys to take children to school? Will my right hon. Friend do all that he can to emphasise to local authorities and others the importance of providing safe routes so that we can reduce unnecessary car journeys to and from school?
    Dr. Reid: Yes, indeed. As my hon. Friend points out, the statistics have changed considerably over the past 10 or 20 years. Two decades ago, one child in three, I think, walked unaccompanied to school. The figure now is one in nine. Improving the safety of walking and cycling, especially round schools, is not only one of our manifesto commitments but would be of enormous benefit both to children and the wider community. However, we recognise and fully understand concerns about the personal safety of children walking to school. We also understand the pressures, especially of time, on parents and schools. We have established—we had the inaugural meeting last week—the school travel advisory group so that we can consider concrete, practical proposals to provide safer and more secure routes to school so as to alleviate parents' concerns and encourage more children to take such routes to school.
    Mr. Jonathan Sayeed: The route to Ridgemont school in mid-Bedfordshire is one of the most dangerous in the county. That is because heavy goods vehicles travelling between the A1 and the M1 go through the very small village of Ridgemont. The county council has put a bypass for Ridgemont at the top of its priority list. Will the Minister do the same?
    Dr. Reid: As for heavy lorries and freight, the hon. Gentleman will no doubt have listened to my detailed answers to Question 2. As for the hon. Gentleman's local

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    plan, I shall always consider plans within the context of the criteria that we set out in the White Paper some months ago. I must remind the hon. Gentleman, however, that, despite the pressure on resources, we announced considerably more bypasses in the roads review this year than the Conservative Government did over a period of years.
    Mrs. Anne Campbell: Is my hon. Friend aware that there is a proposal in Cambridge to encourage people who drive their children in from outside the city to use collection points at the park-and-ride sites around the city, thereby reducing the number of cars that come into Cambridge at a very congested period of the day? Does my right hon. Friend agree that this is an innovative and interesting idea and one which should be supported?
    Dr. Reid: Yes. We want to examine all such proposals with the purpose of producing practical alternatives. We have to recognise the concerns of parents about the security and safety of their children, which are understood by us all, while providing alternative real choices. Part of the answer may be safer and more secure routes, and part of that may be public transport. Presenting people with a choice, and a substantial means of exercising that choice, is the hallmark of the Government's transport policy as well as of our wider aims.

    Road Traffic Reduction
    Mr. Peter Bottomley: If his Department has specific targets in respect of road traffic reduction. [54361]
    The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Ms Glenda Jackson): Relevant targets include both local and national targets. The Road Traffic Reduction Act 1997 obliges local traffic authorities to consider whether to set targets for road traffic reduction on local roads in their area. In considering national targets for road traffic reduction, we will seek advice from the commission for integrated
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    transport, the new independent body that we will set up to review progress on implementing our integrated transport policy.
    Mr. Bottomley: With acknowledgements to the hon. and green Member for Ceredigion (Mr. Dafis), who introduced the Road Traffic Reduction (National Targets) Act 1998, may I ask whether the Minister will announce national targets? Will she also set an example by announcing the miles travelled by Ministers in ministerial cars and targets for reducing them?
    In addition, will the Minister consider particular areas, such as my constituency? It is virtually impossible for a pedestrian or cyclist to cross the A27 in Worthing, where, because the Government have not provided crossings across trunk roads, many people have to use cars.
    Ms Jackson: National targets for the reduction of road traffic must have a clear and specific justification in terms of the environmental benefits that they are expected to achieve, and must, in order to be preferred to other measures, represent the most effective method of achieving those objectives. My right hon. Friend the Deputy Prime Minister stood by his commitment on where we will be on road traffic reduction in five years' time, and I stand by the assurance that I gave to the House on Second Reading of the 1998 Act on 30 January, which was that the first report under that Act would be prepared within 18 months of enactment—by the end of 1999. As regards safe routes across trunk roads, I am sure that the hon. Gentleman is aware that Sustrans is engaged in that matter with Government support. Local transport plans will have £700 million more during the next few years. Since we came to office, we have asked local authorities to prioritise the needs of pedestrians, cyclists and public transport. We expect the issue of improving facilities and encouraging more cyclists to take a prominent place in local transport plans.
    Mr. Hilton Dawson: On a point of order, Madam Speaker.
    Madam Speaker: Points of order come after statements. I shall look the hon. Gentleman's way then.

Easter Floods
3.31 pm
The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley): With permission, Madam Speaker, I should like to make a statement following the publication of the report by the independent review team on the flooding that occurred at Easter this year. I do this as the Ministry of Agriculture, Fisheries and Food has policy responsibility for flood and coastal defence issues in England. Operational responsibility for delivering the flood defence service rests with a number of operating authorities, the principal one of which is the Environment Agency, as well as with other authorities responsible for providing emergency services.
Following torrential rainfall, many areas across central England and Wales were affected by floods, which were the worst for decades. In many respects, they exceeded the floods of 1947 which have hitherto acted as a benchmark for inland flooding in this country. Sadly, five people died as a result of the floods. I offer my deepest sympathy to their families and friends. Thousands had to leave their homes. Many people have still not been able to return more than six months after the event. I have seen for myself the devastation caused by the flood water and repeat the Government's profound sympathy to all those affected. I am sure that I shall be joined in that by the whole House.
The Deputy Prime Minister visited many of the affected areas on the Easter Sunday to assess the scale of the damage caused by the floods and my hon. Friend the Minister for Local Government and Housing is announcing today financial assistance under the so-called Bellwin scheme for Northampton borough council, Warwickshire county council, Stratford-upon-Avon district council and Worcester city council. This is in addition to the financial assistance already announced for Northamptonshire police authority and for Warwick and Wychavon district councils.
It was clear from the outset that issues in relation to the floods needed to be reviewed. No warnings were given in Northampton and Kidlington, two of the towns that were worst affected. There were also allegations that flood defences were operated in ways that sacrificed one town to save another. Such issues needed to be addressed, and lessons identified.
The Environment Agency is the principal flood defence operating authority in England and Wales with responsibility for flood defence in main rivers and sea defences. It also has specific responsibility for flood warning dissemination. I agreed the agency's proposal that an independent review of the floods should be commissioned, with wide terms of reference.
The agency commissioned Mr. Peter Bye, former chief executive of Suffolk county council, to chair the review, with Dr. Mike Horner acting as technical assessor. The review team received and assessed much evidence—both orally and in writing—including visits to the areas worst affected. Its report to the Environment Agency was published on 1 October. It is a balanced, hard-hitting and authoritative document on which Mr. Bye and Dr. Horner are to be congratulated. They acknowledge that the floods were the worst for many years and presented extreme challenges to those with responsibility for responding.
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That includes not only staff in the Environment Agency, but those in local authorities, the emergency services and the military. Many people worked long hours over the Easter weekend to respond to the emergency, and the Government pay tribute to their dedication.
The report also finds that, in many respects, the Environment Agency's policies, plans and operational arrangements are sound, and that staff did their best in extreme circumstances, within the limits of agency guidelines and resources. It is also important to note that, rather than defences being breached, the flooding was generally the result of defences being overtopped by water to a depth that exceeded their design specifications. Importantly, too, the report does not find evidence that some areas were sacrificed to save others.
The review team did, however, conclude that there were instances of unsatisfactory planning, inadequate warnings for the public, incomplete defences and poor co-ordination with emergency services. The report deals with those issues in some detail, identifies lessons to be learned and makes recommendations for improvement of the whole service.
I wish to report to the House that I met the Environment Agency chairman, Lord De Ramsey, on 14 October to consider the report and the agency's response to it. He agreed that there are lessons that the agency must learn from the report and that appropriate response measures must be implemented. Without wishing to detain the House too long, I should like to explain briefly the action that will be taken.
As a starting point, Lord De Ramsey and I agreed that there must be a seamless and integrated service of flood forecasting, warning and response. Weather forecast information needs to be integrated with reliable information about flood risk in particular areas—relating to their topography and the protection offered by the flood defences—to generate a flood forecast and, if appropriate, a flood warning. Flood warnings need to get to the people in the area at risk of flooding in time for them to respond appropriately. Local emergency plans must be ready to be activated, and must work when they are implemented. That needs to happen.
At Easter, there were deficiencies. The agency therefore intends to carry out a thorough review of the whole system to ensure that it is focused to deliver the required service, that management arrangements make that possible and that there are clear lines of accountability and responsibility.
The review will need to take account of experience in recent years of current arrangements and increased understanding over that period, as well as addressing the individual recommendations in the report, some of which can, and must, be implemented ahead of others. The agency will publish its detailed action plan next month.
Having made clear the need for a systems approach, I then considered with Lord De Ramsey each of the five broad areas of criticism in the report—management structures and skills shortages; flood forecasting; flood warning; standards of defence; and emergency response.
On management structures and skills shortages, the agency will carry out a review of its internal management structures by April 1999. That must also take account of the concerns about skills in the report.
On flood forecasting and flood warning, we will be considering with the agency its proposal to develop a national flood forecasting and warning service to bring

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together existing expertise in a more integrated way. Flood forecasting relies on key information on flood risk in river or coastal flood plains. Improvements will be made in the agency's telemetry systems by March 2000. Before then, improvements will be made in other hydrometric standards, including identification and extension of best practice.
The agency is engaged in a five-year project of flood risk mapping. Priority will be given to publishing the best available information, even if in a relatively unrefined state, by September 1999.
We cannot provide defences that are guaranteed to defend against every flooding event. Flood warning is therefore the Government's highest priority. Flood warning dissemination plans must be checked to ensure that they contain no obvious errors or omissions. The agency already has that in hand and expects to complete the work this year. That is but the first step. The agency must go on to consider the content of the plans, their scope and their coverage. It will need to check plans against parameters and targets, which the Ministry will define in consultation with the agency. That will obviously take more time, but the agency is clear about the need to complete that task by September 1999.
Those actions relate to the plans for dissemination of flood warnings. Obviously, warnings must get to the right place at the right time and ensure the right response. We will therefore be reviewing with the agency the content of flood warning messages to ensure that those who receive them understand their significance and what they must do.
On standards of defence, the agency is part way through a complete survey of its flood defence assets. I have agreed with Lord De Ramsey that initial visual surveys must be completed by April 2000 and kept up to date thereafter. Those inspections will be supplemented by more rigorous, but less frequent, structural surveys of the defences.
The agency's responsibility is to issue flood warnings; its having done so, the emergency response is the responsibility of others. Local authorities generally co-ordinate the local emergency planning process, but when those plans are implemented the co-ordination role normally falls to the police, although they will clearly need strong support from the fire and ambulance services, and emergency planning departments in local authorities, social services and other similar agencies.
Although the first priority is to complete the review of emergency plans, we are also taking up another recommendation in the report, which concerns the need for emergency exercises to test the arrangements. I see the need for a mixture of regular, small-scale exercises coupled with less frequent major exercises to provide a rigorous test of the arrangements.
In relation to flood warning, emergency response and exercises, there are a number of key partners. The Under-Secretary of State for the Home Department, my hon. Friend the Member for Knowsley, North and Sefton, East (Mr. Howarth), is therefore writing to local authorities, police and fire chief officers to stress the importance of effective liaison with the Environment Agency in its review of flood warning dissemination plans. He will also stress the importance of ensuring that emergency plans remain up to date and of active participation in exercises.
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I have set out a series of measures that represent a positive response to the recommendations in the report. I have not addressed every recommendation, although the agency will do so next month. However, I assure the House that the Government and the agency take the report extremely seriously and are moving swiftly to address the key issues that have been identified.
In addition to its role as a flood defence operating authority, the Environment Agency is required, under the Environment Act 1995, to exercise a general supervision over all matters relating to flood defence. The Ministry will work with the agency and the other operating authorities—local authorities and internal drainage boards—in considering how that general supervisory duty should be developed to ensure a greater consistency of service and to ensure that best practice is shared. Targets will also need to be set—I have outlined some key ones today.
The Ministry will consider with the agency the cost of the programme of improvements. We will also liaise with local authorities to emphasise the importance of their contribution to adequate funding through the levies that they pay to the agency. Regional flood defence committees are being made aware of the priority that I attach to achieving those targets. The agency will provide progress reports. I will monitor and be prepared to intervene through ministerial direction if necessary.
I acknowledged at the beginning of this statement that many areas were affected by the floods. It may be invidious to single out one place as being particularly badly affected, but I think that that can be fairly said of Northampton. The town is one of five that were subject to special case studies in the report. Two people died and thousands had to leave their homes. Many have yet to return and some may never do so.
The town's residents have pursued a vigorous campaign for a judicial public inquiry into the floods. They have presented a petition to the House, and, all along, their efforts have been assiduously supported by my hon. Friends the Members for Northampton, South (Mr. Clarke) and for Northampton, North (Ms Keeble). Because of those representations, I have given careful thought to the call for a judicial public inquiry. On balance, however, I am not persuaded that an inquiry of that type will add to the detailed findings of Mr. Bye's thorough and independent report. Even the most cynical of observers could not accuse the report of being a whitewash. It pulls no punches in its conclusions.
I believe that there is a compelling need to move on, to learn the lessons identified and, above all, to implement the appropriate measures that I have set out today. A public inquiry would distract attention from that and inevitably result in further and, I suggest, unnecessary delay. It would also divert considerable financial and staff resources from the vital task of reducing the risk of a recurrence of the devastation of the floods.
Mercifully, serious floods are relatively rare in this country, thanks to the investment that successive Governments have made to protect our natural and man-made assets—an investment which this Government increased in the recent comprehensive spending review by some £23 million for capital works over the next three years.
In exercising their flood defence responsibilities, the chairman, board and staff of the agency have onerous duties in protecting the public. They need the support of

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the House and of the Government in achieving that. However, the Government must ensure that everyone concerned in the operation of flood defence learns lessons from experience. The independent report provides the basis on which to build real improvements in the systems and procedures for the future.
Mr. Tim Yeo: I welcome the Minister's very full statement on this issue, and I am grateful to him for making it available to me just before 3 o'clock. It is an extremely important subject. The Easter floods caused substantial damage: there was a high financial and personal cost to many people—I went to St. Ives on Good Friday and saw the extent of the flooding in that area. I should like to join the Minister in expressing sympathy to the people who were affected by the floods.
Nevertheless, many farmers will note that, although an Agriculture Minister can make a statement in the House about flooding after 11 weeks of a recess during which the problems in farming have worsened so fast that the industry now faces its worst crisis for 60 years, there is still no word from the Government about how they propose to respond to the real threat of agricultural depression.
I welcome the conclusions in the Bye report, and I agree with the Minister that its findings are balanced and firm. I broadly support the steps that he is taking with the Environment Agency, in particular to examine the system of flood forecasting, warning and response. I accept his reasons for not proceeding with the suggestion of holding a public inquiry into the flooding in Northampton. I particularly welcome the co-operation between the Minister and the Environment Agency in considering what lessons can be learned.
I have a small number of specific questions. If the analysis that is undertaken results in an increase in the costs of the agency or the local authorities that are affected, because of the measures required to be taken, do the Government intend to cover those extra costs with additional funding from the centre or will the agency and the local authorities be expected to make savings from the other services that they currently provide?
Does the Minister accept that the risk of flooding can be affected by large-scale new development, including housing development, on green-field sites? Such developments may restrict drainage on areas in the historic flood plains. Will the Government issue, as a matter of urgency, new planning guidance that not only incorporates the promised sequential approach to planning decisions on where new housing should be built, so that brown-field sites are used before green-field sites, but requires more consideration of how any proposed development may affect flood risks in the surrounding area?
Does the Minister agree that a significant part of the difficulties at Easter arose from the speed with which the floods took place? Are any studies planned into that aspect of the problem? Flash flooding was a feature in many areas.
The review makes strong criticisms of the system of warnings. I agree that people are entitled to better warnings of when exceptional conditions may occur than
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were given in some places at Easter. Has the Minister noted the view of the Select Committee on Agriculture that, if warnings are not to be devalued, they must be issued prudently, and only when there is a real risk of flooding?
Does the Minister agree that, although, as the review acknowledges, the conditions at Easter were exceptional, the prospect of climate change means that such exceptional conditions may become more frequent? Surely that not only reinforces the need for the reconsideration of flood preparations that the Minister has put in hand, but makes even more urgent the need for the Government to publish their own, long overdue, climate change strategy.
Does the Minister agree that it is important not to act like King Canute? No amount of words can prevent flooding. The risk cannot be entirely eliminated, as the review states. Does the Minister accept that, on this issue, as, I am afraid, on other issues, Government actions across a range of policy, such as their approval of so many large-scale housing schemes on green-field sites, have made matters worse rather than better? Another example is their extraordinary recent decision to block the construction of more gas-fired power stations, although such power stations are one of the cheapest ways in which to slow down the process of climate change.
Given that the Minister—quite reasonably—expects the Environment Agency to do its best to reduce the risk of a repetition of what happened at Easter, would it not be helpful if the rest of Government policy were co-ordinated to achieve the same aim?
Mr. Morley: I welcome the hon. Member for South Suffolk (Mr. Yeo) on the occasion of his first outing as Opposition agriculture spokesman. I am sorry, however, that there has been an attempt to divert attention from the serious issue of the 2,000 and more people who were severely affected by the floods. The normal procedures of the House will give us opportunities to discuss agriculture in an entirely proper way, but today we are concerned with the effect on those people, and the important responses that we as a Government must make to the report.
As I said, we are discussing the costs of changes with the Environment Agency. We accept that there will be costs; it will be the agency's responsibility to meet some of them from its budget, but the Government will have to meet others, and we are prepared to consider the requests, and the commitments, that have been made. If there are implications for local authorities in terms of increased costs, those implications will be considered in the context of their standard spending assessments for flood defence.
The Agriculture Committee report touched on the risk of development on flood plains, and we have made our response to that report available. The issue was flagged up in the Bye report, although that report pointed out that, in recent years, more account had been taken of Environment Agency recommendations.
The question of warning systems, and how they should be applied, certainly needs to be considered. Climate change is being taken into account in future projections for both sea and flood defence. I must tell the hon. Member for South Suffolk that the climate change strategy is not overdue, and that my right hon. Friend the Minister for the Environment will report on it soon.

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As for the hon. Gentleman's final question, about large-scale housing developments, there has been a great deal of housing development over the past 18 years. All I will say about Government policy is that this Government's target for brown-field rather than green-field development is considerably higher than that of the last Government.
Ms Sally Keeble: I welcome the report and the statement, and, in particular, my hon. Friend's comments about the disgraceful slurs that we heard from the hon. Member for South Suffolk (Mr. Yeo).
Does my hon. Friend seriously think that the general public—especially those in Northampton who suffered so much—will have confidence in the Environment Agency's ability to implement these important recommendations, given that that will call for qualities that, according to the report, the agency does not possess? I refer particularly to co-ordination between agencies.
Does my hon. Friend accept that much of the suffering of people in Northampton was caused by the fact that the last ministerial directive, signed by the hon. Member for Daventry (Mr. Boswell), was not implemented properly? Will my hon. Friend look again, very carefully, at the way in which the recommendations will be implemented, and consider whether there could be an independent mechanism or person, and a proper reporting process, so that everyone can be absolutely sure that the disasters of last Easter are never repeated?
Mr. Morley: My hon. Friend has made some important points.
We are responding by setting the Environment Agency targets that it will have to meet, and whose progress we will monitor. My hon. Friend's suggestion on how we can report on that progress, in a transparent way, is worthy of consideration, and we will give it further thought.
Mr. Tom Brake: I welcome the statement, and congratulate the emergency services on the role that they played in tackling the floods. I also extend my sympathy to the families who were affected.
I am glad that the Government are talking to the Environment Agency about the costs of the improvement programme, but will they make contingency funds available now for the £1 million programme of work in relation to warning systems and flood defences that the agency has already said is necessary, so that the agency does not need to cut other equally important programmes? Will they also consider tighter controls for building on land that may be vulnerable to flooding?
Mr. Morley: I can confirm that we are talking to the Environment Agency about the cost. Its provisional estimate is that the immediate cost is about £1 million, and the Ministry is considering how we can make the necessary allocation.
The issue of guidelines was raised by the Agriculture Committee, and we made a formal response. My colleagues in the Department of the Environment, Transport and the Regions are also giving thought to the matter.
Mr. Tony Clarke: The past six months have without doubt seemed much longer to those
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who were affected at Easter, many of whom have still not returned to normality, as my hon. Friend the Minister said. He mentioned the two fatalities in my constituency and the five nationally. It is important to place it on record that the list of fatalities grows longer by the day. For those who have died since Easter, the cause of death may have been given as pneumonia or natural causes, but there is little doubt that the trauma of the event has led to premature death.
Does my hon. Friend agree that his comment about the report being tough hitting does not go far enough for Northampton, and that the word "damning" should be used? The report says that, without doubt, the intensity, severity and depth of the flooding were increased by the failure of the Environment Agency to act on several factors: reservoirs were full; sluice gates were inoperative—last week, I passed to my hon. Friend a picture of floodgates held together with cans of WD40 jammed in their mechanisms; watercourses were blocked; and flood defences were missing, not with small gaps but with gaps which stretched up to 95 m in Northampton alone. Does he agree that the report is damning, and not just tough hitting?
Does my hon. Friend appreciate the anger felt by both Government and Opposition Members who are calling for the resignation of Lord De Ramsey? There is a belief that the buck stops at the top. Is it not, therefore, incredible that, in the six months since the Easter floods, before Members of Parliament called for his resignation, Lord De Ramsey did not make one public comment or offer one word of sympathy or acknowledgment of his responsibility as chair of the Environment Agency?
Will my hon. Friend assure the people of Northampton that he will intervene to ensure that Northampton's flood defences are brought up to scratch as soon as possible, so my constituents can once more sleep safely in their beds?
Mr. Morley: I well understand the trauma and distress suffered by my hon. Friend's constituents, as well as the anger that they feel. I know from my visit to Northampton how much work he and my hon. Friend the Member for Northampton, North (Ms Keeble) have done to support those who were so severely affected and to relay their concerns.
I do not think that the report can be described as damning. It is balanced and hard hitting and identifies the failures, many of which have been accepted by the Environment Agency. It is important that we get on with implementing the recommendations and learning the lessons.
It is for Lord De Ramsey to consider his own position, but I should point out that he went to Northampton and faced the local people in a public meeting where they had an opportunity to question him at first hand. We must learn the lessons and look forward, not backward, so that we can deal with the problems, especially in Northampton, and ensure that such events never happen again.
Mr. Tim Boswell: The Minister will be aware that I preceded him in the responsibility for flood defence and gave the agency its current remit. I, too, welcome the Bye report and his statement and I endorse the comments of the hon. Member for Northampton, North (Ms Keeble) about the importance of monitoring

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the action plan as it develops. The Bye report concentrated heavily on the problems of the borough of Northampton, to which the Minister has promised Bellwin aid today, but my constituents who reside in Daventry district and especially in south Northamptonshire also suffered real and substantial problems. Will the Minister consider those problems and ensure that action is taken? Where there is a clear case that the Environment Agency has failed in its duty, will he undertake to consider losses sustained by constituents, wherever they live, that seem appropriate for compensation and recommend to the agency that it should recognise its responsibilities?
Mr. Morley: I certainly understand the hon. Gentleman's involvement in flood defence and accept that he knows the issues well. Close monitoring is needed, and I have already freely accepted that point. That measure will be implemented and we intend to set targets for the agency, which will be monitored. That means a new, close and, I hope, more transparent relationship with the agency.
I freely accept that others were affected. Although Northampton was the most severely affected, that is no consolation to others who were flooded, and I concede that their needs must also be considered.
On compensation claims, the policy of this Government, as of previous Governments including the one in which the hon. Gentleman served, has been not to compensate for insurable risks. It is difficult and divisive to do so.
Mr. Phil Hope: My constituency, too, contains people affected by the floods. Many of my constituents in Corby and east Northamptonshire are engaged in lengthy legal battles with developers, local authorities and water companies over liability for the costs of the floods. Many of my constituents believe that their homes are almost unsaleable because of the damage that was wrought, and they fear the response if they put their homes on the market in future.
I echo the comments made by my hon. Friend the Member for Northampton, South (Mr. Clarke): the report was a damning indictment of the Environment Agency and its chairman should look to his position. If the report is to be implemented in full, we in Corby and east Northamptonshire must be assured that the Environment Agency is up to the job.
Mr. Morley: I cannot comment on individual legal cases on flood plain developments and potential losses. However, I can give my hon. Friend the assurance that he seeks that the Government will ensure that the targets are monitored. I accept that the report was critical in some areas, and those criticisms have to be faced by the Environment Agency. It must rectify the faults in its systems and we will set targets to ensure that it does.
Mr. Peter Luff: I thank the Minister and his Department for the statement today and for the full response to the Agriculture Committee's report on flood and coastal defence, which will be published shortly. We are grateful to him for the seriousness with which he has taken that report. All my constituents who
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were so badly affected by the Easter floods in Evesham and throughout Wychavon will welcome what he has said today about the Environment Agency's future action, especially on flood warnings which did not work locally as well as they should have done. That welcome will also be extended by members of the Agriculture Committee, whose recommendations are clearly reflected in the Minister's comments today.
It is all very well having excellent flood and coastal defence works in place, but if inappropriate development takes place on the flood plain the floods will occur again. There is no point in putting a party slant on that, because district councils of all political persuasions bear a share of the responsibility. What will the Minister do to ensure that inappropriate developments do not take place in the future?
Mr. Morley: The recent report of the Select Committee on Agriculture was an important advance. It dealt with serious issues in a balanced, thoughtful and weighty way, and I am glad that the hon. Gentleman, who is Chairman of the Agriculture Committee, appreciates that we have tried to respond in kind.
The report points out, and I accept it, that flood warnings clearly failed in certain parts of the country last Easter. We are determined to rectify that and to ensure that they work better in future. I understand the concern raised by the hon. Gentleman and by others about inappropriate development on flood plains. The Bye report said that matters had improved in recent years—there is more awareness of the potential risks of developing on flood plains. I welcome that, and we must take the risks into account. They are a matter for planning, and my colleagues at the Department of the Environment, Transport and the Regions are giving thought to whether there should be improvements in guidance for planning authorities.
Dr. George Turner: The Minister will know that my constituents have good reason to take a keen interest in flooding and flood protection. I was pleased to hear him raise the prospect of proper simulation exercises, but will such exercises be evaluated independently so that people do not end up patting themselves on the back for how well they have done?
My hon. Friend also referred to the many bodies that are involved at times of flood. The media have a key role to play, but I have learnt over the past year that they often feel unsatisfied about the flow of information to them. Will the Minister assure me that the role of the media will be among the matters considered as we look to the future?
Mr. Morley: Emergency exercises must be properly evaluated. The lead responsibility for doing so lies with the Home Office, and I know that the matter is under consideration. The Bye report flagged up the important role of the media in ensuring that flood warnings are disseminated as widely as possible. I am sure that media organisations will have taken that on board.
Dr. Evan Harris: The village of Kidlington in my constituency was badly affected and was one of five areas specially examined by the report. I pay tribute to Mr. Carl Smith, the parish clerk for Gosford and Water Eaton, who contributed a great

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deal to the report and is mentioned in it. There was great trauma in Kidlington, for the simple reason that it was not raining there, and the Cherwell valley was merely draining water from an area where there was rain. The sad fact is that there was little in the way of failure of flood defence there: little flood defence was undertaken as it was not felt that the area would be affected.
The Environment Agency should avoid using terms such as "100-year floods" to describe events that may become more frequent as a result of global climate change. Much work should be done to consider new areas for defence, and to improve warning systems. There was no warning in Kidlington, and that made the problems much worse. Will the Minister join me in regretting the Environment Agency's statement in the report that it is merely considering improvements to the flood warning system in the Kidlington area? The Minister has hinted strongly that contingency funds will be available. Does he agree that the agency should lift its horizons on the work that could be done? Will he consider instructing the agency to consider new methods of flood warning, using future developments in digital television to complement any automatic telephone warning system for those people who could take advantage of it? Perhaps in 10 or 20 years that practice will be more prevalent than is currently envisaged.
Mr. Morley: I certainly appreciate that the residents of Kidlington were affected, and their experiences have helped us to reach the response that we have formulated. It must be borne in mind that the flooding was exceptional, and it did overtop defences designed for a much lower level of flooding. As the Bye report points out, however, some of the flooding was caused by rapid increases in water courses with water arriving from unexpected sources, and that should be recognised in seeking improvements in telemetry for advanced warnings.
On improving flood warning, the Environment Agency proposes a new national centre to integrate the information from weather forecasting and telemetry readings across the country to improve flood warnings so that people get the required information. I accept my hon. Friend's point about the role of new technology. Where there are opportunities for using new technology for flood warning, they should be taken.
Mr. James Plaskitt: I welcome the Minister's statement and the Government's response to the Bye report. In my constituency, Warwick district council appreciates the swift response of the Bellwin scheme. The Minister's comments on compensation for the county council under that scheme were welcome news.
Royal Leamington Spa was badly affected by flooding and was the subject of a special report within the Bye report: 400 homes were badly affected, as were many small businesses in the town centre. Some people are still not back in their homes, and some of the small businesses closed as a result of the flooding will not reopen. The Bye report's section on Royal Leamington Spa details a long list of failures by the Environment Agency, particularly its failure to issue alerts through the automatic telephone system because it had omitted to include the numbers of the district council on the system. That is a serious failure. I am still interested in the issue of compensation, which
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was raised by the hon. Member for Daventry (Mr. Boswell). Would not a useful starting point be acceptance of liability by the Environment Agency for many of the failures?
Mr. Morley: It is true that the Bye report identified the failure to issue alerts. Those failings have been acknowledged by the agency in improvements and in learning the lessons. On compensation, there is an issue about people who feel aggrieved by their losses but in principle, it is not the policy of the Government—the Environment Agency is a Government agency—to compensate for insurable risk. On the flooding, it is impossible to plan and protect against every eventuality, particularly when the circumstances are so extreme. That factor needs to be borne in mind.
Mr. Ian Bruce: I congratulate the Minister on defending the Environment Agency, because many things are improving, especially the local flood defence committees. In my constituency, with the work of the agency and everyone else, this year we had the least floods. Anyone who has visited a flooded family will know how traumatic the experience is.
The Minister should consider carefully what local authorities are allowed to do under planning legislation. They often know that someone is building on a flood plain but do not feel able to stop the planning application going ahead. Often, additional properties on a flood plain mean that there is nowhere for the flood water to go, so that other properties flood that would not otherwise have done so.
Will the Minister consider putting flood warnings in the Land Registry for properties built in that way? That would put pressure on people not to build in such places. Will he carefully consider the suggestion of the hon. Member for Oxford, West and Abingdon (Dr. Harris) on the use of new technology? I imagine that people's telephones could be rung simultaneously, perhaps with a special tone, using current technology. Rather than merely warning a local authority that must then try to warn other people, we could use the telephone system to warn everyone.
Mr. Morley: Planning authorities have the power to turn down inappropriate applications if there is a risk from flooding. If there is a need to issue further clarification or guidance, we will consider it. The issue of Land Registry warnings is much more complicated, and careful thought will have to be given to whether such a procedure is appropriate, and to the practicalities. The technology already exists to ensure that a large number of households are given the warning at the same time. It is offered to those that are considered to be at risk from flooding in certain parts of the country. That is one of the matters that the Environment Agency review will consider.
Mr. Patrick Hall: I would like my hon. Friend the Parliamentary Secretary to be aware that people in Bedford and Kempston are following this issue carefully, because that area was also affected by the flooding. The Minister for the Environment visited part of the flooded area last April. My hon. Friend the Parliamentary Secretary referred to the Environment Agency's action plan, to be published this November. Will that include—if it does not, will the Government look at it—the important question of the agency's powers

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to comment on planning applications for development on flood plains? At present, the agency's role is only advisory. It is fair to say that its advice has largely been ignored over the years. We have seen considerable development on flood plains. That issue, including the agency's powers in that respect, needs to be looked into.
Mr. Morley: The action plan certainly includes warnings and appropriate planning guidance on flood plains. I must repeat the point that was made in the Bye report, which acknowledged that, in recent years, the planning policies of authorities around the country had improved considerably bearing in mind the risks of development on flood plains. Whether there is a need for statutory powers is something which will be considered by my colleagues in the Department of the Environment, Transport and the Regions.
Mr. Brian White: I have read the report. The older parts of my constituency were flooded and I have met many of the people who were affected in Newport Pagnell. The newer parts in the city of Milton Keynes, where balancing lakes were built into the design of the flood defence system, did not flood, yet they had the same rainfall and the same river flowed through them. Many of the people who were flooded are not satisfied with the Bye report because it does not adequately address the suggestions that members of the Environment Agency opened the sluice gates and thereby flooded areas downstream. It may have dealt with some of the issues in the five areas that were detailed, but many other aspects were not fully covered.
In my constituency, the fire authorities decided to reaffirm their charge of 300 quid to pump out flooded houses. They pumped out houses without asking whether people were prepared to pay the money; they simply added the charge at the end. That was a scandalous misuse of their authority and shows that combined fire authorities do not work.
The floods at Easter have shown that the work of loss adjusters, and the way in which insurance claims are processed, is long winded. It has caused a number of my constituents who have businesses at home to lose out. They are in danger of losing their businesses as a result of the protracted nature of the loss adjusters system and the way in which insurance claims are dealt with. Does my hon. Friend agree that there is a case for reviewing the system following the floods last Easter?
Mr. Morley: The Bye report dealt with the point about sacrificing areas, and was clear and specific in its conclusions that no areas were sacrificed to save others. I am not aware of the point about charges by the Environment Agency for pumping, but I will take it up with the agency and write to my hon. Friend about why what he described happened and the justification for it.
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My hon. Friend's comments about insurance claims go wider than the brief that I hold, but it is clear to me, from talking to affected residents, that there is a disparity in the performance of insurance companies. That is something which insurance companies need to address.
Ms Joan Walley: I thank my hon. Friend for his statement. It is important that the whole country learns the lesson of this incident. It should underpin the work that my right hon. Friend the Minister for the Environment will do when he goes to Buenos Aires to negotiate improved reductions in greenhouse emissions, which is crucial.
Irrespective of the issue of new planning guidance for houses built on green-field and brown-field sites, I urge my hon. Friend to look again and give us an assurance that the Environment Agency has the resources to act as a consultee in respect of planning applications on brown-field and green-field sites on a flood plain.
Mr. Morley: It is certainly the case that the Government will hold debates with other Governments and internationally, involving the Minister for the Environment. The issue of CO2, emissions is linked to climate change which, in turn, is linked to the tragedies and implications that we are discussing now. It brings home the need to tackle those issues seriously and in a practical way.
The examinations carried out for the Bye report and the deliberations of the Agriculture Committee have not produced any evidence so far that the Environment Agency has not been able to fulfil its duties in relation to providing advice for flood plain development. The agency has been able to do that and it is important that the planning authorities take notice of that advice. As I have said, the Bye report acknowledges that more attention has been paid to that matter in recent years.
Mr. Huw Edwards: I welcome my hon. Friend's statement and assure him that I believe that the investigation by the independent inquiry into the floods in Skenfrith in my constituency has been particularly thorough. However, that area was not as badly affected as others mentioned by hon. Members today. Does my hon. Friend agree that Welsh Office planning guidelines need to be revised so that there is a presumption against new housing development on flood plains? Does my hon. Friend agree that there should be consistency between the Welsh Office planning guidelines and the Environment Agency's report on giving guidelines to local authorities?
Mr. Morley: The Welsh Office has received copies of the Bye report and our response to the Agriculture Committee. I am sure that it will take into account the recommendations and considerations of those reports when considering its planning policy.

Statutory Instruments
4.21 pm
Mr. Ian Bruce: On a point of order, Madam Speaker. I seek your guidance on two related matters.
First, I want to mention the number of statutory instruments that are published and come into force during the summer recess. Is there any way in which you can get the Government to ensure that, when statutory instruments are laid in that way, the House has an opportunity to debate them in a timely fashion, not allowing them to come into force while the House is not sitting?
To put this matter into context, I shall point out that a statutory instrument on the working time directive was laid on virtually the last day before the summer recess. It dealt specifically with people employed in this place. I told you some time ago, Madam Speaker, that I thought that the regulations would apply to the way in which you are employed by the House, because you are required to be on duty for greatly more than 48 hours a week. If I am seen as one of your employers—I say that in a respectful way—my colleagues and I do not want to break the law.
I hope that we have written to you asking you whether you are prepared to work more than 48 hours a week and that you have responded in writing to say that you are; if not, we will not be able to employ you in the way that we are doing now. Under that directive, the House may have to look again at the way in which we employ our Speaker, including the requirement for that Speaker to be on duty for such hours. I think that we are breaking the law by requiring you to do the wonderful job that you do for us.
Madam Speaker: Hear, hear.
I have had no communication with anybody about the number of hours that I work in the House. The hon. Gentleman gave me no notice of his first comments in the point of order, and I understand that there are probably good reasons for that. However, if he wants me to look at that matter, I will do so when I have looked at the Official Report tomorrow to see precisely what he has said. It is rather complicated and I cannot give him a ruling immediately. I will look at the matter as soon as possible.

Countryside Protection (Landfill and Opencast Mining)
4.23 pm
Mr. David Taylor: I beg to move,
That leave be given to bring in a Bill to make provision for a presumption against landfill sites and opencast mines in open countryside; and for related purposes.
There was a time when the mention in the House of the word "environment" was regarded as a sign of soft politics. Green things were for green people—those whose naivety led them to conclude that there could be a better way. Those who bleated about industry's cost to the environment were costing the country jobs and, moreover, did not understand the world. However, in our last spell in opposition, the Labour party pledged to put an end to all that. We said that the quality of people's lives was too often sacrificed on the altar of profit. Those who might have been wavering about their green politics wavered no more and supported us in great numbers.
I am calling on the House to support a Bill that aims to see off two scourges that rot our landscape as completely as a skin cancer drains life from the body that it takes over—opencasting and landfill sites in open countryside. Both are immensely damaging to our countryside, its economy and the communities who live near them. Although they are closely related, I shall deal with them separately.
Last Friday, the Government announced a tighter planning framework for opencast applications, which I welcome as a major step towards delivering our election promises, but that does not yet restrict opencasting to derelict sites. The Bill would do so. There would be an absolute presumption against granting planning permission for an opencast mine in open green countryside.
Why should the House support the Bill? Hon. Members may think that opencast mines provide us with much-needed inexpensive quality coal that helps to keep open our last remaining deep mines. For those who never have cause to visit a site or have one as a neighbour, the narrow, shallow economic arguments may be attractive—if only they were always true.
The trouble with all economic analysis is that decisions depend on the costs excluded. If one excludes from the equation the social, environmental and community costs of opencast mines, it is not difficult to show that they make a profit. However, if one adds into the sum the cost of housing blight suffered by those who live nearby, the pollution as heavy vehicles daily truck in and out and the deep-mine coal reserves that have been closed down, one has a different story altogether. Opencast comes out of that wider analysis in a negative light, not a green one. We rarely hear those facts. The likes of R. J. Budge and Hepworth in the east midlands are happy when such debates are muted or muddied.
We need secure, sustainable and clean energy in this country. The demands on our national resources are increasing monthly. We need to provide for the future, but an energy policy for a sound future must be built on firm foundations. The opencast vulture is gorging itself on the carcase of the late-lamented deep-mining industry. Plundering green-field sites for the sake of that coal is

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neither sane nor sustainable. It may be convenient for the landowners; it is possibly easy for them; it is probably very profitable for them, but it is certainly a lousy deal for those who live in the blighted communities.
The Bill would end green-field opencast sites for ever. Some hon. Members may be concerned by that, but it is not yet a ban on all opencasting. We are all hoist by the petard of dreadful energy provision planning by the previous Government. That difficulty is at last being dealt with, but a welcome new role for deep mining must not usher in renewed calls for more opencasting. Opencast mining may still proceed, but only in exceptional circumstances where it is environmentally beneficial, not just environmentally acceptable. As one who lives in a community that is constantly under threat, I know that would-be opencasters will have to work hard to demonstrate any such benefits to us.
The second provision of the Bill widens the Chancellor's proposed aggregate tax to include both operational opencast sites and the few given permission in future. For too long, in my view, those who have run our opencast mines have been allowed to print their own profits. When opencasting is looked at in narrow terms, there appears to be a case for extraction. However, a widened aggregate tax—a mineral tax levied to balance the social, economic and environmental books—would change that. A mineral tax would help to focus the mining companies' minds—and that can be a hard job. Talk about the environment, and the mining companies barely listen; talk about social impact, and they turn a deaf ear; but talk about money—especially if it is their money—and one gets their full attention.
The final provision in the Bill will please many people—indeed, it illustrates why opencasting is such a bad idea. Opencast mines have an even uglier and more dangerous sibling: landfill sites. Those of us who still read The Guardian will no doubt have seen during the recess a report of a study in The Lancet about a possible link between birth defects and certain types of landfill sites. The report stated:
"Women who live within three kilometres of hazardous waste landfill sites have a 33 percent higher risk of having babies with birth defects."
Must the unborn child pay for our own bad planning? We, and we alone, create the need for landfill sites. They are filled with our waste. Taking account of commerce and industry, we all produce enough annual national waste for landfill to generate a 30,000 km line of dumper trucks trundling through our countryside. They would fill a four-lane highway from London to Beijing—some takeaway! The annual national volume of all types of waste would bury North-West Leicestershire—110 square miles—up to our necks. It sometimes feels like that.
Yes, we must change our ways; but our ways are changing too slowly for those with landfill sites as neighbours. We allow industry to pour into landfill sites goodness knows what cocktails of chemicals and pollutants. "Skip and tip" and "dig and dump" are not new millennium disposal methods. We need new remediation technology to treat and use contaminated land.
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It is said that not one of our seven seas has not been polluted by man. The situation is no less unsavoury on dry land. Should we be surprised? No, we should not. We all want easy answers to our problems; people do not really want to change their behaviour. Every household in this country creates a tonne of waste a year. Industry, too, wants to get on with the job of making money. Until that becomes more difficult, nobody, but nobody, is going to change.
Tax is a great persuader. The increase in landfill tax to £10 per tonne on certain wastes from next April is very welcome—so long as the environmental projects that it funds are in the immediate area and not just in the home communities of the decision takers. If, in addition, we were to define landfill sites as "public works" under the Town and Country Planning (Compensation) Act 1985, we could force those who create such places to compensate others whose homes and lives are blighted by them.
Two of my constituents whose house is right by a proposed landfill site recently wrote to me:
"We have already suffered severe blight and stress. Our lives have been ruined in recent months by the excavations at the site and (that) can only get worse when the landfill begins".
However, my constituents cannot move: they have been pinned down by poor environmental planning. They continued:
"Our property is unsaleable. So we have lost our rights to enjoy our home, most of the value of our property and the major part of our pension provision".
I am certain that what is happening to those people living in the Leicestershire hamlet of Boothorpe is a fundamental breach of their human rights, and that that injustice is echoed in many other parts of our country. That this should happen at the heart of our new national forest is not just astonishing, but daft. If we must continue to open landfill sites despite the much tougher planning regime that I propose, operators must meet the wider social costs incurred.
The Bill would ensure proper compensation to those communities and individuals who suffer. A compensation regime will make business and industry think twice about creating landfill sites. Money talks and business listens.
There is a political cost. Labour Members have made promises such as our 10-point plan on opencast mining. Unfulfilled promises are like determined dogs; they chase one around—
Mr. Deputy Speaker (Mr. Michael Lord): Order.
Question put and agreed to.
Bill ordered to be brought in by Mr. David Taylor, Mr. Joe Ashton, Mr. Tony Benn, Liz Blackman, Mr. Peter Bradley, Mr. Phil Hope, Dr. Lynne Jones, Judy Mallaber, Dr. Nick Palmer, Mr. Alan Simpson, Mr. Dennis Skinner and Mr. Mark Todd.

COUNTRYSIDE PROTECTION (LANDFILL AND OPENCAST MINING)
Mr. David Taylor accordingly presented a Bill to make provision for a presumption against landfill sites and opencast mines in open countryside; and for related purposes: And the same was read the First time; and ordered to be read a Second time on Friday 13 November, and to be printed [Bill 245].
Orders of the Day
  Strategic Defence Review

    SECOND DAY
    [Relevant documents: Fifth report, on the Reserves Call-Out Order 1998, Etc. (HC 868); sixth report, on the Defence Evaluation and Research Agency (HC 621); seventh report (also the eighth report from the Trade and Industry Committee), on Aspects of Defence Procurement and Industrial Policy (HC 675); and eighth report, on the Strategic Defence Review (HC 138-I).]
    Order read for resuming adjourned debate on Question [19 October],
    That this House approves the conclusions of the Government's Strategic Defence Review (Cm 3999).—[Mr. George Robertson.]
    To which an amendment was proposed—
    To leave out from "House" to the end of the Question, and to add instead thereof:
    "welcomes those aspects of the Strategic Defence Review which build on Conservative policy and which take forward jointery and rapid reaction capability; but deplores the proposed cuts in money, men, ships and planes; notes that, far from being foreign policy led, there are no clear foreign policy objectives, that defence spending between 1996–97 and 2001–2 will fall by £2,166 million in real terms with inevitable consequences for capability, that the Territorial Army is to be cut by almost one third, that the RAF is to have fewer planes and the Royal Navy fewer submarines and surface ships; seriously doubts that the planned replacements for aircraft carriers will ever be built by a Labour Government; believes that the problems of over-stretch and morale have not been adequately addressed; and deplores the fact that the armed forces will be asked to do more in a dangerous world with fewer men and less equipment."—[Mr. Maples.]
    Question again proposed, That the amendment be made.
    Mr. Deputy Speaker (Mr. Michael Lord): Before I call the first speaker, may I tell the House that Madam Speaker has decided that today the 10-minute rule for speeches will apply for all Back-Bench speeches?
    4.35 pm
    The Minister for the Armed Forces (Mr. Doug Henderson): I thank my hon. Friends for their kind remarks in yesterday's debate. I also thank the hon. and learned Member for North-East Fife (Mr. Campbell) for his kind remarks. He said that it was a taxing job being Minister for the Armed Forces, and that I had more athletic prowess than my predecessors. I believe that that gives me the edge over my right hon. Friend the Member for Hamilton, North and Bellshill (Dr. Reid)—my immediate predecessor—and perhaps a slightly greater edge over the hon. Member for Mid-Sussex (Mr. Soames). I pay tribute to my immediate predecessor for his hard work in the strategic defence review, for his clear thinking, and for his high standing among our armed forces.
    Today I shall make a principled point about people in the armed forces. During my contribution, I shall take up specifically two points that were made in yesterday's debate—a point raised by my hon. Friend the Member for City of York (Mr. Bayley) on land reorganisation, and a point made by the hon. Member for Gosport (Mr. Viggers) on medical provision.
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    Yesterday, the Secretary of State told the House of our long-term vision for Britain's defence. It is the first time since the end of the cold war that this country has a coherent, radical and long-term vision.
    It is a great honour to account to the House for the operational effectiveness and commitment of our armed forces. I am conscious that our armed forces have risen to the task of defending our nation throughout history. Their determination, their commitment, their dedication and their service have defended and preserved our freedoms and traditions and the nation's freedom. Today our armed services have the same determination, the same commitment and the same dedication, and can be called upon to make the same sacrifice—a fact that the rest of us should never forget.
    I have seen those qualities as I have met our service personnel in the months since I took over my new position, in August—their extraordinary skills, their motivation, their professionalism. Those qualities and capacities make our armed forces second to none among those who defend the freedoms of the democratic world.
    I have been proud to see those qualities and capacities displayed by the soldiers that I have met in Northern Ireland and Germany, by the sailors on board HMS Westminster, by the ground crew of the Tornado squadron at Bruggen, and by our tanker fleet based at Brize Norton but serving world wide.
    I also know that the commitment of our front-line personnel is matched by those who provide essential support, by the logistics personnel who provide crucial back-up, whom I have met at Devonport, in Northern Ireland and in Germany, and by the Ministry of Defence Police, whom I have met at many locations and only last Friday at Faslane on the Clyde. I am also conscious of the personal sacrifice often made by our service veterans. We owe all those people, past and present, a huge debt. I am sure that the House will share with me that sense of gratitude.
    Before I speak about the role of people in the strategic defence review, I want to deal with concerns raised by Gulf war veterans. I have made it a priority to see representatives of Gulf war veterans. I met them nationally, but in Newcastle some weeks ago. They have told me of the illness and disability suffered by many of their colleagues who served in the Gulf.
    I believe that, in honouring our debt to those who have served, we must do everything we can to try to find out whether it can be established that there is a specific illness or set of illnesses uniquely associated with Gulf service. What were the circumstances in which such illnesses were contracted? Can the cause or causes be identified? Can they be prevented in any future scenario? What kind of treatment is appropriate for those who suffer?
    We are committed to doing all we can to get to the core of those questions. That is why we have committed substantial resources to research. The issue is difficult and complex. Important new medical and scientific information is emerging all the time. I am particularly keen to see the first results from the epidemiological studies on Gulf veterans, which should start to become available at around the turn of the year. Results from other research programmes can be expected to start appearing from next year onwards. I believe that the Government have already demonstrated their clear commitment to

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    addressing properly the concerns of Gulf veterans. I can assure the House that that work will continue, because we take the welfare of our people seriously.
    My hon. Friend the Member for City of York spoke yesterday about proposed restructuring of the Army's land command. I know that he has been diligent in arguing his constituency's case. I listened carefully to the points he made in arguing that York should be the headquarters of the proposed northern region. However, I have emphasised that the purpose of the land command restructuring is to make the Army more effective and more efficient, so that it can meet the challenges of the 21st century. That is, after all, what the strategic defence review is all about. That is at the forefront of my mind as I make my final deliberations on the future district structure of the Army. I can assure my hon. Friend that I shall be able to make an announcement shortly.
    People are the key to Britain's future. That is true for the economic and social life of our country, and equally true for the defence of our country. People are the deciding factor in military operations. The talents and commitment of our people are the main reason for our extraordinary record of operational success. We asked our personnel what reforms they believed were a priority, and we listened to what they said. I am confident that our "policy for people" responds to those demands.
    The Government believe that we owe it to our military personnel and the civilians who support them to put their interests at the heart of defence planning. We need them; we must have their support. We owe it to them to have a policy that deals effectively with their problems, and which is not a quick fix.
    Mr. A. J. Beith: The Minister knows Northumberland and the Borders, and he knows how keen people there are to serve in the Territorial Army and to support it. I hope he will bring a fresh mind to bear on whether there will be a TA presence in Berwick, Alnwick and on the other side of the border. It will not be a practical possibility for the successors of people who have served the forces over the years to have that level of participation in defence of our country if there is no TA presence in that area.
    Mr. Henderson: The right hon. Gentleman will understand that I shall deal with that issue. I am happy to give him a taster of what I shall say later. We have a strong commitment to the Territorial Army, and to modernising it. There has traditionally been a strong recruitment drive and capacity in the north-east of England. I am determined that, with a fresh mind, that will be the case in the future.
    In response to the needs and demands of people in our armed forces, we must deliver them a coherent long-term strategy that allows them to develop their talents. I am pleased to confirm to the House that I agree with the Select Committee that the success of the entire review may depend ultimately on getting this area of policy right.
    Tackling the problem of under-strength is another typical issue. It cannot be solved in the short term, but I am pleased to tell the House that recruitment is already improving. In 1997, the Army could recruit only 88 per cent. of its target. This year, it is confident of recruiting
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    more than 95 per cent. There is, of course, still a long way to go. Our aims are to achieve full staffing in the Royal Air Force from 2000, in the Royal Navy from 2002 and in the Army by about 2004. Full staffing will largely solve the problems of overstretch, but it is a long time until we achieve that in 2004.
    Mr. Mike Hancock: The problem that the armed forces, particularly the RAF, are facing in some areas is the retention of qualified staff. What are the Government's proposals to ensure that we retain people in whose training we have invested tens of thousands, if not millions, of pounds?
    Mr. Henderson: I can assure the hon. Gentleman that recruitment and retention in the armed forces is a top priority for the Government. That is true of the service to which he referred. There are no easy answers. A combination of approaches is needed, to allow us to communicate better to potential recruits what the armed services are about, and to enable us to treat people better when they are in the armed services, to persuade them to stay. Later, I shall outline some of the measures that I propose.
    As I said, 2004 is a long way away. The services are looking hard at how to reduce overstretch by better management of people. They will carry through significant changes as part of the SDR implementation. Some changes in telephone allowances and in rest and recuperation flights introduced in July have been welcomed by personnel. Only a combination of reforms in the longer term will help to make the necessary impact on recruitment and retention.
    Mr. Ian Bruce: Is the Minister confident that the armed forces will be able to recruit 95 per cent. of their target figure? Year after year, we have heard confident predictions that they would achieve their projected recruiting level, but they have failed. In my constituency, we are keen for more and more people to join so that they can be trained at Bovington, but that is not happening. Does the Minister believe that cutting the Territorial Army will help in future years to attain even the present level of recruitment?
    Mr. Henderson: It shows what a change in Government does. I would not say that I was confident of attaining a target if I did not believe that. I am confident that we shall do so. I shall deal later with the hon. Gentleman's question about the TA.
    Mr. Andrew Robathan: The new Army concept of operations for infantry battalions will involve a fourth manoeuvre company. That is what is being spoken about. Given that many battalions are one company under strength, how does the Minister see battalions being able to man four rifle companies per battalion, when they cannot man three at present?
    Mr. Henderson: It is the good news from a change of Government that we are beginning to get numbers up to strength. We intend to continue to work on that. We are confident that our proposals in the strategic defence review will be met. Otherwise, we would not be saying that we believe that that will be the case.

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    I shall move on to the welfare of our personnel and their families, as well as the welfare of veterans. I believe that their welfare is crucial in building a better atmosphere within the armed services. I opened a veterans advice unit on 5 October. It is a single point of contact for veterans and their dependants, who may seek advice on the widest range of subjects, from advice that is important to individuals on how to obtain a medal to which they are entitled, to other questions about very important issues such as pensions. A special Gulf veterans' advice unit and medical assessment programme have already been established.
    We shall also establish a service families task force to co-ordinate our response to service families across Government. I will lead on that task force, and Ministers from a number of Departments will serve on it. Service families will also be represented. Together we shall address the problems that service families face. We are already making progress.
    Like all parents, a major concern for service personnel is their children's education; but the service way of life adds complications with which most families do not have to contend. The Government recognise this, so the Department for Education and Employment has issued guidance to schools and admission authorities on being sensitive to the needs of service families. Education is just one example of the problems that service families experience and which we are taking action to address.
    We want to do more for those for whom the services are only a first career. Our learning forces initiative aims to ensure that service personnel have many more opportunities to acquire recognised academic and vocational qualifications. We want those opportunities to be available both while personnel are in the services and after they leave. We are doing this not only because we want to get the best out of our people but because we want them to return to the civilian employment market with transferable skills and qualifications. I am especially pleased that the Select Committee on Defence welcomed our plans in that area.
    Mrs. Margaret Ewing: This is an important point relating to the families of those who are involved in the services. The Minister will recognise that, because their children are often moved around, given the nature of deployment, among various countries, they sometimes return to a United Kingdom base where they may be excellent at numbers but perhaps restricted in language. That places extra burdens on local authorities. Is any analysis being undertaken by the Ministry of Defence to ascertain how it can best assist in these situations to help youngsters who have a topsy-turvy sort of education?
    Mr. Henderson: I am grateful to the hon. Lady for making that very real point, which was made to me also by the wives of serving personnel in Northern Ireland when I visited them recently. They wanted all troop movements to take place in August every year. I could not quite guarantee them that that would be possible. However, the families' task force is to deal with that sort of issue—to ascertain what additional assistance the families of armed service personnel need to allow them to move from one location to another with the minimum disruption. The hon. Lady makes a valid point.
    I turn to attitudes in the services. We and our armed forces have faced the fact that some racism and sexism exists in the forces, and that some think that the armed
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    forces are not interested in tackling those problems. That perception has not helped our ability to find the right people and to hold on to them. These are issues that my right hon. Friend the Secretary of State, the chiefs of staff and I are determined to tackle.
    Over the past few years, the services have worked hard to remove the stigma of being seen sometimes as organisations which fall short of modern standards on race. Much effort has gone into building bridges with ethnic communities, and real progress is now being made. I say to the House, lest anyone has any misapprehension, that we have a zero tolerance policy on racism. I can tell the House that the Government mean that. We seek exemplary behaviour from modern forces, and we want the best people to join the armed forces. That means getting the best people from all the communities in our country.
    When we say that we want to reflect the multicultural nature of Britain today, it is our responsibility to deliver change: change in values, in attitude and in recruitment patterns. I am pleased to tell the House that, such has been the progress made, that Sir Herman Ouseley, chairman of the Commission for Racial Equality, described it as model leadership in action. However, that achievement must be consolidated.
    The momentum and the improvements must not be allowed to wither. It therefore gave me great pleasure in September to open the tri-service equal opportunities training centre at Shrivenham. The centre will educate those with key responsibilities for removing any racist or sexist behaviour from our organisations. When I see one or two Conservative Members smirking at that, I have to tell them that, when we are involved in dialogue with the armed forces, they take it very seriously and they want to see change. I believe that it will help to guarantee that our armed forces truly reflect the rich diversity of our country.
    Mr. Peter Brooke: What moral has the Ministry of Defence derived from the fact that, in two Territorial Army units in my constituency, the ethnic minorities comprise one in five and one in four respectively? What is working well there which is not working as well elsewhere?
    Mr. Henderson: The right hon. Gentleman makes a good point, which I want to support. Clearly, there has been a modern and radical approach in those units. We want to see that approach replicated in other units throughout our armed services.
    We attach the highest priority also to recruiting women to the services. We have increased the opportunities available to them in the Army. Those opportunities are greater than those available, for instance, in the United States army. The Select Committee on Defence is right to say that changes in attitudes within the armed forces are still needed. That does not mean a reduction in combat effectiveness, for that would be unacceptable. It is not about political correctness, for that would be inept. It is about being a good modern employer, and that is what we should be.
    It makes sense that we should make best use of talents in all parts of society. It is morally right that we ensure that all personnel, irrespective of gender, ethnic grouping

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    or social background, are treated decently. People matter in the regular forces, in the civil service and in the reserves.
    Mr. James Gray: Does that apply to homosexuals?
    Mr. Henderson: I am not giving way. I want to move on, because I have a great deal to cover.
    One aspect of the review that has received much attention—I know that it is of great interest to many hon. Members—is the future role of the reserve forces, and of the Territorial Army in particular. As it was in the past, so it is today: we rely heavily on our reserves. Quite simply, we could not fight a war at any significant level without them. They also have a vital role in the spectrum of crises that increasingly faces us in today's world. Indeed, the reserves have provided 10 per cent. of British forces in Bosnia since December 1995.
    I want to place on record my appreciation of the contribution and commitment, often at personal sacrifice, of our reserves and others. They have an admirable record of essential support for their regular counterparts.
    Against that background, many have asked, "Why change?" The fact is that we want to use our reserves in a wider and more flexible way. The Royal Navy Reserve has an important and valued role in supporting the Royal Navy in meeting its operational commitments. That will continue. Indeed, under the strategic defence review, we are increasing the number of people and resources available to the Royal Navy Reserve to enable it better to undertake this work. We need an extra 385 people in that area.
    The Royal Air Force reserve is equally important. The number of air force reservists will also increase by 270, and we have new roles for them to undertake. In particular, there will be new roles for them in establishing communication links, and in ensuring the security of those communications.
    I come now to the Territorial Army, a matter of concern to many hon. Members. The TA's current structure is based on the cold war scenario of a massive Warsaw pact invasion of western Europe and a major threat to the British Isles. Hon. Members have already recognised that that is the case. But today that is no longer a principal threat to Britain, and it is wasteful and demoralising to maintain forces in anticipation of non-existent tasks.
    We are not prepared to allow the TA to decline in the absence of a clear formal task. The strategic defence review made hard rational decisions on the basis of sound analysis. That is what modernisation is about, and that is what we have done for the reserves. There is a coherent vision and plan for the future of the TA.
    Mr. Chris Mullin: No one is against modernisation, but there is a feeling in the north-east, about which, as a north-east Member of Parliament, my hon. Friend will know, that the area has been hit disproportionately by what is proposed, and that is the point we want him to address. Will he look carefully at what is proposed for the north-east, and see whether it will be possible to make some concessions?
    Mr. Henderson: I shall be receiving proposals in the near future, and in examining those in relation to the
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    north-east, I shall bear in mind the heavy commitment to the TA there. The reason why there are so many units there is that many people there want to serve in the TA. That will continue under our plans for modernisation. Where people in the north-east want to serve, and where they bring the skills that are required, we want to ensure that they have the chance to do so. That will be an important factor in my mind when I come to consider the matter.
    Mrs. Ewing: Will the Minister give way?
    Mr. Henderson: I have already given way to the hon. Lady.
    One of the guiding principles of the restructuring is that the TA should be properly integrated with the Regular Army. The TA should be relevant, fully resourced and trained for real tasks in the real world today. Above all, it should be usable. The restructuring is not about change for change's sake; it is about giving talented men and women in the TA a vital role, the training to do it and the opportunity to serve. It is about giving the TA a key place in our defence planning for the modern world.
    Mr. Julian Brazier: Will the Minister give way?
    Mr. Henderson: I have to give way to the hon. Gentleman, who I know has a deep interest in the matter.
    Mr. Brazier: I am grateful to the hon. Gentleman for saying that the TA needs a real role. Will he explain for once and for all why our English-speaking cousins in America, Australia, Canada and New Zealand all see a role for reserve combat units as formed units, yet we in Britain do not? I remind him that attached to our regular division in the Gulf was a brigade of national guard artillery from America who were commended by our commanders on their performance. Why, if American reservists can do it in reserve combat units, do the Government believe that British reservists cannot?
    Mr. Henderson: The hon. Gentleman's knowledge of and commitment to the TA are respected on both sides of the House, and I am pleased to receive representations from him. In reforming the TA, we are giving the hon. Gentleman what he seeks. We want to make our reserve forces more relevant, so that, when they are called up, they are ready to go. That is what the TA said it wanted in the review, and that is what we will be giving it.
    Many hon. Members have received strong representations on the matter from their constituents, and I understand their concerns. I assure hon. Members that the consultation is still under way, and no decisions have been taken on the future of individual units or TA centres. That is why I have asked the Army and officials to consult as widely as possible on the implementation of change. The Territorial, Auxiliary and Volunteer Reserve Association, which has deep local knowledge, has been particularly important in that consultation process.
    Ms Joan Walley: We have heard about the concerns of the north-east, but there are similar concerns in north Staffordshire, particularly in Cobridge in my constituency. When my hon. Friend

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    considers the representations, will he take account not just of the TA but of the cadet force, which operates from there.
    Mr. Henderson: I will deal briefly with the cadet forces later.
    Mr. Menzies Campbell: The hon. Gentleman will have recognised the mathematical anomaly whereby each hon. Member who intervenes alleges that his or her constituency is taking a disproportionate cut, but he has not so far mentioned an important element—the link between the military community and the civilian community. In the north of Scotland, no matter how enthusiastic a person may be to be a member of the TA, if the leaked proposals are implemented, owing to geographical considerations and the absence of public transport, that will be impossible. Surely the Government will look in an overtly political way at the advantage which is to be derived from ensuring that there is adequate access to TA service throughout the United Kingdom?
    Mr. Henderson: I understand clearly the hon. and learned Gentleman's point. I met the Group Officer Commanding, Scotland last week, and received from him a briefing on the possible implications in Scotland. I am well aware of the geography of Scotland, and that will be an important factor in our considerations.
    Mr. Ronnie Campbell: Will my hon. Friend give way?
    Mr. Henderson: I shall give way for the last time.
    Mr. Campbell: How many TA units will be closed in the future under the review?
    Mr. Henderson: I cannot give my hon. Friend that information. The Government's policy is that the TA should be reduced to around 40,000 people, and that it should have a good geographical spread throughout the United Kingdom. We should bear in mind areas where we have the strength to recruit people that we need. Those factors will be borne in mind strongly in relation to all areas of the country, including the north-east of England. I cannot at the moment refer to any specific location, because proposals have not been put to me, and decisions have not been reached.
    We ask a lot of those who volunteer to serve in the TA, and we want to repay their commitment by offering better training opportunities. We are seeking ways to reinforce that added value by examining greater links to national vocational qualifications, which should also benefit day employers who gain from a more highly skilled employee. We also want to improve the management of the TA, and we have a number of proposals on that to which I shall refer in the House shortly.
    We want to minimise the effect of the review on individuals. Where, under the review, individuals have to move because their skill is no longer required in a particular location, we want to give them every opportunity to move to another location or to reskill so that they can still make a commitment to the TA. That will be another principal point that we bear in mind during the review.
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    The Government firmly support the cadet movement. Although not part of the armed forces, cadets are an important voluntary national youth movement providing vital activity among our young people which is good for the fabric of our communities and for the character of the cadets. I was particularly proud to take the salute at the sea cadets' commemoration ceremony in Trafalgar square last Sunday, when sea cadets from all over Britain met to commemorate the battle of Trafalgar.
    Some sea cadets use TA centres. I give an assurance to all cadets—whether combined, sea, Army or air—that, where our changes affect their activities, we will relocate their activities. We will do everything to minimise disruption; indeed, we seek to give further financial support to cadet organisations.
    Mr. Crispin Blunt: Will the Minister give way?
    Mr. Henderson: I shall press on, because I have taken a lot of the House's time.
    Mr. Frank Cook: Will my hon. Friend give way?
    Mr. Henderson: I am sorry; I am not going to give way any more.
    Many hon. Members have asked about their constituencies. I make it clear again that I will receive a proposal shortly, and the Government will return to the House with a statement when a decision has been reached.
    I want to refer briefly to a further matter in relation to our reserves. I reassure the hon. Member for Gosport (Mr. Viggers) on the points that he made in yesterday's debate: the value of the hospital in his constituency is much appreciated. There is a need for a review of medical facilities generally. An implementation team is considering what needs to be done, and the House will know of the responsibilities when a decision has been reached on that.
    The strategic defence review highlighted the great importance of medical reserves. It recommended an increase of 2,000 reservists, bringing the total reserves required to nearly 7,400. Hon. Members will recall that we inherited a difficult situation in defence medical services. We found, as the Defence Committee said in its response to the SDR, that there were too few people, too few resources and, I would add, too little encouragement to those who deliver the service. We have recognised the imbalance, and are considering how we can best implement change to address those shortcomings.
    The SDR was, from the outset, an open and thorough process. In the short time that I have been Minister for the Armed Forces, people have told me time and again that the review is welcomed, for it addresses the real issues about effective defence at this time of change. Nowhere has it avoided or ducked a difficult choice or an awkward decision. Throughout, we have faced up squarely to difficulties, and have sought and, I believe found practical ways forward.
    I agree with the Defence Committee that the result is a finely balanced package, but it is an efficient and an effective package. We should not lose sight of what it contains: forces that are genuinely capable, deployable and sustainable; real ability to project force, should we

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    need to; major improvements in procurement that will pay enormous dividends in the long term; and a policy for the people who make defence work.
    History is littered with armies that were prepared to fight the previous war. It is my belief that, in contrast, the strategic defence review provides a clear and sensible vision for the future and for the long term. Implementation will, of course, be a challenge—we should expect nothing less from such a significant exercise—but the result will be the delivery of capability to protect this country and its people and a force for good in the world. I believe absolutely that that is right, and I am proud to commend it to the House.
    5.12 pm
    Mr. Robert Key: I warmly welcome the Minister for the Armed Forces to the Dispatch Box. He will find that, although the number of hon. Members involved in defence may be modest, the quality of debate is high and everyone who takes part in these debates is totally committed to the military. Indeed, it is important to stress that we all understand that military personnel and civil servants hold all political views and none. It is easier to agree with the Minister's party now that it has abandoned unilateralism and embraced the nuclear deterrent and all parties support our military. That must not prevent the Opposition, however, from fulfilling our constitutional role—nor will it.
    I congratulate the Minister on his speech. I wish that he had said something about budgets or procurement, but he cannot say it all, and nor can I, so we shall return to many of these points.
    The Minister has the most precious resource to nurture—all our people who serve the Crown, in or out of uniform. I welcome the decision announced yesterday by the Secretary of State to bring uniforms back on to our streets. They have been sorely missed for many years. When I was a child, Army and all service uniforms were part of the scenery in Salisbury, and it was regrettable that that had to cease for security reasons. I have spoken about that many times in the House, but mean it none the less now. There will be a beneficial effect on recruitment, increased respect for the military among the civilian community, and a new sense of responsibility on the part of the military.
    I pay tribute to the Minister's predecessor, the right hon. Member for Hamilton, North and Bellshill (Dr. Reid). The defence community holds him in affection as well as respect. Many have said that we have not seen the last of him in defence matters, but I am sure that it will be a long time before the Secretary of State is replaced by his right hon. Friend.
    Speaker after speaker yesterday, and intervention after intervention today, touched a raw nerve in respect of the reserves and the Territorial Army—a very raw nerve indeed, especially in Scotland. Special pleading is entirely justified, and I commend the patient way in which the Minister listened to several special cases. I make a special
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    case for my TA centre at Old Sarum, which is the home of B squadron, Royal Wessex Yeomanry—all that is left of the old Wiltshire regiment.
    Mr. Menzies Campbell: The rotten borough.
    Mr. Key: No, not the rotten borough—I hear the hon. and learned Gentleman. If he insists upon it, I can go into the fact that my constituency had eight Members of Parliament at one time in our history, but let us quickly draw a veil over that. The Wiltshire regiment was a unique institution, and I am the only hon. Member who, at noon on the day after polling, has to ascend the balcony of the White Hart in Salisbury and sing the marching song of the regiment, "The Vly be on the Turnap"—but we shall spare the hon. and learned Gentleman that as well.
    Spin-doctoring the Government's cuts in the TA simply will not wash. The cold war ended. In line with our allies, we reduced our forces substantially. It was a painful business. Those actions cannot be used as either a reason or an excuse for the current cuts in the TA. These cuts stand alone as a monument to the power of the Treasury and the weakness of the Ministry of Defence.
    The Secretary of State got the closest yet to revealing a hidden agenda, when he said yesterday that he wanted the TA to be
    "better integrated into the British Army."
    If that is a euphemism for abolishing it as we know it, that is an argument that we should hear; but Ministers should not try to spin all this away.
    The Minister for the Armed Forces knows that a lot of questions have been asked, and we cannot possibly expect the Under-Secretary to answer them all tonight, but I courteously ask the Minister to ensure that serious questions are answered in correspondence. I am sure that his officials will be taking note. As he knows, there is knockabout politics, and serious politics and accountability to the House. Generally, defence debates are about serious politics and accountability, so I hope that we will have answers.
    In September, I had the privilege of attending a number of defence-oriented activities, and I emphasise how grateful the Opposition are to the Government for providing access to a wide range of the MOD's activities. That is important if the military is to understand that we are all on side. I visited the Farnborough air show and was immensely proud of our aerospace companies. I visited HMS Invincible for a sea day; and while on the subject of aircraft carriers, I should like to return briefly to yesterday's exchanges.
    The hon. Member for Barrow and Furness (Mr. Hutton) asked for a specific commitment to the time scale. He said that
    "the in-service date was expected to be 2012"
    and hoped that
    "the Minister will be able to say that the Government remain committed to that time scale".—[Official Report, 19 October 1998; Vol. 317, c. 971–1025.]
    The Minister replied that there was no change in the Government's commitment—we were pleased with that, because we want the aircraft carriers—but he did not specifically mention the in-service date. That is important, and I ask the Minister to confirm that date in his winding-up speech. I hope that he will be able to do so.
    Mr. John Smith: Does that mean that the hon. Member for Stratford-on-Avon

    1109
    (Mr. Maples) will now withdraw what he said yesterday? By implying that the building of the aircraft carriers would not go ahead, he has caused much consternation among service personnel in the Royal Navy. It is outrageous.
    Mr. Key: My hon. Friend will speak for himself, but the importance of the matter that he raised is not in doubt. I support my hon. Friend entirely in pursuing this matter today.
    It was not the previous Government's policy to announce a major procurement programme—such programmes do not get much bigger than the building of two new aircraft carriers—and afterwards advertise in the contracts journal to see whether further special refits would do instead. When those studies are completed, what will happen if the answer is that refits will do nicely for years to come? The Treasury will say that the new carriers must be postponed. Thus the Government's position needs tidying up, and I hope that we can support what the Minister says tonight.
    I also visited Barrow and Furness. I pay tribute to the remarks that the hon. Member for Barrow and Furness made last night. He was absolutely spot on in commending the virtues of his work force. I was immensely impressed not only with the company that I visited but with the quality of the work force—its adaptability, the lack of restrictive practices and the fact that it was multi-skilled. It was an object lesson. It is hard to understand why anyone in the world thinks that they can beat companies in this country that are making such a huge impression.
    HMS Vengeance was a treat. It was a real surprise to discover just how fine that ship is. The work force should be extremely proud. The work force on the two amphibious assault ships and on the tanker can similarly be extremely proud of their work. That is cutting-edge technology, and we all have much to learn from it.
    I also visited British Aerospace at Warton, where the Eurofighter 2000 export known as Typhoon is being built. I happened to be there when the two last-ever new Tornado aircraft took off. That was quite a sight, with thousands of the work force out on the tarmac to see it. However, the mid-life update of the Tornados continues, as does the construction of Hawks. The design technology there is world beating.
    I went on to Broughton to visit British Aerospace making Airbus wings, and many other wings. It is another success story, with new apprentices being taken on. I also visited the Territorial Army at Old Sarum and witnessed eight nights' training there. Obviously, given my constituency, I am constantly aware of the Army's activity on the Salisbury Plain training area, and of the Defence Testing and Evaluation Organisation at Boscombe Down, where daily the C130J Hercules circle over my constituency.
    It might be helpful to clear up one or two misconceptions about the C130J Hercules. It is true to say that it is late, which is not acceptable, but it has flown a total of some 5,000 hours and the first C130J has been delivered to Boscombe Down for military aircraft release. Work is now well under way, as my constituents keep telling me. We should be cautious about dismissing the industrial importance of the C130J to the United Kingdom. There are 47 British companies in the C130J
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    industrial support group. They have generated £475 million in C130J earnings thus far and accounted for 20,000 man years of work.
    The Conservative Government were justifiably proud of their record on defence procurement under a series of distinguished Secretaries of State. The Labour Government should not be surprised that we guard their reputations as we observe the fruits of their decisions in the hands of current Ministers. My hon. Friend the shadow Secretary of State has said that we welcome much in the strategic defence review. The Secretary of State is keen to point out that the chiefs of staff have given public and private support to the SDR.
    The chiefs of staff have my public and private support for their professional judgment. They and all their staff have done a magnificent job. Nothing will convince us that the SDR's fate was ultimately not in the hands of the Treasury, but I am confident that all three services have used the SDR to undertake a genuine root-and-branch review. I pay tribute to them for that.
    Many, but not all, of the questions have been asked; many, but not all, of the conclusions have been reached. The SDR's publication last July was the beginning, not the end, of the process, and time is not standing still.
    The SDR has developed a comprehensive list of broad missions and military tasks to form a basis for defence planning. Clearly, the strategic environment is different today—there is no cold war threat to the United Kingdom and we do not foresee the re-emergence of such a threat. However, we cannot take that for granted, and the review proposes to put the forces in the front line. It says that we are not to
    "stand idly by and watch humanitarian disasters or the aggression of dictators go unchecked. We want to give a lead, we want to be a force for good."
    Rightly so, but before we go abroad to do good we must acknowledge that bad can come to us. Before we embark on the "force for good" adventure, we must understand when determining our defence policy that our vital interests are to protect British territory, borders and air space, and British citizens and interests around the world.
    Did the SDR do enough to deal with the asymmetric threat, for example? I see little evidence that it did. I am aware of the new threats that we face—the exploitation of cyber-weapons, for example, could be used to bring the war home by attacking the national strategic infrastructure, which is rapidly exploiting information technology in the name of economic efficiency.
    Why even think about biological and chemical warfare—the "poor man's nuclear bomb"? We must do so because it is unlikely that our possible opponents will confront us directly. CB weapons are inexpensive and accessible, and can be delivered by warheads on missiles or by covert agents, terrorists or even madmen. Like our allies who are dealing with the issue, we are vulnerable to such attacks. That is why I warmly welcome the Secretary of State's announcement yesterday that he will shortly report fully to the House on the conclusions of his review on the risk that biological and chemical weapons pose to our troops overseas. His next step should be to encourage a more open and focused debate on the nuclear, chemical and biological threat at home in the civilian community.
    Civil defence is entering a new era of significance. I pay tribute to the unsung work of our county emergency planning officers. What progress are the Ministry of

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    Defence and other agencies making in assessing, testing and fixing the year 2000 problem? The MOD has been assiduously addressing the problem since 1995, and in 1996 the Central Computer and Telecommunications Agency drew up a programme that set specific targets for all Departments. I should be grateful if the House could have answers—all in good time—to four specific questions.
    We all know that there is a problem with recruiting and retaining specialist staff. What is the extent of the shortage of skilled, in-house staff in the Ministry of Defence? Is it true that there is evidence of staff wastage from the Ministry of Defence to industry? We know that that is true of front-line pilots, but is it equally true of those staff?
    Can the Minister assure us that all the critical systems will be compliant by the end of 1999? Can he identify non-critical systems that will not be? Last month, in the quarterly return of the departmental year 2000 plans, the permanent under-secretary emphasised that the MOD might need to delay or stop important activities or projects while attention or resources were focused on the year 2000 issue. What activities or projects have been identified as frozen or cancelled? It is important not just for the Opposition but for those outside in industry to have specific information.
    We are certainly not short of missions. For four years, our troops have made a major contribution to NATO in Bosnia and Herzegovina. Incidentally, their contribution has been to the peace implementation force, not to the intervention force as page 15 of the SDR says. In order to deploy our men and women, we need to keep them well trained and to retain them in the services. Let us take for example the fast-jet pilots in the RAF. Experienced flight lieutenants and squadron leaders approaching the age of 38 are constant prey for the civil airlines.
    Our pilots always do what we ask of them, as they should. They proved their record in the Gulf and in Bosnia. In Kosovo they are part of the verification force. However, our ability to continue to meet the challenge of Bosnias to come rests on recruiting and retaining those pilots. We can help to do so through access to affordable and adequate housing, improving support for their families, providing access to high-quality health care, and introducing retirement benefits. Issuing short-term contracts might help to keep pilots who are unwilling to make a long-term commitment.
    I am sure that, like our allies, the Government are getting to grips with the problems. We should like them to share their progress with us.
    Front-line pilots continue to feel bruised by the injustice of the Ministry of Defence line on the crash of Chinook ZD576 on the Mull of Kintyre. Members of Parliament from all parties who have taken up this cause were not surprised by the latest stonewalling by the Minister for the Armed Forces at the end of September. Nothing has changed, and I shall continue to seek to redress this injustice. Ministers should know that loyal, serving and retired RAF personnel remain as unhappy as I am.
    The Minister's arguments have led to technical and professional counter-arguments. It is not possible to say that there can be no doubt about the cause of that crash.
    1112
    Of course there is doubt. The RAF should think again. I am grateful to the Secretary of State for his offer of a further meeting, which we shall no doubt accept.
    Earlier this year we had a debate on the Royal Air Force, and I look forward to the other single service debates. I spoke of the loyalty of wives and families of RAF personnel. During the summer, the Association of RAF Wives was put under increasing pressure. Its head office had to close over the summer months owing to lack of funding.
    There also seems to be an attitude problem. Something is wrong if, at an RAF station, the officer commanding the personnel management services—the appropriate contact—refuses to meet or speak to representatives of the Association of RAF Wives. Do Ministers have a problem with the association, or is it that its patron is our independent colleague, the hon. Member for Tatton (Mr. Bell)? Only this morning, I heard from the association that the publishers of its magazine had called to say that they had been warned of closure. Ministers refused to include the association in the website that they so proudly announced because of those rumours. I invite them to address that issue urgently.
    Military families warmly welcome the SDR proposal for a families task force, especially as they have now heard about the proposal for a families forum with access to the Minister. I too warmly welcome that measure.
    This time last year, prompted by the excellent Army Families Federation, I raised the issue of the problems affecting Army families which can be resolved only by interdepartmental co-operation. I regret to report that, almost a year later, there is still no progress on four important areas. First, there is the problem thrown up by the jobseeker's allowance, which puts the working wives of service personnel at a disadvantage. It is no good the Government crowing about the new deal if service families are excluded.
    Secondly, a significant number of children of service families are excluded from university grants if their families have followed the flag for many years. I was pleased to note what the Minister said about that. I am glad that the Department for Education and Employment will be sensitive, but I respectfully suggest that being sensitive is not enough if the problem is not resolved for the dependants of service men and women.
    Thirdly, it remains impossible for military personnel to maintain their NHS dental registration when they are posted overseas. On their return, they must start all over again. Surely that is a straightforward administrative matter, and an item for the agenda of the first meeting of the new families forum.
    Fourthly, back in the spring, the Army Families Federation went to Leeds to meet the NHS executive, which promised to deal with the problem of forces families who are posted after they have seen a consultant: they lose their place on NHS waiting lists and have to start all over again. Will Ministers please address that problem urgently? I know that it is a matter of detail for Ministers, but for service men and their families it is of very great importance.
    Mr. Ian Davidson: Why were these serious matters not resolved by the previous Government?
    Mr. Key: They did not arise under the previous Government. These matters were first put to me last year.

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    I dare say that these problems existed under the previous Government, but that is not a good reason for the present Government to ignore them.
    The adjutant-general's standards and discipline paper has now been under revision for some two years. The last expected date for publication was March. Some high profile and unpleasant cases of courts martial have done nothing to enhance the reputation of the forces, and some of those cases are still outstanding. Meanwhile, paragraph 133 of chapter 6 of the strategic defence review promises the development of a common personnel strategy, led by the centre but implemented by the individual services. Enigmatically, the SDR says that the Government will examine the need for a single, tri-service discipline Act.
    The previous Select Committee on Defence and the previous Special Select Committee on the Armed Forces Bill were highly critical of the Ministry of Defence under the previous Government for its failure to consolidate the existing three service Acts. The Ministry of Defence has always—until now—implied that, given the different ethos and functions of the three separate services, it would be impossible to encapsulate service discipline in a single Act. What has happened to change that?
    We are all aware of the pressures, particularly sexual pressures, implicit in more and more joint activity—perhaps appropriately termed "purple activity"—but Ministers must explain to the House and to the Navy, the Army and the Air Force just what is going on. The beginning of chapter 6 of the SDR makes much of the need to retain highly motivated people and to maintain that motivation. Just so.
    The Secretary of State has said often enough that he believes that service men and women should reflect or be representative of British society at large. I am not sure that the three services would accept that. Traditionally, our services have demanded more of their personnel and have demanded higher standards than prevail in the rest of society. Do the Government intend to drop those traditional standards? Is that why they are able to promise a single discipline Act?
    Paragraph 132 of chapter 6 of the SDR announces the establishment of a cell to provide a focal point for veterans seeking guidance, and that has been welcomed by many ex-service organisations. The British Limbless Ex-Servicemen's Association, in its summer 1998 magazine, expressed the scepticism about the cell. It hopes that the MOD appreciates the likely implications for the equipment and staff that will be needed. It said that, at one point, the war pensions helpline dealt with 22,000 calls in a week. Like us, the association is watching with interest to see what happens.
    On Monday 5 October, the Minister for the Armed Forces launched the veterans advice unit. Is that the much-heralded cell? If so, the staff of just five warrant officers—however well trained and highly motivated—will be hard put to it to cope. My hon. Friend the Member for Mid-Norfolk (Mr. Simpson) will return to policies for people when he winds up the debate.
    Faster, cheaper and better procurement has become the MOD motto.
    "We must capitalise on the lessons we have learned from successful commercial restructuring to adopt modern business practices; consolidate and streamline; embrace competitive market strategies; and eliminate or reduce support strategies … all this in order to do the job better, faster and cheaper."
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    Those are the words of Jacques Gansler, Under Secretary of Defence Acquisition and Technology in the United States. That is what our allies are doing, and it seems that we are to follow suit. Will the smart procurement initiative fulfil that mission?
    In this country we had the Downey cycle in the 1960s, the Levine reforms of the 1980s and the defence cost studies in 1994. We welcome smart procurement, following as it does the US models of defence acquisition reform and the revolution in business affairs. The reaction of the British defence procurement industry to the smart procurement initiative has been very positive, at least on the surface. Indeed, it would be surprising if the response of the providers to the major customer were anything else. Privately, the truth is less flattering. I was recently told that if smart procurement is all about selecting a partner early, what is going on is driving in the opposite direction.
    I was told that many of the ideas within the Ministry of Defence are seen in the commercial world as naive or underdeveloped. British industry, competing in world markets, is at the cutting edge of technologies and financial systems for modelling and costing. Why should companies spread their international competitiveness? The leaching of ideas would be inevitable.
    There is much concern, too, about rainbow teams, whereby the MOD puts together all the potential partners in a project, including foreign prime companies. Some major British companies have declined to take part in that process, and who can blame them?
    Even if there is a funding inducement for prime contractors to collaborate, the length of the various processes—even under the smart procurement regime—means that in four or five years, and by the time one of the primes becomes a winner, the capability of each company will have been exposed and shared. That is not very smart. Chinese walls are not good enough, and raise massive problems of intellectual property rights.
    We warmly welcome the commitment in the SDR to the formation of a broad acquisition stream encompassing military and civilian staff. Integrated project teams and through-life accountability are concepts warmly welcomed by the private sector. There is still a fear that the acquisition cycle is too long, and some scepticism that there will be single-team accountability on the MOD and private sector sides.
    Mr. John Wilkinson: Will my hon. Friend comment on the significant delays in collaborative programmes that have been induced by the defence review, in typical socialist style, being initiated by Gerhard Schröder's red-green coalition in Germany? What does my hon. Friend think about the delay in the multi-role armoured vehicle programme? That is a joint programme, but we could perfectly well have achieved it ourselves using the overcapacity in our armoured fighting vehicle industry. What does he think about the delay in the proposed collaborative, beyond visual range, air-to-air weapon? Are such delays tolerable for our armed forces?
    Mr. Key: That is the finest possible example of why we should not go in for proportional representation and coalition Governments. The instability that is being caused by the lack of a German Government week after week hits hard when it comes to the procurement industry and our military defence alike. The MRAV contract was

    1115
    worth millions to our economy and to the German economy. Battlefield taxis are a concept which has been around for a very long time.
    My hon. Friend is right to put his finger on that contract but, although significant, it is not the only one. A stack of such contracts is building up. It is astonishing to see the way in which the new German Administration—who may one day eventually form a Government—are wheeling and dealing with the Greens, whose agenda is absolutely anti-NATO and all that it stands for, in order to cobble together some sort of Government. It is very worrying—even more worrying, I suppose, than the former German Chancellor's proposal for a future large Antonov.
    Mr. Menzies Campbell: Am I to understand from what he has said before that the hon. Gentleman would have opposed British participation in the Eurofighter project, that he would now withdraw from the Horizon frigate project and that the United Kingdom would build its own successor to the type 42?
    Mr. Key: There are, of course, plenty of people who say that it would be a very good thing if we built our own successor to the type 42; but the answer to the hon. and learned Gentleman's question is no.
    I must make progress. No doubt we shall return ad nauseam to debates on proportional representation in the future.
    The defence procurement industry's supporting essay 6 was at the heart of the strategic defence review. The scientific and technological superiority available to the fighting forces of a handful of western nations gives us a hugely important asymmetrical advantage over enemies, but we cannot rest on our laurels because the catching-up process is speeding up as well. That is why, when I visited the north-west of England, I was so pleased to see the progress being made by British industry on, for example, the future offensive aircraft, about which my right hon. Friend the Member for Fylde (Mr. Jack) spoke so well last night.
    Product data modelling now allows the most senior technicians to talk through design concepts with the fastest pilots and the most senior military officers, in terms of real time but virtual reality, on the premises of our procurement companies, without even making the journey to Abbey Wood. One of the many reasons why product data modelling is so important is that it reduces abortive expenditure that results from late design changes and the reworking of manufacture, which add to costs and time overruns. Concurrent engineering processes and systems being developed by private-sector defence procurement companies can reach their full potential only if they are matched by a determination in the Ministry of Defence to break down some of the old barriers and restrictive practices.
    May I ask a specific procurement question? Has the MOD a clear vision of the total lift capability required for the SDR concept of operations? I wrote to the Minister about that in July, but I have still not received an answer. The SDR equipment acquisition appears to envisage a maximum of four C17s, the 25 C130Js already on order and some amount of additional tactical support. How will the MOD calculate the final balance of lift assets to be acquired through the short and long-term airlift competitions?
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    MOD witnesses told the Defence Committee that the MOD's operational analysts had suggested that four was the required number of C17s. Why, then, is Boeing under the impression that eight, 10 or even 12 C17s will be considered? Can Ministers explain the contradiction, or is this just something else for the contracts journal? If the real intention is to procure more than four C17s, how will the MOD pay for the additional aircraft, given that they cost £125 million each? What is the intellectual basis for a number greater than four?
    We know that RAF pilots are already training on C17s. On what basis would the MOD lease them? What work is in hand to investigate the leasing mechanisms? How will the MOD ensure value for money? C17s cannot be refuelled in flight by British tanker aircraft; will the MOD overcome that problem through technical changes to the C17, or through cover by United States planes for extended missions?
    The Government are schizophrenic about our relationships with Europe and the United States as allies. That is reflected in their attitude to procurement. Most important military research is being undertaken in the United States. The Pentagon's research and development budget is $37 billion; the combined research and development budgets of France, Germany and ourselves is $10 billion. If we are to have access to the latest technology on anything other than American terms, we must own some of it ourselves, and must be able to use that as an entry ticket to joint projects with the Americans.
    There is a huge and welcome variety of joint venture projects within Europe, and between European and American companies, and that should be encouraged; but if all our defence manufacturers were subsumed into one European corporation, would the option remain open? A very serious question is whether the United States would be prepared to enter into joint projects involving the latest technologies with a monolithic European competitor embracing countries in Europe which, it must be said, the Americans mistrust.
    Finally, let me ask about the Defence Evaluation and Research Agency. What is the state of the public-private partnership option? I was grateful to the Minister for Defence Procurement, who wrote to me in August ruling out the privatisation of DERA in its entirety. We note that he has decided that highly sensitive parts of the agency, and those that ensure that the United Kingdom can continue to operate effectively with our allies, will need to be retained wholly within the Ministry of Defence. Of course, I have a constituency interest, as my constituency contains the two Porton Down establishments and Boscombe Down; but more than 12,000 staff work for DERA across the country, and the Government owe it to them to end the uncertainty that surrounds their future as quickly as possible.
    After last year's general election, DERA put proposals to Ministers on defence diversification. Well, that was a damp squib. In autumn 1997, DERA provided a corporate plan with options for its future. Silence! Last November, 11 months ago, the MOD announced that the SDR would examine future options for DERA. In spring this year, the Chancellor of the Exchequer advanced proposals for privatisations and partnerships. Mysteriously, DERA unexpectedly slipped from the list.
    In July, the SDR had just one sentence on DERA tucked away in paragraph 164. It told us nothing. Later in July, DERA's chief executive briefed media analysts on

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    the situation; Parliament was kept in the dark. The former Minister for the Armed Forces visited Porton Down, and told my constituents that he was not in favour of privatisation. It became clear that the MOD, the Treasury and No. 10 were all players before the recess. Informed opinion now believes that a new MOD team has been told to go back to square one and complete its review in a further six months. So by July 1999, Ministers might make a decision to be implemented by July 2000; but if primary legislation were needed, that would slip by a year, to the summer of 2001.
    These are tough choices indeed. The delay is bad for DERA, and bad for our whole defence procurement industry. It is a dismal record of bad government, and it will not do.
    Mr. Nick Hawkins: Does my hon. Friend share my concern, and that of other hon. Members in whose constituencies DERA operates, about the fact that, while the uncertainty to which he has referred continues, different arrangements are being made in different constituencies for the release of DERA property? There is great concern in my constituency about decisions being announced while DERA's whole future is uncertain—decisions about the release of land for DERA test tracks on which houses might be built, for instance. That may completely alter the housing structure in different constituencies.
    Mr. Key: Yes, I share my hon. Friend's concern. Indeed, in my constituency DERA has been involved in seeking to use land and assets for commercial activities. We must press the Government to come clean on the issue, and to do so quickly.
    Was it wise of the Government, in retrospect, to promise to deliver the SDR within six months? Was it wise to claim that it would be foreign policy led? Was it wise to keep secret the foreign policy baselines, while claiming that this was the most open policy review ever? Was it credible of the Secretary of State to launch his "mother of all reviews" on the basis that funding might at best stay level, but would probably be cut, and to offer as his opening gambit to the Treasury guaranteed cash back of at least £500 million a year? That already looks pretty old-fashioned in view of the recent United States decision to increase its defence budget by 10 per cent., to $280 billion: an increase greater than our entire defence budget, which we are cutting.
    The Secretary of State told us that he is developing a strategic planning process that will keep defence planning up to date; that there are no plans to hold defence reviews at regular intervals; but that there may be further reviews if the need arises. It will.
    The Labour party manifesto in 1997 promised a
    "strategic defence and security review",
    but that is not what we got. True, the review included threats posed to the UK and UK interests by drugs, international crime and environmental degradation, but the Government failed to produce a cross-departmental military and security review involving the Ministry of Defence and the Foreign and Commonwealth Office, with input from the Department for International Development; the Department of the Environment, Transport and the Regions; the Department of Trade and Industry; Customs and Excise; the Home Office; and the intelligence services.
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    Responses to threats to the UK homeland were not given sufficient consideration. We got a reorganised—and, yes, improved—military posture, but we have no new central Government mechanisms or initiatives, in stark contrast to our friends in the United States of America. The review scarcely addresses our future relationship with the USA or with other European countries. It reduces the defence budget without reducing our defence commitments: do more with less.
    We should not be surprised, as that sounds exactly the same answer as the Government would get from a focus group of taxpayers; indeed, the Government spent £50,000 on such groups last summer, claiming that they wanted
    "to explore the public's attitudes, feelings and knowledge regarding the key issues covered in the SDR."
    That was in keeping with the Government's declared objective of achieving a national consensus on the defence of the country. It is consensus first, tough decisions later—perhaps.
    That is no way to win this nation's battles, be they for freedom, justice and democracy around the world; for our homeland and people; for our United Kingdom; for our national and international interest; or for the British way of doing things. Ministers can spin to their heart's content, but, as my hon. Friend the shadow Secretary of State said last night, it will fall to the next Conservative Government to put our defences and security back on a sound footing.
    5.52 pm
    Dr. Lynda Clark: I enter this debate with some trepidation. I know that many of those who have spoken have considerable expertise on the subject. I cannot claim that expertise. I cannot claim, as my hon. Friend the Member for Portsmouth, North (Mr. Rapson) did, to have lived and worked with Marines—some people have all the luck—but I have the expertise to recognise a well-founded argument when I hear it. The constituents who beat a path to my door with their worries about the TA proposals have had good arguments—so good that I felt that, despite my lack of expertise on the subject, I should try to do my best for them in this debate.
    We have already heard many powerful arguments in favour of retaining the strength, organisation and local connections of the TA. In order not to weary the House with repetition, I will adopt the brevitatis causa, as we say in court in Scotland when we mean that we do not want to waste time.
    I am sure that the Minister will take into account the views expressed in the wide consultation process, which I understand to be similar to those expressed by many hon. Members and by the Select Committee. My constituency is home to TA units of the Royal Armoured Corps, the Royal Artillery and the Royal Engineers. My hon. Friend will be well aware of the pride that the volunteers have in their units, and of their proud history.
    My plea is not that the TA should be preserved in aspic as an historical institution with little relevance for today—that would be a poor memorial for all those who have served in the TA; nor do I support the position of those who want to preserve the existing TA because they have a narrow, nationalistic view of defence strategy based on the perceived need to defend internal national borders.

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    The Government's vision is, I believe, the correct one—we need a new role for the armed forces and the reserve forces in the post-cold war era—but I believe that, in that vision, my right hon. and hon. Friends should attach more importance to the critical defence role that can be played by volunteers. The wider implications go beyond defence, and they may not have taken that sufficiently into account.
    There are economic considerations: the TA's contribution to local community employment is extremely valuable, and there is military aid to the civilian population, which is especially important in isolated communities. It is important to realise that the TA's role fits well into the Government's wider programme of training for work. TA training is valuable not only to those who receive it but to the wider community, which benefits from the skills that have been acquired.
    In the cost calculations, we should remember that what is spent in the defence budget spreads out into other budgets. In my constituency, as in many others, the TA also gives considerable support to the veterans who have served us all so well. The TA has a host of roles that go beyond its important defence role, which we should not evaluate in isolation.
    I am concerned about the allegations made by the hon. Member for Stratford-on-Avon (Mr. Maples), who said yesterday that TA staff had been forbidden to talk to their Member of Parliament and that a TA officer had been reprimanded. I regard raising concerns with one's Member of Parliament as a fundamental right of any TA member. I understand that there may be some restrictions on persons serving in the military talking to their Member of Parliament—if that is the case, it should be investigated—but that there are no such restrictions for TA members. If any of my constituents have been threatened in that way, I hope that they will tell me about it, because I will certainly make strong representations on their behalf.
    I am here because of my constituents, but, having sat through this interesting debate, I am pleased, unlike some Opposition Members, to be able to congratulate my right hon. and hon. Friends on the excellent developments that are giving opportunities to all our people regardless of sex or race. We are looking for talent in our armed forces, and we will find that in a wide range of people.
    I congratulate my hon. Friend the Minister, but ask him to pay close attention to the many representations that have been made about the TA.
    5.57 pm
    Mr. Tom King: Having had some responsibility in this area, I start with a word of congratulation to the Government on the presentation, certainly, if not on all the content, of the strategic defence review. We know the Government pretty well by now, and when I started hearing about "smart procurement" and "rainbow teams" I realised that the spin doctors had been through all the presentations.
    I was enthusiastic to hear about smart procurement, so I read what was proposed. I saw that almost all the ideas, on the need continually to improve the procurement process—which, with the scale of the procurement
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    programme, is far from satisfactory and will be a continuing challenge to Governments long after the present Government have gone—were around in my time in the Ministry of Defence, so I wish the Government luck with them.
    I admire many aspects of the review. Although one cannot call it comprehensive because it excluded from its purview the two largest defence expenditure programmes, Eurofighter and Trident, there is much in it that commands respect.
    The Parliamentary Under-Secretary of State for Defence (Mr. John Spellar)rose—
    Mr. King: I am afraid that I cannot give way because I have only 10 minutes in which to speak, and I have several things to say arising from my previous experience in these matters.
    Many areas of the review command respect, including the development of jointery, rapid reaction and equipment systems, and work on those areas must be carried forward. The Defence Committee's report was excellent and I agree with its wish that this should be the last review. That was my hope of "Options for Change", although necessary work continued on the logistic follow-up. I understand why the Government had to have a review—they said that they would do so because that was the only defence policy that they could think of in opposition—and, in many areas, the review has been carried out without too much damage.
    Although I hope that no more reviews will be conducted, I hope that the Government will remain flexible. I have the need for flexibility burned into my soul: in a statement on "Options for Change" one 25 July, I said that we must be ready for the unexpected; seven days later, Saddam Hussein invaded Kuwait, and the wisdom of my remarks was revealed rather earlier than I had expected.
    My hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) referred to the changes in Germany that have taken place since the review was published. We now face the prospect of a Green Foreign Minister in the German Government and a new Chancellor who, earlier in his career, was opposed to NATO. The Chancellor has changed his attitude, but fundamentalist elements in the new German coalition are anti-military and strongly against defence expenditure. That will have implications for German attitudes to defence. Völker Ruhe was very supportive of air strike activities in Kosovo, but the new German Government's attitude may be very different. Attitudes to defence alliances and industrial restructuring will change. Indeed, I have seen some reports that German defence companies are thinking of moving their headquarters out of Germany, because the new Government's attitude to arms exports may be different from that of the previous Government.
    Drawing on my other responsibilities connected to intelligence, I recognise the importance of what is called asymmetric warfare, or the weapons of the dispossessed. I refer to the need in any defence strategy to be ready to combat the type of threats that we may now face. Given the time I have available, I shall not rehearse those threats, but they include the possible utilisation by terrorists of chemical, nuclear or biological weapons. Any defence strategy that purports to care for the security of this

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    country must keep in mind the threats posed by such unconventional warfare. Intelligence is important to enhancing the defence role. If we put unarmed observers into Kosovo, their first defence will be good intelligence so that they know whether any elements mean them harm.
    The Defence Committee and the strategic defence review recognise that defence is about people. I became Secretary of State for Defence having been Secretary of State for Northern Ireland, and I learned in that job about nights out of bed and unaccompanied tours. Those phrases stick firmly in my mind and I know the challenges, strains and stresses imposed on those who serve us so magnificently in difficult circumstances. I also know the challenges that are posed for Governments and all those involved in defence—for example, in maintaining recruitment and adequate manning to reduce unfairness in the arrangements for unaccompanied tours.
    When we consider the challenges posed by manning levels, we should remember MARILYN—manning and recruitment in the lean years of the '90s. Everybody has forgotten about it, but it identified the problems in the 1980s; and it has been with us through the 1990s. Those are the problems that beset the Government now.
    When I was Secretary of State and we undertook the "Options for Change" review, people proposed reductions in the TA as a way to save costs. I regard the TA decision in some ways as the most political of the decisions that I took in the "Options for Change" review. I am perhaps the last Secretary of State to have served in the TA. I was about to say that everybody knows that, if someone did national service, he also served for four years in the TA, but that is probably not true because there are now fewer people around with that experience. I am a deep believer in the wider role of the TA. The Government have identified specific roles and problems for which the TA can be targeted to provide an immediate response, but the hon. and learned Member for North-East Fife (Mr. Campbell) described the wider role of the TA very well. It includes contact with the community and interaction with the public, such as work in civil emergencies such as flooding. God help us if we should ever have to mobilise again, but if we had to face a critical emergency—and the defence of the country has to be ready for the unexpected—such a mobilisation would be achieved through the TA. It is profoundly necessary that the TA's role of identification with the community, and the inclusion of many people who cannot serve in the regular forces but who enrich the calibre of our services, continues.
    I hope that no one will object if I say that, in my experience, the TA is not represented in the Ministry of Defence at the same level as the senior services. In any argument, the reserves and the TA need another spokesman, and if the Minister for the Armed Forces does not perform that role, no one else will.
    We reduced the TA and I make no apology for that. We had an establishment of 91,000 that was under-manned and unachievable, and I reduced that to the minimum level possible of 60,000. Minor adjustments have been made since, but the review now proposes a further cut of more than a third. I reached my judgment on numbers after careful study, and I believe that this new cut will take the TA significantly below the level at which it will be viable. Large areas will no longer feel any identification with the Army such as that achieved in the past through a relationship with the TA. The cut is the
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    most profound and grievous mistake in the review, and I believe that hon. Members from all parties recognise that. I hope that the Minister will not just listen to constituency representations, as the Secretary of State promised in his speech yesterday, but recognise that the overall level proposed is far too low.
    6.7 pm
    Mr. Alan Keen: I congratulate Ministers on the review, which has received praise from almost every quarter, and I, too, welcome the new Minister for the Armed Forces. It is worth reflecting that, not so many years ago, my hon. Friend's previous responsibilities for Europe would have been combined with his current job, in the post of War Minister. It is good that we have moved on from those days.
    I wish also to praise the Minister's predecessor, my right hon. Friend the Member for Hamilton, North and Bellshill (Dr. Reid), who contributed so greatly, both in opposition and in government. When I made my maiden speech in 1992, from the Opposition Benches, my right hon. Friend sat with me to give his support. In that speech, I said that it was a nostalgic return for me, because my first Army posting after infantry and trade training was to headquarters, London district, in Horseguard buildings in Whitehall. I cannot work out whether my career, in which I started as a sergeant and ended as a corporal after two and a half years, matches beginning as a Back Bencher and ending as one.
    I was lucky not to have to fight in any war. In case anyone wonders whether I served on special missions with the SAS, I did not. The closest I came to conflict was when I was seconded to the Egyptian army that fought the Ethiopians, but that was none too dangerous because it happened in the Royal Opera house, and we seemed to win every night, which was lucky for the opera goers because it would have been awful if they had to miss the triumphal march in "Aida".
    Two weeks on Sunday, I will march from Heston Territorial Army depot to the local church with people who did fight in the second world war. They gave the best part of their lives to winning us the freedom that we enjoy today. For those who do not know where Heston is, incidentally, the two top restaurants in west London are the Heston North and Heston South motorway services on the M4. I should make that clear, because my accent can be misleading. I am proud of the multicultural society of west London. Marching with me will be members of the Sikh community who fought at Monte Casino and in other crucial combats during the second world war. It is sometimes too easy to forget them. As one born in 1937, I shall never forget the war years and the period after them, when the prisoners of war came home only to suffer the deprivations that the whole people suffered at that time. Memories of the second world war could slip away quite easily if it were not for those who will march in a couple of weeks' time.
    I am continually reminded at my surgeries that conflicts happen all the time, and that is what the defence review is about. People from all parts of the world come to see me, having had to leave their own countries and possibly some of their families as a result of conflicts. It is important to address their problems in our defence review.
    I cannot accept the statement made yesterday by the shadow Defence spokesman, the hon. Member for Stratford-on-Avon (Mr. Maples), that we do not want to

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    be part of a world police force. We may not want to be, but our duty as a democratic nation is to look after people all over the world. We have learnt many lessons recently on that. I accept that the United States has more than once had to withdraw from some areas, and those defeats have been bitter. However, the USA was not really supported by all the democratic world, and we must learn from that. It is vital to revise the United Nations so that consensus can be achieved before action is taken.
    My major concern is not financial aspects but our moral duty to all human beings, wherever they happen to live. However, there is no doubt that the financial cost of inaction is greater than the cost of firm and decisive action, especially when the impact on potential aggressors of the deterrent effect is taken into account. The defence review takes full account of that.
    I have paid tribute to the soldiers of the second world war, and I extend that tribute to those who have suffered in conflicts since then, and to those who serve now in our armed forces. My brief, compulsory, experience of the armed forces helped me to understand the culture of the armed forces, and 30 or more visits to the Royal Air Force as a member of the parliamentary armed forces scheme has taught me a great deal about the impact of high-technology equipment and the need for high-level training. I have learnt of the dedication of personnel at all levels, and I realise that everyone understands the international responsibilities of the armed forces. They are no longer defending Britain against an aggressor, but playing a part in establishing a secure world.
    It was clear to me after days of questioning and listening that there was a high level of dissatisfaction in the services. Personnel knew that although it was necessary and beneficial for the United Kingdom to reduce its armed forces after the end of the cold war, the cuts imposed by the previous Government were completely Treasury led. People were angry about that, and the present Front-Bench team has learnt from the mistakes made then.
    Personnel want to know what role the nation wants them to play in defence of our country and in the furtherance of peace in the world for our children and our grandchildren. They want to know that future commitments will be fully financially supported, both for human resources and equipment. They deserve more than the treatment they had from the previous Government, when military commitments were extended way beyond the scope of financial and logistical support.
    I listen frequently to men and women whose family lives have been stretched beyond the limits of acceptability. The armed forces and their families have always benefited from medical resources, not given as a reward but because it was essential for those in the front line to know that their families had access to health care whenever they needed it. I hope that Ministers will take that into account. That policy represents common sense and good management, as is recognised by many commercial companies. The armed forces should not change the culture that has existed for many years.
    The closure of many high street recruitment centres has meant that the burden of promoting awareness of the armed forces has fallen increasingly to other parts of the military. Museums play a part. They may seem to be soft
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    targets for cost cutting, but I hope that the Government understand the opportunity that they give to many people to understand our military history, which is inspirational and helps with recruiting.
    I do not have time to elaborate on problems caused by cost cutting, but I am sure that the contractorisation of much RAF engineering, while it may save money in the short term, will result in higher costs in future, because the contractors are unable to recruit from retiring RAF technical personnel.
    There are proposals to market-test, or sell off, the military survey in my constituency. Military survey plays a crucial role in providing vital information for the Army and the RAF, and there has been no indication that the sell-off proposals will save any money. They can only decrease the security of the operation. If an attempt is made to follow the previous Government's dogma, the staff at Feltham will have faced nearly five years of uncertainty by the time a decision is made. On my first visit to them, four or five years ago, I was told that I should not publicise the visit for security reasons. Yet the survey is now a target for transfer to the private sector. That does not seem quite right.
    A handful of us visited the NATO in 1993 because we were concerned about inaction in Bosnia. I was told by the then chairman of the NATO defence staff Field Marshall Sir Richard Vincent—
    Mr. Deputy Speaker: Order. I am afraid that the hon. Gentleman has had his 10 minutes.
    6.17 pm
    Mr. Mike Hancock: I welcome the new Minister for the Armed Forces to his post, although I was disappointed that the first letter I received from him brought bad news for Portsmouth. It announced 200 job losses and 105 compulsory redundancies. I hope that that is not the shape of things to come, and it was a depressing start from the new Minister. From now on, I hope everything will be on the way up rather than down.
    I want to address some local issues, the first of which is those 200 jobs. I understand why the Minister of State has to leave the Chamber as I am speaking, and I am sure that the Under-Secretary will be able to cover his back. I hope that the Minister of State will take seriously my suggestion that he tries to work with the men and women who have been told that their jobs must go, and to try to assimilate them into other defence establishments in the Portsmouth area.
    The second local issue is the need for the MOD to start to make decisions about long-term procurement projects. The hon. Member for Portsmouth, North (Mr. Rapson) spoke yesterday of his commitment to the work force of Lockheed Martin who are working on ASTOR, the airborne stand-off radar programme. What that programme needs is a decision. We must safeguard the 2,000 jobs, so the right decision for us would be support for the Lockheed Martin scheme. A decision is needed; many people's hopes and future depend on it.
    The third local issue concerns the two aircraft carriers. The hon. Member for Salisbury (Mr. Key) asked a pertinent question about their in-service date. It is not good enough for the people whom I represent, many of whom serve or have served in the Royal Navy or work for the MOD. They have banked an awful lot on the two

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    carriers. Uncertainty has been percolating through the area since the local newspaper suggested a week or so ago that there could be delay. When asked, I said that I thought that a delay would be nonsense. It would be a serious setback for the Government and the defence review if there were any truth in it. The people whom I represent, and the rest of the country, are owed an explanation. We need a commitment about whether the in-service date of 2012 is firm.
    I am not much concerned about the naming of ships, but, if there is confusion, as one who has watched the Royal Navy leave Portsmouth harbour over the past 50 years, I believe that the names Victorious and Eagle should not go amiss.
    The last local issue is the future of the Defence Evaluation and Research Agency. I represent hundreds of people who work in DERA establishments in and around Portsmouth and some who work in the Aldershot area and travel up to the Farnborough site daily. Indecision has hung over them for some time and they deserve to be told exactly what has happened. They should not have to go through the frustration of continually being told that further studies are needed before a decision.
    Hon. Members must have been disappointed when the Minister for the Armed Forces spoke. Did not the Secretary of State suggest yesterday that we would hear some news about the Territorial Army? Were we not led to believe that we would get an announcement that would nail some of the rumours that have been flying around? We got nothing.
    Mr. Richard Livsey: My hon. Friend will have noted my early-day motion 1534 about the future of the Territorial Army in Wales, where we may lose our two remaining TA regiments: the 2nd battalion, Royal Regiment of Wales and the 3rd battalion, Royal Welch Fusiliers. Would not that be a tragedy? The Minister has told me in the past week of the closure of Cwrt y Gollen training camp in my constituency with 36 job losses.
    Mr. Hancock: I thank my hon. Friend the Minister for Brecon and Radnorshire (Mr. Livsey). I was pleased to sign the early-day motion. I am delighted that he is leading the fight for the TA in Wales but the story does not end with Wales, Scotland or the north-east. The TA is affected in my area as well, as I said in an intervention yesterday.
    If we are to believe the reports that are circulating, there is to be nothing in Aldershot, the home of the British Army. Southampton's TA commitment is to be halved. The Winchester unit, which was praised all round the House as the one that had adapted its role to suit the MOD's on-going commitment, is to be done away with. Two units are to be scrapped or decimated in the Portsmouth area. That is sad.
    Other hon. Members have commented to me. My right hon. Friend the Member for Caithness, Sutherland and Easter Ross (Mr. Maclennan) and my hon. Friend the Member for Argyll and Bute (Mrs. Michie) made points about the islands. My right hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) noted that cuts in the Royal Regiment of Fusiliers would leave a gap in the TA between Newcastle and Edinburgh. Answers are needed. My hon. Friend the hon. Member for Torbay
    1126
    (Mr. Sanders) mentioned that Paignton has a brand-new TA centre but has been led to believe that the unit must move to Exeter. My hon. Friend the Member for Brecon and Radnorshire intervened to make his point. Many hon. Members have said that if TA coverage stops being UK-wide, we will have a serious problem.
    It is no good the MOD saying that it wants the TA to supply supporting specialists when it is closing off that supply. If it needs a specialist doctor in Bosnia and that person exists in Galashiels, it will not be able to get him or her because that person will find it difficult to belong to a TA unit in the area. The man and woman power will not be available. The Government must reconsider.
    The Minister for the Armed Forces spent the best part of 10 minutes talking about personnel issues but he was 10 minutes into his speech before he mentioned the civilians who work for the MOD, which was disappointing. There are several issues relating to the way in which we have treated people in the armed forces. I welcome the chapters in the defence review that say that personnel matters will be dealt with more sympathetically.
    There is the continuing saga of those suffering from asbestos-related illnesses caught while working as MOD personnel. There is no progress on their campaign. There is also the despicable treatment of the Chinese laundrymen, the retired Gurkhas and the veterans of nuclear test and the Gulf war. What about the civilians in the Gulf, whom the MOD virtually disowns? I represent two such people whose lives have dramatically changed, yet the MOD says nothing about them.
    What about RAF morale? I talked in an intervention about young pilots leaving. One reason is that their kit is unserviceable. My hon. and learned Friend the Member for North-East Fife (Mr. Campbell) was told in answers this year that 58 per cent. of the Tornado GR1 and GR4 fleet was less than fully serviceable, and 70 per cent. of the Nimrod fleet is not fully functional. In a written answer yesterday, the Minister for the Armed Forces said that there was 5 per cent. gapping—what a word—on major ships in the Royal Navy. A 5 per cent. gapping policy on a major carrier means 50 or 60 men. Can such a ship operate properly with such stress on the crew?
    The hon. Member for Portsmouth, North spoke of the high morale he had found in the Royal Marines on his many visits under the parliamentary armed forces programme. When the hon. Member for Thurrock (Mr. Mackinlay) and I were with the Royal Marines, the story was not the same. There was a problem with young non-commissioned officers with the promotion logjam and the difficulty in getting the right rate for the jobs that they were asked to do. It was the same for young officers. Many were making terribly difficult decisions at the age of 25 or 26 after recently training to a high standard. We need to consider morale seriously.
    I draw attention to the in-built cut that the MOD has inflicted on itself through efficiency savings. The hon. Member for Portsmouth, North said yesterday that he thought there was still fat there. I would be interested to know where. We cannot service all our aircraft. It is suggested that filling the fat gap would need 40,000 personnel. Where will the economies be found?
    The hon. Member for Walsall, South (Mr. George), who chairs the Defence Committee, said that he scored the defence review eight out of 10. He was overgenerous. The Committee members who went into great detail to

    1127
    produce long reports cannot have shared his enthusiasm. There are so many unanswered questions on procurement, cost savings, the priority of the foreign commitments on which we are embarking and personnel issues. The men and women who serve in our armed forces and who work for the MOD are entitled to straight answers from the Government. They were promised them, and many hundreds, if not thousands, of them have taken part in the review. They have welcomed that opportunity, but, for goodness sake, do not pay lip service to their commitment and the part that they have played in producing the report. Give them the answers and stability for their future in the armed forces.
    6.29 pm
    Mr. Lindsay Hoyle: My turn to speak has seemed to take a long time coming round. It has been a long debate over two days. At least I have heard many interesting comments, with some of which one can agree and with some of which one may disagree. Here I am, at last, to speak about the strategic defence review.
    I welcome most of the strategic defence review and its implications for defence in the United Kingdom. It is a well-considered White Paper, which has reassessed our essential security interests and defence needs. It considers how the roles and capabilities of our armed forces need to be adjusted to meet the realities of today.
    We are still investing in our defence capabilities. It is there that we have to begin to judge ourselves. I know that many people have views about what will happen in the future. It is important that we begin to look at what we shall get. It is great that we are cutting defence spending by only 3 per cent. over three years in comparison to cuts of 20 per cent. by the Conservative Government since 1990, but questions have to be answered about what happens from the fourth year onwards.
    When the review was announced, it was thought by some that it would mean simply a cut in defence spending. That was wrong. Instead, the review has signalled a clear commitment that the Government are looking at defence from a foreign policy perspective and assessing the needs of our armed forces in a truly global way. The emphasis has shifted from what the Treasury can get out of the review to what is really needed in defence. The review has restored confidence within our armed forces and it has been widely welcomed. I congratulate the Minister and the team who have worked hard on the review.
    The great buzz word of new smart procurement is something that the world will look to, but what does it mean? It means that we are cutting out only the waste in procurement. That is a positive step, which will enhance the quality of the defence industry and rid us of its outdated aspects. However, our targets are based on a three-year time span. I hope that we can look beyond that, and that the Treasury will realise that we have to look further, and that when we spend £1 on defence, the return will be much greater in terms of exports and jobs created. All that must be taken into account.
    In four years' time, it will be essential that we maintain investment. I hope that we do not see the vast reduction that Opposition Members expect, as once again they
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    spread rumours and create discontent within the armed forces. I believe that exports will be generated and I hope that everyone will realise that British troops have the best of what British industry can supply. We are still investing in, and improving, our defence capabilities and technologies. That is important if Britain is to maintain its leading edge in defence capabilities.
    We all talk about the big expenditure—the aircraft carriers. I welcome the announcement that the two aircraft carriers will be built in Britain. I hope that they will be capable of operating Typhoon, as we have invested so heavily in the European fighter aircraft programme that it would be a shame to waste its potential. The building of aircraft carriers will present us with new avenues in foreign policy.
    The argument for the aircraft carriers was proven not just by the Falklands but by the Gulf and Bosnia. They will allow us to police hotspots around the world from offshore. That is especially appropriate, as we have few land bases and few countries wish to see jets operating from their territory.
    I hope that the Government will reaffirm their commitment to produce the two aircraft carriers in 2012, if not before, as that would secure many jobs. We have heard a great deal of speculation about the carriers. I am sure that my hon. Friend the Minister will reaffirm tonight that the carriers are part of the SDR and part of the package; that they are important not only to the armed forces but for the jobs that they will create.
    While I am on the subject of aircraft carriers, it is appropriate to mention the aircraft carrier that was loaded in Gibraltar, not in the United Kingdom, during the Gulf war. The jets flew out to Gibraltar and were loaded there when they went off to the Gulf before Christmas. It is important that we recognise the importance of Gibraltar and Gibraltar's assistance to the United Kingdom. Will my hon. Friend take this opportunity to comment on the future of Gibraltar and on the merits of having a base more than 2,000 miles away on the cornerstone of the Mediterranean and Africa? Gibraltar has paid the price over many years and it is only right that there is a commitment to its future. It plays an important and integral part in meeting our defence needs.
    I am pleased that Eurofighter—or, under its new name, Typhoon 2—has been confirmed. It will be an integral part of the Royal Air Force, and it is good news for the defence manufacturers, British Aerospace at Warton and Salmesbury. The production of advanced military airframes and components such as those for Typhoon 2 will give them the leading edge in technology. I have heard that the Airbus 320 project is being transferred to Scotland to free resources for that development. I hope that, as well as there being training opportunities for existing employees, jobs will be protected and Eurofighter will be the source of many new jobs at those sites. I hope that the Minister will comment on the German Government' s policy on Eurofighter.
    There is a lot of speculation about C17. We hear that four C17s or the equivalent are to be leased. If there is to be an equivalent, what will we do to ensure that there is a real competition and that we get value for money? There are alternatives. Let us look at all of them before we jump into bed with the American C17. To do so would place a question mark over what I wish to see, which is a future

    1129
    large aircraft developed in Europe that will be as successful as Airbus and create as many jobs. That is important.
    Will my hon. Friend confirm that there is no need for a battle tank now to be carried on the outsize aircraft? I move on quickly, as time is rushing on.
    I welcome the introduction of the Merlin for the Royal Navy and the Air Corps. It will be a welcome boost to the services. The EH101 will also secure jobs at Westland and among subcontractors throughout the United Kingdom. We shall all benefit.
    I look forward to an early decision on ASTOR. I hope that Global Express will win the contract, thereby creating and securing jobs in the north-west. Not only will we benefit from the additional jobs, but the project will improve our technology base and will be cheaper to operate than the alternatives that are being suggested. It will put us at the cutting edge of surveillance and monitoring systems and allow us to lead a battlefield attack instead of being reliant on the Americans.
    The main subject tonight, and the one that we all wish to talk about, is the Territorial Army. The review has regional implications. I should like to raise some points on behalf of my constituents and others in the north-west. I have received many letters expressing people's concern about the effects of the SDR on the TA. It was made clear in the SDR that there was a need to restructure the TA, and that this would result in an adjustment in its size and location. I fully understand the need for some reduction, although I am doubtful that such a drastic cut is necessary. Ideally, I should like to see the Minister reduce his estimates and signal a clear commitment to listen to the concerns of TA centres throughout Britain.
    The north-west TA has expressed its concern to me about the decision. Chorley TA centre wonders what role it will play. The 101 Battalion headquarters is based in Chorley, and there is a cadet base there too. I hope that their number will not be reduced. Colonel Jones and his staff have done an excellent job and their commitment and dedication should be matched by a commitment from the Government to support the troops based there. As yet, the Government have been unable to say how the north-west will be affected and I should be grateful for any light that can be shed on that, as well as for any assurances that there will not be a dramatic reduction in the north-west and that the TA centre in Chorley will survive.
    It has been particularly unhelpful for Opposition Members—
    Mr. Deputy Speaker (Mr. Michael J. Martin): Order.
    6.39 pm
    Mr. Nicholas Soames: I shall start by welcoming many of the changes in the strategic defence review. They take place against a sombre backdrop, with weapons of a highly sophisticated and extremely dangerous nature in the hands of unstable regimes and terrorist groups. The range of options for military action has increased greatly.
    I welcome the expeditionary force changes. There will be considerable difficulties in shaping the policy, not least with the carriers. I hope that the Minister will give us a straightforward answer, not just some weasel words,
    1130
    to the questions asked by the hon. Member for Portsmouth, South (Mr. Hancock) and my hon. Friend the Member for Salisbury (Mr. Key). I am glad to see that the son of the joint rapid deployment force—the joint rapid reaction force—will give the United Kingdom a wider and broader golf bag of capabilities. I strongly welcome that. I consider that to be a good solid Conservative policy being built on in a sensible way.
    It is important to place on record the fact that the changes to our armed forces are not taking place against a background of British military defeats and disasters. For the past 50 years, our armed forces have scarcely put a foot wrong. In the past few years alone, in the Falkland Islands, the Gulf, Northern Ireland and Bosnia, they have, literally, covered themselves with glory. The House might care to pause to remember that, during the Falklands campaign, regardless of the risks that it was running, the Royal Navy put ashore, on a hostile coast, during a difficult winter's night, a fighting force of about 5,000 men together with all auxiliary arms. That was an astonishing feat of arms. We truly have some of the best armed forces in the world and certainly, in my judgment, the best people. I urge the Government not to ruin that.
    We welcome the equal opportunities initiatives. Anything that can improve recruiting and all the sideshow business is very important. However, I remind the Minister that, for the young service man and woman of today, the fundamental character of war will remain unchanged. Those highly trained young people will have to take part in a terrifying contest of wills for which they will need to be extremely highly trained and in which they will have to cope with extreme danger, in rapidly changing circumstances and conditions of great chaos and uncertainty. Their skills and the quality of their leadership, weapons and equipment will be severely tested. Such operations are sustainable only by men and women who are highly motivated by tremendous pride and confidence in their regiment, their corps, their service and their traditions.
    I do not believe that the equal opportunities training centre at Shrivenham will have a great deal to contribute to the success of British military arms. I beg the Labour party to understand that the service ethos is worth defending to the very end. It does not mean that we should not try to improve the services as employers. The services have always been good employers and always look after their people. Of course, they can be criticised at the margins, but the Government must not ruin what is a priceless and golden asset in this country to accomplish a feat of social engineering and political correctness of the worst sort.
    Changes are to be made and, in the strategic defence review, many of them are sensible changes. The services have a reputation, rightly, for intelligent, positive and humane leadership. It is clear from their success on operations that they have been supremely successfully prepared for the task. Any fundamental changes must be weighed carefully against the advantages that they will bring to that training.
    Having already welcomed the joint rapid reaction forces and the added responsibilities of the permanent joint headquarters, I am glad to see that there is to be a reorganisation of the training cycle for the Army. That is an excellent move, but great care will need to be taken to ensure that those units not at high readiness or in the training part of the cycle are sensibly and carefully

    1131
    employed and are thoroughly well briefed about where they are going and what they are doing. There must never be a feeling that there is a two-tier Army in operation—one in training for high readiness and high-intensity conflict, in high-readiness mode, ready to go anywhere in the world—one consisting of those dealing with the more mundane jobs.
    I am delighted to see that 5 Airborne brigade and 24 Airmobile brigade are to be put together to form the air manoeuvre brigade. That is an excellent move and both brigades will benefit. It will create a versatile and extremely powerful entity. I want the Minister to assure the House that the unique fighting ethos of the Parachute Regiment and all that that has meant for this country will be retained.
    I must tell the Secretary of State that I am afraid that it will not be possible for the Navy to live up to the concurrency arrangements set out in the SDR. I doubt whether the new so-called flexible deployment will be able to cope with all tasks asked of the fleet. Having been Minister of State for the Armed Forces, I know what all those terms mean. The term "flexible deployment" means doing more with less kit. The proposals in the SDR will lead to greater overstretch and I hope that the Minister of Defence will watch that with great care.
    On the Royal Air Force, I warmly welcome the joint Harrier force. It is a disgrace that it was not done before and I partially blame myself for its not happening earlier. The pursuit of jointery should continue to be a high priority—I am sure that it will be. We bang on about jointery here, but it has been a fact of life in the services for generations. It takes very little to keep pushing it forward. It is now deeply established and deeply ingrained, particularly in the vestiges of the joint services staff college, but it must be pushed forward in force formation. I am pleased to see the new force appear. I am certain that the new joint helicopter command arrangements are a further step in the right direction.
    An important change is the creation of the post of the Chief of Defence Logistics. I hope that the Minister knows how lucky he is that, in the personage of General Sam Cowan, he has the right man for the job. I am sure that the Minister knows that there are some heroic efficiencies to be found in logistics. I hope that, in the future, the Secretary of State will consider extending the principle that he is applying to the Chief of Defence Logistics to the adjutants-general and personnel departments across the three services where, again, there are many efficiency savings to be made.
    Given all the noise that the Secretary of State has made about defence diplomacy, one would think that the fellow invented the task, when it has been a major part of the defence business of this country for many years. Any Minister who has served in the Ministry of Defence, particularly in the job that I held, will know that a great deal of time and effort goes towards trying to put the right people in the right places and assessing the balance of what we need to achieve and why we need to achieve it.
    Defence diplomacy is extremely important to this country, not just to promote defence sales, which is the reason that always used to be given by the Labour party, but to promote the interests of the United Kingdom and, from time to time—this may affront some of the more
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    tender souls on the Government Benches—to promote defence sales. The respect felt overseas for the British armed forces is a great prize for the interests of this country. Many foreign countries want their young men and women to train here with British armed forces because they want them to be trained alongside British troops and in the British environment. There are many other reasons for pursuing British interests abroad.
    I want the Secretary of State also to be aware that there will shortly be difficulty between the Foreign Office and the Ministry of Defence because the Foreign Office is now running out of officials who did national service—there are fewer and fewer of them. The perfect understanding that has existed between the two Departments will therefore begin to be eroded. I should like the Minister to assure me that he will make sure that there are more exchanges between the Foreign Office and the Ministry of Defence than there have been.
    I shall not say anything about the TA, but I want to make one point to the Minister. The Government talk about how much they value our service personnel, and I am sure that they do, but I beg the Minister again to consider with great care the new nostrums that are creeping into defence management. The preservation of service ethos is vital for us all.
    6.49 pm
    Ms Dari Taylor: The Minister for the Armed Forces is not in the Chamber, but I warmly congratulate him. He will be vigorous in his role.
    I also congratulate my right hon. Friend the Secretary of State on producing a highly acclaimed strategic defence review, which has listened to the concerns and hopes for development of 7,000 people and organisations. That is a feat, but it is not the only one to be celebrated, because the review will also widen equal opportunities. I found the comments of the hon. Member for Mid-Sussex (Mr. Soames) contemptuous and others will also find them so. He talked about social engineering, but we are defining talent as the prerequisite for choosing people in the armed forces. Ministers must be congratulated also on strengthening the naval and air force reserves. Those are fine and timely moves.
    Unfortunately, like others, I have serious concerns about the defence review which inevitably relate to the Territorial Army. I also have hopes because, when the Secretary of State came to the Select Committee on Defence, he said:
    "The SDR will not downgrade the TA."
    I thought those words were important. Later in the summer, after the SDR had been published, the Secretary of State came to the House and said:
    "Although its numbers will be trimmed … it—
    the TA—
    "will be given a real heavyweight role"—[Official Report, 8 July 1998; Vol. 315, c. 1075.]
    I read those statements again and again because I wanted to understand exactly what they meant. Like other hon. Members, I looked forward to the announcement in the House.
    I am confused and concerned about what the statements mean. My concern relates not to the Secretary of State but to the advisory backdrop of officials and experts who represent the TA's interests. I am sad to say that my

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    concern extends to some who claim to be the friends and representatives of the TA. Their comments and the feeble value that they place on the TA undermine its important role. However, I believe the Secretary of State when he says that the TA will in future develop a heavyweight role, because the various talents of the volunteer body have great scope.
    I visited many TA units in the north-east and asked them whether they had had an audit of the qualities, skills and talent that they offered. They had not, so I told them that I would conduct an audit because I wanted to know what the people did. I was astounded—perhaps others will not be—by the vast range of skills. There were chartered surveyors, linguists, pathologists, telecommunications engineers, chefs, computer operators, builders, bankers, and so on. That is a wealth of talent. The House knows that we could not afford to pay for that range of talent out of the public purse. Of course, we do not pay for it out of the public purse, yet we all benefit from it. We should not reduce that force, because it has a potential that is often under-used. Reconfiguration and restructuring of the force can only acknowledge the value of the people who make up the Territorial Army.
    There are many who argue that the TA is not relevant to high-intensity warfare. That is not so. Hon. Members have spoken about Bosnia, where our TA reservists served alongside our regulars, rebuilding countries, rebuilding hope, being an adaptable force and showing their value. Surely when cases such as Bosnia arise, that is not the moment to start cherry picking and deciding who is relevant and who is not. The territorials are a force where all volunteers are welcome. That should be the stance for the future. We do not have sufficient numbers of regular soldiers or volunteers. We want more of both.
    I am not an expert, unlike many hon. Members, but I have read the words of Colonel Puttnam, who said:
    "Cutting those units that are the most usable and most versatile of all the volunteers, who have shown that they can adapt to different roles and learn new skills extremely quickly"—
    means that we could
    "end up with units … with little opportunity to form operational roles as formed units … short of a general war."
    Surely we do not want that. I hope that the territorials will not be defined in such a limited way that the force of 7,000 once spoken of becomes the reality. The Secretary of State promised that the TA would have a heavyweight role. We know that it has a diversity of talent; I want that to be used.
    I referred to my audit of the north-east TA units. My postbag tells me that there are many concerned people—families, men and women, youngsters and cadets—who all know that a cut of 12,000 could mean not only a cut in operations but a closure. I ask the Minister to reconsider that. There is a whisper in the corridor to the effect that he will add to the TA and thus cut less. Let us hear that in a statement—we are all waiting.
    The men and women of the TA are proud to serve, and many would not question the fact that in doing so they could die. I hope that, when outlining the TA's heavyweight role and reconfiguration, the Minister will acknowledge that many have talents that we cannot afford and commitment that we cannot buy. When we conduct a risk assessment and talk of high-intensity warfare, we accept that today's concerns are not necessarily those that will instigate conflict in the many tomorrows to come. If
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    we take those words as salutary statements about what the future may bring, I am sure that the heavyweight role that the Minister promised the TA will, in the 21st century, be a permanent and growing strategic role.
    6.59 pm
    Mr. John Wilkinson: Was I alone in detecting a certain bipartisanship across the Front Benches earlier this evening? The Minister for the Armed Forces prided himself on his athleticism and my hon. Friend the Member for Salisbury (Mr. Key) outdid him in gravitas, but they were united on one point—the subject is serious and merits at least 45 minutes. I shall try to be briefer and deal with only three central issues which are vital to the defence of this country.
    One theme running through the review's many pages is the paramount importance of our armed forces personnel. As our armed forces get smaller, it is critical that our personnel be better trained. Earlier today, I had the privilege of visiting Royal Air Force Halton, formerly the apprentice training school of the service, which was founded by Lord Trenchard, who was the father of the Royal Air Force 80 years ago. It is now the school for recruit training. I shall quote some of Lord Trenchard's words which I am sure the House will find apposite. He said:
    "When we originally formed the Air Force in those days we were told—and I want to emphasise this because of its bearing on the future—that we were spending all our money on bricks and mortar, and on ground staff and ground personnel. In fact, some of you … will remember that it was called 'the Ground Force' and I believe I was myself once described as 'GOC Ground Force'. That was because we put all the pressure we could on getting a sound foundation for training, in spite of the expense. Has this policy not justified itself? Is it not one of the main reasons why the Luftwaffe has been defeated? The whole work of the Air Force has shown what training is doing. But there is no getting away from the fact that it is expensive. There is nothing to show for it in peacetime, but in war-time there is just this difference to show for it—the difference between defeat and victory."
    We are training our armed forces to fight and to win. There should be no diminution in the training budget or the length of training courses. Indeed, the training of our armed forces should intensify as they diminish in size. The reserves should be augmented rather than reduced.
    I am sure that sustainability will be the key in future operations. Our armed forces have been drawn down below the minimum safe level, and this is not something of which the Government should be proud. Although I am pleased that the Royal Auxiliary Air Force is to be expanded, I believe that it should comprise more flying personnel. There should be no question of putting at risk stations such as Royal Air Force Northolt in my constituency where 1 Maritime Headquarters Unit is based.
    Equipment is also crucial: if our armed forces are small, they must be equipped with the very best. "Smart procurement" is the buzz phrase, but the practice is very different. The danger is that our drive towards European autarchy in defence procurement will lead to a protectionist procurement policy—a sort of fortress Europe. We see this in the agglomeration of European military industrial power, which has occurred to offset the challenge posed by the major American suppliers. Nevertheless, once that agglomeration has taken root, there will be a tendency to feed it—even though the products created may come into service later and may

    1135
    be more expensive than their American counterparts. We should be eclectic in defence procurement, with industry choosing the best partners for the job.
    The late entry into service of the common new generation frigate, the potential problems that German policies have created for the Meteor consortium in respect of the RAF's beyond visual range air-to-air missile, and the hiatus regarding the multi-role armoured vehicle to which I alluded earlier are just three examples of problems experienced by our armed forces. For that reason, I think that the Royal Air Force was correct to choose an existing heavy-lift aircraft—the C17 from the United States—as the right one for the job.
    Looking to the future, we must invest much more in research and development. If our armed forces are small, our research programme must ensure that there is no technology gap between ourselves and the major countries with which we might have to engage in combat. The technology gap between Europe and the United States is growing, and the defence review does nothing to offset it.
    I shall address just one area: ballistic missile defence. This activity is virtually totally ignored in the strategic defence review, yet missiles could pose the most major threat to our country. Let us suppose that Russia had a rogue regime which was as bankrupt as the current regime. A rogue dictator could say, "Give us your money, or else". The threat comes not only from Russia. Although the Prime Minister visited China and found everything most agreeable, there is a rogue regime in that country. I do not think that the Prime Minister discussed Tibet when he was in Beijing. I do not think that he addressed the offensive military programme that exists in the People's Republic. China is developing ballistic missiles of intercontinental capability, and it tests its nuclear weapons.
    The North Koreans test ballistic missiles weapons over Japan. The Chinese conducted missile tests when Taiwan was holding crucial elections. Iran is acquiring missile technology from China and from Russia. Iraq's nuclear and launcher programme is continuing, notwithstanding the efforts of the United Nations. Now that we have backed down in our confrontation with Iraq, Saddam Hussein will be even more confident. The awesome arms race on the subcontinent between India and Pakistan—both of which are clearly nuclear equipped and have nuclear delivery systems—is continuing. Pakistan gets the technology that it needs from China, and India acquires its technology from Russia. It is a most alarming situation.
    Although we may not be concerned now, we face the danger of blackmail by proxy. For example, Libya might acquire from Iraq nuclear weapons and ballistic missile systems which could be targeted at our cities. Could we live happily with the prospect? Mr. Rumsfeld, the former United States Defence Secretary, submitted an excellent report to the United States Congress assessing the ballistic missile threat to his country. The report stated clearly that the threat exists not just for the United States, which is a continental power and perhaps further removed than most European countries from the potential launcher nations. The report pointed out that Europe is on the front line of the potential ballistic missile threat.
    A theatre defence capability will be a step in the right direction. I know that technology programmes are progressing to some degree within the Ministry of
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    Defence, but we need more than research. We must begin to develop systems that work, or we will face blackmail or intimidation. Deterrence as we knew it during the cold war no longer exists. There is no question of mutual assured destruction; no one wants to risk the incineration of our cities because of the actions of a rogue regime. We must put the protection in place now.
    7.8 pm
    Mr. Jamie Cann: As a member of the Defence Committee, I welcome both the review and its findings. I believe that it is incumbent on any incoming Government to review all policy areas and expenditure of moneys for which they are responsible.
    Mr. Soames: Take your hands out of your pockets.
    Mr. Cann: I shall take my hands out of my pockets if the hon. Member for Mid-Sussex (Mr. Soames) wants—or perhaps I shall just put one in. I shall compromise, because that is what the Committee tried to do, in a bipartisan manner, throughout our discussions.
    To continue what I was saying, it seems to me that, essentially, the Government got it right in the view that they reached and the way in which they reached that view. As a member of the Committee, I was impressed by the fact that the chief of every service obviously believed that they had been listened to, that their views had been taken into account and that a collegiate decision had been taken at the end of the process. If the hon. Member for Mid-Sussex permits me, I shall put one hand back in my pocket.
    I was impressed by the fact that, for the first time since I became involved in national politics—although that was not long ago—a review of defence policy has been conducted whose sole purpose was not to take money from defence. The previous Government brought us "Options for Change", which was about stripping front-line units without reducing their liabilities, and "Front Line First", which stripped money from the support services without reducing the responsibilities that continued to be imposed on them. For the first time, we have a defence review that is actually about defence, not about grabbing money from the defence budget.
    It has been suggested from the Opposition Benches that the carriers will not be part and parcel of what is proposed for the future—that the Government will renege on that commitment. [Interruption.] Goodbye, Mr. Soames. [Interruption.] I repeat, it has been put about that the Government might renege on the commitment on the carriers. In Committee, the First Sea Lord and others accepted that the carriers were central to the strategy. It is nonsense to say that those carriers will not be produced, because if they were not to be produced the strategy would be nonsense.
    Mr. Keith Simpson: Exactly.
    Mr. Cann: Exactly. Therefore, even Opposition Members should accept what the review has produced. It has produced two big new carriers; the updating of existing carriers to cover until 2012; the production of the assault ships HMS Ocean, HMS Bulwark and HMS Albion; the ability to place people on shore; and the ability to provide heavy lift to keep them supplied for as

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    long as we wish. It will give us the ability to project power second only to that of the United States of America in the present-day world. I think that is wonderful, and I cannot understand why Opposition Members cavil at the strategic defence review, which has been supported on a bipartisan basis by our Committee.
    I believe that the Government have done a tremendous job on the review, as have the services. I am only sorry that, at the last stage of preparing what should have been a bipartisan defence policy capable of lasting for the next 20 years, a few Opposition Members—presumably for political purposes only—have chosen to cavil at it.
    7.13 pm
    Mr. Crispin Blunt: It gives me pleasure to follow my fellow member of the Select Committee on Defence, the hon. Member for Ipswich (Mr. Cann), and to recall that, yesterday, the Secretary of State commented that he regarded our report as admirable.
    As the hon. Member for Ipswich said—and as the Chairman of the Committee, the hon. Member for Walsall, South (Mr. George), said yesterday—the report was unanimous. I remind the hon. Member for Ipswich what the Committee Chairman meant by unanimity. To achieve unanimity, it was sufficient to put a nice paragraph at the start and a nice paragraph at the end—but, in the 436 pages in between, put the boot in. I believe that careful reading of our Committee's report will show that it contains very serious criticisms of the strategic defence review. I hope that, if the Secretary of State regards the report as admirable, he will pay careful attention to what it says.
    I was especially disturbed by comments made by the hon. and learned Member for North-East Fife (Mr. Campbell) yesterday—and by the Committee Chairman when we took evidence from the Secretary of State after the review—congratulating the Secretary of State on his victory over the Treasury. If that is a victory, I hate to think what a defeat would look like. Under this defence review, £900 million has been taken from the defence budget. In addition, two weeks before the defence review was announced, the Secretary of State for Defence was mugged by the Chancellor when, in a meeting, he conceded an extra percentage point by increasing the efficiency savings target from 2 to 3 per cent. It sounds innocuous enough, but hon. Members should be aware that that amounts to removing £1.5 billion from the defence budget over the four years of the rolling efficiency programme. If I have time, I shall return to the subject of efficiency savings.
    In general, however, the Committee welcomed the changes and proposals for the regular force structure, which build on the qualities of jointery and deployability mentioned by my hon. Friend the Member for Mid-Sussex (Mr. Soames). I sincerely hope that the commitment to the two aircraft carriers is honoured, and I disagree with my hon. Friend the Member for Canterbury (Mr. Brazier), who cast doubt on the proposal to buy six ro-ro ferries. I believe that that is a very important part of ensuring that we have the ability to deploy our forces overseas. With two landing platform docks, I hope that the Minister will consider producing a second helicopter carrier, because it would give the future force of the Navy far greater sustainability to have two of each major platform.
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    There are, however, problems in the Navy. There was overstretch in the frigate and destroyer force with 35 frigates and destroyers; it escapes me how the problem of overstretch has diminished with 32. Despite the evidence that the Committee considered, I remain to be convinced that the Navy will not suffer greater overstretch and pressure on its people as a result of the cuts that it has suffered. We should not ignore the grievous cut to defence capability in the removal of two further nuclear-powered fleet submarines from the naval order of battle. They are very significant weapons platforms, and the reduction of 20 per cent.—from 12 to 10—is much to be regretted.
    I shall talk for a short time about the Army, and especially about the proposals for the Royal Armoured Corps, of which I have some little experience. In his evidence to the Committee, the Chief of the General Staff said that the unsquaring of the brigades in Germany was the most difficult decision that he had had to take. We must watch carefully to ensure that the benefits that will come from that process through the training cycle—which my hon. Friend the Member for Mid-Sussex mentioned—are realised, and that their readiness is sustained.
    The lesson was learned that type 38 small armoured regiments were not sustainable as units, did not work well and were militarily and administratively unviable. Therefore, I especially welcome the return to six type 58 tank regiments. As we have learnt all those lessons in armoured regiments, the reason escapes me for our failure to translate those lessons with regard to armoured reconnaissance. I served as an armoured reconnaissance officer for more than 11 years. Hardly surprisingly, armoured reconnaissance has proved ideal for the operations in which our forces are deployed. It is light. It is armoured. It has sufficient firepower to make a difference in almost any operation in which it is likely to be deployed now. It also has the vital asset of being able to gather information on the ground wherever it goes. It is hardly surprising, therefore, that by June my regiment, the Light Dragoons, will have supported 11 squadron tours in Bosnia since 1992. I beg the Minister to listen to some of the consequences of that.
    The regiment has an establishment of about 400. In the past four years, with some soldiers having completed five tours in Bosnia—most of the soldiers who have been in the regiment all of that time will have completed at least three—there have been 82 divorces in my regiment. Given the number of soldiers who are not married, that figure is staggering. That is the impact of not having enough armoured reconnaissance to deploy on such operations.
    I was distressed to learn that the apparent good news that there would be four armoured reconnaissance regiments turned out to mean that, instead of three armoured reconnaissance regiments of four squadrons, we would have four armoured reconnaissance regiments of three squadrons, which leaves the operational output of the armoured reconnaissance squadrons unchanged at 12. I hope that the Minister will reconsider. That arm has fabulous utility for today's operations.
    The Select Committee heard about the Royal Air Force's problems of overstretch when we went to visit RAF Bruggen. Supporting operational deployments in the Gulf and in Turkey has taken its toll on the fighting squadrons of the RAF, which must constantly roll pilots through a four-month deployment programme to the Gulf. Given the length of time that we will probably have to be

    1139
    deployed in the Gulf, it may be time for the Minister to consider permanent deployment—two-year tours—for pilots and support staff in the Gulf on accompanied tours, as we did in the 1950s and 1960s when we had a permanent presence in the Gulf. That would address many of the problems of instability and overstretch that the RAF is suffering.
    On the reserve forces, the Government are making a strategic, political and administrative mistake in their proposals for the Territorial Army. The regular forces are focused on the day-to-day task of maintaining global stability. We are entering a period of strategic uncertainty. If we recall that 16 years ago, we had just recovered the Falkland Islands, it is clear that we can have no idea what the world will look like 16 years from now. By 2013, if the Government carry out their proposals for the TA, there will be 100,000 fewer mobilisable men and women who have military experience for us to call on. Given the size of the regular forces, it is a substantial cut to the strategic capability of the United Kingdom.
    The hon. Member for Paisley, South (Mr. Alexander) spoke yesterday about the cut to the engineer squadron in his constituency. In my constituency, Reigate, the second troop of 127 field squadron of the Royal Engineers is also, I understand, scheduled to be lost—one of five engineer regiments, which are enormously useful for civilian and military work and which are to be lost from the order of battle of the Territorial Army.
    I understand that the TA centre in Reigate is to be closed. With it goes an Army cadet force hut in my constituency. I hope the Minister realises that it will cost him £100,000 to replace each ACF hut. That is the evidence that we took from the south-east area Territorial Auxiliary and Volunteer Reserve Association, and it represents a total of £15 million that the Minister will have to find for capital expenditure to keep the cadets in being. That does not allow for the fact that all the talent and enthusiasm of the volunteers who run the cadets will be lost.
    Finally, I shall deal with efficiency savings and their consequences for people. The Minister should understand that what the Government are trying to do over the next four years in efficiency savings alone is "Front Line First" twice over. That was a huge programme of change inside the Ministry of Defence. The task set for the MOD is enormous. We are already hearing rumours of the LTC being £800 million short. The effect of those efficiency savings will impact on people and their quality of life and they have the potential to destroy the Minister's strategy for people, which he placed at the centre of his remarks today.
    7.23 pm
    Mr. Frank Cook: It is a privilege to follow the hon. Member for Reigate (Mr. Blunt), who has such an illustrious track record in defence studies. I did not have the pleasure of serving with him on the Defence Committee—I had to relinquish that post some 12 months ago. For the record and for the information of newer Members, perhaps I should record my positions.
    I represent the House in the parliamentary assembly of the Organisation for Security and Co-operation in Europe, and have done ever since being appointed in 1991, at its
    1140
    outset. I also represent the House as an elected delegate to the North Atlantic Assembly, on which I am the vice-chairman of the defence and security committee and the assembly's special rapporteur on the reform of the Russian armed services. My second interim report on that topic will be presented in Edinburgh. I therefore have some knowledge of defence matters.
    The strategic defence review is a huge topic, to which one cannot do justice in 10 minutes. I must be selective, so I shall start with the reserve forces. Seven years ago, I was the author of the report on reserve forces to the North Atlantic Assembly. Much has been said about them already, which I shall not repeat. We know about the military needs and the social needs. In the north-east, many young men and, indeed, young women have been saved from anti-social behaviour by the opportunities presented by the programme of training, annual camp and so on. That would be a sorry loss to society, not only to military resource. Those young people are a source of recruitment and support for the cadet force.
    I have to agree in part with the right hon. Member for Bridgwater (Mr. King) about levels. I do not want to descend into pointless argument setting region against region—north-east against north-west—about the imbalance in cuts. That does not make sense to me. The right hon. Gentleman is right to speak about levels.
    The Minister of State today was kind enough to give us a pitch of 40,000 reservists. That is about 35 per cent. of the size of the regular force. I remain to be convinced that a 35 per cent. reserve force will be adequate, bearing in mind the demands that will be made of our forces by crisis management, peacekeeping, peace enforcement and so on, especially when nations have in their armouries weapons of mass destruction that can have an enormous impact on regular forces with very little warning.
    I urge the Minister to think again. He has given us the idea that there is still some way to go, and that decisions have yet to be made. I say to him, "Please, for God's sake, think clearly when you do this, and do not saddle us with only a 35 per cent. reserve force."
    The reserves are good at supporting the cadet forces. The Minister mentioned sea cadets. The sea cadets in Stockton are based on HMS Kellington, a counter-mines warfare vessel that is somewhat redundant and has been in the River Tees for well over 10 years—it is grounded on the bottom. It is kept in good order. A large sum of money has been spent over those 10 years. The vessel is in good nick, unlike other vessels that were lent out to sea cadet forces elsewhere in the country, which were not maintained to suitable standard.
    Since the vessel was placed in its present position, well sited right in the centre of town, a source of pride in the community, we have built a bridge down river, the Princess Diana bridge. If the counter-mines vessel were moved, all the superstructure and probably the top half of the hull would have to be taken off it. Worse than that, further down is the Tees barrage, whose existence I successfully negotiated through the House, the first moves having been made by Lord Dormand in the other place. Even if it were possible to get the vessel under the bridge, it could not go through the lock because it is too broad in the beam. However, the Ministry of Defence wants it back. It says, "If you won't give us it back you will have to pay for it." We are willing to pay for it and we have

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    offered the MOD 5,000 quid. If it does not get 5,000 quid, what will it do about it? It is mind boggling. It is the sort of thing that Michael Bentine made his reputation on.
    I am appealing to the Minister of State—[Interruption.] Joking aside, this is serious. I am appealing to my hon. Friend to come to my constituency. I am president of the sea cadet corps and I would love to take my hon. Friend up the gangplank to the tune of the bosun's pipe to visit the ship to see how well it is maintained. That is a serious request.
    Time is limited and I am on five minutes, which means that I must move on. I agree with the plea for northern command made by my hon. Friend the Member for City of York (Mr. Bayley). It seems crazy that, with force strength of 10,500 in northern England and 2,500 in Scotland, we should want to move a two-star general up to Scotland. If 80 per cent. of the force is in northern England, that does not seem sensible to me, despite all the arguments about modern communications and the like, which cut both ways.
    When I was in the Army, I liked nothing better than to see my top brass walking in my camp, giving me pride that they had an interest in me. That is a damned sight easier for a general to do at Catterick and the like than in Edinburgh. Let Scotland have its kilt-wearing colonel or whatever up there, but we want York.
    The Minister was kind enough today to mention the Gulf veterans. That was a source of great reassurance to me. I commend him for his commitment, because it is long overdue. However, I must talk about another commitment which is also long overdue, and that is to the British Nuclear Test Veterans Association. For years, the association has been patted on the head by successive Governments and told by the National Radiological Protection Board that there was no link between the veterans' incredibly high incidence of disability in their offspring, as well as death, and the role that they performed in serving the Crown. I do not accept that. I think that the evidence is damning. It is about time that there was a proper review of it. I am asking my hon. Friend, not for the first time: "Let us have a review of the British nuclear test veterans' circumstances in the same way that there is to be a further review of the Gulf veterans."
    My role in the North Atlantic Assembly demands that I mix with people from central Europe, eastern Europe and the Russian Federation in what we call Rose-Roth seminars. The purpose of these seminars is to acquaint officials, military people and politicians with the way in which western democracy works, with our procedures and with the form that they take. We seek to acquaint them with how to maintain civil control over a military establishment.
    A form of multinational North Atlantic-NATO team conducts these inquiries, so the Brits are only part of the process. Our allies and the learners—the students—find it incredible that we have so little control over defence matters. We have five days of debate under the normal set-up in the House, if we are lucky. There are two days on the defence estimates, a debate that is taking place now under the strategic review. We have three single-force debates, if we are lucky. There is no comment about joint operations or joint services. Why we are treating the services singly when we are trying to put them together is another question in my head.
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    My appeal is that we approach our defence debates more sensibly in future and allow ourselves in the Chamber a measure of democracy that allows us to take a foot in decision making so that it is not a matter, at the end of tonight's debate, of taking the strategic review lock, stock and barrel. I ask that we be allowed to examine separate sections of it and make decisions.
    Mr. Deputy Speaker: Order. Mrs. Ewing.
    7.34 pm
    Mrs. Margaret Ewing: It is a great pleasure to follow the hon. Member for Stockton, North (Mr. Cook), whose passion and knowledge on defence subjects is highly regarded throughout the House. I endorse everything that he has said, particularly about the nuclear test veterans. The campaign on their behalf has been going on for a long time and deserves recognition at this stage. It will be interesting to see whether there is a response.
    I am conscious that I have only a short time to speak in the debate. I welcome the concept of a strategic review. Many people have told me, as a Member with many interests in defence matters, that it was all so much easier when there was an iron curtain, when we knew where the enemy was and where we were pointing our weapons. What was needed then was to work out a strategy. I agree with that. I am talking of people who may not be able to speak out publicly on these issues, but perhaps want Members such as me to make their view clear.
    It is important that in this debate, which I have listened to and participated in yesterday and today, we remember that we are talking about a strategic review. It seems that many points have been directed to practical issues rather than strategic ones.
    We must look towards the next century, and I believe that the points of conflict that will arise will be new. We can look back over the 20th century and analyse the history of that period, but it seems that in future the points of conflict will be new. Unfortunately, however as in the Balkans, some are redolent with history. There is uncertainty.
    Having listened to some of the contributions to the debate, I find it worrying that many Members seem to feel that defence policy must be written in tablets of stone, never ever to be changed. It is important that we focus on rapid reaction and jointery, an awkward new word which has crept into the vocabulary of defence debates.
    The interest stimulated by the review is in itself interesting. Not only defence personnel have written or spoken to me; people have contacted me from voluntary organisations and medical associations, for example. Various interest groups in employment, exporting and training have been involved. All those people have made links with us as Members to ensure that decisions made as a result of the review take full cognisance of society's attitude to it.
    It is important that some people have argued against the development of, for example, the Western European Union and the common foreign and security policy. They are looking back as if all the maps of the world are still painted pink. This is where strategy comes in because I believe that all negotiations must be discussed with our partners within NATO, the European Union and other organisations. We should try to work forward into an area where we shall be talking about strategic peace reviews rather than strategic defence reviews.

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    It is rather sad that antagonistic comments were made about the European Union yesterday and, indeed, today. It seemed to many people that we were talking of a deadly plague that had to be avoided at all costs.
    Like the hon. Member for Stockton, North, I do not believe that strategy is dependent on a few stylised debates in the House. The hon. and learned Member for North-East Fife (Mr. Campbell) made a rather sad jibe that was below his normal standard. My party mentioned to him yesterday that I would refer to him. Apart from the gross inaccuracy of what he said, I do not think it is right that we measure our concern for our defence personnel by always sitting on the green Benches.
    Concern for our defence personnel and how our defence policy develops goes far beyond stylised debates in the House during which votes are rare and not all aspects of policy are investigated. As a constituency Member representing many defence personnel, I know that the issues involve the Benefits Agency, the Defence Housing Executive, education for children—a point I raised during the Minister's opening speech—war veterans, war widows, the voting rights of those posted abroad and the salaries of, for example, MAEops—major aeronautical engineer operators—who are critical in the maintenance of the RAF. All that fits into a general pattern of involvement. If we are to have committed men and women in our forces, we need not only occasional speeches but consistent communication with them and advocacy on their behalf in peace as well as when they are on alert or on duty.
    Like other hon. Members, I want to talk about the Territorial Army, and I make no apology for doing so. The hon. Member for Stockton, North referred to kilts—and here am I, a woman wearing trousers. Perhaps I should have worn my kilt to keep him happy. But as a Member of Parliament from the highlands and the Grampian area, I am concerned about what is happening to the TA in Scotland.
    Little reference has been made to the Royal Engineers, an important aspect of the TA, certainly in the north of Scotland. In my constituency, 236 Squadron is based at Kinloss, and 237 Squadron at Lossiemouth. During last year's flooding in my constituency, those squadrons did invaluable work. In my discussions with them, I met young unemployed people who had found a dignity in participating in the work of the Royal Engineers. Others who were employed found that being out and about with the TA one day a week with the acceptance of their employers was important in giving them a different attitude to life. Such activities have an important effect on the psyche of people involved with those organisations.
    The Regular Army appears to want to increase the capability of the Royal Engineers, but that may take until 2002, so why on earth scrap two organisations with the best training capability north of the border? There will be no Royal Engineers north of the M62. Given the nature of our area and the sparsity of its population, communication between those organisations and civilians is vital, particularly at times of crisis but also when they are assisting generally within the community.
    Great play has been made of the word "footprint", but it may be difficult for people to understand what that means. A footprint in an area of high population density
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    is quite different from a footprint in an area of low population density. In the highlands and islands and the northern part of Scotland, it is important that the footprint should not become a paw print in the context of the arguments propounded by the strategic defence review.
    We all accept that changes are necessary, but it is important to consider the geographical requirements. The Territorial, Auxiliary and Volunteer Reserve Association has said that the recommendations would take the TA in the north of Scotland back to the 1960s, dominated by the central belt, with little communication and few facilities for people to work within the TA and to travel to those organisations. I am conscious of the time. Those elements have already been made clear to the—
    Mr. Deputy Speaker: Order.
    7.44 pm
    Mr. Harry Cohen: I am pleased to follow the hon. Member for Moray (Mrs. Ewing), for whom I have a great deal of respect. I say that genuinely, not just because she has some fine distilleries in her constituency to which I hope to receive an invite one day.
    I start by congratulating the Government on one of the most thorough examinations of defence policy carried out by any British Government. Ministers are right to say that other Governments have been impressed by its process, analysis and, I suspect, outcome.
    The outcome gives rise to my first criticism. There has not been much saving in defence expenditure. With the cold war over, we could have expected more. The consensus was achieved by keeping defence spending at roughly the same level at which it was at before the review. As Professor Paul Rogers of Bradford university's school of peace studies told the Select Committee on Defence, of which I am a member:
    "Some further modest cuts are envisaged, but the bottom line is that Britain will still be a major military player on the world stage, a role which is believed to give it international clout, but at the cost of maintaining a pretty hefty defence budget, at least by post-Cold War standards."
    We have the largest defence budget in Europe. Defence is an insurance policy, but the British taxpayer is paying the high cost premium.
    The strategic defence review was thorough, but it was not comprehensive. Some areas of defence policy were not covered thoroughly enough. An example is nuclear weapons policy. I welcome whole-heartedly the announced reduction in warheads carried on Trident, but, as the Select Committee pointed out, the United Kingdom's strategic and sub-strategic nuclear policy needs clarification. That policy remains at best unconvincing, and at worst dangerous. We are prepared to use a nuclear bomb, not just on a non-nuclear country but on a nuclear one, in order, allegedly, to prevent a nuclear exchange. That is not a reassuring policy.
    My hon. Friend the Minister referred to Labour's manifesto commitment to retain Trident; but there was also a manifesto commitment, supported by 90 per cent. of the Labour party, to enter into international nuclear weapon disarmament negotiations. There is no sign of when that will be fulfilled. It is far too early to talk of the betrayal of that manifesto pledge, but Labour's policy makers should be aware that insistence upon maintaining

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    nuclear weapons should not be in the next election manifesto if future international nuclear weapon disarmament negotiations are to be meaningful.
    Another example of relatively closed thinking is the defence of the dependent territories. Are we to go to war on their behalf as if any challenge to them were an invasion of the United Kingdom itself? Is not that unwise as an indefinite future commitment? Long ago, the United Nations passed a resolution saying that all colonial powers should relinquish control over their foreign territories by 2000. All the dependent territories should go, in accordance with the UN resolution. That does not prohibit close relationships and security agreements freely entered into, but those should not be taken for granted on our part and the principle of completely ending colonialisation should be adhered to.
    Another issue not properly covered by the review is the United Kingdom's place as one of the select five on the United Nations Security Council. The obvious sensible solution is for a joint European Union seat to replace ours and that of France. Instead of being viewed as a loss of prestige, that should be grasped as more realistic, and evidence of our co-operation in Europe, and may lessen the onus on our military.
    The Defence Committee, notwithstanding its members' diversity of views, carried out an intensive inquiry into the SDR, and produced a report that is both extensive and constructive. I should like to highlight a few aspects. It does not welcome nuclear weapons, including those of the United Kingdom—I regard that as significant in comparison with previous Defence Committee reports—and recognises that appropriately targeted development aid improves security, and that there should be more of it. Good overseas aid is good for our security.
    The report notes that, if the dependent territories are used as havens for gangsters or for money laundering, they should risk forfeiting their security guarantee from this country. It notes that there may be a peace dividend from Northern Ireland, should the peace agreement hold, and recognises that the United Kingdom—in the distant past, I should note—has not supported the United States in every military action that it has undertaken, and that it should not be presumed that it would do so in the future.
    The report takes a strong position against racism and gender inequality in the armed forces. I hear rumours that there are to be new codes of conduct on racial and sexual harassment; I would welcome that, and, if those rumours are true, I ask that they be published.
    Professor Paul Rogers, whom I quoted earlier, talked to the Defence Committee of moving away from "lidism"— keeping the lid on present circumstances—to plans for a more co-operative world which would ensure sustainable economic growth based on economic justice. That would give defence a much more inclusive aid and peacekeeping role. The real decision for security today is whether to fight to keep the present international status quo or to move to a changed world which would be more just and equal, and would have effective international institutions to prevent and resolve conflict fairly.
    The status quo argument is highlighted in the SDR:
    "The first requirement of our foreign and defence policy is to maintain and reinforce the present favourable security environment."
    But the reality is that we do not know for how long that environment will exist. Following recent turmoil, we cannot even be sure what the world economy will look like in the first few years of the new millennium.
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    The millennium is a good focus. To think that we will fight over the next 100 years for the present unsatisfactory state of the world is not enticing. Unless we act to make the world a fairer place, injustice, backed by arms profiteering, will make for a future world which bristles even more with mass destruction weaponry. That will inevitably price us out of effective security. International disarmament measures are better than arms races for our security. A hefty defence budget does not automatically make a country more secure.
    The SDR also considered the changed world option, however. It states:
    "The challenge is now to move from stability based on fear to stability based on the active management of these risks, seeking to prevent conflicts rather than suppress them."
    That is a security policy based on foreign policy. Although the SDR was supposed to have been foreign policy led, I am not sure that that was the case. The foreign policy baseline was never published, and its terms were discussed only vaguely.
    In the context of justice, however, the ethical element of our foreign policy is vital. I congratulate my right hon. Friend the Foreign Secretary on bringing that to the fore. It must be protected, enhanced and enshrined at the forefront of our defence policy. Although I suspect that a number of powerful figures in the Government, the Department of Trade and Industry, the Ministry of Defence—even in Downing Street and the Foreign Office itself—and certainly in the arms trade, do not like the ethical dimension, have doubts about it, or are just plain cynical, it points us in the right direction to improve our future security. The ethical dimension needs to be built upon, in this country and internationally.
    In many respects, the defence review is worthy, but it is certainly not the end of consideration of these issues if we are to achieve a more secure world.
    7.54 pm
    Mr. Gerald Howarth: It is a great pleasure to speak after the hon. Member for Leyton and Wanstead (Mr. Cohen). It is wonderful that old Labour is still preserved, if somewhat muted, and I have no doubt that the hon. Gentleman's speech was not cleared by the Secretary of State for Trade and Industry. Nevertheless, it was a sincere speech—let us have more of them in the House.
    The Secretary of State, who has just left the Chamber, said yesterday:
    "Let me make it clear: we were building on success, not on failure."—[Official Report, 19 October 1998; Vol. 317, c. 970.]
    Conservative Members agree entirely. He was building on a policy of 18 years of Conservative Governments who were committed to strong defence in this country and who had to manage a difficult period of change following the end of the cold war—an end which was brought about, in part, by a determined Conservative stance on defence. It is important to recognise that.
    One of the features of that success was the European fighter aircraft, which has, I am delighted to say, been renamed the Typhoon. A very fetching tie has been issued to mark the renaming, and I am proud to sport it tonight.
    Dr. Julian Lewis: It looks lethal.
    Mr. Howarth: The tie is pretty hideous, it has to be said.

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    I shall address a number of issues. First, I thank the Defence Committee—which, we all agree, has done a splendid job—for its comments on the future of 5 Airborne Brigade and the Aldershot garrison. The Minister will not be surprised that I refer him to paragraph 248 of the report, which relates to 5 Airborne Brigade and whether the new airmobile brigade will be located in Aldershot or Colchester. It states:
    "We would urge the Government to weigh very carefully the balance between military and other factors in reaching its decision on where to base the Brigade, and to make the balance of these factors explicit when announcing its decision."
    Although my principal concern is for the implications for my constituency, I have also argued that the proposal to establish a new airmobile brigade based in East Anglia carries risks with it.
    As currently organised, we have a highly deployable airborne capability, which is able to move at short notice and encompasses full airborne logistics support. According to the Defence Committee, the airmobile brigade's Apache attack helicopters will require a long logistics trail to support them. The Committee suggests that the first-line supporting establishment for a regiment including 16 attack helicopters is likely to consist of 220 vehicles, which would severely impair its ability to move at short notice.
    The ability to move at speed provides the Government with a means to reinforce their political message to a potential enemy—the option of making a credible threat of action. That valuable benefit will be removed if rapid deployment is no longer possible.
    Secondly, I, like many other hon. Members, wish to raise the issue of the Territorial Army. I had the pleasure of visiting 10 Battalion, Parachute Regiment, recently in the Aldershot constituency, and I was greatly impressed. The paras have a special appeal, not only for regulars, but for reservists. Hon. Members will not be surprised to learn that the regiment is over-subscribed—men travel to Aldershot from the far side of Essex, from Andover and from Portsmouth to take part in training.
    That training provides not only fitness sessions or mortar training, but the essential link with the Regular Army. Above all, it provides men who are frequently called upon, even now, to fill gaps alongside the regulars, especially in Northern Ireland and in Bosnia, where they are deployed on S-type engagements, which are specifically designed to recruit TA personnel to fill front-line vacancies.
    The TA para units are highly valued by 5 Airborne Brigade. They are the only reservists to train to the same standards as their regular colleagues. Those men made it clear to me that they fulfil an important function in today's Army, but they are concerned that in future the reserves will be limited to those with specialist skills. In times of emergency, a reserve force without infantry will not be sufficient to replace any casualties. Accordingly, the Government's policy threatens to expose the Army to a gaping hole left by the absence of infantry reserves.
    As the hon. and learned Member for North-East Fife (Mr. Campbell) and others said yesterday, in many parts of the country the territorials are the only military manifestation. They provide the only contact between the civilian community and those responsible, in the final analysis, for defending our freedoms.
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    Thirdly, I remain deeply concerned about the Government's relentless chipping away at the special ethos of the services. Ten days ago, my wife and I had the pleasure of attending a marvellous concert given by the Cannock Chase Orpheus male voice choir in my previous constituency. It was accompanied by the central band of the Royal Air Force.
    I understand that the band's membership is being reduced from 220 to 175. Regimental and service bands provide an important contribution to creating that essential ethos—an esprit de corps of pride in service and country—as well as representing the armed forces before a wider audience. How long will it be before the services have only token bands, or, dare I say, bands are replaced by jukeboxes? It is a serious matter, which has not been raised as much as it should have been in this debate.
    The hon. Member for Feltham and Heston (Mr. Keen) mentioned museums. Military museums are an important link between the civil community and the armed forces, and provide a link with our history. They are vital, and I hope that the Army and other services will always find space to accommodate them.
    On the question of ethos, I am delighted that the Government have announced that, from 1 November, serving personnel can walk about town in their military uniforms. Men in Aldershot have for a long time regretted losing that right. I would have mentioned the matter anyway, but the Government beat me to it.
    My hon. Friend the Member for Mid-Sussex (Mr. Soames) mentioned the pursuit of politically correct policies in the armed forces. The men to whom I have spoken are not homophobic, but they are generally worried that a policy of open acceptance of homosexuality will damage service morale. Some ask me why their senior officers do not reflect their concerns. Although they have no doubt that their generals would lay down their lives for their country, they believe that they may be unwilling to imperil their pensions for their principles by speaking out.
    Mr. Spellar: What a scandalous suggestion.
    Mr. Howarth: Perhaps the men the Minister sees are afraid to tell him. If we cannot discuss these matters openly in the House, it is a great shame. It is one of the men's concerns, and it should be taken into account.
    My final point is on the future of the Defence Evaluation and Research Agency, which is based in my constituency and which my hon. Friend the Member for Salisbury (Mr. Key) mentioned. Indeed, many hon. Members have DERA facilities in their constituencies. It is clear from this debate that there is a serious problem of morale throughout DERA, and that it arises from the Government's failure to decide about DERA's future. The Government are reducing the money for DERA year by year—I understand that this year it will be reduced by a further £56 million.
    DERA feels that, if it is to keep ahead of the game, it must have the resources to enable it to invest in the future. If that money does not come from the Government, it must come from elsewhere, particularly industry. That presents DERA with a quandary. DERA at Farnborough has a relationship with the United States Government which it would not have if the United States Government felt that information would seep across to France and other parts of the continent.

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    We must retain DERA's central business of providing impartial advice to the Government. I urge the Government to fund it. If they privatise it, they must bring in private capital in a way that will not damage our relationship with the USA.
    8.4 pm
    Mr. Malcolm Savidge: I welcome the report. It is appropriate that we should have a strategic reappraisal based on foreign policy objectives in the light of the ending of the cold war. By contrast with the shadow Secretary of State's churlish remarks yesterday, I think that it is significant that intelligent, independent and well-informed people have welcomed the review. I refer to defence correspondents, academics and most of the military establishment.
    I want to concentrate on one specific aspect of the report. A chapter is devoted to it, but, as the hon. and learned Member for North-East Fife (Mr. Campbell) said yesterday, it was decided that the matter should not be subjected to as rigorous a scrutiny as others. I am talking about the subject of weapons of mass destruction, particularly nuclear weapons. Obviously, the subject cannot be looked at in isolation but must be seen in a broad context, including foreign and defence policy and the Government's manifesto objectives.
    Nuclear weapons in Britain are regarded as being for deterrent purposes. Because of our agreements under the nuclear non-proliferation treaty, that specifically means the deterrence of nuclear threats. I wish to discuss some of the possible nuclear threats that this country could face. They probably fall into four broad categories: first, global or large-scale nuclear war; secondly, a direct attack on us by another country; thirdly, nuclear terrorism; and, fourthly, our suffering from fallout from a nuclear conflict in which we were not directly involved. I shall discuss each of those threats in terms of the level of risk, the relevance of a deterrent and how we might reduce the risk. I shall take them in reverse order, recognising in all humility that many wars have been unpredicted and unpredictable.
    First, let us look at the possibility of our being a third-party sufferer from a nuclear conflict in which we were not involved. Obviously, that risk becomes much greater if nuclear proliferation continues. We must seek to reduce that risk. It is particularly important to reduce the proliferation of fissile materials and of delivery systems. That may become increasingly difficult if the line between civil and military uses becomes blurred with, for example, the spreading of the civil nuclear industry and satellite rocket technology.
    The sort of threat that we could face ranges from radiation and fallout to severe, large-scale climate change. Clearly, a nuclear deterrent can provide no protection from such a threat. Our best protection must be to seek to halt proliferation and, as a nuclear power, to play our part in that by participating seriously in multilateral nuclear disarmament negotiations.
    On the threat of nuclear terrorism, I remember more than a decade ago, during a general election, seeing Margaret Thatcher interviewed by Robin Day. She said that even if every other country gave up nuclear weapons, we would need to keep them in case a terrorist organisation got hold of them. We could then use our nuclear weapons as a deterrent. Her argument made no
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    sense to me at the time, and it has made no sense to me since. The whole nature of terrorist organisations is that they do not have a sufficiently defined geographical location to enable us to use a nuclear deterrent to threaten some form of retaliation. The only way to reduce the terrible threat of nuclear terrorism is to try to control both the spread of fissile materials and delivery systems.
    The third threat I mentioned was the threat of a direct national attack. That threat has changed massively in the past 50 years. With the growth of the European Union, it is inconceivable that we could be involved in direct conflict with any of our immediate European neighbours. Given our withdrawal from empire, the danger of direct conflict between Britain and other countries not involving our allies has been reduced.
    It may be thought that the most likely reason for a country to attack us would be our perceived closeness to the United States—as a surrogate way of attacking that country. I suspect that the greatest deterrent to a country seeking to do that would be our membership of NATO and the likelihood that the United States would become involved either with its conventional or with its nuclear forces. However, this is the circumstance in which a nuclear deterrent could be relevant.
    It would be difficult to sustain the view that our present levels or the proposed reduced levels provide a minimum credible deterrent relative to the likely strengths of most of the countries we are talking about, or to the possible level of damage that could be caused. Our best chances of reducing that threat must be to stop proliferation, and to ensure that a multilateral nuclear disarmament process takes place.
    The final threat to which I referred was the possibility of global nuclear war. I am sure that we would all agree that that threat has greatly reduced since the ending of the cold war and the halting of the nuclear arms race, which was largely as a result of the initiatives of Mikhail Gorbachev—[Interruption.]—as was recognised by the award to him of the Nobel peace prize and by intelligent members of the Conservative party. Unfortunately, that process seems to have lost impetus since Mr. Gorbachev fell from power. We cannot afford to be complacent.
    If there were to be another arms race, the threat of global war could increase. Whether British nuclear weapons would significantly add to the deterrence against that threat is questionable. What is certain is that if the time comes when we get back into an arms race between super-powers or between groups of countries, the prospects for the survival of human civilisation could be gravely endangered. As we approach the new millennium, I contend that the greatest threat to the survival of our species for another full millennium is the use of weapons of mass destruction. For that very reason, our supreme moral imperative must be to try to reduce that threat.
    The Prime Minister has recently spoken about a third way to solve problems. I suggest that there is a third way to deal with this particular problem, apart from the sterile talk about unilateralism and multilateralism. It is not a new third way: it was propounded by Mr. Gorbachev five years ago. We could take unilateral initiatives to achieve multilateral disarmament. This report provides a basis for doing that.
    I am running out of time, so I shall not quote again the statement of the Secretary General of the United Nations that the Secretary of State quoted when he introduced the

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    debate. The Secretary General thought that the cuts in nuclear weapons that we were making contributed significantly to the fulfilment of the nuclear non-proliferation treaty. We should take that path, and through a new initiative we should try to involve the smaller countries—India, Pakistan, Israel and others—and the larger countries, although that may be difficult given the present reactionary nature of Congress and the Duma. I am optimistic, because just last week the Russian Deputy Prime Minister said that he believed that, to solve its economic problems, Russia would have to endorse START 2 and START 3. As he is part of the communist group that has blocked such a move, his remarks are hopeful.
    There may be a window of opportunity that will enable Britain to take a lead. Such an approach, together with test bans, verification, attempts to halt proliferation, the spread of nuclear weapon-free zones and the strengthening of the United Nations, will provide a basis for preventing wars and the causes of wars. The imagination that we used to bring peace to Northern Ireland could be used to try to bring peace to the world. As that amounts to nothing less than trying to ensure the survival of our species, there can be no greater cause to which to commit ourselves as we enter the new millennium.
    8.14 pm
    Mr. Martin Bell: I shall be extremely brief. I have made it my business to stay close to the military, especially the other ranks from which I came a long time ago. I have seen our armed services, especially the British Army, in action these past years in some dangerous places—war zones and elsewhere. I know that they are second to none, just as I am second to none in my admiration for them. I know the risks and the realities, and I know the insecurity that they have felt through successive defence reviews. I very much hope that we can resolve that this will be the last defence review in this Parliament and the next, because our serving men and women are due a period of stability in which to practise their dangerous craft.
    This review is wide ranging and well thought out, and I welcome it. A few matters trouble me. I am troubled by the extent of the cuts in the Territorial Army. I am troubled by the effect on certain regions, including the north-west. I am troubled by the numbers. We were given a figure of 40,000, but that includes the 3,500 members of the Officers Training Corps, who are not deployable abroad.
    Something else troubles me, too. Over 18 months, the finest minds in the Ministry of Defence—both civilian and military—have been concentrating on this review. I am beginning to think that something may have been slightly disregarded that is more important than any procurement programme, weapons system or order of battle, and that is the duty of care.
    Where is the duty of care if the Association of RAF Wives, which helps to bind the RAF together, is wrapped up? Where is the duty of care in the high profile court martial cases, in which officers are held to a moral code that is more appropriate to the priesthood than to an officer corps? Where is the duty of care if a brave soldier
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    commanding an Army Air Corps unit returns to an airfield in this country and is arrested by the RAF police in the most humiliating circumstances? Above all, where is the duty of care in a case now before the Ministry of Defence police—the Minister will know about it—in which a brave major in the Parachute regiment was arrested by that police service more than a year ago but has not been charged, while his career lies in ruins?
    We are not living in a Kafkaesque totalitarian state: we are living in a free democracy. When I heard the Minister pay his compliments to the Ministry of Defence police, I wished that he would summon the chief constable and make him answerable for the actions and unjust procedures of his force.
    As I understand it, senior soldiers have lately being going round the military academies outlining the doctrine of soldiers first. That is fine, and we applaud it, but let them practise what they preach. Let them and Ministers pay absolute attention to their duty of care and their obligation to the men and women who keep us free.
    8.17 pm
    Mr. John Smith: It is an honour to be called after the hon. Member for Tatton (Mr. Bell), who speaks with great authority. I remember his memorable statement that we have the best little army in the world. I agree with that statement, and I would extend it slightly and say that we also have the best little air force and the best navy in the world.
    I am perhaps one of the few hon. Members who owe a great personal debt of gratitude to our armed forces. I am one of the many thousands of young people who benefited at an early age from the opportunity of joining our fine services, and who were able to build a future. We were able to gain discipline, self-respect and self-confidence, which is hard for many young men and women to achieve. We should recognise more often that vital role that our armed services play.
    It is also a pleasure to speak, albeit briefly, on the strategic defence review. It is a tribute to the defence team, and to the review itself, that the speeches have been curtailed: the fact that so many hon. Members on both sides of the House have wanted to participate must constitute a record in itself.
    The Government should be congratulated on the review, which I consider to be one of the few genuine defence reviews that we have had since the war. I do not doubt that Ministers have wanted to conduct strategic defence reviews, but the fact is that, by and large, they have failed, and many of their good intentions have resulted in the worst possible outcomes. This, however, has been a genuine review: it has been bipartisan from day one.
    I remind the House that Opposition Members—members of all parties, indeed—were invited to take part in genuine consultation last year. That consultation included not only all Members of Parliament but members of the armed forces, members of the public, trade unions and industrialists, on an open and transparent basis. That, I think, provided the review with a firm foundation.
    That, incidentally, is why I think that there has been so much unnecessary hoo-hah about the absence of a foreign policy baseline. All hon. Members are fully aware of the policy baseline on which the review has been conducted.

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    That is largely because it was set up by the Secretary of State last September, but it is also because, if truth be known, we all agree on the fundamentals of that baseline. They are our commitment to defend this country; our commitment to defend our dependent territories; our commitment to NATO; and our commitment to our leading role internationally. We do indeed have the best forces in the world, and that allows us to have a role in the world that is perhaps greater than the role to which we would otherwise be entitled. That, surely, is a valuable asset, to which we should cling. We have other commitments: our commitment to the United Nations and our role in it, our membership of the Security Council and our commitment to a minimum nuclear deterrent.
    I do not think that many hon. Members would disagree with what I have said. What we have is a genuine review, based on consensus and bipartisan in nature, which sets out to reconfigure the country's forces to enable it to meet its defence commitments.
    It is a mistake to think that the present Government inherited circumstances in which we merely required a review. We did not merely require a review; we had to inherit the mess created by earlier Governments—the gaps in our forces that created the overstretch and lack of morale in our forces. During that period, there were real cuts of 30 per cent. The proportion of gross domestic product spent on defence was cut from 5.3 per cent. to 2.8 per cent., and there was a manpower cut from nearly 750,000 to 400,000. Gaps were created in our ability to meet our defence commitments in the world, which put unacceptable pressure on our brave service men and women.
    Hon. Members have mentioned the virtual collapse of the medical support services, the absence of an acceptable ability for heavy lift to reach the front line, shortages in second-line logistics and support, and gaps of 5,000 in service establishments in the Army—gaps that were unacceptable and which put pressure on our service men and women. The strategic defence review has addressed those issues, and addressed them clearly.
    I considered yesterday's speech by the hon. Member for Stratford-on-Avon (Mr. Maples) completely unacceptable. Unlike most Opposition speakers, he, in his desperation, uttered not a word of support for, or in recognition of, the value of the review to our service men and women and to the country. The review has, however, received the unanimous support of the Defence Council, private and public support from the Chiefs of Staff, widespread support from the public and—perhaps most important—support from the international community. I have the honour of representing the House on the NATO parliamentary assembly. I assure hon. Members that colleagues throughout the other NATO states have given due respect and recognition to the review, and have asked us how we managed to achieve what we did.
    We have heard about the statements that have come from one end of the world: Russia. When an all-party delegation from the British-American parliamentary group visited the Pentagon recently, everyone asked how the British had managed to produce such a welcome document as the review. It was something that they had failed to do. I think that we should recognise that achievement. I do not think that Opposition Members should be so churlish; I think that they, too, should recognise the value of the review.
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    The review has been particularly valuable for the people of Wales. Confirmation of the Eurofighter project did not come from the previous Government, or, indeed, from the current Opposition. They were very slow in accepting that confirmation. The news will be welcome in Wales—especially at RAF St. Athan, which provides one of the most professional and expert on-site support services, and off-site aircraft engineering services, not just in this country but in the world. I consider that a real asset.
    I welcome the announcement by my hon. Friend the Under-Secretary of State—at column 727 of the Official Report for 31 July 1998—about the future of the Defence Aviation Repair Agency as it relates to RAF St. Athan. Not only are the 4,000 military and civilian jobs on the camp secure for the future; the creation of DARA may well mean an expansion of activity in the area. That is good news not just for the military and for my constituency, but for the whole economy of south Wales.
    My hon. Friend the Member for Barrow and Furness (Mr. Hutton) spoke of the value of the defence diversification agency, and the role that it could play, in partnership with private industry, in developing regional economies and a synergy between the private and public sectors. That already takes place at RAF St. Athan. It is a critical asset to the south Wales economy, which already enjoys the synergy provided by the British Airways maintenance plant at Cardiff international airport, the GEC engine plant and the avionics industry. In fact, it plays a critical role in the economy of south Wales.
    The review is welcome, and hon. Members should appreciate it. As a Member—
    Mr. Deputy Speaker (Mr. Michael J. Martin): Order. The hon. Gentleman's time is up.
    8.27 pm
    Mr. Andrew Robathan: I agreed with what the hon. Member for Vale of Glamorgan (Mr. Smith) said at the beginning of his speech about the value of service in the armed forces. As for the rest, I must tell the House that I served under both Labour and Conservative Governments when I was in the Army, and, for all sorts of reasons, much preferred serving under a Conservative Government.
    Julius Caesar wrote: "A soldier is not as other men, and when he thinks he is, he ceases to be their guardian." Not many people read Julius Caesar nowadays, and, regrettably, not many even know who he was. Sadly, not many people understand what he was talking about. Fifty-three years after the end of the second world war, it is obvious that there is a lack of experience and understanding of the armed forces.
    The most worrying fact is that too many people, including some hon. Members, have forgotten the purpose of the armed forces: they are here for our defence. The first duty of government has always been the defence of the realm, and I submit that it remains so. As my hon. Friend the Member for Stratford-on-Avon (Mr. Maples) said yesterday, that includes our vital interests elsewhere.
    Twice this century, in the lifetime of one Member of Parliament, and of my own father, who I am glad to say is still alive, this country has been grievously threatened. How are we treating our guardians? In every defence debate, Ministers praise the calibre of our soldiers, sailors and airmen. The Minister for the Armed Forces has just

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    done so. I agree: I personally believe that they are indeed the best, or among the best, in the world. That usually gets a "Hear, hear". [HON. MEMBERS: "Hear, hear."]
    Why is new Labour so keen on undermining what it says is so good? This debate gives us the opportunity to review a wide range of defence issues. I could have talked about the very real threats to this country, which are dismissed in the SDR; about the totally incredible aircraft carriers that are so crucial to future naval policy; about when our soldiers are to be brought home from Bosnia; or about the pressure from the Treasury on budgets.
    Instead, I shall concentrate on the most important element of our defence. In its recent report on the review, the Select Committee said:
    "The quality of the people is perhaps the defining characteristic of the UK's armed forces."
    The armed forces continue to attract people of very high calibre at all ranks, and parents continue to believe, as do their children, that service in the armed forces is an honourable profession.
    The old-fashioned ethos of service is admired throughout the country. It is built on patriotism, common endeavour, shared experience and camaraderie, and it is often inexplicable to those who have not experienced it. If this country wants its guardians to be effective, it should not try to destroy what works so well.
    I am not saying that the armed forces will not or should not change: they have evolved over centuries and will continue so to do. Technological changes are one reason why evolution has been essential. The cavalry now fit remarkably well into tanks and, as air cavalry, into helicopters.
    As society has changed, the armed forces must inevitably change, because the personnel do not live in a vacuum but are a part of society; but that does not mean that they should slavishly reflect society, as that is not their purpose and I doubt whether there are many people who would want their soldiers to reflect some of the worst attributes of modern life. People want soldiers, sailors and airmen to defend them.
    It is my very real fear that the Government's determination that the armed forces should "reflect society" and "modernise" will undermine our services and destroy their efficiency. The outstanding qualities of what are possibly the best armed forces in the world may be sacrificed on the altar of political correctness.
    The armed forces are accused of being elitist. That should not be an accusation but a source of pride, and I believe that it is true in many ways. I was proud to be part of two elite regiments. I am delighted if regiments, fast jet pilots, the Royal Marines and the Navy are considered elites. Sadly, it appears that there is something wrong with being an elite in new Labour Britain. Anything that is elite must be brought down to the lowest common denominator, until perhaps our armed forces will resemble nothing so much as a particularly unpleasant bunch of football hooligans.
    Mr. Bob Russell: Who wrote this speech?
    Mr. Robathan: We will have a chance to hear the hon. Gentleman's pearls of wisdom later. If they are up to his normal standard, I do not expect that many of us will stay awake.
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    The armed forces are accused of being a bastion of privilege. I spent 15 years in the armed forces, and I can assure hon. Members that it was not a privilege to be paid as I was. Last year, the Secretary of State attacked the fact that there was a disproportionate number of public school officers in the Army. That may be true; I have no idea, because I have not counted them. The Under-Secretary of State, or perhaps the Prime Minister, could have been such a public school officer. I suspect, too, that there may be a disproportionate number of Oxbridge officers in the armed forces: again, the Under-Secretary of State, or the Prime Minister, could have been such officers.
    It should not be a matter of shame that people of quality, in open competition, join the armed forces. There is a wide variety of all types of people at all ranks in the armed forces, and there always has been. We want quality, and currently we get it. If we discriminate, as the Secretary of State suggested, against public school education, it will reveal more about envy and the nature of new Labour than about anything else. I believe that H. Jones was an Etonian. Would he have been awarded the Victoria Cross by this Government for dying in battle? I have no idea.
    Mr. Mike Gapes: Oh, come on.
    Mr. Robathan: It was the Secretary of State, not I, who raised the question.
    Mr. Hilton Dawson: Disgraceful.
    Mr. Robathan: Perhaps, when he gets the chance to speak, the hon. Gentleman will illuminate me about what was disgraceful about that.
    There are excellent service men and women, and indeed senior officers, of all backgrounds, and we recruit throughout society, but the armed forces demand certain standards. Those standards, which have been praised to the rooftops today, include not only education but old-fashioned values that are perhaps more evident in some schools than in others—not solely public schools, I hasten to add.
    The Minister for the Armed Forces spoke about the employment of women in the armed forces, and the question exercises many Labour Members. I would have thought that it was self-evident that women are physiologically different from men, and usually less strong. That is not in any way damning, but it is true. I am glad to say that women are generally temperamentally different from men, and less aggressive, but in some parts of the armed forces physical strength and aggression are of the utmost importance, and it is ludicrous to deny it.
    I welcome women in many parts of the armed forces. In the second world war, and all other recent wars, women have filled many roles extremely well and have been of the utmost importance in the war effort, but I and many others do not want women to be in fighting units with bayonets fixed. Killing and being killed—that is why one fixes a bayonet—is, I consider, an unsuitable role for women.
    The Government have opened up the artillery to women. Anyone who has ever carried artillery ammunition will know what a grave error that may prove

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    to be. A few years ago, a warrant officer in charge of a workshop in Bosnia said that he was happy to have women in his team, but that, unfortunately, whenever it came to taking a power pack—an engine—out of a Warrior, the men had to do it because the women were simply not strong enough. I similarly recall a naval officer saying that women were very good at reading radar but that when it came to realistic exercises and dragging injured comrades out of damaged areas they were generally simply not strong enough.
    A female Tornado pilot has recently gone on maternity leave. I am absolutely delighted for her and her husband, and I am sure that she is an excellent pilot, but perhaps the Minister can explain what happens if we go to war—which is what we have Tornados for—and several pilots are on maternity leave? Other leave gets cancelled, but the imminent arrival of a baby is not quite the same.
    Much of the politically correct assault on the ethos of the armed forces is motivated by dislike of the old-fashioned, traditional nature of the services and is not welcomed by armed forces personnel. Those old-fashioned values are admired by people in other countries and are partly responsible for the effectiveness of our armed forces.
    The Government talk of modern forces for the modern world, and nobody wants antiquated forces—do we have them in Bosnia; did we have them in the Falklands?—but modernisation is desirable only where it is necessary. Many of the personnel policies may harm—
    Mr. Deputy Speaker: Order. The hon. Gentleman must resume his seat.
    8.38 pm
    Mr. Hilton Dawson: It is a real pleasure to take part in this debate, which has been interesting and important. I say with real sadness that I am sorry to follow the hon. Member for Blaby (Mr. Robathan), who did his best to give us a caricature of the armed forces that could only play into the hands of those who are opposed to them. He used this precious opportunity to debate one of the most important aspects of the Government's and the country's policy to parade a host of simple prejudices. Having said that, I think that the contributions from hon. Members from both sides of the House have been excellent, thoughtful and knowledgeable. The House clearly contains hon. Members with tremendous direct experience of the armed forces as well as those with long experience of Committees that have made important decisions on the armed forces.
    I have to confess that I have never had any desire whatever to join the armed forces or any uniformed organisation. I do not believe that that is a matter for shame: it is perfectly acceptable. I am aware that I, in common with many other people, am a member of the first generation this century which has not had to fight in France. I am grateful to the women and the men of our armed forces who have kept me safe, and I assure the House that I have an extreme personal interest in maintaining that situation.
    I welcome the strategic defence review. It is an excellent document which seems to line defence policy up, albeit implicitly, with foreign policy, and to make some important points about the future and set a clear
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    direction. I am also prompted to say that by the views of constituents, many of whom have great experience of the armed forces, including serving personnel. Many of those people, I would guess, are not inveterate Labour supporters, but they have told me in recent weeks that they regard the SDR as a serious piece of work that sets out a coherent vision for the armed forces of the future. I might say that they did not feel the same about other reviews in recent years. The review reflects a world situation that differs in many ways from that of the recent past, and is perhaps now more threatening. The changed world situation will require a new approach.
    My particular constituency interest is in the TA, which will need to develop new and special skills; to be highly responsive and extremely flexible; to integrate further with the Regular Army; to go into action at short notice; and to develop a capacity for joint operations. I am sure that the TA can do all that. Conservative Members have expressed qualms about the TA being set challenging efficiency targets, but they seem fine to me. All public services should be set challenging efficiency targets and be able to justify what they do.
    Yesterday, Conservative Members expressed qualms about selective compulsory call-up. I welcome that, because it is important if we are to involve properly skilled people in the TA who are ready at the drop of a hat to serve in difficult situations. Business should support that and be willing to allow staff to serve, because the partnership with the TA gives much back to business. We have also heard qualms expressed about equal opportunities, but I profoundly believe that all people should have the opportunity to serve their country to the best of their ability.
    I am hopelessly biased in favour of Lancaster, but I believe that what happens to the TA in Lancaster has important implications for defence policy. However, the fact that I think that Lancaster is the finest city in the land does not mean that I am so arrogant as to think that other areas do not have important links with the TA. In Lancaster, we have the headquarters of the 4th Battalion, King's Own Royal Border Regiment and a detachment of 208 Field Hospital. I do not want to get bogged down in history, because this debate is about the future, but it is important to say that the King's Own was formed in 1680 and has a proud and distinguished record. The regimental museum is in Lancaster and the people there have family traditions connected with the regiment. Commitments to the armed forces in Lancaster have been carried down through generations. The King's Own, the TA and the armed forces are respected and have a valued place in the city of Lancaster. That commitment is felt by business, by local authorities and by me.
    I am disturbed by the prospect that UK Land Command may move to Scotland. Although it is based in York, which causes us problems in Lancaster, it has significance for the north of England. Indeed, I remind hon. Members that 39 per cent. of the armed forces are recruited from that area. We have an excellent recruiting ground in Lancaster. The King's Own has 175 part-time soldiers, but it is also good at recruiting to the Regular Army, especially to Signals and Engineers. The King's Own has excellent links with the Regular Army and 10 soldiers recently served with distinction in Bosnia as part of a peace support operation. Several more are now serving as regulars and I am proud that people from the city that I am privileged to represent have played an important role in peacekeeping in the dreadful situation in Bosnia.

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    As I have said, we also have a detachment of 208 Field Hospital and we have heard that the Government are keen on more resources for Army medical facilities. We have modern facilities, an up-to-date barracks and an excellent Army cadet force, which trains and supports young people interested in a career in the Regular Army. We also have good links with the university Officer Training Corps. I would be perturbed if Lancaster did not have a big part to play in supporting the future defence objectives of the TA, because the community understands the role that it performs.
    Lancaster is at the heart of the north-west region and we have excellent communication links. We work well together with other companies and the detachment of the King's Own in Cumbria. I do not make a plea for no change, because I am convinced that the exceptional people in Lancaster and in the armed forces will face up to change and deal well with whatever it brings. The armed forces based in Lancaster that I have mentioned have a positive role to play in the Army in the north-west and in the highly skilled, responsive Territorial Army of the future.
    8.47 pm
    Mr. Bob Russell: The garrison in my constituency is one of the largest in Britain. The service personnel, their families and civilian employees total nearly 10,000 people. I therefore welcome the Government's commitment in the strategic defence review—and, in fairness, the commitment of the previous Government—to maintaining the importance of the Army in Colchester. I especially welcome the earlier decision to build three new barracks. While I remain opposed in principle to the use of the private finance initiative in funding the defence of the realm, I appreciate the capital development of several hundred million pounds in the coming years. I hope that the Minister can tell us tonight when he expects to make a further announcement about the new development at Colchester garrison, but an acknowledgement that it will proceed will suffice.
    We have heard a great deal about the future of the Territorial Army. I urge the Government to think again on their TA proposals for the reasons that have been given on both sides of the House. In particular, will the Minister guarantee that the Colchester TA centre—a purpose-built complex within the garrison estate—will not be closed as part of TA restructuring?
    When he considers the ramifications of the strategic review, and to provide a genuine value-for-money review, will the Minister reconsider the previous Government's proposal to transfer the internationally famous Defence Clothing and Textiles Agency from its established research and development premises in Colchester to a remote place in Oxfordshire? Does the Ministry of Defence consult other Departments before it makes decisions? Do the pronouncements of the Deputy Prime Minister about developing recycled land and buildings rather than green-field sites apply to MOD property?
    The future of the cadets seems to be non-existent in the strategic defence review. I should welcome a statement on that from the Minister.
    Mr. John M. Taylor: It is humbug for the Government to say that they are sustaining the cadets
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    while admitting that they are cutting the Territorial Army. In TA depots such as the one in Haslucks Green road in my constituency, the cadets are absolutely dependent on the TA for a place in which to parade and in which there is a secure armoury, a miniature range and transportation. If the TA centre goes, the cadets will have nowhere to meet.
    Mr. Russell: I thank the hon. Gentleman for his intervention. The same point has been made by speakers on both sides of the House. TA and cadet premises are often one and the same, although that is not quite so in Colchester where there are three separate units for army, air and sea cadets. If the Government are committed to the future of the cadet forces, why have they cut the cadet budget, and how does that square with the wishes of the Home Secretary to tackle juvenile crime and of the Secretary of State for Education and Employment to see young people pursuing constructive activities?
    The Minister will know that Colchester is home to 24 Airmobile brigade. The strategic defence review envisages a new and exciting role for that brigade and for the Parachute Regiment. Can the Minister assure us that operational reasons alone will determine whether the Paras move to Colchester? He should not be deflected by behind-the-scenes manoeuvres from those who, for supposedly sentimental reasons, want the Paras to remain at Aldershot.
    8.51 pm
    Mr. Mike Gapes: I want to make two constituency points and one more general point. However, let me first welcome the strategic defence review, which is the culmination of a long process. I worked at Labour party headquarters during the 1980s on defence, disarmament and international policy. I am pleased to say that I was secretary of the policy review group when Labour changed its policy in 1989. Throughout the 1980s, we called for a defence diversification agency and it is good to have a Government committed to introducing something along those lines. We had a long-standing commitment to a comprehensive defence review that would be driven by foreign policy, but that would take account of the needs and capabilities required for effective security for our country. I am proud that a Labour Government are doing that, too. A look at the needs of the UK and of our allies in the modern world after the cold war was long overdue. We have greater commitments now to humanitarian work, to the United Nations and to a role in peacekeeping or even, if necessary, peace enforcement throughout the world. The review is very welcome.
    It is clear from the debate that there is a continuing commitment to the Bowman programme for future radio communications for the British Army. I am disappointed by the decision to award that contract to the Racal Thomson consortium rather than to the British Aerospace consortium, in which I declare a constituency interest. If the Archer programme goes ahead, I hope that the Army can have the investment and communications system that it needs for the future. The former First Sea Lord was quoted in the Financial Times of 7 October warning of the potential dangers of the United States getting so far ahead with digitisation that its European NATO allies would be unable to compete technologically. I hope that the decision to place the Bowman local area system with

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    a French company will not mean that the UK does not receive full technology transfer. Britain must be at the forefront of the new technologies that will be essential to the future security of our country and of our European allies.
    On my second constituency-related point, I was pleased to hear the Minister of State offer firm support for the cadet movement. There is a Territorial Army in Gordon Fields in the middle of my constituency. The hon. Member for Blaby (Mr. Robathan) is not here, but he will, I hope, read my remarks. Many black and Asian young men and women attend the cadets and take part in their activities. They are involved in the TA. I hope that those black and Asian men and women will feel able to go into our armed forces, and that some will achieve senior positions, including positions of command. The misogynists on the Conservative Benches may not like that, but the future requires armed forces that reflect our society.
    Mr. Gray: Will the hon. Gentleman give way?
    Mr. Gapes: No, I do not have time.
    The review rightly says a lot about NATO and arms control. It includes a commitment that would not have come from the previous Government about the global importance of nuclear-free zones, along with a helpful map. It also gives helpful negative security assurances. The review mentions the importance of the work in Kosovo of the Organisation for Security and Co-operation in Europe. Clearly, we must make an important distinction between hard security based on NATO and softer security organisations such as OSCE. NATO should not become like OSCE. We need a firm, hard defence and security organisation in Europe, and that is why NATO must continue without becoming some weaker, generalist organisation on the OSCE model.
    I am disappointed that the review and the accompanying essays contain not much discussion about the Western European Union and the European security and defence identity. Those issues are relevant for the future because in 1999 NATO will be developing a new strategic concept. We shall have to consider them. It may be that it was felt that such discussion lies in the future because there are still discussions among the allies. I am prepared to accept that, but the issues will not go away.
    There is a move from some European Union countries to change the EU into a defence organisation. That would be a profound mistake. We must ensure that NATO remains the firm defence organisation, that the European Union deals with non-military aspects of security, and that the Western European Union acts as a bridge to take on the Petersberg tasks, such as peacekeeping, in the European context. It is dangerous to weaken our firm security foundations in the interests of allowing enlargement to anyone who wishes to join. I know that my Front-Bench colleagues agree, but it is not spelled out in the document. I am sure that it will be in future.
    Paragraph 13 in supporting essay 6 refers to coalitions of the willing. Until we have a stronger United Nations—something that is very necessary—we shall always be dependent on ad hoc coalitions within NATO, the WEU or another mechanism. That is not entirely satisfactory because it leaves us open to the difficulties that we had in the Balkans.
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    We need to think long term—20, 30 or 40 years ahead—and build a strong international security architecture. That means a stronger United Nations, and giving the commitment and resources to achieve it, otherwise we shall always be too late and too slow; it will be politically difficult to do what is necessary. Until then, it is essential to continue our commitment to work with our allies in NATO, the WEU, the EU and elsewhere.
    Several hon. Members rose—
    Mr. Deputy Speaker (Sir Alan Haselhurst): Order. It will not have escaped the attention of hon. Members that, if speeches were nearer five minutes than 10, more satisfaction could be afforded than would otherwise be the case.
    9 pm
    Mr. Jonathan Sayeed: I shall not seek to follow the hon. Member for Ilford, South (Mr. Gapes), except to say that I agree with many of his later remarks.
    In their manifesto, the Government promised to undertake a foreign-policy-led review to reassess our security and defence needs. Like so many of their pre-election promises, I regret that this one appears not to have been kept. The failure to publish the foreign policy baselines means that it is impossible for the House to assess whether the Government are seeking to match our military capability to our foreign policy commitments or are being dictated to by the Treasury.
    I do not believe that this can honestly be called a review. In a review, one determines whether too much or too little money is being spent and takes appropriate action. Again, the Government have misused the English language. Instead of reviewing defence expenditure, they made it clear at the outset that, at best, defence expenditure would not increase. The acronym SDR is a misnomer. I prefer my own: LEMON, or less money on the Navy. While not a penny piece has been allocated to the two new aircraft carriers, the cuts to escorts and mine counter-measure vessels are real.
    I congratulate the Government on one thing: the brilliant smoke-and-mirrors exercise of their original presentation. When I visited the royal naval air station at Yeovilton on 18 July, I met several serving officers with whom I had joined the Navy many years ago. They were delighted with the SDR. They had been promised two large aircraft carriers. I must admit that I felt a little churlish for deflating their somewhat naive expectations. I pointed out that the in-service date was 2012 and that no money had been put aside in the MOD's long-term costings. I prophesied—I hope that I am proved wrong—that, under a Labour Government, we should be lucky if even one large carrier was built. If those officers had known, as we know now, that the Government were considering extending the life of the three small Invincible class carriers by putting them out to tender for extension-of-life refits to 2022, the Labour Government's potential for duplicity would have been clear to all.
    It is clear from the SDR that frigate and destroyer numbers will be reduced by nearly 10 per cent. I believe that the previous Government's cuts went far too far, and I said so at the time.

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    If one allows for the time spent in refits—although that has been reduced in latter years—the time spent on docking and essential defects, self-maintenance periods and the time spent on passage and other commitments, there will not be enough escorts to protect two aircraft carriers concurrently operating in different oceans. Yet that is one of the promises in the SDR. The Government should do what the previous Government would not do. Rather than paying ships off, they should put them into reserve and get industry to design command and control, propulsion and defence systems that are modular in nature so that the hulls can be recommissioned and the modern systems put into those hulls at short notice if a crisis looms.
    The review heralds a change from open ocean warfare to near-coast or littoral operations. The SDR states that shallow water operations in United Kingdom waters are of declining importance. While I accept that there will be more near-coast operations, to neglect UK shallow water operations is a mistake.
    The old Soviet Union—most people do not seem to know this—sold tens of thousands of ground and buoyed mines to nations run by dictators whose views are inimical to ours. Those mines are easily deployed by fishing or merchant vessels, by submarine or even by air. All the likely flashpoints around the world—the Arabian gulf, the Adriatic, and the Spratley islands—and most of the strategic maritime waypoints are in water that can be easily mined.
    I am surprised that the blackmail of maritime mine warfare has not been used so far, but I think that that position is unlikely to continue. So to cut the number of mine counter-measure vessels is wrong. We should be building more. The Government should reverse the previous Government's mistaken policy of frittering away the Royal Naval Reserve by using it to make up the complement of major warships. Instead, they should continue to use it in its specialised mine counter-measure role and re-equip it with small mine-hunting vessels capable of being airlifted in the largest heavy-lift aircraft to potential trouble spots that would otherwise be weeks away by sea.
    Still on the SDR but at a tangent to it, may I ask the Secretary of State when he comes to read Hansard to consider a suggestion of mine? What do we know about Russia? We know that it is in dire need of generous financial assistance. It is in our interest to provide such assistance. We fear that terrorists may get access to Russian nuclear, chemical and biological weapons. So why does not the international community negotiate to purchase as many of Russia's weapons of mass destruction as we can and arrange for them to be destroyed, possibly on Russian soil? I recognise that considerable work has been done on the strategic arms reduction talks and other treaty discussions, but the process is slow and fails to get to the heart of the problem, which is that, in an anarchic state, which Russia is today, everything is for sale and an unpaid Russian military may decide to sell weapons to the highest bidder.
    I understand your request to be brief, Mr. Deputy Speaker, so with those remarks, I conclude my speech.
    9.8 pm
    Mr. David Chaytor: I shall be brief, as I know that other hon. Members wish to speak. I wish to raise two points, but first I congratulate my right hon. Friend the Secretary of State and his colleagues on the report. It is remarkable how universally the broad thrust of the recommendations has been welcomed.
    I endorse the comments of the hon. Member for Tatton (Mr. Bell) about the impact of changes to the Territorial Army in the north-west, especially in my constituency. In Bury, North we have C company of the 4th Battalion of the Queen's Lancashire Regiment, which consists of 100 men and women. It has strong connections with the former Lancashire Fusiliers. If the unit were to go following the SDR, it would bring to an end a 100-year link between the Lancashire Fusiliers and Bury. The Fusiliers have a distinguished reputation and fought in most of the major battles at the end of the last century and throughout this century. I would fight strongly to retain that link and the present TA unit in Bury.
    I endorse the comments of other hon. Members who have drawn attention to the importance of the TA not only for the skills that it develops in the men and women who join but for the wider benefits that it brings to the local community. The TA in Bury is strongly linked to wider community activities.
    There are two particular reasons for wanting to make a special case for my TA unit. Although it is only one of 55 units in the north-west, within the Queen's Lancashire Regiment area the TA unit in Bury is responsible for 25 per cent. of recruitment. Its recruitment record is outstanding. As successive hon. Members have commented, recruitment will be a continuing issue for the armed forces.
    The location of the TA is crucial. The TA in Bury meets in the drill hall, which is called the castle armoury. The castle armoury is an important listed building which is over 100 years old. It also houses the area headquarters of the Air Training Corps and the Army Cadet Force. I believe that the castle armoury is unique in that it is not owned by the MOD. The argument that there are capital receipts to be obtained by closing down some TA centres does not apply in this case. It is owned by a board of trustees which is bound to manage the building on behalf of the people of Bury. If the MOD revenue funds were pulled out, it would be in dire straits.
    The castle armoury is the subject of an exciting development plan that would involve moving the current Fusiliers' regimental museum from its present inadequate headquarters into the castle armoury. It is located in the centre of the town, which makes it strategically important in developing the attraction of the museum for local schools and visitors. I hope that the Minister will look carefully at the impact that the changes to the TA will have on the unit of the Queen's Lancashire Regiment in Bury.
    My next point follows the comments of my hon. Friend the Member for Aberdeen, North (Mr. Savidge) about weapons of mass destruction. I welcome the fact that the SDR makes changes to the deployment of Trident. It reduces the number of warheads and brings about a new transparency in our policy towards fissile material, but there are other beneficial changes which could be made to the deployment of Trident. We have not quite adjusted to the post-cold war era. It was interesting that,

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    in his opening remarks, my hon. Friend the Minister justified the reduction in TA numbers by saying that we had to move away from the cold war era and that the present numbers of the TA, representing 50 per cent. of the total armed forces, were excessive. However, I am not sure that we have extended that analogy to the deployment of Trident.
    Weapons of mass destruction are sensitive, and things cannot move too quickly. The Government have supported important changes including the nonproliferation treaty and the comprehensive test ban treaty, which are steps in the right direction. We desperately need a fissile material cut-off treaty and I hope that the Government will direct their attention to that in the near future.
    The most important point is this: our dilemma over weapons of mass destruction is that we must view them as either an unfortunate legacy or a necessary evil. The logic of seeing them as a necessary evil is that every other nation in the European Union and, arguably, every other nation in the world, would be more secure with them. I challenge every Opposition Member to argue that the world is a safer place because India and Pakistan now have nuclear weapons. My constituents who have friends and family in Kashmir do not feel safer because of the nuclear weapons in India and Pakistan.
    We have to think through the logic of the argument and accept that, if we were designing from scratch a strategic defence policy for Britain, at this point in history it is highly unlikely that we would choose Trident as the main plank of our defence because it does not match up to the defence commitments that we are likely to face. The thrust of the SDR points to the importance of rapid deployment forces in small-scale regional conflicts in different parts of the world where Trident is useless. It was of no use in the Falklands, the Gulf war or Bosnia, and it is certainly of no use in Kosovo.
    I strongly congratulate the Government on the progress achieved, but I hope that they will remember the second part of the Labour manifesto commitment, which was not simply to maintain Trident but continuously to work for a world free of nuclear weapons.
    9.15 pm
    Mr. James Gray: How refreshing it is to follow someone like the hon. Member for Bury, North (Mr. Chaytor). At the end of his remarks we saw a glimpse of good old Labour, behind which lies a Campaign for Nuclear Disarmament history. An hon. Friend made the comment that the hon. Gentleman's local Territorial Army regiment, the QLR, is known in the Army as "the Queen's last resort" or even "Quick let's run"
    There are two curious aspects to the debate. First, every Member who has spoken has given a passionate defence of his local Territorial Army regiment. One could almost argue that the two-day debate has primarily been about the Territorial Army. Each hon. Member has then said how fine is the SDR overall, ignoring the fact that it includes a reduction in the TA from 59,000 soldiers to 49,000, or 37,000 if we remove the Officer Training Corps, whose members cannot serve overseas. Those two points do not add up. One cannot preserve one's home Territorial Army regiment while saying broadly that the SDR has got it right.
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    The second conundrum about the debate is that almost every Labour Member has gone to great lengths to say that the defence chiefs have supported the SDR throughout. They would, wouldn't they? It would be surprising if Ministers said, "We hereby present the SDR, and the defence chiefs don't agree with us." Defence chiefs are unlikely to want to disagree with a new Labour Government. They will be nice to their bosses in ministerial offices and are unlikely to voice their criticisms in public or in private. However, I have heard one or two defence chiefs mumbling into their drink at service dinners. [HON. MEMBERS: "Into their drink?"] Into their non-alcoholic drink, of course.
    I take those remarks by Labour Members with a pinch of salt. The defence chiefs who have said that they are most in favour of the SDR are those from the Regular Army. Again, they would, wouldn't they? The Regular Army has done very well under the SDR. What have the bosses of the Territorial Army had to say about it? Have they been as fulsome in their praise of the SDR? I suspect that they have not, not least because the senior Territorial Army officer in the MOD is a brigadier, who is badly outranked by all the Regular Army officers who have been arguing their case. That is the second puzzle of the SDR.
    There are good parts of the SDR, and most of my hon. Friends have gone to great lengths to point out that there is much to be said in its favour. The only strange point is that most of the good parts are built solidly on the principles laid down by the previous Government. The Government are building on Conservative principles.
    It may be instructive to consider one little town in my constituency that encapsulates the good and bad parts of the SDR. Forty-two per cent. of Corsham is dependent on defence and almost every aspect of defence is represented there. It is the home of 2 (Signals) Brigade, 66 per cent. of which is made up of Territorial Army soldiers. I suspect that they will probably survive under the SDR because they are specialist signallers.
    Corsham is the home of the Defence Communications Services Agency, which was set up to handle communications and information technology for all three services. Jointery is one of the best points to come out of the SDR, and the DCSA is one of the best examples of that. I challenge the Government to go one step further. The DCSA is housed in 1944 underground bunkers, which are not proof against nuclear war or any other major attack. If we are to give all service communications to one organisation in Corsham—I welcome the fact that we are—the Government must finance the rebuilding which is needed urgently. Corsham is also the home of Leafield Engineering, which makes one of the components essential to the construction of the Raytheon short air-to-air missile for the Eurofighter. I challenge the Government to put their money where their mouth is and stick with the best product available at the best price available—which I understand comes from Corsham.
    Corsham is odd in that it is the location of Army, Navy and RAF bases. It is probably unique in having all three services based in one small town. I think that Royal Navy Copenacre is situated further inland than any other naval base. A significant number of sites are about to be made redundant and the Army and the MOD have taken some time deciding whether to sell those sites—I am thinking particularly of RAF bases Kemble, Rudloe Manor and Spring Quarry. Those three bases are now redundant and

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    I ask the Minister to progress those sales as quickly as possible. He might also consider the redundant hangars at RAF Hullavington. They would be an ideal site for the Chippenham livestock market, which will be looking for a new home in 2000.
    I would prefer the Minister to press ahead with the sale of redundant sites such as that under the SDR rather than looking with greedy eyes at the Territorial Army halls and depots up and down the land. That real estate—some 150 bases and depots around the country—lies behind the Government's proposed cuts in the Territorial Army. It has nothing to do with tactics or the TA: it is about the Government getting their hands on those bases. That is the most damaging thing that the Government could do.
    There has been constant comment throughout the debate about the uncertainty in foreign policy and how we do not know where the next threat will come from and how we shall see it off. The Government say such things on the one hand, while, on the other, they cut the only real support for the Regular Army—the Territorial Army. One of the Government's most worrying comments in the SDR is that the Territorial Army supplies only specialist services. They refer convincingly to medics, signallers, gunners and one or two drivers. The Government are correct in that many worthwhile skills are embodied in the Territorial Army, and it is right that they should praise and preserve that aspect of the TA.
    However, the Territorial Army infantry is equally important. It is too easy for the Government to say that the infantry is finished, that it is yesterday's thing and belongs in the cold war era, and to see the Territorial Army only as a source of specialist services. Look at what is happening in Bosnia, where every single battalion comprises 15 or 20 Territorial Army soldiers who are serving as infantry soldiers, not as drivers or doctors. Look at what is happening in Northern Ireland, where the 1st Battalion of the Royal Gloucestershire, Berkshire and Wiltshire Regiment has just finished a tour of duty. It was supported significantly by the 2nd Battalion of the Royal Gloucestershire, Berkshire and Wiltshire Regiment based in my constituency, which comprises Territorial Army soldiers.
    The 1st RGBW would not have been able to do its job in Northern Ireland with the same effectiveness and efficiency without the support of the 2nd RGBW, whose colours parade I attended recently in Windsor. If the Government do away with those colours and reduce 2nd RGBW to a company or even worse—as I believe they propose—the 1st RGBW will not be able to perform its designated tasks.
    The Territorial Army is being reduced from 56,000 to 40,000—or by about 29 per cent. However, it is said on the wires and behind closed doors that the infantry will be cut from 16,000 to 7,100. That is a 55 per cent. cut—a wildly disproportionate cut—in the infantry. The truth is that, in any operation, wherever it might be, it is the poor bloody infantry that does the work. The infantry holds the ground, and it can do that only if it is supported by the Territorial Army infantry.
    If the cuts proceed, large areas of the countryside will be entirely devoid of Territorial Army infantry regiments, including the whole of Gloucestershire and Wiltshire. The title of the Royal Gloucestershire, Berkshire and Wiltshire Regiment will ring a little hollow—to say the least.
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    In a positive spirit, I suggest to the Government a simple alternative approach to the question of the Territorial Army infantry: to have one infantry company per county, throughout the country. By putting that approach into action, the Government would increase the force of Territorial Army infantry soldiers from 7,100 to only 9,000. That could be easily done. It would cost the Government almost nothing in terms of the cuts that they propose, and it would be welcomed throughout the nation, not only because of the contribution that those soldiers make to the defence of the nation, but because, as a result, many depots throughout the country could not be cut.
    I welcome so much about the excellent Select Committee report on the SDR—especially what the Committee says about the Territorial Army. I say to the Government, "If you believe in the Select Committee system, if you believe in the Select Committee on Defence, listen to what it says, especially about the Territorial Army, and think carefully about the easy solution—to have one infantry company per county."
    9.24 pm
    Mr. Robert Walter: I shall make three brief, simple constituency points. I shall be totally even-handed and start with a very positive point. The largest single employer in my constituency is the British Army at Blandford, headquarters of the Royal Corps of Signals and the Royal School of Signals. In this and previous reviews, the Signals have done rather well. Building on the previous Government's investment, there is continued expansion in Signals in both manpower and equipment.
    Signals, of course, is a euphemism for information technology, which is all about the modern Army. Paragraphs 81, 148 and 149 of the report on the strategic defence review deal with what is happening in my constituency. They deal with the Bowman communication system, which was mentioned earlier in the debate, and also with training in electronic warfare, command and battlefield planning, some of which will now be part of a public-private partnership.
    The largest private sector employer in my constituency is also involved in the defence industries, as an aerospace contractor. That is Cobham, sometimes known as "Flight Refuelling" or "FR Aviation", which also did well in previous reviews, rebuilding the airframe for the VC10 tankers. It is now rebuilding the airframe for the Nimrod aircraft under contract to British Aerospace, and the fuel systems that go in the Airbus in the commercial sector and will go in the Eurofighter.
    However, there is some disappointment at Cobham that its aircraft, the Firefly, was not chosen as the new trainer aircraft for the RAF. The Grob from Germany was chosen—a decision which, I believe, was largely due to the high level of sterling when the deal was concluded. That is a cause for some regret.
    My final point, which is the one of greatest concern to my constituents, and which will not surprise the Government, relates to the demise of the Territorial Army. The current consultative exercise, which was mentioned, and the consultative document "TA Restructuring" is all secret. None of us has seen that document. We can only surmise from what is written in the strategic defence review and what we have read in the Sunday Telegraph, but I understand that the 4th Battalion of the Devonshire

    1169
    and Dorset Regiment, which is very much part of the local scene, is to be merged into something called the "South-West Battalion".
    Mr. Soames: No. It is not possible.
    Mr. Walter: Someone says that it is not possible. One wonders whether the "South-West Battalion" will be administered by the south-west regional development agency; it may well form the "guard of honour" when the south-west regional assembly is opened. However, I view the matter with concern. The five companies of the 4th Battalion Devonshire and Dorset Regiment and the affiliated combined cadet forces—12 are affiliated to that regiment, and there are six companies of the Army cadet force in 58 detachments throughout the two counties—mean that there is a very strong local presence, and a very strong local link with the Army.
    I heard what the Minister for the Armed Forces said about integrating the TA with the Regular Army. The 4th Battalion of the Devons and Dorsets operates alongside the 1st Battalion, which is the regular battalion of the regiment. If we break that local link, the territorials will no longer operate alongside the regulars; they will be a separate body, with a totally meaningless local identity.
    I would emphasise to the Minister that destroying the Devon and Dorset family would destroy the historic links between soldiers and their community. Some 2,200 TA members and cadets are proud to wear the cap badge of the Devons and Dorsets. It may not be particularly cool in new Labour's new Britain to serve in one's local regiment, but I must tell Ministers that in my constituency there is great pride in the fact that we have a county regiment and a strong TA battalion in our county regiment. It is a matter of great regret to me and my constituents that that link is to be broken, not only through the TA, but through the Army cadet force and combined cadet forces, between the Regular Army and the volunteers. I appeal to Ministers to retain the county regiments of the TA.
    9.30 pm
    Mr. Keith Simpson: With the leave of the House, Mr. Deputy Speaker. The second day of the debate on the strategic defence review has been extremely good. More than 25 hon. Members have spoken, and it is hardly surprising that 18 of them spoke about the Territorial Army. That sends a strong message to the Minister, whom I welcome to his new job as Minister for the Armed Forces. I pass on my best wishes to his predecessor, who did an extremely good job.
    I welcome the Minister's commitment that, when the final decision is made on the future of the TA, it will be announced on the Floor of the House in the form of a statement, so that all hon. Members may comment on it. He will have got the message from all hon. Members about the importance that they attach to the TA, and I am sure that he will pass that message on to the Commander-in-Chief, Land Command, General Sir Michael Walker, and to the Director of Reserve Forces and Cadets, Brigadier Richard Holmes, who will no doubt take note of it.
    My hon. Friend the Member for Salisbury (Mr. Key) spoke at length about the defence industry. I need not remind hon. Members of the crucial importance of the
    1170
    defence industry to our British defence effort. We must remember that the Ministry of Defence is the largest single customer of the UK defence industry. Some 400,000 of our constituents are employed in the defence industry, and their products are worth £5 billion per annum in defence exports. That means that the MOD and the Government have a powerful influence on the survival of that industry.
    I shall make three points about the defence industry and the role of the Government. First, if we are eventually to follow the United States model, that will mean fewer and larger companies, with the possible consequence of job losses and factory closures. The Government must bear in mind their influence on the British defence industry.
    Secondly, the SDR makes several references to greater co-operation and harmonisation in the European defence industry, but it has little to say about the close links between the UK and US defence industries. Those of us who have been involved in defence know that people engaged in the British defence industry are only too aware of the challenges and the dangers of co-operation with our European or American colleagues. Once again, the Government may have an important role in deciding the future of the British defence industry.
    My third point relates not only to Ministers who are present, although the new Minister of State, having come from the Foreign Office, knows the issue only too well. There is at times muddle, inconsistency and an element of hypocrisy in the Government's so-called ethical foreign policy, especially in relation to arms exports. There is no doubt that the majority of the British defence industry has attempted to follow over many years a code of conduct, but, at present, many people in the industry are telling many hon. Members that there appears to be muddle and delay in giving export licences: sometimes, when eventually an export licence is awarded, it is too late and someone else has secured the contract. That means loss of money and loss of jobs here in Britain.
    Given the reduction in the defence budget of £2.1 billion by the year 2001 and the economic recession that we may be teetering into—I suspect that there will be further Treasury raids on the defence budget, which is now basically the Government's contingency reserve—Ministers will have to explain to the defence industry how they intend managing within the 10-year long-term costing the major equipments planned. I think that the Select Committee on Defence touched on this, and many hon. Members have touched on individual aspects of the matter. We are talking of carriers, large aircraft, sealift, Tomahawk missiles, landing ships and submarines, the vast and expensive area of IT command and control.
    Many hon. Members believe that, given the budget outlined by the Government over the next decade, it will be impossible to purchase all those items of equipment. We need to have some understanding of what the long-term costings will be over the next decade. I know that Ministers will say that it has never been Government policy, either under Conservatives or under previous Labour Governments, to publish the long-term costings. I think that that must change. The Government must now publish their LTCs.
    Perhaps the Minister would be prepared to comment on our understanding that there is a £1 billion overspend in the air equipment budget alone, and that there are likely to be large overspends for the Army and the Navy,

    1171
    and say how the Government square that with the sort of commitments that they have entered into. I challenge the Government to make known their long-term costings, either here in the Chamber or perhaps in evidence to the Select Committee.
    My hon. Friend the Member for Salisbury and the Minister concentrated, like many other hon. Members, on what the Government refer to as a "policy for people", which has been built on work undertaken by the previous Government. That was a combination of the Bett report of 1995 and "The Armed Forces of the Future—A Personnel Strategy" of 1997. In their strategic defence review, the Government have rightly emphasised a "policy for people" and have linked the issues of recruitment and retention by emphasising education and training opportunities for service personnel, improving conditions of service and making additional welfare provision at an estimated cost of £30 million per annum.
    I hope that all hon. Members would recognise that that was money well spent. However, my colleagues and I have emphasised that the strategic defence review is asking our service men and women to do more with less. There will be further overstretch, particularly in configuring armed forces for the expeditionary force role. I suspect that the £30 million and all the things that the Government are putting in to deal with overstretch will possibly meet past overstretch but will not be able to cope with future overstretch. The Government will have to do more, and probably will have to find more money to meet this need.
    In the words of the House of Commons research paper on the strategic defence review on page 59,
    "There is also the danger that the Government has raised expectations that quantifiable improvements will be made to Service life."
    The MOD's own strategic defence review liaison team was apparently surprised a year ago by the extent of discontent in the armed forces. Morale was described as between "good and adequate", and although personnel were
    "keen to get on with their work",
    the liaison team found
    "a more deep seated pessimism about the long term future of the defence of the United Kingdom".
    In particular, it found considerable scepticism—[Interruption.] In particular, it found considerable scepticism—I want Ministers to listen to this instead of gobbling—about the then continuing Labour review—this is from the liaison team's own study—and
    "cynicism about the message delivered from on high"
    by Ministers.
    The strategic defence review has been careful to state that its proposals for people are modest. But if the Government fail to deliver their modest proposals, that may lead to considerable disillusionment, and exacerbate retention problems even further.
    The Opposition welcome the strategic defence review's endorsement of the Armed Forces Pay Review Body's view that there is a need for a new pay system reflecting civil society. However, in view of the Chancellor's statement on 14 July on the comprehensive spending review, when he said that the chairmen of the public
    1172
    review bodies will have to take into account departmental spending limits, the Government's inflation target of 2.5 per cent. and the need to achieve Government targets for output and efficiency, I suspect, to use the words of the Chief of the Defence Staff, that that will be "very challenging for Ministers", and that the pay of the armed forces will once again affect retention and recruitment.
    The British armed forces are facing up to cultural and institutional changes, political and legal challenges concerning authority, the chain of command, equal opportunities, racial and sexual equality, ethics and tradition, and rightly so. The armed forces are not a mirror of society, but they must reflect many aspects of society.
    The armed forces do not have a right to be different, but, given the specific job that they have to do, they have a need to be different. Others in the public service—the fire brigades, the police, the ambulance service and many voluntary organisations—at one stage or another may have to risk their lives. Only those in our armed forces have a totally open-ended commitment, literally on an order, not just to risk their lives but to take other people's lives for the protection of Britain and of society. That makes them unique.
    The Opposition fully stand by the attitude of the previous Government and this Government, which is that we should ensure that, there are equal opportunities for everybody within the armed forces, and that racism and bullying will not be tolerated. As much as anything else, that is a command responsibility by all ranks in responsible positions. People who break those rules and regulations will receive no sympathy from us.
    However, at times the Secretary of State has seemed to send a complex message. The case of Major Eric Joyce is still unresolved. He is a serving officer who wrote a pamphlet some 18 months ago criticising the British Army, saying that it had many things wrong with it, that it was class-ridden and full of public schoolboys. That has not stopped the Secretary of State having a good relationship with the Chief of the Defence Staff, or with the Prime Minister or with his Under-Secretary—I understand that Dulwich is a public school. There is something hypocritical there.
    The Secretary of State has failed to answer the questions that I, and other hon. Members, have put about how it is possible for a serving officer to continue to serve in the British Army having made such statements, and, more recently, having participated in the selection for the Scottish Parliament as a Labour party candidate. Had he stood for any other political party, I suspect that that officer would now be out. Had he written an article criticising Eurofighter, I suspect that he would have been asked to resign. I call that double standards.
    There are a number of unanswered questions which I hope the Minister will answer either this evening or, if he does not have time, in writing. First, will he publish the foreign policy baseline of the strategic defence review? Secondly, will he publish the long-term costings and confirm the in-service date for both the so-called planned carriers? Will he undertake to provide the House, especially the Defence Committee, with a comprehensive document on the defence budget and its resources? We got one page in the defence review. Will he undertake to hold single-service debates on the Royal Navy and the Army?

    1173
    The previous Government provided funding, equipment and the manning for the current operations of the armed forces—Northern Ireland, Bosnia and the Gulf. Now, with the SDR published and as we begin the long and difficult task of implementation, there can be no more ministerial excuses. The public will judge Labour's defence policy by action, results and implementation, not by rhetoric or soundbites of one kind or another. I therefore urge all hon. Members to support the Opposition amendment and urge Labour Members, "Be brave, throw away your pagers, show that you have minds of your own"—I know that one or two of them have—"and come into the Lobby with us. Speak for Britain."
    9.45 pm
    The Parliamentary Under-Secretary of State for Defence (Mr. John Spellar): This has been an interesting debate. The hon. Member for Salisbury (Mr. Key) advised us that his constituency was previously represented by eight Members of Parliament, which is obviously an example of efficiency measures. I was accused by the hon. Members for Blaby (Mr. Robathan) and for Mid-Sussex (Mr. Soames) of political correctness. Colleagues will find that slightly difficult to take. It is also absolutely absurd—we are talking not about political correctness, but about good, old-fashioned British virtues of fair play and decency. In that context, the contribution of the hon. Member for Mid-Norfolk (Mr. Simpson) was welcome.
    In closing what has been a good debate, I should like to address two areas of defence business which may not catch the headlines in the way that operations do, but which are none the less extremely important: the defence estate and the smart procurement initiative. Ministry of Defence land holdings in the United Kingdom currently extend to almost half a million acres. We are thus a major landowner and a major customer of the United Kingdom construction industry, to the tune of £1.7 billion a year.
    Our management of the wider defence estate was considered carefully during the strategic defence review. We had to ensure that our estate is not only utilised to the maximum possible extent, but is the right size to meet our changing operational requirements. We have concluded that there should be more effective central strategic management of the estate. As a result of a thorough review of our estate holdings during the SDR, we have put in place an ambitious, but achievable, land disposal programme which will shape our estate better to reflect the new structure and priorities of the armed forces. It is also part of our contribution to brown-field development, which was mentioned by the hon. Member for Colchester (Mr. Russell).
    Mr. Ian Bruce: The Minister knows from our many conversations that I am concerned, as are my constituents, that an air station that is to close and be sold off, for which we had customers, has been frozen from that sale. I am told that we will not even be able to start negotiating until March 1999. That is not acceptable. What is he going to do about it?
    Mr. Spellar: As the hon. Gentleman knows, I was down in Weymouth and Portland last week. I met the local council and a number of the companies involved, and I fully understand the frustration at delays. There are genuine issues that we have to deal with in terms of
    1174
    alternative use; indeed, we aim to progress that as soon as possible. I will write to the hon. Gentleman as soon as we are able to make further progress.
    Last week I also announced major changes in our construction programme. We are a major, £1.7 billion a year public client. As such, we must not only secure value for money for front-line defence, but play our part in reform of the construction industry following the Lathan and Egan reports. That, I have to admit, is challenging, in the best Sir Humphrey use of the word, but it is vital for our defence infrastructure and for our national economy.
    Our smart procurement initiative on defence equipment was mentioned by a number of hon. Members and is, as the hon. Member for Mid-Norfolk rightly said, enormously important for our vital defence industry. The initiative is a key element of a reform programme that will lead to clear improvements in defence procurement in terms of time, cost and performance.
    A full-time smart procurement implementation team has been established. The team started work in earnest in September and has made brisk progress. It is required to produce, by March 1999, a detailed implementation plan for transition activities during 1999–2000. The approach adopted by the team, which is working under the overall direction of a steering group, which I chair, will be to test the smart procurement principles and concepts in a series of pilot projects. A number of projects are now being selected as potential pilots, such as the future offensive air system, the attack helicopter and the future attack submarine.
    Those pilot projects will provide a challenging test of the smart procurement principles in a live environment. They will not involve parallel running, nor will they shadow existing project activity. They will do it for real. They will draw from projects relating to all environments and range across the spectrum of our procurement activity by value, technology, their position in the procurement cycle, and the degree of industry involvement.
    I accept that that is all being driven forward at great speed. Momentum has been generated and we intend to maintain it for two reasons. First, the Ministry of Defence has been set a number of performance and savings targets as part of its funding allocation and we need to ensure that the improvements promised by smart procurement are delivered as soon as possible. Secondly, the reorganisation of projects into integrated project teams creates uncertainty for staff, both civilian and military, which we are keen to resolve at the earliest opportunity. We understand that this is a time of anxiety and opportunity for our staff. Many are looking to the changes with eager anticipation to improve the job that they do for the Department. Some are concerned and will want to move, and others will want to be sure that it works. Like the Select Committee, we recognise that we will need to manage change with care to preserve staff morale and working efficiency.
    Mr. Peter Bradley: My hon. Friend will know of the defence sector's importance to my constituency and how welcome the Secretary of State's announcement was in April that GKN Defence was to be part of the German, French and British consortium that has won the contract for a multi-role armoured vehicle. We are also pleased to see a reference to that in the SDR. Since then, however, we have had the German elections.

    1175
    Can my hon. Friend confirm that Ministers have discussed the issue with their German counterparts, and that the contract remains on track, the consortium remains in place and the timetable is secure?
    Mr. Spellar: That issue was also mentioned by the hon. Member for Salisbury in the introduction to his speech. The position has not changed. We are continuing to discuss with France and Germany the terms of the contract with the winning consortium. We have had no indications from the Germans of an intention to freeze the programme. Not only are we continuing to work actively with them on it, but my right hon. Friend the Secretary of State will go to Germany this week and discuss that matter. I give my hon. Friend those assurances.
    Industry support for, and involvement in, the smart procurement initiative is vital. The creation of new partnering arrangements with industry, established through competition wherever possible, will be an important enabler for a number of the smart procurement principles. I am pleased to tell the House that new guidelines, agreed between the Ministry of Defence and the Confederation of British Industry, will shortly be issued.
    Smart procurement is but one area where we are demonstrating our determination to make the very most from defence resources. Another area where we are considering ways to maximise the return on our investment is that of defence diversification, mentioned by my hon. Friend the Member for Ilford, South (Mr. Gapes). Our Green Paper has been generally well received and I am pleased to announce that we intend shortly to publish a White Paper on defence diversification.
    I shall now deal with some of the matters raised in the debate, though regrettably not all. There was a new and welcome element, particularly in the speeches by the hon. Members for Mid-Sussex and for Salisbury. It might almost be described as "constructive opposition"—they were prepared to say where they agreed and focused on the arguments where they differed. I hope that that does not damage their careers. I say genuinely that it is a welcome development. The real consensus on defence is when we get national agreement on principles, and argue about implementation.
    Hon. Members, including my hon. Friend the Member for Chorley (Mr. Hoyle) and the hon. Members for Portsmouth, South (Mr. Hancock), who has unfortunately had to leave, and for Salisbury, have, again today, asked about carriers. I dealt with most of the points yesterday in columns 1051 and 1052 of Hansard. I reaffirm what we said in paragraph 115 of the SDR, which is that
    "we plan to replace our current carriers from around 2012 by two larger, more versatile carriers".
    That is what we said, that is what we are going to do, and that is what the Navy wants.
    Mr. John Maples: I am glad to hear that commitment. If that is the case, what will the Ministry do if the feasibility studies on the existing carriers conclude that it can be done, and they can land the joint strike fighter? Will he throw that out?
    Mr. Spellar: Having misread the advertisement yesterday, and having carefully omitted the word "study", the hon. Member for Stratford-on-Avon should have kept quiet. We answered that question.
    1176
    Yesterday, the right hon. Member for Wealden (Sir G. Johnson Smith) and the hon. Member for Stratford-on-Avon referred to NATO, as did my hon. Friend the Member for Ilford, South today. In our manifesto, we said:
    "Our security will continue to be based on NATO."
    In the strategic defence review, we said:
    "NATO will continue as the cornerstone of our defence planning".
    That is why it was sad to see the outbreak of Euro-scepticism among Conservative Members. There is no sharp choice between Europe and America in today's strategic environment. They are but two sides of the same coin: both are essential to our security.
    Britain is playing a key role in developing NATO's new strategic concept—the alliance's own SDR—to give it an equally clear vision into the next century. We are also playing a central role in developing an effective European security and defence identity in NATO. I stress the word "effective", because at present European rhetoric is not matched by the reality of Europe's military capability. Our priority must be to ensure that European allies can make an effective military contribution to operations, including when the Americans choose not to participate.
    The Western European Union is an integral part of that approach. Progress on the practical relationships between WEU and NATO on the one hand, and WEU and the European Community on the other, are important to avoid unnecessary and damaging duplication of the work of all three organisations.
    The hon. Members for Salisbury and for Tatton (Mr. Bell) referred to the Association of RAF Wives. I am pleased to tell them that the chairman and executive of that organisation met the air member for personnel earlier this month. They have agreed to produce in the next month or so a memorandum of understanding and an acceptable business plan for the association. I am sure that that is welcome, and I shall write to the two hon. Gentlemen to inform them of the outcome.
    My hon. Friends the Members for Leyton and Wanstead (Mr. Cohen), for Aberdeen, North (Mr. Savidge) and for Bury, North (Mr. Chaytor) referred to nuclear disarmament. On many occasions, we have made clear our commitment to the goal of global elimination of nuclear weapons. When we are satisfied with verified progress towards that goal, we shall ensure that British nuclear weapons are included in multilateral negotiations. We are working to take forward our commitment in the light of the conclusions of the SDR.
    I remind colleagues that the United Kingdom was the first nuclear weapon state to introduce legislation to implement the comprehensive test ban treaty. We also welcome the agreement made this year at the conference on disarmament to begin negotiations on a convention verifiably ending production of fissile material for use in nuclear weapons.
    The hon. Member for Mid-Sussex referred to the movement of staff between the Foreign and Commonwealth Office and the Ministry of Defence. I presume that, as the new permanent secretary at the MOD has come from the Foreign Office, we may be instigating that policy.

    1177
    My colleagues and I are justifiably proud of the outcome of the strategic defence review. We have developed a package of measures that will provide a clear and sensible direction for the armed forces and all those who support them. That package has been welcomed on all sides: it has been praised by politicians, journalists and academics here and around the world and, most important, by the men and women whose lives are most affected. That should not surprise us. The structure that will emerge from the review will provide modern and relevant forces that will be more effective and more capable of furthering Britain's interests as a force for good in the world.
    We are keenly aware that the success of our proposals depends on implementation, and we know that that is no easy task, but the rewards will be great, and we are determined to achieve them. As we have made clear in the past two days, we are making good progress.
    The strategic defence review has been a remarkable success. Its implementation promises much, and will deliver it. I have pleasure in commending it to the House.
    Question put, That the amendment be made:—
    The House divided: Ayes 134, Noes 366.

    Division No. 362]

    [9.59 pm

    AYES

    Ainsworth, Peter (E Surrey)

    Fox, Dr Liam

    Amess, David

    Fraser, Christopher

    Ancram, Rt Hon Michael

    Gale, Roger

    Arbuthnot, James

    Garnier, Edward

    Atkinson, Peter (Hexham)

    Gibb, Nick

    Beggs, Roy

    Gill, Christopher

    Bercow, John

    Gillan, Mrs Cheryl

    Beresford, Sir Paul

    Gorman, Mrs Teresa

    Blunt, Crispin

    Gray, James

    Body, Sir Richard

    Green, Damian

    Boswell, Tim

    Greenway, John

    Bottomley, Peter (Worthing W)

    Gummer, Rt Hon John

    Brady, Graham

    Hague, Rt Hon William

    Brazier, Julian

    Hamilton, Rt Hon Sir Archie

    Brooke, Rt Hon Peter

    Hammond, Philip

    Browning, Mrs Angela

    Hawkins, Nick

    Bruce, Ian (S Dorset)

    Hayes, John

    Burns, Simon

    Heald, Oliver

    Butterfill, John

    Heathcoat-Amory, Rt Hon David

    Cash, William

    Horam, John

    Chapman, Sir Sydney (Chipping Barnet)

    Howarth, Gerald (Aldershot)

    Hunter, Andrew

    Chope, Christopher

    Jack, Rt Hon Michael

    Clappison, James

    Jackson, Robert (Wantage)

    Clark, Rt Hon Alan (Kensington)

    Jenkin, Bernard

    Clark, Dr Michael (Rayleigh)

    Johnson Smith,

    Clarke, Rt Hon Kenneth (Rushcliffe)

    Rt Hon Sir Geoffrey

    Key, Robert

    Clifton-Brown, Geoffrey

    King, Rt Hon Tom (Bridgwater)

    Collins, Tim

    Lait, Mrs Jacqui

    Colvin, Michael

    Lansley, Andrew

    Cormack, Sir Patrick

    Leigh, Edward

    Cran, James

    Letwin, Oliver

    Curry, Rt Hon David

    Lewis, Dr Julian (New Forest E)

    Davies, Quentin (Grantham)

    Lidington, David

    Davis, Rt Hon David (Haltemprice)

    Lilley, Rt Hon Peter

    Day, Stephen

    Lloyd, Rt Hon Sir Peter (Fareham)

    Duncan, Alan

    Loughton, Tim

    Duncan Smith, Iain

    Luff, Peter

    Emery, Rt Hon Sir Peter

    MacGregor, Rt Hon John

    Evans, Nigel

    MacKay, Andrew

    Faber, David

    Maclean, Rt Hon David

    Fabricant, Michael

    McLoughlin, Patrick

    Flight, Howard

    Malins, Humfrey

    Forth, Rt Hon Eric

    Maples, John

    1178

    Mates, Michael

    Streeter, Gary

    May, Mrs Theresa

    Swayne, Desmond

    Moss, Malcolm

    Syms, Robert

    Nicholls, Patrick

    Tapsell, Sir Peter

    Norman, Archie

    Taylor, Ian (Esher & Walton)

    Page, Richard

    Taylor, John M (Solihull)

    Paterson, Owen

    Thompson, William

    Pickles, Eric

    Townend, John

    Prior, David

    Trend, Michael

    Randall, John

    Tyrie, Andrew

    Redwood, Rt Hon John

    Viggers, Peter

    Robathan, Andrew

    Walter, Robert

    Robertson, Laurence (Tewk'b'ry)

    Whitney, Sir Raymond

    Rowe, Andrew (Faversham)

    Whittingdale, John

    Ruffley, David

    Widdecombe, Rt Hon Miss Ann

    St Aubyn, Nick

    Wilkinson, John

    Sayeed, Jonathan

    Wilshire, David

    Shephard, Rt Hon Mrs Gillian

    Winterton, Mrs Ann (Congleton)

    Simpson, Keith (Mid-Norfolk)

    Winterton, Nicholas (Macclesfield)

    Smyth, Rev Martin (Belfast S)

    Woodward, Shaun

    Soames, Nicholas

    Yeo, Tim

    Spicer, Sir Michael

    Young, Rt Hon Sir George

    Spring, Richard

    Tellers for the Ayes:

    Stanley, Rt Hon Sir John

    Sir David Madel and

    Steen, Anthony

    Mrs. Caroline Spelman.

    NOES

    Adams, Mrs Irene (Paisley N)

    Campbell—Savours, Dale

    Ainger, Nick

    Canavan, Dennis

    Ainsworth, Robert (Cov'try NE)

    Cann, Jamie

    Alexander, Douglas

    Caplin, Ivor

    Allen, Graham

    Casale, Roger

    Anderson, Janet (Rossendale)

    Caton, Martin

    Armstrong, Ms Hilary

    Chapman, Ben (Wirral S)

    Ashton, Joe

    Chaytor, David

    Atkins, Charlotte

    Chisholm, Malcolm

    Austin, John

    Clapham, Michael

    Banks, Tony

    Clark, Rt Hon Dr David (S Shields)

    Barnes, Harry

    Clark, Dr Lynda (Edinburgh Pentlands)

    Barron, Kevin

    Battle, John

    Clark, Paul (Gillingham)

    Bayley, Hugh

    Clarke, Charles (Norwich S)

    Beard, Nigel

    Clarke, Eric (Midlothian)

    Beckett, Rt Hon Mrs Margaret

    Clarke, Rt Hon Tom (Coatbridge)

    Begg, Miss Anne

    Clarke, Tony (Northampton S)

    Bell, Martin (Tatton)

    Clelland, David

    Bell, Stuart (Middlesbrough)

    Clwyd, Ann

    Benton, Joe

    Coaker, Vernon

    Bermingham, Gerald

    Coffey, Ms Ann

    Berry, Roger

    Cohen, Harry

    Best, Harold

    Coleman, lain

    Betts, Clive

    Colman, Tony

    Blackman, Liz

    Connarty, Michael

    Blair, Rt Hon Tony

    Cook, Frank (Stockton N)

    Blears, Ms Hazel

    Cooper, Yvette

    Blizzard, Bob

    Corbett, Robin

    Blunkett, Rt Hon David

    Corston, Ms Jean

    Boateng, Paul

    Cousins, Jim

    Borrow, David

    Cranston, Ross

    Bradley, Keith (Withington)

    Crausby, David

    Bradley, Peter (The Wrekin)

    Cryer, John (Hornchurch)

    Bradshaw, Ben

    Cummings, John

    Brinton, Mrs Helen

    Cunningham, Jim (Cov'try S)

    Brown, Rt Hon Gordon (Dunfermline E)

    Curtis—Thomas, Mrs Claire

    Brown, Russell (Dumfries)

    Dafis, Cynog

    Buck, Ms Karen

    Dalyell, Tam

    Burden, Richard

    Darling, Rt Hon Alistair

    Burgon, Colin

    Darvill, Keith

    Butler, Mrs Christine

    Davey, Valerie (Bristol W)

    Byers, Stephen

    Davidson, Ian

    Caborn, Richard

    Davies, Rt Hon Denzil (Llanelli)

    Campbell, Alan (Tynemouth)

    Davies, Geraint (Croydon C)

    Campbell, Mrs Anne (C'bridge)

    Davies, Rt Hon Ron (Caerphilly)

    Campbell, Ronnie (Blyth V)

    Dawson, Hilton

    Dean, Mrs Janet

    1179

    Denham, John

    Howarth, George (Knowsley N)

    Dismore, Andrew

    Hoyle, Lindsay

    Dobbin, Jim

    Hughes, Ms Beverley (Stretford)

    Dobson, Rt Hon Frank

    Hughes, Kevin (Doncaster N)

    Donohoe, Brian H

    Humble, Mrs Joan

    Doran, Frank

    Hurst, Alan

    Drew, David

    Hutton, John

    Drown, Ms Julia

    Iddon, Dr Brian

    Eagle, Angela (Wallasey)

    Illsley, Eric

    Eagle, Maria (L'pool Garston)

    Jackson, Ms Glenda (Hampstead)

    Edwards, Huw

    Jackson, Helen (Hillsborough)

    Efford, Clive

    Jamieson, David

    Ellman, Mrs Louise

    Jenkins, Brian

    Ennis, Jeff

    Johnson, Alan (Hull W & Hessle)

    Etherington, Bill

    Johnson, Miss Melanie (Welwyn Hatfield)

    Ewing, Mrs Margaret

    Jones, Barry (Alyn & Deeside)

    Fatchett, Derek

    Jones, Mrs Fiona (Newark)

    Field, Rt Hon Frank

    Jones, Helen (Warrington N)

    Fisher, Mark

    Jones, leuan Wyn (Ynys Môn)

    Fitzpatrick, Jim

    Jones, Jon Owen (Cardiff C)

    Fitzsimons, Lorna

    Jones, Dr Lynne (Selly Oak)

    Flint, Caroline

    Jones, Martyn (Clwyd S)

    Flynn, Paul

    Jowell, Ms Tessa

    Foster, Rt Hon Derek

    Keeble, Ms Sally

    Foster, Michael Jabez (Hastings)

    Keen, Alan (Feltham & Heston)

    Foster, Michael J (Worcester)

    Keen, Ann (Brentford & Isleworth)

    Fyfe, Maria

    Kelly, Ms Ruth

    Galbraith, Sam

    Kennedy, Jane (Wavertree)

    Galloway, George

    Khabra, Piara S

    Gapes, Mike

    Kidney, David

    Gardiner, Barry

    Kilfoyle, Peter

    George, Bruce (Walsall S)

    King, Ms Oona (Bethnal Green)

    Gerrard, Neil

    Kingham, Ms Tess

    Gibson, Dr Ian

    Kumar, Dr Ashok

    Gilroy, Mrs Linda

    Ladyman, Dr Stephen

    Godman, Dr Norman A

    Lawrence, Ms Jackie

    Godsiff, Roger

    Lepper, David

    Goggins, Paul

    Leslie, Christopher

    Levitt, Tom

    Golding, Mrs Llin

    Lewis, Ivan (Bury S)

    Gordon, Mrs Eileen

    Lewis, Terry (Worsley)

    Graham, Thomas

    Liddell, Mrs Helen

    Griffiths, Jane (Reading E)

    Linton, Martin

    Griffiths, Nigel (Edinburgh S)

    Lock, David

    Griffiths, Win (Bridgend)

    Love, Andrew

    Grocott, Bruce

    McAllion, John

    Grogan, John

    McCabe, Steve

    Gunnell, John

    McCafferty, Ms Chris

    Hall, Mike (Weaver Vale)

    McCartney, Ian (Makerfield)

    Hall, Patrick (Bedford)

    McDonagh, Siobhain

    Hamilton, Fabian (Leeds NE)

    Macdonald, Calum

    Hanson, David

    McDonnell, John

    Harman, Rt Hon Ms Harriet

    McIsaac, Shona

    Heal, Mrs Sylvia

    McKenna, Mrs Rosemary

    Healey, John

    Mackinlay, Andrew

    Henderson, Doug (Newcastle N)

    McNulty, Tony

    Henderson, Ivan (Harwich)

    MacShane, Denis

    Hepburn, Stephen

    Mactaggart, Fiona

    Heppell, John

    McWalter, Tony

    Hesford, Stephen

    McWilliam, John

    Hewitt, Ms Patricia

    Mahon, Mrs Alice

    Hill, Keith

    Mallaber, Judy

    Hinchliffe, David

    Marsden, Gordon (Blackpool S)

    Hodge, Ms Margaret

    Marsden, Paul (Shrewsbury)

    Marshall, Jim (Leicester S)

    Hoey, Kate

    Marshall-Andrews, Robert

    Home Robertson, John

    Martlew, Eric

    Hood, Jimmy

    Maxton, John

    Hoon, Geoffrey

    Meacher, Rt Hon Michael

    Hope, Phil

    Merron, Gillian

    Hopkins, Kelvin

    Michael, Alun

    Howarth, Alan (Newport E)

    Michie, Bill (Shef'ld Heeley)

    1180

    Miller, Andrew

    Smith, Angela (Basildon)

    Mitchell, Austin

    Smith, Miss Geraldine (Morecambe & Lunesdale)

    Moffatt, Laura

    Moonie, Dr Lewis

    Smith, Jacqui (Redditch)

    Moran, Ms Margaret

    Smith, John (Glamorgan)

    Morgan, Ms Julie (Cardiff N)

    Smith, Llew (Blaenau Gwent)

    Morgan, Rhodri (Cardiff W)

    Snape, Peter

    Morley, Elliot

    Soley, Clive

    Morris, Ms Estelle (B'ham Yardley)

    Southworth, Ms Helen

    Morris, Rt Hon John (Aberavon)

    Spellar, John

    Mudie, George

    Squire, Ms Rachel

    Mullin, Chris

    Starkey, Dr Phyllis

    Murphy, Denis (Wansbeck)

    Steinberg, Gerry

    Naysmith, Dr Doug

    Stevenson, George

    Norris, Dan

    Stewart, David (Inverness E)

    O'Brien, Bill (Normanton)

    Stewart, Ian (Eccles)

    O'Brien, Mike (N Warks)

    Stinchcombe, Paul

    O'Hara, Eddie

    Stoate, Dr Howard

    Organ, Mrs Diana

    Stott, Roger

    Osborne, Ms Sandra

    Strang, Rt Hon Dr Gavin

    Palmer, Dr Nick

    Straw, Rt Hon Jack

    Pearson, Ian

    Stringer, Graham

    Pendry, Tom

    Stuart, Ms Gisela

    Perham, Ms Linda

    Sutcliffe, Gerry

    Pickthall, Colin

    Taylor, Rt Hon Mrs Ann (Dewsbury)

    Pike, Peter L

    Plaskitt, James

    Taylor, Ms Dari (Stockton S)

    Pollard, Kerry

    Taylor, David (NW Leics)

    Pond, Chris

    Temple—Morris, Peter

    Pope, Greg

    Thomas, Gareth R (Harrow W)

    Pound, Stephen

    Timms, Stephen

    Powell, Sir Raymond

    Tipping, Paddy

    Prentice, Ms Bridget (Lewisham E)

    Todd, Mark

    Prentice, Gordon (Pendle)

    Touhig, Don

    Prescott, Rt Hon John

    Trickett, Jon

    Prosser, Gwyn

    Truswell, Paul

    Purchase, Ken

    Turner, Dennis (Wolverh'ton SE)

    Quin, Ms Joyce

    Turner, Dr Desmond (Kemptown)

    Quinn, Lawrie

    Turner, Dr George (NW Norfolk)

    Radice, Giles

    Twigg, Derek (Halton)

    Rammell, Bill

    Twigg, Stephen (Enfield)

    Rapson, Syd

    Vaz, Keith

    Raynsford, Nick

    Vis, Dr Rudi

    Reed, Andrew (Loughborough)

    Walley, Ms Joan

    Reid, Dr John (Hamilton N)

    Ward, Ms Claire

    Robertson, Rt Hon George (Hamilton S)

    Wareing, Robert N

    Watts, David

    Rogers, Allan

    Welsh, Andrew

    Rooker, Jeff

    White, Brian

    Rooney, Terry

    Whitehead, Dr Alan

    Ross, Ernie (Dundee W)

    Wicks, Malcolm

    Rowlands, Ted

    Williams, Rt Hon Alan (Swansea W)

    Roy, Frank

    Ruane, Chris

    Williams, Alan W (E Carmarthen)

    Ruddock, Ms Joan

    Wills, Michael

    Russell, Ms Christine (Chester)

    Winnick, David

    Ryan, Ms Joan

    Winterton, Ms Rosie (Doncaster C)

    Salmond, Alex

    Wise, Audrey

    Salter, Martin

    Wood, Mike

    Sarwar, Mohammad

    Woolas, Phil

    Savidge, Malcolm

    Worthington, Tony

    Sawford, Phil

    Wray, James

    Sedgemore, Brian

    Wright, Anthony D (Gt Yarmouth)

    Shaw, Jonathan

    Wright, Dr Tony (Cannock)

    Sheldon, Rt Hon Robert

    Wyatt, Derek

    Shipley, Ms Debra

    Singh, Marsha

    Tellers for the Noes:

    Skinner, Dennis

    Mr. Jim Dowd and

    Smith, Rt Hon Andrew (Oxford E)

    Mrs. Anne McGuire.

    Question accordingly negatived.
    Main Question put and agreed to.
    Resolved,
    That this House approves the conclusions of the Government's Strategic Defence Review (Cm 3999)

  PETITION

    Midwifery Service
    10.15 pm
    Audrey Wise: I am honoured to present a petition signed by nearly 70,000 people from all parts of the United Kingdom. It concerns maternity services, and while many of the signatories are midwives, many are not. There are only 32,000 practising midwives, and many other people have signed to show their support. Maternity services are fundamental: we are all born and many of us are parents. We value our midwives.
    The petition states:
    The Petition of midwives and others concerned
    Declares that the midwifery service is at breaking point, due to midwives leaving the profession because of low pay and because midwifery is no longer an attractive career option.
    The Petitioners therefore request that the House of Commons urges the Government to prevent increased risk to mothers and babies caused by midwife retention and recruitment problems and to ensure that midwives are paid appropriately and the minimum grade of F or equivalent is paid in accordance with NHS guidance.
    And the Petitioners remain your humble servants.
    To lie upon the Table.

  M8 Motorway (Upgrading)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Hanson.]
  10.17 pm
  Mr. Tom Clarke: I thank the Minister for the courtesies of his telephone call about the M8 announcement, and of his letter of 6 August informing me of the decision not to proceed with proposals to extend the motorway. Many people in Lanarkshire, not least in Coatbridge and Chryston, regard that as a serious blow. I need not remind my hon. Friend of what I can only describe as the economic devastation that has decimated Lanarkshire over the past 15 years or more. Solving the problems of Lanarkshire's economy is crucial if the area is to replace jobs lost in the closures at Ravenscraig, Caterpillar, Gartcosh and many other places. Only then can we restore hope to thousands of people's lives. Improved road networks are an essential part of that.
  In December 1990, in response to local and national concern about the impact of these job losses, the then Secretary of State for Scotland announced the setting up of a Lanarkshire working group headed by Allan Stewart, then the Minister responsible for industry at the Scottish Office, bringing together the main agencies active in economic development in the area. The group's broad remit was to identify the main physical, economic and environmental constraints on revitalising the local economy. Its study found that physical problems were the most significant obstacles to the resolution of the problems that afflicted, and still afflict, Lanarkshire. One of the group's most important points was that it
  "regards the upgrading of the final section of the A8 between Newhouse and Baillieston as being the first priority."
  That is what this debate is all about.
  I remind the Minister that that recommendation was made way back in 1990. It met with unanimous support in my constituency and was endorsed by the then Strathclyde regional council, the Lanarkshire development agency and the former districts of Monklands, Motherwell, Strathkelvin and Cumbernauld and Kilsyth, which make up the present North Lanarkshire council area.
  It was recognised then, not least by the Scottish Office, that the M8–A8 route between Glasgow and Edinburgh is one of the Scotland's most important internal and strategic routes. It is a primary link with major arterial ties, serving Scotland north of the central belt, southern Scotland and the whole of England. The decisions this August imply that the Baillieston-Newhouse sector—the one area that needs an improved infrastructure, having been denied it for too long—may well deteriorate rather than be improved. The situation could be with us for many more years.
  People travelling on that section of the motorway cannot help but notice the significant amount of patching and repair. Scottish Office research has shown that it has carried the highest volumes of business trips of any road in Scotland. It is badly dilapidated and the geometry is substandard. Freight traffic is being blatantly disadvantaged. Allan Blackley of the local chamber of commerce spoke for many when he said that
  "there is a general reluctance by business people to visit the area or, indeed, travel from one part to the other at certain times of the day."

  1183
  A significant cause of the A8's problems, where traffic has grown at twice the national average, stems from its dual role as a strategic route carrying long distance traffic and as a local route serving the communities and industries located around my constituency. The congestion and state of disrepair that are the natural consequence of the inadequacy of the present A8 mean that lorries are being diverted through the already overcrowded roads of my constituency. As a film buff, there are times when I wonder whether I am on the set of the film "Convoy" rather than on my own patch: lorries, lorries and more lorries.
  Poor infrastructure affects the whole of Lanarkshire and, indeed, Scotland. We have known for years that the A8 is approaching the end of its working capacity and is increasingly in need of costly and disruptive maintenance. Minor incidents, poor weather and road works cause substantial delays, affect safety and have adverse environmental impacts on noise and air pollution.
  The 1990 recommendations by the Lanarkshire working group that the A8 should be upgraded are even more relevant given the sheer chaos of today. Economically, the A8 has simply failed local enterprise. For far too long, we have lacked the infrastructure necessary to attract vital inward investment. Local businesses can do without roads that are constantly in a state of disrepair, with endless bottlenecks and tailbacks.
  Moreover, the A8 is no friend of the environment. Its perpetual state of disrepair has undoubtedly increased noise and air pollution. Those are the very things that my right hon. Friend the Deputy Prime Minister, in his excellent White Paper, has said he wishes to eradicate.
  The road also has a terrible safety record. Since 1986 on the A8 between Newhouse and Baillieston there have been almost 400 accidents, of which 87 were serious and 21 were fatal. Last year alone, there were eight serious accidents in which three people died.
  When we consider the inadequacy of the A8 and its manifest dangers, it is no surprise that as far back as 1990 the Lanarkshire working group supported the upgrading first mooted in 1965–33 years ago. The Scottish Office also saw the need for change. At a national, regional and district level, the recommendations for the upgrading of the A8 were endorsed by the Scottish Office. It warmly embraced the proposal, described by it as a 10-lane superhighway—in parts 14-lane—as compared with the existing four lanes.
  In a letter written by W. H. Valentine from the Scottish Office to the Lanarkshire Development Agency in 1996, the position was reaffirmed. On the development of EuroCentral, he stated:
  "it is but one of many priorities for the Scottish Office, the main one being to improve the access along the A8/M8 corridor and to aid economic development in Lanarkshire as a whole."
  When the then Secretary of State for Scotland announced in December 1996 that private finance would be used to complete the upgrading of the M8, he reiterated what people in Lanarkshire had been saying for years:
  "The upgrading will not only provide a new upgraded motorway but also an improved local road network which will allow distribution access to existing businesses and new economic initiatives along the road corridor, such as Chungwa … at EuroCentral."
  1184
  He touched on an important point for EuroCentral, which is just one example of an enterprise that had based many of its vital business decisions on the assumption that the M8 upgrading would take place—in this case, the decision to invest £12.1 million to connect EuroCentral to the new M8 superhighway. Moreover, the M8 was enthusiastically supported at a public inquiry that required less than one day. There is now extensive congestion during peak flows at Shawhead, EuroCentral, Chapelhall and Newhouse.
  I regret to have to say, but I do so in all candour, that the decision to abandon plans has greatly concerned inward investors who had been advised that the upgrade was imminent. The decision has reduced business confidence. Some people fear long-term damage to the local and national economy. How does the Scottish Office expect to encourage inward investment in an area in which the main arteries to the key markets in Scotland, the rest of the United Kingdom and abroad fail to meet modern standards?
  I must ask my hon. Friend for an important reassurance for my constituents on road pricing. Will the resources gained from pricing be in addition to current transport spending? Will the money be ploughed back into those communities that are paying the charges?
  I should like my hon. Friend to clarify the contents of a serious letter from David Hart at the Scottish Office to the acting chief executive at North Lanarkshire council. On 13 October Mr. Hart said that
  "options for a more limited enhancement of the A8 in Lanarkshire will now be considered within the strategic roads review, which is expected to be completed by the end of this year or early in 1999."
  Frankly, "a limited enhancement" of the A8 will do little to meet the needs of all who depend on the regeneration of Lanarkshire. Too much time has already been lost. We know, after endless rounds of consultation, what local and national enterprises see as the way forward. They have told us time and again, I think rightly, of the crucial nature of the project.
  If I were putting a question to the Minister's advisers it would be quite simple. What else do we need to know? Why go over old ground? Heavens! If the Romans had approached road building in this way, we would never have heard of Hadrian's wall, and the Antonine wall would no doubt still be under review.
  What on earth is the point of another delay costing a lot more private and public money? The west of Scotland accounts for over 60 per cent. of Scottish manufactured exports, 42 per cent. of Scottish employment and 50 per cent. of employment in electronics and electrical engineering. That is very important. Electronics-based companies engage in just-in-time processes. In common with most sectors now, freight movements have become an integral part of the production process. Roads are critical to that sector. Some 85 per cent. of electronic products are circulated through and exported from Scotland by road; and even after all the reviews, there is no obvious alternative. I shudder to think how many orders have gone up in smoke, along with unacceptable amounts of pollution, while lorries have been held up in congestion on the A8 day after day. We just do not have the rail infrastructure to cope with that volume of business.
  In the economy generally, about 80 per cent. of the freight lifted in Scotland is delivered by road. It is extremely difficult to imagine how the volume of traffic

  1185
  could be transferred and absorbed by other modes of transport. The M8 upgrading would complete the motorway link between Scotland's principal cities which is critical to the Scottish economy in general and to the regeneration of west central Scotland in particular.
  Like my hon. Friends, I do not find that my arguments are inconsistent with the sort of Lanarkshire that I want to see. Of course it would be wrong to see Lanarkshire only in terms of closure, despair and unemployment. I want to see Lanarkshire utilise its potential—a well-educated and young work force and a healthy diversity of companies—and move forward to develop a strong local and modern economy served by the sort of viable transport infrastructure that I believe our people deserve.
  10.33 pm
  The Parliamentary Under-Secretary of State for Scotland (Mr. Calum Macdonald): I congratulate my right hon. Friend the Member for Coatbridge and Chryston (Mr. Clarke) on securing the opportunity to debate a subject that is clearly vital for his constituency and the whole of central Scotland. I hope that I can respond to all the points that he made in his eloquent and forceful speech on behalf of his constituents and, in particular, I shall say something about the enhancement of the A8 that we are considering.
  I accept fully that the A8 and the M8 are critical parts of Scotland's transport infrastructure—there is no dispute about that. Although the great majority of the road between Glasgow and Edinburgh is of motorway standard, the 10 km section between Baillieston at the outskirts of Glasgow and Newhouse in Lanarkshire, which passes through my right hon. Friend's constituency, remains all-purpose, two-lane dual carriageway. That section is particularly important because it serves key development areas including Tannochside, Strathclyde business park, Newhouse industrial estate and the EuroCentral site and its rail freight terminal.
  My right hon. Friend emphasised the congestion problems. It is a sign of the success of efforts to attract new jobs to Lanarkshire that traffic on the route has increased rapidly in recent years. I am aware of the congestion problems that can arise, particularly during the morning and evening peak periods, and the difficulties that motorists experience in joining the route at some key junctions.
  I acknowledge the safety benefits that upgrading would bring about, which was another key point emphasised by my right hon. Friend. I am aware that that section of road is in poor structural condition so I have no difficulty in agreeing with him that something needs to be done to deal with the problems on the A8.
  My right hon. Friend also mentioned the Lanarkshire working group set up in 1990. I am aware of the various plans over the years to upgrade the Baillieston to Newhouse section, going further back even than the Lanarkshire working group. I understand the local frustration at the fact that none of those plans has been implemented.
  The previous Government had plans to deal with the problem through a private finance initiative design, build, finance and operate scheme. That would have involved the construction of a new section of motorway between Baillieston and Newhouse for through traffic, the
  1186
  upgrading of the existing route to service local traffic and the addition of a third lane to each of the existing motorway carriageways between Newhouse and Shotts. Between Baillieston and Newhouse, the scheme would have involved an increase in capacity from the present four lanes to 10 lanes. With various interconnecting links that would have increased to 13 lanes at the western end of the scheme approaching Baillieston.
  In their last years in office the previous Government slashed the trunk roads budget from £248 million in 1994–95 to £171 million in 1997–98—a reduction of over 30 per cent. Perhaps even more significant is a shift in the pattern of spending within those overall totals. The previous Government maintained a new build programme only by squeezing expenditure on repair and maintenance and using the private finance initiative as a means of deferring expenditure. They had raised expectations of future schemes, including the M8, well beyond what was affordable given the resources that they had allocated. Put simply, they had willed the ends but not the means. More crucially, the squeeze on repair and maintenance was irresponsible and unsustainable. The road network was being allowed to deteriorate to a condition that now demands remedial action.
  In place of that short-termism we were determined to develop an integrated approach to transport that would balance public and private transport needs and the demands of economic growth with our responsibility to the environment. The development of that strategy reached an important stage in July when we published our White Paper, "Travel Choices for Scotland". That aims to offer those using transport services and infrastructure in Scotland a genuine choice by promoting a high-quality integrated transport system that is sustainable.
  Our White Paper signalled the end of the old predict and provide approach to trunk road construction, which is self-defeating, environmentally damaging and unaffordable because new road capacity generates extra traffic, extra pollution and extra demands for further increases in capacity.
  That does not mean that the Government are anti-roads or anti-cars; on the contrary, we firmly believe that the road system will continue to provide vital links for private users and industry. That is why, even within the comprehensive spending review, which increased resources for priorities such as education and health, we have allocated an additional £58 million over the next three years to the trunk roads programme. We have stated clearly that, after meeting our legal commitments, our first priority must be to tackle that massive backlog of essential repair and maintenance that we inherited from the previous Government.
  It is against that background that we concluded that the private finance initiative scheme for the M8 proposed by the previous Government was simply incompatible with our policy direction. As I said, the scheme involved a massive increase in capacity when our policies aim to constrain traffic growth. In addition, the shadow tolls required to pay for the construction and maintenance would have amounted to about £20 million per annum over 30 years. This and the annual commitment to the M74–M6 would have taken about 25 per cent. of the entire trunk roads budget and was simply unaffordable, given the comprehensive spending review outcome and our justifiable decision to give priority to repair and maintenance over the next three years.

  1187
  I said at the outset that there was no dispute between my right hon. Friend and the Government about the need to do something to address conditions on the A8 in Lanarkshire. That is why we have announced that options for a more limited enhancement of the A8 will be considered within our main trunk roads review. Hence, we are currently developing two options for improving the Baillieston to Newhouse section, both of which I can assure my right hon. Friend would improve the road to motorway standards.
  I shall explain what those options entail. A broad choice will need to be made between an alignment that partially bypasses the existing A8 and an alignment that widens the road along its present route. Understandably, both options are at a very early stage in their development and there are a number of combinations of junction layouts to be considered and of consultations to be undertaken before a final decision can be made as to whether either option should be taken forward. However, both options would result in significant improvements.
  The first option would follow an alignment close to the previous Government's proposal, but would be more modest in scale and environmentally more sustainable. This option would bypass the existing A8 in the Shawhead area between Drumpark junction and the EuroCentral junction in order to avoid the disruption associated with altering the complex existing junction of the A8 with the A725 at Shawhead. It would also provide a better connection between the motorway and the A725 Bellshill bypass.
  This option would allow two lanes in each direction for through traffic, but would be widened at critical points to three lanes in each direction to allow traffic joining or leaving the motorway to weave safely with other traffic. Between the junctions at EuroCentral and Chapelhall, two-lane local link roads would also be provided either side of, and parallel to, the proposed motorway to handle the local traffic movements.
  The second option would be to widen the existing A8 along its full length on its present alignment. That would involve building one carriageway of the future motorway alongside and to the south of the existing road, and then converting the existing road into the other carriageway of the motorway and, where appropriate, into a parallel all-purpose local road to cater for access to the few adjoining premises and to permit cycle use. The second option would also allow two lanes in each direction for longer-distance traffic, and, again, would require a selective widening to three lanes in each direction to allow safe access to the motorway. Between EuroCentral and Chapelhall, parallel two-lane local link roads would also be needed in order fully to connect those two junctions to the motorway.
  Those layouts are now being considered as part of the strategic review. They have been chosen to reflect a balance between providing some additional capacity, in recognition of the existing and future pressures on the road, while avoiding the dangers of environmental intrusion and the attraction of traffic from other modes. The additional capacity that either of the two options would provide varies between junctions, but would be approximately 70 per cent. compared with the present
  1188
  road capacity. That figure compares with the 200 per cent. increase in capacity that the previous Government's proposals would have involved.
  Clearly, I cannot predict now the priority rankings that will emerge from the trunk roads review. The review is assessing priorities against the Government's five criteria, which include the two aspects that my right hon. Friend emphasised: economy or congestion and safety. It would be wrong of me to prejudge the outcome of that exercise. Should the A8 be accorded priority, the detailed process of developing and implementing the scheme could begin. As my right hon. Friend will be aware, there are fairly long lead times involved in building a new road, given the statutory and other procedures that must be undertaken before construction can begin.
  Affordability will continue to be an issue. That is one of the reasons why our White Paper announced our intention to move ahead as speedily as possible to introduce the legislation necessary to allow road user charging on sections of the Scottish motorway and trunk road network and to implement early schemes. The White Paper contained a commitment to recycle an appropriate proportion of the proceeds into transport improvements in those areas, including key trunk road improvements as assessed in our trunk roads review. Therefore I can definitely give my right hon. Friend the Member for Coatbridge and Chryston the full assurance that he seeks on that matter. Indeed, the White Paper specifically mentioned the upgrading of the A8 in Lanarkshire as an example of one road that might benefit from that new source of funding.
  The implementation of charging is still some way off, but the Scottish Office and the Department of the Environment, Transport and the Regions are co-operating in a major programme of research and development work, designed to establish the capability of a complete electronic road-user charging system. An important element of that will be a demonstration project, including a Scottish site, which will test, in a real-world situation, the full range of equipment and back-up services needed to operate a free-flowing electronic charging system.
  This week, sections of the media have been speculating that a Scottish pilot will go ahead next spring on the M8. That is not the case. The precise timetable and location of that project have still to be determined, but the lead times involved in launching a project of that scale—which involves, for example, compliance with European procurement procedures—means that it may possibly be the year 2000 before a demonstration project could be in place.
  We shall also seek ways—possibly using the private finance initiative—in which infrastructure improvements can be made before, or at the same time as, charging is introduced. We are certainly aware that road users will look much more favourably on the prospect of charges if they can see, at the same time, some tangible improvements in the service provided to them.
  I therefore regret that I am unable, tonight, to give my right hon. Friend the Member for Coatbridge and Chryston a definite timetable for implementing improvements on the A8 in Lanarkshire. He will

  1189
  appreciate that some uncertainties remain to be resolved. However, I can say that, in the meantime, we shall undertake significant and necessary maintenance work on the A8-M8, which we shall ensure is compatible with the longer-term improvement strategy. I hope that my right hon. Friend will take it from my remarks tonight—especially my comments about our specific proposals for
  1190
  the improvement of the A8-M8—that the Government acknowledge that there is a problem to be addressed, and have taken steps, consistent with our transport policies and the White Paper, and with our wider commitment to control public expenditure, to address that real problem.
  Question put and agreed to.
  Adjourned accordingly at fourteen minutes to Eleven o'clock.

DEFENCE

  Sexual and Ethnic Discrimination
  Mr. Hoyle
  To ask the Secretary of State for Defence what plans he has to reduce sexual and ethnic discrimination within the armed forces. [55360]

  Mr. Doug Henderson
  The Government are committed to eliminating all forms of ethnic and unlawful sexual discrimination within the Armed Forces. Together with the Chiefs of Staff, we are determined to provide a working environment that is free from any form of racial or unlawful sexual discrimination. We will be unremitting in our efforts to remove any racist or sexist attitudes, racially and sexually discriminatory practice, behaviour and language—and this has been made absolutely clear to all Service personnel.

  All three Services are implementing Equal Opportunities Directives and Action Plans to put our commitment into practice.

  We consider that robust equal opportunities training is an important component of our determination to challenge prejudice. To this end, I opened a tri-Service Equal Opportunities Training Centre at the Royal Military College of Science, Shrivenham on 25 September 1998. The centre provides equal opportunities training for dedicated equal opportunities advisers, and all senior personnel—both Service and civilian. The Centre will complement the wide range of equal opportunities training and initiatives already undertaken by my Department.

  The Naval Service has produced a video on sexual and racial harassment, and bullying. It will be distributed to all ships and establishments this month. The video will be accompanied by a supporting letter and feedback questionnaires.

  The Army is introducing mandatory Individual Training Directives (ITDs) for all its personnel. All personnel will be required to undertake a minimum of two 40-minute training sessions on equal opportunities each year.

  The RAF is currently reviewing how it may better convey its policy of 'Zero Tolerance' of harassment and discrimination.

  In addition, personal guides and leaflets on equal opportunities are distributed throughout the Armed Forces and confidential telephone support lines for Service personnel have been introduced.

  RAF Northolt
  Dr. Tonge
  To ask the Secretary of State for Defence what plans he has to consult local authorities on the future of RAF Northolt. [51863]
  1066
  Mr. Doug Henderson
  Any proposals emerging from work currently under way which may affect the future of RAF Northolt will be subject to maximum consultation, which will include local authorities and other interested parties.

  Cyprus
  Mr. Cox
  To ask the Secretary of State for Defence what discussions his Department has had with President Clerides on the subject of a demilitarisation of the Island of Cyprus; and if he will make a statement. [55615]

  Mr. Doug Henderson
  My right hon. Friend the Secretary of State for Defence met President Clerides in Nicosia on 5 October. They had a wide-ranging discussion covering a number of subjects of mutual interest. My right hon. Friend took the opportunity to reassure President Clerides of the UK's continuing and steadfast commitment to supporting UN efforts to bring about a settlement.

  CBDE Technical Papers
  Mr. Livingstone
  To ask the Secretary of State for Defence when the Chemical and Biological Defence Establishment Technical Notes series of documents(a) started and (b) finished; how many documents were produced in this series; and how many of the documents are currently unclassified. [55328]

  Mr. Spellar
  This is a matter for the Chief Executive of the Defence Evaluation and Research Agency. I have asked the Chief Executive to write to my hon. Friend.

  Letter from John Chisholm to Mr. Ken Livingstone, dated 20 October 1998:
  I have been asked to reply to your question about the series of Technical Notes produced by DERA's Chemical and Biological Defence sector (CBD).
  The series of internal reports known as the CBD Technical Notes started in 1969 and finished in 1997. The reports were numbered sequentially from 1 to 1629 although not all numbers were used. There are some 440 unclassified reports in the series, 6 of which are in the Public Record Office in the WO 189 class list.
  I hope this is helpful.

  Strategic Defence Review
  Mr. Key
  To ask the Secretary of State for Defence following the Strategic Defence Review, the withdrawal of troops from Germany and the creation of a sixth new AS 90 regiment, what options for new facilities in Wiltshire(a) he and (b) his Department have assessed; and when he expects to make a decision. [54916]

  Mr. Doug Henderson
  [holding answer 19 October 1998]: My Department is in the process of assessing a range of options for the basing of newly created units, and units which will be relocated from Germany following the Strategic Defence Review. Decisions will be announced as soon as possible.

  Sixth AS 90 Regiment
  Mr. Key
  To ask the Secretary of State for Defence where the new sixth AS 90 regiment will be based; and if he will make a statement. [54917]
  1067
  Mr. Doug Henderson
  [holding answer 19 October 1998]: The Strategic Defence Review identified the requirement to create a sixth AS90 regiment to support the new UK based Mechanised Brigade. No decisions have yet been taken on where the new regiment will be based. An announcement will be made as soon as possible.

  Mine Action Technologies Centre
  Mr. Key
  To ask the Secretary of State for Defence in what areas the British Government are(a) contributing to and (b) participating in, the creation of a centre for mine action technologies at the Defence Research Establishment in Suffield, Canada; and if he will make a statement. [55468]

  Mr. Spellar
  [holding answer 19 October 1998]: The recently opened Centre for Mine Action Technologies at the Defence Research Establishment in Suffield, Canada, is a national initiative in which the British Government have not been involved. The Defence Evaluation and Research Agency (DERA) conducts research into counter mine warfare on behalf of the British Government, and makes publicly available any results relevant to humanitarian de-mining. The Ministry of Defence and the Department for International Development are also actively involved in the international exchange of information and co-operation on mine clearance technologies and will continue to contribute to international work on humanitarian mine clearance.

  Logistic Information Systems Agency
  Mr. Olner
  To ask the Secretary of State for Defence what key targets have been set for the Chief Executive of the Logistic Information Systems Agency 1998–99. [55735]

  Mr. Doug Henderson
  The Chief Executive of the Logistic Information Systems Agency has been set the following Key Targets for 1998–99:Key Target 1—To deliver the agreed levels of service within budget levels defined by the customer.
  Key Target 2—To achieve a reduction in unit costs of 3.0% by April 1999.
  Key Target 3—To improve delivery performance to customer requirements such that:

  95% of Requests for Change are assessed within 7 days.

  The average period required for Request for Change Authorisation is reduced by 10%.

  85% of Requests for Change are moved from the Tasking Phase to the Implementation Phase within 90 days.

TREASURY

  Economic and Finance Council
  Mr. Derek Twigg
  To ask the Chancellor of the Exchequer if he will make a statement on the Council meeting of the Economic and Finance Ministers of the European Union held on 12 October. [55671]

  Mr. Gordon Brown
  I attended the Economic and Finance Council—ECOFIN—of the European Union in Luxembourg on 12 October.
  1068
  The Council started in restricted session with a discussion of the Finnish Stability programme and the Greek Convergence programme which are part of the implementation of the stability and growth pact. These programmes are important to ensure that the launch of the euro is successful. There was agreement to Council opinions for Greece and Finland.

  On preparation of stage 3 of EMU, three items designed to improve multilateral surveillance were approved. The first was a letter by the chairmen of the Monetary Committee and the Economic Policy Committee on the broad economic policy guidelines. The Commission expressed support for a debate in Council in February. The second item was an opinion of the Monetary Committee on the content and format of stability and convergence programmes. The third item on multilateral surveillance was an opinion of the Economic Policy Committee on the content and format of reports on structural reform. The Presidency reminded member states that commitment to reform was essential at the highest levels and that the Economic Policy Committee would report again to ECOFIN on 15 March.

  The Commission presented a report on the Community's Own Resources. There followed a discussion where interest was expressed by some member states in the concept of co-financing the Common Agricultural Policy. In response to criticism by some member states of the UK rebate, I emphasised that, even after the rebate, the UK remains a larger net contributor to the EU budget than Member States with a greater capacity to pay. The UK rebate remains fully justified.

  The Presidency presented a paper on the future financial framework. There was significant support for real terms stabilisation of the financial perspective by 2006 at around current real-terms levels and for this to be reflected in the ECOFIN report to Vienna.

  The chairman of the Economic Policy Committee summarised a statement from the Committee on some key employment policy issues. This statement was accepted by the Council.

  The Finance Ministers of the EFTA member states joined ECOFIN Ministers for lunch. A range of topics were discussed including international economic issues.

  Customs Information System
  Mr. Caplin
  To ask the Chancellor of the Exchequer if the Government have, in addition to Her Majesty's Customs and Excise, designated additional competent authorities with direct access to the Customs Information System (C.I.S.) as referred to in Article 29(2) of EC Regulation 515/97 on mutual administrative assistance. [55776]

  Dawn Primarolo
  In addition to Her Majesty's Customs and Excise, I have designated the Intervention Board Executive Agency, the Home Office, and the Ministry of Agriculture, Fisheries and Food, as competent authorities to have direct access to the Customs Information System (C.I.S.).

  The Data Protection Agency has agreed to be designated as the national supervisory authority responsible for carrying out independent supervision of personal data included in the C.I.S., and it has access to the system for this purpose. (Article 37).
  1069

  Pension Mis-selling
  Ms Lawrence
  To ask the Chancellor of the Exchequer if he will make a statement on progress in the review of personal pensions mis-selling. [55930]

  Ms Hewitt
  Further advances have been made towards completion of the first phase of the review.

  Of the 29 firms whose results are set out in the table only four have resolved less than 75 per cent. of their cases. All firms have now resolved over 60 per cent. of their cases.

  However, the completion of cases, as measured in the table, is not the end of the process. With many firms close to their targets, it is now time for them to turn their

  Progress by pensions firms in resolving cases of personal pensions mis-selling in the period to the end of September 1998

  A

  B

  C

  D

  E

  F

  G

  H

  50–75% of cases resolved

  Countrywide

  5,020

  2,727

  322

  191

  131

  106

  2

  60

  DBS

  2,410

  845

  837

  201

  605

  439

  18

  62

  Financial Options

  554

  294

  74

  26

  48

  35

  6

  64

  Burns Anderson

  1,267

  420

  512

  219

  293

  230

  18

  69

  Over 75% of cases resolved

  IFA Network

  378

  120

  166

  111

  55

  54

  14

  75

  Windsor Life

  9,645

  3,971

  4,080

  320

  3,760

  3,147

  33

  77

  Abbey Life

  17,733

  6,106

  8,680

  1,251

  7,429

  6,573

  37

  79

  Sun Life of Canada

  28,848

  10,276

  13,887

  2,572

  11,315

  10,046

  35

  79

  Lincoln National

  13,533

  2,178

  9,909

  1,377

  8,532

  7,206

  53

  80

  London and Manchester

  8,568

  1,519

  5,922

  677

  5,245

  4,674

  55

  80

  Gan

  12,235

  2,090

  8,615

  912

  7,703

  6,881

  56

  81

  Hill Samuel

  6,199

  918

  4,582

  700

  3,882

  3,483

  56

  82

  Standard Life

  7,435

  889

  5,663

  1,267

  4,396

  4,052

  54

  83

  Colonial

  8,732

  3,119

  4,952

  587

  4,365

  3,652

  42

  84

  Sedgwick

  16,835

  9,504

  5,281

  1,821

  3,460

  2,981

  18

  85

  CIS

  44,681

  7,365

  35,191

  14,003

  21,188

  16,947

  38

  86

  Friends Provident

  7,101

  1,281

  5,204

  814

  4,390

  3,997

  56

  86

  Berkeley Independent

  185

  122

  42

  29

  13

  11

  6

  88

  Hogg Robinson

  2,299

  832

  1,293

  444

  849

  758

  33

  88

  NatWest

  15,396

  4,852

  9,727

  1,266

  8,461

  7,575

  49

  89

  Canada Life

  5,622

  499

  5,048

  661

  4,387

  3,958

  70

  91

  Pearl

  47,541

  4,303

  41,247

  5,856

  35,391

  33,273

  70

  91

  M and E Network

  319

  179

  115

  29

  86

  84

  26

  92

  Equitable Life

  7,629

  1,964

  5,274

  1,804

  3,470

  3,240

  42

  92

  Legal and General

  36,961

  15,235

  20,676

  1,944

  18,732

  17,086

  46

  93

  Allied Dunbar

  19,654

  4,286

  14,531

  3,850

  10,681

  10,146

  52

  93

  Albany Life

  3,105

  713

  2,268

  216

  2,052

  1,963

  63

  93

  Wesleyan

  4,180

  315

  3,769

  960

  2,809

  2,747

  66

  96

  Royal London

  13,532

  1,167

  12,363

  1,546

  10,816

  10,791

  80

  100

  Notes:

  A: cases identified as requiring review

  B: of A, cases where investor was informed that information gained during assessment excluded cases from review

  C: number of assessments completed

  D: cases where the investor has been informed that no redress is due

  E: cases where redress has been offered

  F: cases where redress has been accepted

  G: cases where redress has been accepted as a percentage of cases identified for review ((F/A)x100)

  H: cases completed, including exclusions, as a percentage of cases identified for review (((B+D+F)/A)x100)

  Petrol and Diesel Fuel Imports
  Mr. Thompson
  To ask the Chancellor of the Exchequer what measures are being taken to combat the illegal importation of petrol and diesel fuel from the Republic of Ireland. [55659]

  Ms Hewitt
  The Government recognise that the illegal importation of petrol and diesel across the border into Northern Ireland for resale is a serious problem which 1070
  attention from review to redress. The Government want to see the redress agreed between firms and customers delivered as a matter of priority.

  The PIA is monitoring firms' follow up action to deliver redress, and will take action against laggards where this is warranted.

  The time limit, set by the Personal Investment Authority (PIA), has expired for a further seven firms: Albany Life, Allied Dunbar, Canada Life, Gan, National Westminster, Royal London and Wesleyan. Consistent with the treatment of the twelve firms already removed from the Treasury's monthly list, the PIA will make its assessment of whether they have in fact met their targets. If they have, they will be removed from the list next month. They must continue to update the Treasury on their progress.

  disadvantages legitimate traders. HM Customs are taking the lead, acting in conjunction with other authorities, including the Royal Ulster Constabulary, in deploying resources and actively mounting investigations against those involved to counter the threat posed to the revenue and to the Northern Ireland business community. Wherever possible, cases are progressed with a view to criminal prosecution of the individual concerned.
  1071

HEALTH

  Commission for Health Improvement
  Mr. Paul Marsden
  To ask the Secretary of State for Health if NHS trusts and primary care trusts will be able to purchase the services of the Commission for Health Improvement on a consultancy basis. [55244]

  Mr. Milburn
  Initially, we do not see the Commission charging individual National Health Service organisations directly for work undertaken with them. However, we believe that in the longer term, as the Commission's role develops more fully, there is merit in a move to a system where more of its work is funded locally, as this would encourage greater local involvement in the Commission's work and greater ownership of the results.

  Mr. Paul Marsden
  To ask the Secretary of State for Health over what timescale the Commission for Health Improvement plans to visit each NHS trust and primary care trust. [55248]

  Mr. Milburn
  It is proposed that the Commission for Health Improvement conduct a rolling programme of visits, over a period of about 3 to 4 years, to every National Health Service trust and primary care trust.

  Departmental Vehicles
  Mr. Burstow
  To ask the Secretary of State for Health if he will list for(a) his Department and (b) bodies listed in the National Asset Register, how many vehicles are currently (i) owned and (ii) leased; if he will indicate their (A) fuel types and (B) engine cubic capacities; and how many vehicles are expected to fall due for replacement in each of the years (1) 1998–99, (2) 1999–2000 and (3) 2000–01. [49227]

  Ms Jowell
  [holding answer 6 July 1998]: The Department owns 129 vehicles and leases 244 of which 162 are diesel and 211 petrol. The engine cubic capacities are:

  900 c.c: 1

  1.2: 3

  1.4: 9

  1.5: 5

  1.6: 33

  1.7: 51

  1.8: 76

  1.9: 70

  2.0: 88

  2.1: 22

  2.3: 3

  2.5: 11

  2.9: 1.

  The vehicles are expected to fall due for replacement in each of the years as follows:

  1998–99: 167

  1999–2000: 87

  2000–01: 102.

  To provide this information in relation to those bodies other than the Department included in the National Asset Register would involve disproportionate cost.
  1072

SCOTLAND

  Lockerbie
  Mr. Dalyell
  To ask the Secretary of State for Scotland if the Lord Advocate will make a statement on his contracts(a) directly and (b) through the UN with (i) the Libyan authorities and (ii) the lawyers representing the Libyans accused of the Lockerbie bombing. [55454]

  Mr. McLeish
  My noble and learned Friend the Lord Advocate and my right hon. Friend the Foreign Secretary set out the Government's position on 24 August when they announced the initiative for a Scottish trial in the Netherlands. The Libyan authorities were invited to seek any clarification of the terms of the initiative through the Secretary General of the United Nations. One such set of questions has been addressed through the Legal Counsel to the Secretary General and a comprehensive response has been given.

  Temazepam
  Mrs. Irene Adams
  To ask the Secretary of State for Scotland how many amputations in Strathclyde resulted from the misuse of the injected drug Temazepam in each year between 1990 and 1998. [55158]

  Mr. Galbraith
  The information is not available centrally.

  Cervical Smear Tests
  Dr. Starkey
  To ask the Secretary of State for Scotland for each health authority in Scotland, what is the average time taken for a patient to receive the results of their cervical smear test; and what percentage take longer than the recommended four weeks. [55211]

  Mr. Galbraith
  The average reporting time for the results of cervical smear tests for each Health Board laboratory for the year ending 31 March 1998 was:

  Number of days

  Argyll and Clyde

  9

  Ayrshire and Arran

  17

  Dumfries and Galloway

  9

  Fife

  11

  Forth Valley

  26

  Grampian

  21

  Greater Glasgow

  13

  Highland

  13

  Lanarkshire

  11

  Lothian

  32

  Tayside

  14

  For the year ended 31 March 1998 the average reporting time for the results of the cervical smear tests in Scotland was 17 days. The laboratory that serves Lothian and Borders Health Boards experienced major staffing problems during 1997 but the Health Boards have now taken action to address this problem.

  The figure for Lothian includes Borders cases, Grampian includes Orkney and Shetland cases and Highland includes Western Isles cases. Figures are collected only for the time from the date a smear test is received by the laboratory to the date the report is issued by the laboratory and do not therefore include the time it

  1073
  takes GPs, family planning clinics, etc. to issue the results to patients once they receive them from the laboratory. For this reason, no information is available on the percentage of patients who take longer than 4 weeks to receive their result.

LORD CHANCELLOR'S DEPARTMENT

  Civil Justice
  Ms Beverley Hughes
  To ask the Minister of State, Lord Chancellor's Department if a date has been set for the introduction of the first phase of the civil justice reforms. [55732]

  Mr. Hoon
  The first phase of the Civil Justice Reforms will be introduced on Monday, 26 April 1999, when the new Civil Procedure Rules and supporting materials will come into effect.

WALES

  New Deal
  Mr. Öpik
  To ask the Secretary of State for Wales if he will make a statement on the progress of the New Deal for the young unemployed in Wales; and if he will make a statement. [55156]

  Mr. Jon Owen Jones
  The New Deal for 18–24s is making excellent progress in Wales. By the end of July, more than 1,600 jobless young people had secured employment and, at the latest count, over 2,000 employers had committed more than 3,800 job opportunities.

  A further 600 young people have either entered full-time education and training or are developing skills that will enable them to secure employment through work that benefits their community or their environment.

  This is a tremendous achievement in just a few months and is a great credit to the Employment Service, its many partner organisations and the employers of Wales. However, we must not be complacent. Further hard work lies ahead to ensure that we continue to develop the high quality opportunities that our young unemployed people deserve.

  A449
  Mr. Öpik
  To ask the Secretary of State for Wales for how long there have been roadworks on the A449 between Monmouth and Newport; when they are planning to be completed; at what total cost; and for what reason information on the duration of the roadworks has not been provided. [55027]

  Mr. Jon Owen Jones
  1. The A449/A40 between Monmouth and Newport was completed in 1972 with a design life of 20 years. By 1984, it had carried in excess of its design traffic and a programme of repair and reconstruction commenced. The three major contracts commenced in 1994, 1995 and 1997.

  2. Expenditure to date has been £9 million on interim repairs and £24 million on reconstruction, including the current works.
  1074
  3. The current contract, between Coldra and Usk, is scheduled for completion in February 1999. Reconstruction of the carriageway between Raglan and Monmouth will also be required and is currently programmed, subject to available resources, to commence in 2001–02.

  4. Information on the duration of the roadworks contracts has been extensively circulated by information leaflets distributed to interested parties and left at many locations in the area and also by press notices.

  Motorcyclists
  Mr. Öpik
  To ask the Secretary of State for Wales for what reasons motorcyclists are not represented on the Welsh Transport Advisory Group; and if he will make a statement. [55372]

  Mr. Jon Owen Jones
  My right hon. Friend has received a number of requests from motorcycling organisations for representation on the Welsh Transport Advisory Group. He has told them he is satisfied that the current membership of the Group already adequately covers the interests of two wheeled transport. He has also offered them the opportunity to submit written representations to the Group. In addition, a separate advisory group is currently being established to bring together motorcycle interests and other interested parties for Great Britain as a whole.

  Radioactive Materials
  Mr. Llew Smith
  To ask the Secretary of State for Wales what information has been provided to his Department by the Environment Agency concerning plans by Nycomed Amersham to store radioactive materials in Wales. [55423]

  Mr. Jon Owen Jones
  The Environment Agency provided my right hon. Friend with information concerning the Company's application to transfer low and intermediate level radioactive waste for storage at their Cardiff site.

  He was furnished with copies of the draft certificates of authorisation, background explanatory note, explanatory note to assist the public consultation, and information provided by the Company to support the application. Copies of all these documents have been placed on the relevant public registers.

HOME DEPARTMENT

  EU Justice and Home Affairs Council
  Ms Stuart
  To ask the Secretary of State for the Home Department if he will make a statement on the outcome of the Justice and Home Affairs Council held in Brussels on 24 September. [55923]

  Mr. Straw
  The Under-Secretary, my hon. Friend the Member for Vauxhall (Kate Hoey), and I represented the United Kingdom at the Council. The main matters dealt with were as follows:

  The Council agreed as 'A' points, among other things, Europol's budget for 1999, the half-yearly report on the activities of the Europol Drugs Unit, decisions concerning

  1075
  the role of the Director of Europol after entry into force of the Europol Convention and the transfer of the strategic direction of the TECS project to Europol, and the regular Europol information system report.

  The Council reached political agreement on the text of the draft Joint Action on the identification, tracing, freezing, seizing and confiscation of instrumentalities and the proceeds from crime.

  The Presidency informed the Council that the explanatory report on the Convention on the fight against corruption would be adopted at a later Council meeting after passing through jurist-linguists.

  A useful discussion was held on new technical developments in the interception of telecommunications and their implications for the draft Convention on Mutual Legal Assistance, agreement to which is an important priority in the fight against organised crime.

  The Council noted a progress report on preparations for the entry into force of the Europol Convention and discussed the rules and procedure to be employed by Europol's Joint Supervisory Body. This matter will be discussed further at the informal meeting of Justice and Home Affairs Ministers in Vienna at the end of October.

  The Presidency gave an oral progress report on negotiation of the draft Eurodac Convention, which is concerned with the fingerprinting of asylum applicants. Ministers will discuss the matter again at the Vienna informal Ministerial meeting.

  The Council received from the Presidency an oral report on the implementation of the Action Plan on the influx of migrants from Iraq and on migration from Kosovo and the neighbouring region.

  The Council discussed the need for urgent measures to tackle abuse of the Internet and other forms of sexual exploitation of children. The Presidency's draft Joint Action on child pornography on the Internet will be discussed at the December Justice and Home Affairs Council (JHA). The Council also discussed Europol's role in this area and the importance of early implementation of the Joint Action of February 1997 concerning action to combat trafficking in human beings and sexual exploitation of children.

  In the afternoon, European Union Justice and Home Affairs Ministers held a joint meeting with their counterparts from the associated Central and Eastern European countries (CEEs) and Cyprus. The meeting began with an exchange of views on implementation of the JHA acquis in the field of immigration and asylum, with discussion introduced by Germany.

  The United Kingdom introduced discussion on judicial co-operation. A number of applicant states outlined the progress they had made towards meeting the JHA acquis in this area, the importance of which, in both practical and legal terms, they fully recognised. The applicant states were encouraged to consider accession to the Lugano Convention.

  On organised crime, the Commission gave an overview of recent work together with an analysis of the linkages of this work to the wider accession process. A number of CEEs and Cyprus described recent developments in their domestic legislation and policies to combat organized
  1076
  crime. Common themes highlighted included the development of domestic legislation; the creation of multi-disciplinary task forces to co-ordinate action; and the development of practical operational co-operation between police forces in different states.

  Outside the formal Council meetings, a number of discussions were held with other Interior Ministers and officials on the need for better co-ordination and action to stem the flow of economic migrants claiming asylum.

  Prisons
  Mr. Stringer
  To ask the Secretary of State for the Home Department what is the outcome of his review of the powers of controllers at contracted out prisons which he announced on 19 June 1997. [55924]

  Mr. Straw
  I have carefully reviewed the existing powers of controllers at privately managed prisons and have decided that, broadly, the current arrangements should be retained. Increasing the powers of controllers would reduce the contractors' operational responsibility for managing the prisons. The essence of contracting out is that optimum risk should be transferred to the private sector; efficient contract enforcement would seem to be the best way to ensure value for money from these contracts.

  Forensic Science Service
  Miss Melanie Johnson
  To ask the Secretary of State for the Home Department when he will publish the results of his consultation exercise about the Government's proposal to establish the Forensic Science Service as a trading fund; and what conclusions he has come to about the future financial regime for the operations of the service. [55925]

  Mr. Straw
  I have today reported the outcome of the consultation exercise to establish the Forensic Science Service as a trading fund. Copies of my report are being placed in the Library. I have concluded, and my right hon. Friend the Chief Secretary has agreed, that it would be in the interests of the improved efficiency and effectiveness of the management of the Forensic Science Service if its operations were financed by means of a trading fund. Important benefits will arise from this proposal: in particular the Forensic Science Service will be able to plan and manage its investment and business needs with a long term view. A draft Order under the Government Trading Funds Act 1973 (as amended) will shortly be brought before the House to secure approval for the establishment of the Forensic Science service Trading Fund.

FOREIGN AND COMMONWEALTH AFFAIRS

  Libya
  Sir Teddy Taylor
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on allegations by a former employee of the security agencies that public funds were used to seek to assassinate the leader of Libya and that public funds were directed to an organisation based in London to facilitate such a project. [55311]
  1077
  Mr. Robin Cook
  I have nothing to add to what I have already stated publicly: there was no Government-inspired plan or proposal to assassinate Colonel Qadhaffi, or to assist others in doing so.

  Indonesia
  Ms Corston
  To ask the Secretary of State for Foreign and Commonwealth Affairs if, during recent meetings with the Indonesian President, he has been able to raise the Balibo incident of October 1975; and if he will make a statement. [55674]

  Mr. Fatchett
  I raised our concerns about the Balibo incident with President Habibie during a visit to Indonesia on 8 October. The President undertook to investigate the matter.

  European Community Legislation
  Sir Richard Body
  To ask the Secretary of State for Foreign and Commonwealth Affairs, pursuant to his answer of 12 March 1998,Official Report, columns 277–78, how many Community legislative acts for 1997 (a) were and (b) were not delegated to committees of member state representatives. [55397]

  Ms Quin
  Most Commission legislation is made under implementing powers delegated to the Commission by the Council. The Commission is normally assisted in enacting implementing measures by committees made up of Member State and Commission representatives. The Commission Annual Report for 1997 lists the Commission as having enacted 1,430 regulations, directives and decisions over the year, the Council, either alone or acting jointly with the European Parliament, having enacted 407. However, in contrast to previous years, these figures exclude instruments not published in the Official Journal and routine management instruments valid for a limited period.

  Sir Richard Body
  To ask the Secretary of State for Foreign and Commonwealth Affairs, pursuant to his answer of 12 March 1998,Official Report, columns 277–78, what estimate he has made of the proportion and quantity of European Community legislation that neither passes before the Council of Ministers nor is discussed in Parliament; and if he will make a statement on his Department's policy on this procedure. [55395]

  Ms Quin
  The Commission makes legislation under powers which are delegated in specific cases under primary legislation approved by the Council of Ministers. Proposals for such measures may in some cases be referred to the Council of Ministers. In addition to implementing legislation, the Commission is also given specific legislative powers under Articles 48.3.d and 90.3 of the Treaty establishing the European Community.

  The Commission's Annual Report gives totals of 7,068 Commission regulations, directives and decisions for 1993 and 6,732 Commission regulations, directives and decisions for 1994. The 1995 Report gives no figures. In these years, Commission legislation made up over 90% of total Community legislation.

  Proposals for Commission implementing measures are not currently subject to Parliamentary scrutiny. However, the House of Commons Modernisation Committee
  1078
  propose changing the terms of reference of the European Legislation Committee to include such legislation. The Government support this. Because of the volume and nature of this legislation, it is proposed that the Committee scrutinise these measures 2–3 times per year for trends.

SOCIAL SECURITY

  War Pensions
  Mr. Livingstone
  To ask the Secretary of State for Social Security how many service personnel who served in the 1991 Gulf War have been awarded war pensions for illness attributed to their service in the war. [55321]

  Mr. Timms
  The administration of the War Pensions Agency is a matter for its Chief Executive, Mr. Gordon Hextall. I have asked him to write to my hon. Friend.

  Letter from Gordon Hextall to Mr. Ken Livingstone, dated 19 October 1998:
  The Secretary of State for Social Security has asked me to reply to your recent Parliamentary Question about the number of War Pensions awarded for illness attributed to service in the Gulf Conflict.
  My letter of 30 July 1998, in response to your previous Parliamentary Question (Official Report 31 July 1998 Column 760/761) is still relevant to the current question. This explained that, although our statistics record claims from service personnel whose service included the Gulf Conflict, such claims may not be confined solely to injuries etc. sustained in the Gulf Conflict and could include any injuries etc. received in service.
  I am however, able to update the figures that I gave in my earlier reply. At the end of September 1998, a total of 2,474 claims had been identified for medical conditions relating to ex-servicemen whose service included the Gulf Conflict. So far, 1,815 awards of War Pension have been made. Of the 2,474 claims, 599 have been received where a Gulf Veteran had made reference to a "Gulf War related illness". Of these so far, 345 have been awarded a pension, 46 have been rejected and 24 claims were withdrawn or lapsed.
  I regret that the precise information you requested is not available but to identify claims relating only to the Gulf conflict would require a manual examination of all 2,474 case files which would incur disproportionate cost. However, if you would find it helpful, I could provide a regular update on the figures available. If you would like me to arrange this, please let me know.

  Correspondence
  Mr. Hinchliffe
  To ask the Secretary of State for Social Security when the hon. Member for Wakefield will receive a reply to his correspondence of 8 May, on behalf of his constituent Mr. Wright, from(a) the Disability Living Allowance Unit and (b) the Benefit Agency Medical Service. [55032]

  Mr. Timms
  The administration of the Disability Living Allowance Unit and the Benefits Agency Medical Services is a matter for Peter Mathison, the Chief Executive of the Benefits Agency. He will write to my hon. Friend.

  Letter from Peter Mathison to Mr. David Hinchliffe, dated 19 October 1998:
  The Secretary of State for Social Security has asked me to reply to your recent Parliamentary Question asking when you will receive a reply to your correspondence of 8 May, concerning your constituent Mr. Write, from (a) the Disability Living Allowance Unit (DLA) and (b) the Benefits Agency Medical Service (BAMS).

  1079
  The Benefits Agency Customer Charter sets out targets for response to complaints. They are an acknowledgement within two working days and a full response within seven working days (twenty working days for BAMS). I am sorry, on this occasion, you have failed to receive the standard of service which you are entitled to expect.
  Replies to your letter were issued from the BAMS on 7 August 1998 and from the DLA Unit on 11 August 1998.

CULTURE, MEDIA AND SPORT

  English Tourist Board
  Mr. Hoyle
  To ask the Secretary of State for Culture, Media and Sport if he will make a statement on the abolition of the English Tourist Board; what body or bodies will replace the English Tourist Board; what assessment he has made of the ability of English tourism to compete against Welsh and Scottish tourism following the abolition of the English Tourist Board; and what grants will be made available for the promotion of tourism in the English regions. [55500]

  Janet Anderson
  On 24 July 1998,Official Report, columns 699–700, we announced our consultation into the Department's activities following the Comprehensive Spending Review. This included a review of the support we currently give to English tourism. While recognising the need for a national co-ordinating role, the consultation set out four possible options for alternative structures that might deliver a greater proportion of the available funds more directly in support of tourism in the regions.

  We are currently considering the responses we have received. No decisions have yet been made on whether to abolish the English Tourist Board and, if so, which structure should replace it. We will decide in the light of the consultation which support structure for English tourism can best implement our new tourism strategy, which will be published in the next few months.

  All the money that is currently provided for the support of English tourism will be ring-fenced for that purpose. It is our intention to seek to deploy those resources more effectively in order to release more money for regional support of tourism.

  Royal Parks Agency
  Mr. Pickthall
  To ask the Secretary of State for Culture, Media and Sport what targets he has set for the Royal Parks Agency. [55775]

  Mr. Chris Smith
  The following targets have been set for the Royal Parks Agency for 1998–99:

  Financial and Efficiency
  To increase receipts by 16 per cent. to £3.3 million from £2.84 million in 1997–98 from permits, fees, licences, events, concessions and car parking.

  Achieve a 1.5 per cent. reduction in running costs.
  Reduce Royal Parks Constabulary hourly costs of a police constable on duty from £22.90 per hour in 1997–98 by 2.5 per cent. to £22.35 in 1998–99.

  Visitor satisfaction
  Maintain an overall quality rating of 86 per cent. from visitors to the parks.
  1080
  Fabric
  Review contract documents and specifications and competitively re-tender the grounds maintenance contracts for Regent's Park, St. James's Park, Kensington Gardens and Greenwich Park and award new contracts by December 1998.
  Maintain an average rating from visitors of at least 85 per cent. on cleanliness in the parks, compared with a target of 82 per cent. in 1997–98.
  Maintain an average score of 83 per cent. for soft landscape presentation.

PRIME MINISTER

  Government Annual Report
  Mr. Mitchell
  To ask the Prime Minister who was the freelance photographer who took the photographs and did the interviews for the Government's Annual report 1997–98. [55240]

  The Prime Minister
  Mr. Richard Baker.

  Mr. Mitchell
  To ask the Prime Minister for what reasons the name, age and occupation of one of the members of the public quoted in the Government's Annual report 1997–98 are given. [55241]

  The Prime Minister
  This information was included in error and should have been removed at the proof reading stage.

TRADE AND INDUSTRY

  Ministerial Meetings (Transport Policy)
  Mr. Dafis
  To ask the Secretary of State for Trade and Industry which bodies or individuals outside Government his predecessor met to talk about transport policy and the Transport White Paper over the three months before publication of the White Paper; and how many of these meetings were attended by employees of professional lobby consultants. [54132]

  Mr. Battle
  The former President of the Board of Trade and I regularly discussed industry, transport and environmental matters and the links between them, with bodies and individuals outside Government, both formally and informally.

  Nuclear Reprocessing
  Mr. Forth
  To ask the Secretary of State for Trade and Industry what representations he has received from EU environment ministers with regard to the future of the nuclear reprocessing industry. [54334]

  Mr. Battle
  My right hon. Friend has received no such representations.

  Export Credits Guarantee Department
  Helen Jones
  To ask the Secretary of State for Trade and Industry if he will make a statement on the extension of ECGD's Amber Zone Budget beyond 31 March 1999. [55992]

  Mr. Mandelson
  I have decided to extend the Amber Zone Budget (AZB), which controls the level of new commitments on markets where ECGD exposure is
  1081
  already concentrated or the risks are high, by a further two years, until 31 March 2001. In view of the ample headroom against the current AZB of £3.8 billion, the AZB for 1999–2000 and 2000–2001 will be maintained at this level, but the position will be kept under review to ensure that ECGD can continue to support worthwhile export business. In line with good practice followed by commercial banks ECGD will continue to set exposure against the AZB on a weighted basis according to its susceptibility to political risks. In the meantime, a review is being undertaken on how to improve ECGD's exposure management regime, with the objective of providing Ministers with a clearer and better framework for striking a balance between supporting worthwhile exports and the financial risks to the taxpayer.

  EU Research Council
  Mr. Plaskitt
  To ask the Secretary of State for Trade and Industry if he will make a statement on the outcome of the EU Research Council on 13 October. [55993]

  Mr. Mandelson
  Lord Sainsbury, Under-Secretary of State and Minister for Science, represented the UK at the meeting of the EU Research Council on 13 October. The Council made further useful progress in the legislative process for the Fifth Framework Programme for Research and Technological Development (FP5), maintaining momentum in the tight timetable for introducing FP5 at the beginning of 1999. Though formal agreement was not possible at this stage, informal agreement was reached on the scientific and technological content of three of the specific programmes which set out FP5's research priorities in detail. The Council also agreed Decisions on the mandate for negotiating terms of association with FP5 with the countries seeking accession to the EU, on the conclusion of an agreement for scientific and technological co-operation between the European Community and the United States, and on amendments to the statutes of the Joint European Torus Joint Undertaking (JET), through which the EU pursues nuclear fusion research.

  Director General of Gas Supply
  Mr. Stephen Twigg
  To ask the Secretary of State for Trade and Industry if he will make a statement about the appointment of the next Director General of Gas Supply. [55990]

  Mr. Mandelson
  I have appointed Callum McCarthy as Director General of Gas Supply (DGGS) from 1 November 1998, and as Director General of Electricity Supply (DGES) from 1 January 1999. Both appointments will run until 31 October 2003.

  The appointment of a single individual as DGGS and DGES reflects the convergence of the gas and electricity markets, and the Government's confirmation, in July, that they proposed to amalgamate the regulatory regimes for gas and electricity. Subject to parliamentary approval of legislation to create the post, Mr. McCarthy will in due course be appointed as the first Energy Regulator for Great Britain, chairing a new full-time board that will replace the present DGGS and DGES.

  I am placing in the Library of the House a copy of my Department's Press Notice of 24 September, with further details of the appointment.
  1082
  The Council also discussed the issue of parallel imports and trade-mark rights, following the European Court of Justice's recent Judgment in case 355/96 (Silhouette).

  The Commission made presentations of its Green Paper on patent protection within the EU; on its communication on statutory audit in the EU, addressing the supervision of auditing and auditing standards within a Single Market context; and on its progress towards development of an action plan to follow up the Report of the Business Environment Simplification Task Force (BEST).

  Internal Market Council
  Mr. Sawford
  To ask the Secretary of State for Trade and Industry what topics were discussed at the EU Ministerial Council on the Internal Market on 24 September; and what matters were voted upon. [55991]

  Mr. Mandelson
  My noble Friend the Minister for Trade and Competitiveness in Europe represented the UK at the Internal Market Council in Brussels on 24 September.

  The Commission reported to the Council on Member States' progress towards implementation of the Single Market Action Plan, which aims to improve the operation of the Single Market. The Commission reported that the number of directives not yet implemented in all Member States had been cut from 35.5 per cent. in June 1997 to 15.4 per cent. currently. The Council adopted conclusions which re-affirmed its commitment to the implementation of the Action Plan, noted the importance of making the Single Market rules more effective and welcomed the Commission's communication "Making the Single Market rules more effective", which set out some ideas for achieving this.

  The Council had an initial orientation discussion on a proposal for a directive on the protection of invention by "utility model". This is a form of intellectual property protection right, which does not currently exist in the UK, for technical innovation, which is aimed, in particular, at ephemeral products with a short shelf life, and for the use by small businesses.

  Dounreay
  Sir Robert Smith
  To ask the President of the Board of Trade, pursuant to his answer to the hon. Member for Kirkaldy (Dr. Moonie), 5 June 1998,Official Report, column 385, if the Dounreay Nuclear Establishment will receive further shipments of unused plutonium fuel from the German Hanau nuclear facility. [48028]

  Mr. Battle
  UKAEA has a committed contract to deal with this material and so would expect to receive it at Dounreay in due course. However, at present UKAEA are not accepting any new nuclear material onto the Dounreay site, and they will not do so until after they have satisfied their regulators.

  Electromagnetic Fields
  Ms Walley
  To ask the Secretary of State for Trade and Industry what research he has evaluated into low energy electromagnetic fields associated with cellular telephones and telecommunication masts; and if he will make a statement. [53960]
  1083
  Mrs. Roche
  Advice on exposure to electromagnetic fields is given by the National Radiological Protection Board (NRPB). It evaluates published and peer reviewed sound scientific evidence on which its Guidelines for exposure are based. The exposure guidelines at mobile communications frequencies are based on well established thermal effects. Whilst it has been suggested by a small number of studies that there are potential effects associated with weak electromagnetic fields, such studies are inconsistent, and have proved difficult to replicate. They do not provide a basis for altering the advice provided. The NRPB Advisory Group on Non-ionising Radiation continues to review the published literature.

  A European Expert Group under the chairmanship of the Head of Non-ionising Radiation of the NRPB has reviewed the published literature and examined research needs. The research recommendations, which could be implemented under Framework V, included areas for further work and identified key research to be replicated. We welcome research that is systematic and undertaken by laboratories with proven skills in this subject. Support for such research does not imply that the Government believe there are harmful effects or that members of the public are subject to harmful electromagnetic fields generated by mobile communications equipment.

  Interest Rates
  Miss McIntosh
  To ask the Secretary of State for Trade and Industry what assessment he has made of the impact of interest rates on the competitiveness of small and medium-sized enterprises in the UK. [54856]

  Mr. Mandelson
  The Government have established a new framework for monetary policy, with the Bank of England setting interest rates to meet the Government's inflation target, so ensuring that decisions are taken on the basis of the long-term needs of the economy, not short-term political considerations. By delivering low and stable inflation, and avoiding a return to the damaging cycle of boom and bust, this new framework for monetary policy will produce a more stable economic environment which in turn will enhance the competitiveness of small and medium-sized enterprises.

AGRICULTURE, FISHERIES AND FOOD

  Intervention Board
  Mr. Drew
  To ask the Minister of Agriculture, Fisheries and Food if the Intervention Board intends to publish a revised corporate plan, as set out in its Policy and Resources Framework Document. [56009]

  Mr. Nick Brown
  The Intervention Board published a new Corporate Plan in September 1998, to cover the years 1998–1999 to 2002–03. Copies are held in the Library of the House.

  Agriculture Council
  Mr. Drew
  To ask the Minister of Agriculture, Fisheries and Food what was the outcome of the Agriculture Council held in Brussels on 28 September. [55927]
  1084
  Mr. Nick Brown
  I represented the United Kingdom at a meeting of the European Union Agriculture Council in Brussels on 28 September.

  The Council held a first debate on a Commission proposal to reform the EU wine regime. I welcomed many elements in the proposal, in particular measures to redirect EU production away from its traditional reliance on market intervention and towards improved quality and competitiveness. However, I questioned the need to increase the budgetary cost of the wine regime in order to achieve those ends.

  The Council also debated the impact of the crisis in Russia on EU agricultural markets, and invited the Commission to keep the position under constant scrutiny in view of the importance of the Russian market for EU agricultural exports. More generally, the Commission circulated updated market forecasts for the principal EU agricultural commodities in the period up to 2005, forecasts which will form part of the Council's consideration of proposals to reform the Common Agricultural Policy within the framework of Agenda 2000.

  In the context of CAP reform, I introduced in the Council a paper prepared jointly with Italian, Swedish and Danish colleagues which proposes a mechanism and a timetable for the removal of milk quotas by 2006. We collectively called for the paper to be examined in detail as part of the on-going Agenda 2000 negotiations.

  Discussion of the proposal to improve the welfare of laying hens revealed continuing differences amongst member states over the desirability of the measure, and the economic effect of the proposal if implemented. In common with several other member states, I stressed the UK view that the EU should commit itself to an eventual phasing out of the battery cage system.

  The Council also took stock of the difficult economic conditions prevailing on the pigmeat market and invited the Commission to keep the situation under review. There was also an exchange of views on the incidence of BSE in Portugal in which the Commission reported that its own inspection team was currently examining the measures taken by the Portuguese administration to protect human health and combat the disease in animals.

  Government Purchase Card
  Mr. Clifton-Brown
  To ask the Minister of Agriculture, Fisheries and Food what use(a) his Department and (b) its agencies are currently making of the Government Purchase Card; what savings he estimates are being achieved as a result; what plans he has to expand use of the card by his Department and its agencies; and if he will make a statement. [55169]

  Mr. Morley
  [holding answer 19 October 1998]: Of MAFF and its Agencies, only the Central Science Laboratory (CSL) and the Veterinary Laboratory Agency (VLA) are using the Government Purchase Card (GPC), introduced on 1 August 1998.

  The core-Ministry and the VLA introduced their own pilot procurement card schemes in advance of the GPC. The VLA's was introduced in September 1996 and the

  1085
  Ministry's in August 1997. The VLA migrated to the GPC in May 1998. Details of the card numbers and usage are in the table.

  MAFF

  VLA

  CSL

  Numbers of cards

  72

  130

  2

  Numbers of transactions

  3,227

  8,000

  17

  Value of transactions

  £103,000

  £600,000

  £18,000

  Savings

  £33,580

  £160,000

  £340

  The savings figures given above are based on an estimated average savings per transaction. The figure differs from scheme to scheme, but the administrative savings, which arise from the operational benefits procurement card provides, are estimated currently to be between £10 and £20 per transaction. The use of procurement cards for low value transactions is a primary means of reducing the costs of administrative procurement and improving response times for obtaining goods and services.

  Having successfully completed a year's trial the core-Ministry now plans a phased roll out of its own card subject to the completion of a full economic appraisal. The other Agencies and one or two of the Non-Departmental Public Bodies (NDPBs) were awaiting the results of the pilot schemes before deciding whether to take up the use of procurement cards. The Centre for Environment, Fisheries and Aquacultural Sciences (CEFAS) is now planning to introduce a card at the end of this financial year. On the basis of the success so far, I expect the other Agencies and the NDPBs who have approached us to be among the first new users set up as part of the phased roll out.

  Civil Servants
  Sir Richard Body
  To ask the Minister of Agriculture, Fisheries and Food what representations he has made on the representation of British nationals in senior Civil Service grades in Directorate General XIV (fisheries); and if he will make a statement. [55318]

  Mr. Morley
  None.

  Public Bodies (Reports)
  Ms Roseanna Cunningham
  To ask the Minister of Agriculture, Fisheries and Food if he will list the bodies within the responsibility of his Department currently required by legislation to lay a report before Parliament. [33555]

  Mr. Morley
  [pursuant to his reply, 12 March 1998, c. 299]: The following bodies, for which my right hon. Friend has responsibility, are currently required by legislation to lay a report before Parliament:

  Department and Executive Agency

  Intervention Board

  Executive Agencies

  Central Science Laboratory

  Centre for Environment, Fisheries and Aquaculture Science

  Farming and Rural Conservation Agency

  Meat Hygiene Service

  1086

  Pesticides Safety Directorate

  Veterinary Laboratory Agency

  Veterinary Medicines Directorate

  Executive Non-Departmental Public Bodies

  Agricultural Wages Board

  Agricultural Wages Committees

  Apple and Pear Research Council

  Food from Britain

  Home-Grown Cereals Authority

  Horticultural Development Council

  Meat and Livestock Commission

  Milk Development Council

  Potato Industry Development Council

  Royal Botanic Gardens, Kew

  Sea Fish Industry Authority

  Public Corporation

  Covent Garden Market Authority.

  Previously, the Department has advised that the Veterinary Products Committee had a statutory requirement to publish an annual report and to lay the report before Parliament. It has now been established that this is not the case.

EDUCATION AND EMPLOYMENT

  Remploy
  Dr. Iddon
  To ask the Secretary of State for Education and Employment if he will make a statement on Remploy's achievements against the targets set in their 1997–98 Annual Performance Agreement. [55737]

  Ms Hodge
  Now that Remploy has published its Report and Accounts for 1998 and audited figures are available, I am delighted to confirm that Remploy has exceeded its 1997–98 APA targets. The targets and achievements were:

  Target

  Achievement

  The average number of disabled people employed by Remploy

  at least 9,800

  10,021

  Average number of disabled people employed under the Interwork Scheme

  at least 3,000

  3,123

  The number of disabled employees to move from Remploy factories to Interwork having been employed there for at least 1 year, or from Interwork or factories to open employment

  200

  225

  Remploy will keep within a unit cost target (operating deficit per disabled worker) of:

  £10,000

  £9,726

  The unit cost of Interwork to be no more than:

  £4,400

  £4,226

  Remploy to keep within an operating deficit (including reorganisation costs) of:

  £99m

  £99m

  Copies of Remploy's 1998 Annual Report and Accounts have been placed in the Library.
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ENVIRONMENT, TRANSPORT AND THE REGIONS

  Fishermen (Occupational Safety)
  Dr. Godman
  To ask the Secretary of State for Environment, Transport and the Regions when he last met his colleagues from other member states of the European Union, to discuss matters relating to the occupational safety of fishermen. [54331]

  Ms Glenda Jackson
  There has been no recent discussion with EU colleagues on the occupational safety of fishermen. A number of regulations which implement EC health and safety directives, including the Merchant and Fishing Vessel; (Health and Safety at Work) Regulations 1997, are already in force. Further regulations will be introduced later this year.

  Area Cost Adjustment
  Mr. David Heath
  To ask the Secretary of State for Environment, Transport and the Regions what plans he has to reform the area cost adjustment. [54337]

  Ms Armstrong
  We are considering a range of options for changing the area cost adjustment. We expect to announce our conclusion at the usual time around the beginning of December.

  Non-departmental Public Bodies
  Jackie Ballard
  To ask the Secretary of State for Environment, Transport and the Regions what plans he has to give local authorities the power and responsibility to scrutinise non-departmental public bodies. [54338]

  Mr. Raynsford
  On 30 July, my right hon. Friend the Deputy Prime Minister published a White Paper "Modern Local Government: In Touch with the People" which welcomed the steps taken by some councils to convene public forums to enable issues of particular local concern or interest to be aired and considered. We are keen to encourage all councils to take on this local scrutiny role but do not wish to be prescriptive about the way in which they go about doing so.

  Social Housing (Tenure)
  Mr. Soley
  To ask the Secretary of State for Environment, Transport and the Regions what plans he has to increase flexibility of tenure in the housing association and council housing sectors. [54339]

  Ms Armstrong
  On 30 July 1998,Official Report, columns 417–18, I announced plans to encourage more Registered Social Landlords to develop "flexible tenure" schemes which will help shared owners facing mortgage difficulties and repossession because of a change in their financial circumstances.

  My Department is considering the discussion paper recently published by the Chartered Institute of Housing on a single form of tenancy for social housing.

  We are also planning to simplify schemes by which tenants of local authorities and RSLs are helped into home ownership.
  1088

  Estates Renewal Challenge Fund
  Maria Eagle
  To ask the Secretary of State for Environment, Transport and the Regions what plans he has to replace the estates renewal challenge fund with funding mechanisms which will facilitate the transfer of housing from local authority control. [54340]

  Mr. Raynsford
  My right hon. Friend the Deputy Prime Minister announced in his statement on 22 July that there would be no further rounds of the Estates Renewal Challenge Fund. Allocations already approved will, however, remain in place to enable all planned transfers to be completed.

  We want authorities to take a more strategic look at how to meet the investment needs of all their housing. Where stock has a negative value and transfer is the best option, I would expect authorities to use their capital resources under the Housing Investment Programme to pay for it. Some negative value transfers may also form part of packages under the New Deal for Communities.

  Sustainable Development
  Miss McIntosh
  To ask the Secretary of State for Environment, Transport and the Regions what representations he has received from representatives of the business community over his Department's plans to encourage sustainable development; and if he will make a statement. [54341]

  Mr. Meale
  As part of the Government's "Opportunities for Change" consultation on sustainable development, my Department has also consulted separately with the business community about "Sustainable Business". We have received a great many responses from individual businesses offering constructive reactions about the many ways in which business can be encouraged to improve its performance. These have come from the different business sectors and included representations from Trade Associations who also expressed interest in collective action to improve sectoral performance and sustainability.

  Rural Buffer Zones
  Mr. Gray
  To ask the Secretary of State for Environment, Transport and the Regions what is his policy on the future of rural buffer zones. [54342]

  Mr. Raynsford
  Planning Policy Guidance note 7-—"The Countryside", advises (para 4.16) that local countryside designations such as rural buffer zones should be maintained or extended only where there is good reason to believe that normal planning policies cannot provide the necessary protection. Such local designations carry less weight than national designations and development plan policies and development control policies should reflect this.

  Second Homes
  Mr. Andrew George
  To ask the Secretary of State for Environment, Transport and the Regions what representations he has received about the appropriate level of council tax for second homes. [54343]
  1089
  Mr. Raynsford
  In response to the consultation paper on local government finance, we received 40 representations on second homes. Since the election, we have also received an additional 112 representations on second homes. Of the representations received, 113 were in favour of abolition of the 50 per cent. discount and 39 were against abolition of the discount.

  Buenos Aires Conference
  Mr. Dalyell
  To ask the Secretary of State for Environment, Transport and the Regions if he will make a statement on his preparations for the Buenos Aires conference on climate change. [54344]

  Mr. Meacher
  The Protocol we agreed in Kyoto last December was an historic turning point with developed countries taking on legally binding greenhouse gas emission reduction targets. But many issues, for example rules for the operation of flexibility mechanisms such as emissions trading, remain to be resolved. We must maintain the momentum of Kyoto in Buenos Aires by: making progress on as many issues as possible; avoiding sterile confrontation on issues not ripe for resolution; putting in place a work-plan to resolve these issues; and by involving all stakeholders—including business and non-governmental organisations—in delivering implementation of the Protocol.

  Rent Levels
  Ms Moran
  To ask the Secretary of State for Environment, Transport and the Regions what measures he intends to take to equalise rent levels between housing association and local authority housing. [54346]

  Mr. Raynsford
  In his statement on Housing and Regeneration Policy on 22 July, my right hon. Friend the Deputy Prime Minister said that"no decision has yet been reached on rent policy in the longer term".

  That remains the position.

  Energy Efficiency
  Mr. Stunell
  To ask the Secretary of State for Environment, Transport and the Regions what measures he plans to encourage energy efficiency in Government Departments. [54347]

  Mr. Meale
  The Government are committed to an improvement in the energy efficiency of departments of 20 per cent. over 1990–91 levels by 2000, and progress will be reviewed regularly by Green Ministers under the chairmanship of my right hon. Friend the Minister for the Environment. New benchmark indicators for different building types, based on good practice in other sectors of the economy, are being developed as a further tool to help departments assess the energy efficiency of different parts of their estates and concentrate efforts where there is most scope for improvement. My Department will continue to ensure that relevant written and practical guidance is available to energy managers in the Government estate.

  Local Government Finance
  Mr. Rammell
  To ask the Secretary of State for Environment, Transport and the Regions if he will make 1090
  a statement on discussions he has had with the Local Government Association about local government finance. [54348]

  Ms Armstrong
  We are maintaining a close and effective working relationship with the Local Government Association. The Deputy Prime Minister and I, along with other Cabinet colleagues, last met them to discuss local government finance at the Central Local Partnership meeting on 21 September. I also met groupings of authorities suggested by the Association to discuss the report by the SSA sub-group on possible changes in Standard Spending Assessments. A wide range of differing interests were covered and in the light of all the evidence we will decide the way forward. We will announce our proposals, as usual, later this year.

  Best-value Regimes
  Mr. McNulty
  To ask the Secretary of State for Environment, Transport and the Regions when he expects a best-value regime to be implemented by local authorities. [54349]

  Ms Armstrong
  Primary legislation will be required to introduce the best value regime and abolish CCT for all local authorities. We have set up pilot projects to take forward best value principles prior to legislation and we have relaxed existing CCT regulations to encourage all authorities to adopt best value practices. I cannot comment on the contents of the Queen's Speech; however, the Government remain committed to introducing best value in local authorities.

  "Access to the Open Countryside"
  Mr. Tipping
  To ask the Secretary of State for Environment, Transport and the Regions when he expects to respond to the consultation exercise on his document "Access to the Open Countryside". [54350]

  Mr. Meacher
  The Government are considering carefully responses to the consultation paper, "Access to the Open Countryside in England and Wales". We shall announce our conclusions as soon as possible.

  Local Government White Paper
  Mr. Hope
  To ask the Secretary of State for Environment, Transport and the Regions how many responses he has received to the local government White Paper; and if he will make a statement. [54351]

  Ms Armstrong
  The White Paper 'Modern Local Government: In Touch with the People' was born out of a wide-ranging consultation exercise—centred on 6 papers, which prompted some 2,500 responses. As a statement of our firm plans, the White Paper does not invite specific responses but has been widely welcomed, by the Local Government Association amongst others, as an agenda for radical reform bringing councils closer to the people.

  Wind Turbines
  Mr. Evans
  To ask the Secretary of State for Environment, Transport and the Regions what representations he has received on the siting of wind turbines in the countryside. [54352]
  1091
  Mr. Raynsford
  The Department receives a small number of letters each month about the planning policy guidance on wind turbines contained in Planning Policy Guidance note 22, "Renewable Energy". Any representations on specific projects would be referred to the appropriate Government Office for the Region and the information is not held centrally.

  East-west Rail Link
  Dr. Starkey
  To ask the Secretary of State for the Environment, Transport and the Regions what discussion his Department has had with the local consortium promoting an east-west rail link. [54362]

  Mr. Prescott
  The Government welcome any proposals that might contribute towards a better, more integrated transport system. Our policy of encouraging use of rail is already bearing fruit in terms of a 7 per cent. increase in passenger rail travel and a 5 per cent. increase in freight tonne kilometres last financial year. But it is important that a large, expensive proposal such as this is supported by a clear business case. My hon. Friend the Minister for Transport in London met representatives of the East-West Rail Consortium and Railtrack in February, to be briefed on their proposals. Since then, officials from my Department and OPRAF, have had several meetings with representatives of the Consortium, and discussions on the detailed business case for the project are continuing.

  Cycling
  Mr. Mitchell
  To ask the Secretary of State for the Environment, Transport and the Regions what financial help his Department makes available to local authorities to encourage the use of cycles. [54363]

  Ms Glenda Jackson
  My Department works closely with local authorities in this field. In addition to co-operating with them on the development of new approaches to providing for cycling, we allocate substantial funding for cycling infrastructure improvements. £85 million were allocated to transport packages in 1998–99. Authorities are free to use on cycling as much of their package allocation as they choose. Next year we hope to be able to increase support for packages and to restore funding for minor works outside the areas covered by transport packages, thereby making available additional resources for cycling.

  National Air Traffic Services
  Mr. Brady
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the future of the NATS pension scheme. [54364]

  Ms Glenda Jackson
  The detailed arrangements for future NATS pension arrangements are being considered urgently, as they form an important part of the development of a Public Private Partnership for the business. The Secretary of State hopes to make a statement in due course.

  Ms Squire
  To ask the Secretary of State for the Environment, Transport and the Regions when he expects to announce his proposals for a public/private partnership for National Air Traffic Services Ltd; and if he will make a statement. [55988]
  1092
  Dr. Reid
  I have today published a consultation paper on the Government's preferred option for a public/private partnership (PPP) for National Air Traffic Services Ltd.

  The safe and efficient provision of air traffic control services is rightly a matter of great public interest and, since the PPP was announced, a debate has begun on key issues such as safety, the national interest and public accountability. The Government now want to launch a structured, full and open consultation on these issues. The consultation document which I am publishing today therefore sets out a wide range of matters on which we are looking for views. Safety remains our top priority and we believe that the proposed PPP offers the opportunity to establish a structure which will strengthen safety, satisfy the public interest and the needs of aviation users while providing for the sound future of National Air Traffic Services Ltd and its employees.

  I hope that all those with an interest in this subject, whatever their views on the Government's preferred option, will take the opportunity to respond to the consultation document.

  Birmingham Northern Relief Road
  Mr. John M. Taylor
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on progress on the Birmingham Northern Relief Road. [54365]

  Dr. Reid
  I am very pleased with today's High Court judgment which clears the way for implementation of the Orders for construction that were made in February. It vindicates the Government's position, showing that they acted with probity and integrity.

  This new road is vital as a much needed alternative to the very heavily congested M6 and as a strategic national route.

  The process of getting this road authorised under the statutory provisions has taken over 5 years. The inquiry itself took over 15 months. It is time for us to get on with the job and start construction of this much needed scheme.

  Railfreight
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions how many miles of railway track are presently in use for freight purposes only. [54366]

  Ms Glenda Jackson
  I am advised by Railtrack that there are currently 1,632 kilometres of freight-only track in use.

  Rainworth Bypass
  Mr. Tipping
  To ask the Secretary of State for the Environment, Transport and the Regions when he expects construction of the Rainworth bypass, Nottinghamshire, to commence. [54367]

  Dr. Reid
  The Orders for the proposed bypass have yet to complete their statutory procedures. Should they be confirmed, the start of works date will be a matter for Nottinghamshire County Council.
  1093

  A31
  Mr. Ian Bruce
  To ask the Secretary of State for the Environment, Transport and the Regions what factors led his Department to detrunk the A31–A35 trunk road in Dorset. [54368]

  Dr. Reid
  Factors considered in defining the core trunk road network were set out in the White Paper A New Deal for Transport: Better for Everyone. The proposed detrunking of non-core routes is subject to consultation with local highway authorities.

  Kingskerswell Bypass
  Mr. Sanders
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement about the funding of the Kingskerswell bypass. [54369]

  Dr. Reid
  Devon County Council and Torbay Borough Council are considering the feasibility of taking forward the Kingskerswell Bypass as a local road scheme with private finance.

  If a PFI proposal comes forward seeking financial support, my Department will assess the project under established arrangements for considering such proposals from local authorities.

  Road Pricing
  Mrs. Spelman
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on his plans for road pricing. [54370]

  Dr. Reid
  The Transport White Paper stated the Government's intention to introduce legislation to enable local authorities to introduce road user charges in their area to help meet their transport and other objectives. We will consult on the details shortly.

  Dr. Cable
  To ask the Secretary of State for the Environment, Transport and the Regions how he proposes to implement his proposals on road user pricing schemes. [54375]

  Dr. Reid
  We shall issue a consultation paper shortly to invite views on the detail of how schemes will be implemented and operated. Thereafter, we will work with interested local authorities to introduce pilot schemes, once the necessary enabling legislation is in place.

  Transport White Paper
  Miss McIntosh
  To ask the Secretary of State for the Environment, Transport and the Regions when he last met representatives from motoring organisations to discuss the integrated transport White Paper. [54371]

  Ms Glenda Jackson
  DETR Ministers have had frequent contact with representatives from AA and RAC during the integrated transport consultation exercise and in the lead up to the publication of the Transport White Paper. The Deputy Prime Minister last met John Dawson, the Group Public Affairs Director of the Automobile Association, on 12 May 1998.

  Mr. Dafis
  To ask the Secretary of State for the Environment, Transport and the Regions which organisations and individuals outside Government he met to talk about transport policy and the Transport White 1094
  Paper during the three months before publication of the White Paper; and how many of these meetings were attended by employees of professional lobby consultants. [54131]

  Mr. Prescott
  In the three months prior to the publication of the Transport White Paper, I met with representatives of the Passenger Transport Executives, rail, bus, road and shipping interests as well as users and Non-Governmental Organisations. In addition, I had several meetings with the specially constituted White Paper Advisory Panel which I had set up to assist with the fundamental review of transport policy. The discussions and the written representations we received played an important role in informing the development of our integrated transport policy.

  Channel Tunnel Rail Link
  Mr. Rowe
  To ask the Secretary of State for the Environment, Transport and the Regions what is his estimate of the cost per projected passenger journey of the channel tunnel rail link. [54372]

  Ms Glenda Jackson
  My Department has estimated that, in overall terms, taking account of travel and regeneration benefits, the new Channel Tunnel Rail Link deal provides good value for the taxpayer.

  School Transport
  Mr. Bennett
  To ask the Secretary of State for the Environment, Transport and the Regions what progress is being made in encouraging children to walk to school. [54373]

  Ms Glenda Jackson
  Guidance for schools and local authorities on greener travel to school, including walking, is in preparation and we expect that the forthcoming national strategy on walking will promote walking to school. We will shortly establish the School Travel Advisory Group to oversee further work.

  Mr. Amess
  To ask the Secretary of State for the Environment, Transport and the Regions what recent representations he has received on the provisions in the White Paper on Integrated Transport relating to school transport. [54376]

  Ms Glenda Jackson
  My right hon. Friend the Secretary of State has received over 100 letters from members of the public on the White Paper provisions for school transport. We fully understand people's concerns. Our aim is to encourage realistic alternatives to the car for the journey to school while improving the safety and quality of life for children and for everyone.

  Stations (Disabled Access)
  Mr. Pike
  To ask the Secretary of State for the Environment, Transport and the Regions if he will estimate the percentage of railway stations which have adequate disabled access. [54377]

  Ms Glenda Jackson
  Railtrack are currently conducting a survey of all stations which will include a review of access arrangements.

  Access requirements cover many different facilities including toilets, visual and audible information and the use of colour contrast and tactile platform edging. There

  1095
  are no comprehensive statistics available currently covering all these features but Railtrack estimate that some 40 per cent. of stations can currently be classified as having unassisted wheelchair access.

  Railtrack will be identifying the priorities and timescales for providing adequate access at all stations. Access to stations will also be covered by Part III of the Disability Discrimination Act 1995 the provisions of which will start to come into force in October next year.

  Kyoto Targets
  Mr. Chaytor
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to ensure that the transport sector contributes to achieving the Kyoto targets. [54378]

  Ms Glenda Jackson
  We are shortly to produce a consultation paper, seeking views on policy options to meet our climate change commitments. Our aim is to develop a climate change programme where all sectors, including transport, play a balanced part.

  Moreover, we are already committed to a number of measures that should reduce greenhouse gas emissions from the transport sector. These include the Chancellor's announcement that fuel duty will rise by 6 per cent. a year in real terms, a new graduated system of vehicle excise duty to encourage more fuel efficient cars, setting up the Cleaner Vehicles Task Force, and supporting the European Commission's strategy for reducing CO2 emissions from new cars. The measures contained in the Transport White Paper will also play an important role by delivering a properly integrated transport system for the UK and reducing dependence on the car.

  Public Transport
  Mr. Canavan
  To ask the Secretary of State for the Environment, Transport and the Regions what specific measures he intends to introduce to encourage people to travel by public transport. [54379]

  Ms Glenda Jackson
  Our recently published White Paper on the future of transport sets a framework for truly integrated public transport systems. Our programme of carefully targeted, proper funding, better interchange facilities, reliable services, simplified fares and increased access for all, aims to win more passengers onto public transport.

  Methyl Bromide
  Mr. Dalyell
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his letter of 4 September to the hon. Member for Linlithgow (EE/PSO/14592/98), what consultation he has had on the effects of methyl bromide on the ozone layer, with whom, and with what results. [55540]

  Mr. Meale
  On 8 September 1998 we began a consultation on the European Commission's proposed new Regulation on ozone depleting substances, which includes a proposal to phase out the use of methyl bromide by 2001. The consultation ended on 1 October 1998. In total, 307 parties were consulted, including the National Farmers Union, the British Pest Control Association, flour millers and importers of commodities, all of whom expressed a particular interest in the methyl 1096
  bromide proposals. To date, sixty-five responses have been received, and these are currently being analysed. Some concern has been expressed about the implications of the proposed phase out of methyl bromide and these will be taken into account as we formulate the UK's negotiating position on the new Regulation.

  Traffic Growth
  Mr. Jenkin
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to the recent White Paper on integrated transport and roads, if it is the policy of the Government to(a) reduce road congestion and (b) to curb traffic growth; and if he will revise his Department's traffic growth forecasts. [55287]

  Ms Glenda Jackson
  [holding answer 19 October 1998]: As we made clear in the White Paper, in order to tackle the congestion and pollution that are caused by road traffic we need to reduce the rate of road traffic growth. We also want to see an absolute reduction in traffic in those places and streets where the greatest environmental damage is done. The New Deal for Transport: Better for Everyone sets out how we plan to achieve these objectives through integrated transport policies acting at the national, regional and local level.

  The White Paper explains that, with assistance from the Commission for Integrated Transport, we will be revising the 1997 National Road Traffic forecasts to reflect the new direction for transport provided by the New Deal.

  Roads (Wiltshire)
  Mr. Key
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the authors of representations he has received since his announcement in July concerning his plans for(a) the A303(T) and (b) the A36(T) in Wiltshire, indicating whether the representations are for or against his proposals. [54914]

  Ms Glenda Jackson
  [holding answer 19 October 1998]: Since July, we have received two representations in support of the A303 Chicklade Bottom to Mere scheme and five representations against the A303 Stonehenge cut-and-cover tunnel scheme; one other asked for technical details about the proposed tunnel construction alongside Stonehenge. There have been no representations about the A36(T). It would not be appropriate to publish the names of the authors of these representations as they have not given their permission for that.

  A14
  Mr. Lansley
  To ask the Secretary of State for the Environment, Transport and the Regions what are his latest estimates of the degree of over-capacity usage of the A14 between Huntingdon and Cambridge. [55429]

  Ms Glenda Jackson
  [holding answer 19 October 1998]: A number of factors govern the absolute capacity of a road, including the spread of peak hour usage throughout the day and the proportion of the traffic flow that is composed of heavy commercial vehicles. A measure of capacity has been produced which is called the congestion reference flow (CRF). The CRF of a section of road is estimated of the 24 hour Annual Average Daily Traffic flow (AADT = total annual traffic divided by 365) at which the carriageway is likely to be "congested" in

  1097
  the peak periods of the average day. The CRF for the dual-two lane section of the A14 between Huntingdon and Cambridge has been calculated as 78,371 vehicles per day (vpd). Current average traffic flows on this section of road are up to 68,000 vpd (87% of the CRF). Traffic flows on this section of A14 are high, therefore, but not beyond its capacity in terms of the road's calculated CRF.

  Catalytic Converters
  Mr. Swayne
  To ask the Secretary of State for the Environment, Transport and the Regions what studies his Department has initiated into the consequences of catalytic converters operating at below optimal temperatures; and if he will make a statement. [55571]

  Ms Glenda Jackson
  The Department's research programme has produced Transport Research Laboratory Report 270 "Environment Traffic Management: A Review of factors affecting cold start emissions". The objectives of the review were to investigate the factors affecting the definition and measurement of cold start emissions and to suggest how emissions models might better account for them. With a view to helping local authorities develop plans for local Air Quality Management Areas, where these are required under the Environment Act 1995, the Department also plans to let a two year research contract, starting early next year, aimed at assessing the effects of cold starts on parking control strategies.

  Road Congestion
  Mrs. Virginia Bottomley
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to reduce road congestion; and if he will make a statement. [54355]

  Mr. Prescott
  The policies I announced in my recent Integrated Transport White Paper will play a major part in reducing congestion. They will encourage the transfer of freight from road to rail, reduce the need for people to travel, offer them better transport choices and encourage more people to undertake short journeys by cycle or on foot.

  Basel Convention
  Helen Jackson
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the application of the amendment to the Basel Convention as laid down in Decision IV/9 of the Parties to the Convention. [55733]

  Mr. Meale
  Command Paper 4061 which sets out details of the Decision IV/9 amendment has been laid before the House.

  This amendment helps to clarify which wastes will be subject to the ban on the exports of hazardous wastes to developing countries. Rules to implement the amendment within the EC have been agreed by Member States.

  The amendment will enter into force for all Parties to the Basel Convention on 6 November 1998, except for those who notify the Depositary, in writing by 6 November 1998, that they are unable to accept it.
  1098
  The Basel amendment represents yet another milestone in securing an environmentally sound regime for the movement of hazardous wastes. I am pleased to announce therefore that the Decision IV/9 Basel Amendment will enter into force for the UK on 6 November 1998.

  Flooding (Midlands)
  Ms Keeble
  To ask the Secretary of State for the Environment, Transport and the Regions if he will provide financial assistance to Warwickshire County Council, Stratford on Avon District Council, Worcester City Council and Northampton Borough Council under the Bellwin scheme for costs incurred following the severe flooding on the weekend of 9 to 12 April. [55736]

  Ms Armstrong
  Warwickshire, Worcester, Northampton and Stratford upon Avon councils are all to be given cash under the Bellwin scheme after successful applications to my Department.

  I am satisfied financial assistance under the Bellwin scheme is justified in these cases given the exceptional nature of the floods and the damage they caused. Schemes will, therefore, be established under section 155 of the Local Government and Housing Act 1989. Grant will be paid to each authority to cover 85 per cent. of eligible costs above a threshold which have been incurred by the authority in dealing with the flooding.

  Director of Transport Security
  Mr. Pond
  To ask the Secretary of State for the Environment, Transport and the Regions when he plans to publish the 1997-98 Annual Report of the Director of Transport Security. [55738]

  Mr. Prescott
  Copies of the report have been placed in the Library of the House.

  Town and City Policies
  Shona Mclsaac
  To ask the Secretary of State for the Environment, Transport and the Regions how the Government intend to take forward their policies for towns and cities. [55739]

  Mr. Prescott
  The Environment Transport and Regional Affairs Select Committee Report on Housing (Tenth Report Session 1997–98) recommended that there should be an Urban White Paper.

  I announced today that I intend to produce a White Paper on Urban Policy next year, which will be the first such paper in 20 years. This will describe the Government's policies to improve the quality of life in our towns and cities. We will look at the combined effect of a wide range of issues, with the aim of enabling communities in our towns and cities to prosper, and to tackle problems such as social exclusion. We will consider policies on, for example, housing, competitiveness, delivery of public services, regional development, planning, transport, community involvement and sustainable development. We will also link in with work being taken forward by other Departments on issues such as education, training and crime reduction—all of which are essential to enabling communities to achieve their full potential.
  1099
  The Government's proposals to reform local government and to establish Regional Development Agencies will create the framework to implement our policies and achieve prosperity for our communities.

  The Urban Task Force, led by Lord Rodgers, and the work undertaken by the Coalfields task force has already started the debate on urban issues. I now intend to broaden it further and engage more groups and organisations.

  Of course, vibrant and attractive towns and cities complement thriving rural areas. We will separately be paying special attention to the specific issues affecting rural areas and will be making an announcement on this shortly.

  Heavy Goods Vehicles
  Mr. Gapes
  To ask the Secretary of State for the Environment, Transport and the Regions what was the outcome of the recent consultation on a scheme for the impounding of illegally operated heavy goods vehicles. [55774]

  Dr. Reid
  The consultation period ended on 29 May. There were 36 responses. These showed overwhelming support for our proposals. We are now working up a comprehensive detention scheme with the aim of bringing it into effect at the earliest available opportunity. This will require primary legislation.

  Transport Council
  Mr. Alan Keen
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the outcome of the Transport Council held in Luxembourg on 1 October. [55926]

  Dr. Reid
  The Transport Council met in Luxembourg on 1 October. I represented the United Kingdom.

  The Council agreed common positions on two legislative proposals, and held useful discussions on some other important areas of transport policy.

  In land transport, the Council reached a common position on a directive which will facilitate the free movement of transportable pressure equipment within the Community. The text which was agreed met a UK concern that the industry itself should be able to continue to carry out inspections of this type of equipment, under the necessary supervision.

  The Commission reported on the recent Swiss referendum on lorry charges. The referendum approved a law allowing the Swiss Government to impose Alpine transit charges, which would be higher than those foreseen by the draft EC/Switzerland transport agreement. The Commission now hoped that agreement could be reached on the EC/Switzerland agreement at the next Transport Council.

  There was also discussion of the directive on charging of heavy goods vehicles for the use of certain infrastructures (the Eurovignette).

  The Council debated the directive amending Community rules on the promotion of combined transport. This would require reduced taxes for lorries engaged in combined transport and would permit lorries above current Community weight limits to carry out such
  1100
  operations. There was discussion of the need for careful definition of combined transport, if the proposal were to lead to a real incentive to reduce road mileage. The proposal will continue to be examined with a view to reaching agreement at the next Transport Council.

  The Commission reported that, following the break-down of negotiations between employers and employees on working time in road transport, it would propose the extension of the working time Directive to non-mobile workers. The latter would cover own-account operators and self-employed drivers.

  The Commission presented its new proposals on rail access and charging rules. Member States generally welcomed the proposals, which aim to contribute to the revitalisation of the Community's railways by clarifying the regulatory framework for the provision of rail services. The Presidency concluded that the Council would look again at these proposals at its next meeting.

  In air transport, the Council reached a common position on a regulation to restrict the use of older aircraft which have been modified ("hush-kitted") to meet the latest noise regulations, but which produce more noise than newer aircraft. The United Kingdom expressed its disappointment at the suspension of Gibraltar from the scope of this regulation, especially as Gibraltar is covered by existing EU legislation on aircraft noise. The UK reluctantly agreed to suspension on this occasion, to allow progress on this measure, which is important to all Member States.

  The Council noted progress on a Commission proposal to amend the rules on compensation for passengers denied boarding on overbooked flights. The UK made it clear that it supports this proposal and that it would oppose the inclusion of clauses suspending application to Gibraltar. The Presidency said that it would attempt to secure agreement on the regulation at the next Transport Council and urged rapid progress.

  Following further discussion of civil aviation relations between the EC and the US, the Presidency said that the proposal to give the Commission a mandate to negotiate market access would continue to be examined, in the hope of reaching a conclusion at the next Council.

  The Italian Minister requested a discussion of the Commission's Decision that the decree requiring movement of airlines' operations to the new Milan Malpensa airport was discriminatory and illegal. Minister agreed that the matter should be resolved bilaterally between the Commission and Italy.

  Road Traffic Reduction Act 1997
  Mrs. Gilroy
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to implement the Road Traffic Reduction Act 1997; and if he will make a statement. [55928]

  Dr. Reid
  It is clear that the setting of road traffic reduction targets will be an integral part of the process of drawing up local transport strategies. Local transport plans are a centrepiece of the Government's transport proposals and it is vital that we get implementation right. We have listened to the Local Government Association and local authority concerns about the difficulty of producing robust local transport plans by July 1999. We
  1101
  will therefore invite local highway authorities to produce 'provisional' 5-year plans by July 1999, covering the period 2000/01–2004/05. These would be the basis for allocating resources for 2000/01 only. Authorities would then roll their plans on by one year and submit 'full' plans for 2001/02–2005/06 in July 2000, when resources would be allocated across the plan period.

  Statutory reports produced under the provisions of the Road Traffic Reduction Act 1997 will therefore be submitted in July 2000, as part of the first round of full local transport plans. We will expect authorities to submit non-statutory 'interim' road traffic reduction reports in July 1999, as part of the provisional plans.

  The London Boroughs are not covered by the White Paper requirement to produce local transport plans, but will be separately required to produce local implementation plans which are in keeping with the Mayor's integrated transport strategy for London. We are taking this forward separately.

  The Road Traffic Reduction (National Targets) Act 1998 requires the Government to consider the setting of national targets. We will therefore require a greater degree of standardisation from local authorities in the measurement of existing traffic levels and forecasts—in order that we can assess the national implications. We believe this can be done by building on the data already collected for national surveys. It will take some time to get an assessment framework in place. This is something we would like to take forward jointly with local authorities under the auspices of the Transport Statistics Liaison Group. The existing draft guidance on the Road Traffic Reduction Act 1997 will be revised in the light of this work. The Government have also undertaken that they will produce a first report to Parliament on the issue of national traffic targets by the end of 1999 (which will also need to reflect the views of the Commission for Integrated Transport, when appointed). To achieve this, they will need to draw on existing sources of information together with any useful inputs from local authorities from their 1999 plans, accepting that at this stage the material will not be in a standardised format.

  National Air Quality Strategy
  Mr. Leslie
  To ask the Secretary of State for the Environment, Transport and the Regions when the current review of the National Air Quality Strategy will be completed. [56010]

  Mr. Meacher
  My hon. Friend the then Under-Secretary of State announced on 23 June 1998,Official Report, columns 431–32, that the review of the National Air Quality Strategy, originally planned for 1999, would now be completed by the end of this year, to look at the prospects of delivering cleaner air more quickly. I can confirm that we are on course to meet this and we aim to publish our proposals to amend the Strategy for consultation in the New Year.

  Environment Council
  Mr. Singh
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the outcome of the Environment Council on 6 October. [56011]
  1102
  Mr. Meacher
  I represented the United Kingdom at the Environment Council which took place in Luxembourg on 6 October.

  The Council agreed Conclusions which prepare the Community's negotiating position for the Fourth Conference of the Parties to the UN Framework on Convention on Climate Change taking place in Buenos Aires on 2–13 November. Through Conclusions, the Council also endorsed the commitment by the European Car Makers Association (ACEA) to reduce carbon dioxide emissions from new cars. This agreement between the Commission and ACEA will cut carbon dioxide emissions from new cars by 25 per cent. by 2008 and play a considerable role in reducing greenhouse gas emission in the European Union. Ministers also discussed for the first time two proposals which complement that agreement. These will require the monitoring of carbon dioxide emissions from new cars and similarly provide a scheme for labelling the fuel economy performance.

  First ministerial discussions were held on a number of other important dossiers. I gave general support to the directive concerning end of life vehicles whilst stressing that Member States should be given reasonable flexibility in implementation. A brief initial discussion was also held on the Commission proposal for a new Regulation introducing stricter controls on substances that deplete the ozone layer, which the UK supports in broad terms. The Council also reached agreement on a Resolution on Environment and Employment.

  The Council noted the progress of discussions in a working group on directive proposals to reduce emissions from heavy goods vehicles and to revise the proposal controlling the deliberate release of genetically modified organisms. These will return to the Council in December. Informal discussions were held over lunch on the environmental implications of Community enlargement and on the integration of environmental objectives into other policy areas.

  East Midlands National Forest
  Mr. Reed
  To ask the Secretary of State for the Environment, Transport and the Regions when he will report on the National Forest Company's progress in creating the National Forest in the East Midlands. [55734]

  Mr. Meale
  I have arranged for copies of the National Forest Company's Annual Report and Accounts for 1997–98 to be placed in the House Libraries.

NORTHERN IRELAND

  Equal Rights
  Mr. McNamara
  To ask the Secretary of State for Northern Ireland (1) if equality is one of the rights issues which will be subject to continuing consultations between the Irish Government and Her Majesty's Government under the proposed British Irish Governmental Council; [55524]

  (2) if the proposed Northern Ireland Assembly and the United Kingdom Parliament will have concurrent responsibility for legislating on equality issues following the enactment of the Northern Ireland Bill; [55526]
  1103
  (3) if equality is (a) transferred, (b) reserved or (c) excepted matter under the proposals contained in the Northern Ireland Bill; [55523]

  (4) in what areas concerning equality the proposed Northern Ireland Assembly will be able to legislate. [55525]

  Mr. McFall
  [holding answer 19 October 1998]: Current legislation on fair employment, sex discrimination, race relations and disability discrimination in Northern Ireland is a transferred matter within the responsibility of Northern Ireland Departments and will remain so in accordance with paragraph 3 of the Strand One section of the Good Friday Agreement. The Government intend that the provisions in the Northern Ireland Bill establishing a unified Quality Commission and a statutory obligation to have due regard to the promotion of equality of opportunity will be reserved matters on which the Assembly will be able to legislate only with the consent of the Secretary of State, and subject to Parliamentary control. The Government propose to bring forward amendments in the course of the Parliamentary passage of the Bill to this effect. Equality issues may be discussed in the British Irish Intergovernmental Conference insofar as they remain within the responsibility of Her Majesty's Government, but it is preferable that developments in policy on equality should arise from agreement between elected representatives in Northern Ireland to the extent that this can be achieved.
  1104

  Anti-terrorist Legislation
  Mr. Mitchell
  To ask the Secretary of State for Northern Ireland what consultations she has held with(a) the RUC, (b) the police in Great Britain, (c) civil liberties organisations, (d) the Irish Government, (e) members of the Northern Ireland Affairs Committee, (f) other hon. Members and (g) the United States Government, concerning the new anti-terrorist legislation. [55350]

  Mr. Ingram
  I refer my hon. Friend to the reply given to him on 19 October 1998,Official Report, column 934, by my right hon. Friend the Home Secretary.

  School Applications
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland how many new applications there were for places at(a) Comber High School, (b) Movilla High School, (c) Regent House Grammar School and (d) Saintfield High School in the academic year beginning September 1998; and how many were unsuccessful. [55355]

  Mr. McFall
  The information requested is set out in the table:

  1998–99 school year

  Number of applications received

  Number of applications refused

  Comber High School

  76

  —

  Movilla High School

  193

  13

  Regent House School

  293

  67

  Saintfield High School

  121

  56

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 Blackburn.

Lord Clarke of Hampstead
Anthony James Clarke, Esquire, CBE, having been created Baron Clarke of Hampstead, of Hampstead in the London Borough of Camden, for life—Was, in his robes, introduced between the Lord Cocks of Hartcliffe and the Baroness Gould of Potternewton.
Lord Evans of Watford
David Charles Evans, Esquire, having been created Baron Evans of Watford, of Chipperfield in the County of Hertfordshire, for life—Was, in his robes, introduced between the Baroness Dean of Thornton-le-Fylde and the Lord Paul.

Democratic Republic of Congo: Political Solidarity
2.45 p.m.
Lord Judd Lord Judd asked Her Majesty's Government:
What action they are taking bilaterally and multilaterally, including action through the European Union, the Commonwealth and the United Nations Security Council, to promote political solidarity to the problems of the Democratic Republic of Congo and to prevent the escalation of instability and conflict across the region and the African continent.
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, Britain is working hard for peace. We are actively encouraging all the states involved in the fighting in the Democratic Republic of Congo to pursue a negotiated settlement. We have made clear that there can be no military solution. Only a process of dialogue and negotiation can bring about a settlement that will last. We are also taking action with our European Union partners and in the United Nations Security Council to promote a peaceful solution.
Lord Judd: My Lords, does my noble friend agree that it was highly significant when the Prime Minister said at the UN in New York last month that there are few higher priorities than bringing peace to the Great Lakes region? Does she agree that apart from promoting the kind of approach which she has constructively suggested, if peace is to be brought it is absolutely essential to work at an economic programme for the region which makes use of the immense mineral
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resources in the interests of the people of the region as a whole? Meanwhile with 14 nations involved, thousands of refugees, ethnic cleansing and indiscriminate killing, are we encouraging and supporting Dr. Kofi Annan as the first African Secretary General of the UN to use all his authority and good standing to try to promote the solution which my noble friend has outlined?
Baroness Symons of Vernham Dean: My Lords, of course I can agree that bringing peace to the Great Lakes region is an important priority. We support the initiatives of the Southern African Development Community and the Organisation of African Unity for a peaceful solution. We have encouraged them to use all their influence and, of course, through our chairmanship of the Security Council this month, we are actively encouraging the discussions between the Secretary General and other council members to find concrete ways in which the UN can support a regional peace initiative. In our view it is vitally important that there is regional backing for any solution to this grave problem.
The noble Lord also raises the question of the immense resources of the area. We believe it is important that there should be a future programme in the area. Before the current conflict began a trust fund to help reconstruction and rehabilitation in the DRC was set up by the World Bank. I hope the noble Lord will be pleased to learn that we pledged 10 million US dollars to that. The future of the fund will need to be re-examined when there is a peaceful resolution to the conflict. However, we are looking ahead.
Lord Steel of Aikwood: My Lords, does the noble Baroness accept that when I was in Kinshasa in April it seemed to me that neither the political structures nor the communication structures were anywhere near in place for the holding of elections? Can the noble Baroness confirm that, since then, matters have deteriorated and there are about four or five forces from neighbouring countries now in the country? Does she welcome the declaration yesterday by the rebels of a ceasefire, and will we, therefore, encourage President Kabila to enter into direct discussions with those rebels in order to bring some relief to the people of that country who suffered so much under the rule of President Mobuto?
Baroness Symons of Vernham Dean: My Lords, the noble Lord, Lord Steel, is of course quite right. There is a highly complex situation on the ground in the DRC. There are many different elements involved in this struggle from within that country and of course from neighbouring countries too. A few days ago the rebels took the strategic eastern town of Kindu.
The noble Lord raises the question of President Kabila's discussions with the rebels. We have actively encouraged all those involved in the fighting to pursue a negotiated settlement. Both the internal issues and the concerns of the neighbouring states must be addressed if a lasting peace is to be achieved. We have, therefore, urged President Kabila to accept that the rebels must be

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included in any talks. We hope that those talks will establish a basis for a genuine, representative and accountable government in the DRC.
Viscount Brentford: My Lords, can the Minister tell us to what extent institutions such as schools, hospitals and other medical facilities still function in eastern Congo, or is it the case, as normally happens, that it is the poorest and most vulnerable who suffer most from the conflict?
Baroness Symons of Vernham Dean: My Lords, as is always the case in these terrible conflicts, it is the poorest who suffer most. At the moment the situation is highly complex and volatile. The rebels hold a number of major towns in the east and strategic areas in the south west. Their advance on Kinshasa was halted by the intervention of sizeable contingents from Angola and Zimbabwe, with Namibia providing logistical support. Chad and the Sudan have recently provided troops to Mr. Kabila's forces and there are also credible reports that Libya is providing logistical and financial support. I give your Lordships this overview to indicate the complexity of the problems that are faced and the undoubted disruption to the people of the DRC.
Lord Hughes of Woodside: My Lords, does my noble friend agree that the United Nations' capacity to provide a peaceful solution in the Congo is diminished by the inability of the United Nations to resolve the issue in Angola, where the UNITA rebels have still not carried out their agreements under the Lusaka protocol? Does she not agree that failure there diminishes the credibility of the United Nations and makes its work more difficult?
Baroness Symons of Vernham Dean: My Lords, I do not believe that apportioning blame or saying who has failed where is helpful. I hope I have made it clear that a number of different countries are involved in this conflict and that we, chairing the United Nations Security Council this month, are doing all we can to ensure that the United Nations plays a leading role in trying to find a solution to this enormously complex war.
Lord Moynihan: My Lords, the Minister mentioned the work of the United Nations. What assessment have the Government made of the criticism by Human Rights Watch of the United Nations Security Council presidential statement issued in July as "weak" and an "insult to the victims" of humans rights abuses?
Baroness Symons of Vernham Dean: My Lords, we have supported the special envoys from the United Nations, Mr. Dinka, the Secretary General's representative and regional adviser for the Great Lakes, and Mr. Sahnoun, the Secretary General's special envoy in Africa. The fact is that neither has a specific mandate to make recommendations about a settlement in the DRC. We believe that the circumstances in the DRC call for action on behalf of the UN by a high level political
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figure with real clout, possibly a former head of state or a senior Minister with influence in Africa. The view of Her Majesty's Government is that we should not look back to statements of criticism but should look forward and try to find a real solution to a real problem in the DRC.
Lord Rea: My Lords, does my noble friend agree that part of a solution to the conflict in the Congo area might be some redrawing of national borders which were put in place by the colonial powers at the time and, as in many parts of Africa, do not reflect the ethnic realities on the ground?
Baroness Symons of Vernham Dean: My Lords, such a proposal begs all kinds of questions, not only about the DRC itself but about the surrounding countries. We must look for a clear role to be given to the Southern African Development Community and the Organisation of African Unity. Both of those bodies are working hard to bring the parties together, to negotiate initially a ceasefire and then a peaceful solution. We shall, of course, listen to what they say about issues of borders and ethnicity. We fully support their efforts and will do everything that we can to help them achieve a negotiated settlement.

Dog Registration
2.57 p.m.
Lord Stanley of Alderley Lord Stanley of Alderley asked Her Majesty's Government:
Whether they will take steps to start a national dog register when they alter the regulations for quarantine for pets entering the United Kingdom.
Lord Carter: My Lords, the Kennedy Advisory Group on Quarantine did not consider a national dog register to be a necessary requirement for the proposed changes. The Government are sympathetic to the advisory group's proposals for the ending of quarantine in certain circumstances. After the public consultation, which runs until 31st December, the Government will decide what action to take.
The Government received a number of representations on the question of dog registration and have yet to take a decision on the way forward. Speaking personally, as Chief Whip I am all in favour of systems of licensing and even more in favour in some cases of the withdrawal of licences.
Lord Stanley of Alderley: My Lords, I thank the noble Lord for that Answer. But is he aware that he gave the impression that the Government are backing away from a dog registration scheme? If I misunderstood him, will the Government speed up the process by supporting a Private Member's Bill in the next Session of Parliament? I am sure the noble Lord realises that such a scheme would be of enormous benefit in regard to the

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marking and chipping of cattle and sheep. At the same time, could not the dog wardens which would be needed also be litter wardens?
Lord Carter: My Lords, as the noble Lord will know, electronic identification of farm animals can be carried out now on a voluntary basis. Cattle, sheep, pigs and goats can be tagged by electronic means. At present, boluses and electronic tags are the favoured approach. With regard to the possibility of government support for a Private Member's Bill, I cannot at this stage forecast what will happen in the next Session, but it is an idea that we could look at. A number of representations have been made regarding a dog registration scheme. The Government are considering those representations, but a widespread consultation period would be necessary before any action was taken.
Baroness Trumpington: My Lords, does the Minister agree that a national dog register may help to deal with the malpractices and horrible stories that emerge from so-called puppy farms? If dogs were registered there would at least be a responsibility to try to get rid of the evil side of puppy farms.
Lord Carter: My Lords, I believe that powers already exist to deal with that matter. One does not need a system of dog registration to deal with it. There are statutory powers to set standards, and a consultation exercise is about to start on the implementation of those standards through parliamentary order. We hope that that will take place some time next year.
Baroness Nicol: My Lords, does my noble friend recall that this House expressed a firm view a few years ago that there should be a dog registration scheme and the idea was overturned by another place for reasons of which I am unaware? I am quite sure that had one been introduced implementation of new quarantine regulations would have been a little easier. Is he aware that the cost of dealing with stray dogs alone is some £38 million? That represents the cost of livestock damage, traffic accidents, dog wardens and the cost to the police. Is it not time that the Government took these factors on board? In particular, now that the technology is so advanced it would be a good deal easier to do.
Lord Carter: My Lords, it is important to understand that dog registration is not relevant to the question of quarantine. It is estimated that out of a total dog population of 6.9 million there will be a maximum of a quarter of a million cats and dogs exported and imported back to the UK which will subject to quarantine. One does not have to register 6.9 million dogs in order to catch the maximum 250,000 dogs that will be caught under the proposals referred to in the Kennedy Report. As to dog wardens, under Section 149 of the Environment Protection Act 1990 each local authority is required to appoint an officer for the purposes of dealing with stray dogs in its area.
Baroness Fookes: My Lords, as I had the support of the then Labour Opposition when I sought in vain to
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introduce a dog registration scheme on two occasions in the other place, I am disappointed by the apparent dragging of feet by this Government in the matter. Why have they changed their mind now that they are in government?
Lord Carter: My Lords, this happens sometimes. It is correct that the Labour Party was in favour of a national dog registration scheme when in opposition but there was no commitment in that respect in the manifesto. All of us in this House know how important manifesto commitments are. Any scheme is likely to require changes to primary legislation and Ministers will need to consider a number of wide-ranging issues, including cost and enforcement. No decision has been taken on the need for a registration scheme, but we are prepared to consult and consider the merits of the issue.
The Viscount of Falkland: My Lords, is the Minister aware that many noble Lords in this House have pressed for some time for a dog registration scheme and that one of the points made persistently by the previous government was that such a scheme was unnecessary because people who handled dogs irresponsibly would be unlikely to register? Can the noble Lord say what the Government would do to police a registration scheme if they decided to introduce one? Incidentally, how many dogs does the Minister believe there are in this country; and how can they be counted without a registration scheme?
Lord Carter: My Lords, I have already answered that question. It is estimated that there 6.9 million dogs in 5.4 million households. I have now forgotten the noble Viscount's first question.
Lord Bruce of Donington: My Lords, has my noble friend considered the possible cost of the introduction of what he considers to be a feasible scheme? Will he bear in mind that should he introduce one there is every likelihood that the European Commission will claim competence in this field, which I believe will be a considerable embarrassment to some dog owners in various parts of the country, not least in this House?
Lord Carter: My Lords, there is no European Union legislation on the import of pets. The Commission regards this matter as a single market issue. But there is as yet no sign of any attempt to introduce legislation or a directive. If there were such a directive it would be subject to qualified majority voting.

United Nations: US Debt
3.5 p.m.
Lord Renton of Mount Harry Lord Renton of Mount Harry asked Her Majesty's Government:
Whether they will seek to persuade the United States to pay the money it owes to the United Nations.
Baroness Symons of Vernham Dean: My Lords, we have made it clear to the United States that we expect the

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United States to pay its United Nations arrears and future contributions promptly, in full and without conditions. We welcome the inclusion of the 475 million dollars for United Nations arrears in the budget agreed by Congress and the White House on 15th October, last week. But this is far short of what the US owes, and we have serious concerns about the conditions attached. The relevant legislation still contains unrelated abortion which the Administration has said would cause President Clinton to veto the whole legislation.
Lord Renton of Mount Harry: My Lords, while I thank the noble Baroness for what she has just said—I very much agree with it—is it not true that the 475 million-odd dollars that the United States has agreed to pay is only just sufficient to keep the US with a vote in the General Council? Further, is it not ironic that at the very moment when President Clinton is working so hard to broker a renewal of the Middle East peace talks the United States is itself 1.6 billion dollars—four times the figure for Russia—in arrears to the United Nations, which endangers peace-keeping operations all round the world? Can the noble Baroness use all her influence in Downing Street to persuade the Prime Minister that, if he has the close relationship with President Clinton of which the spin-doctors tell us so much, he should use it to get the United States to pay its dues to the United Nations?
Baroness Symons of Vernham Dean: My Lords, I should like to make an important point about the budget agreed last week. There are two parts that are relevant to the financing of the United Nations. The first is legislation to authorise payment of a further tranche of the 1998 dues. That is likely to be enough for the US to avoid the operation of Article 19 in January 1999. We welcome that but only as far as it goes. The second matter is the bill to which I referred in my initial response. That is an appropriation of 475 million dollars of arrears to the United Nations. It is that payment which remains tied to the "abortion" language.
The noble Lord asks how much the United Kingdom is able to bring pressure to bear on the United States on this matter. We have used our European Union and G8 presidencies to press for payment of all the arrears, not only those of the United States considerable as those are. The Foreign Secretary has raised the issue with Madeleine Albright. I have raised the issue on a number of occasions. The subject is raised frequently by Sir Christopher Meyer, our ambassador in Washington, and Sir Jeremy Greenstock, our Ambassador to the United Nations in New York. No one is left in any doubt about that. But it is not a matter of exerting influence upon Mr. Clinton. If Mr. Clinton had a free hand in such matters he would not be unwilling to make the prompt and unconditional payment that we all wish him to make. It is a matter of Congress using this as a vehicle for some of its other preoccupations to try to exert pressure elsewhere.
Lord Peyton of Yeovil: My Lords, does the Minister agree that it is a particularly shabby manoeuvre on the part of Congress to connect two issues which have nothing to do with one another, thus frustrating the strength and
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influence of the United Nations at a time when every day that institution becomes more necessary? It is surprising that the United States which provides the home for the United Nations should be doing that.
Baroness Symons of Vernham Dean: My Lords, I agree that the connection which Congress has sought to make is unrealistic. I hope that we shall not indulge in name calling so far as concerns Congress. I believe that all that will do is to harden attitudes. We should be trying to persuade the United States Congress that, as a responsible member of the United Nations, the United States must pay its contributions on time, in full and without conditions.
I stress to your Lordships that it is not only the United States which is in arrears. I told your Lordships last week that 149 countries are in arrears. There has been some updating. The figure is now only 145 countries in arrears—a marginal improvement, but none the less an improvement. However, the difficulties that that has engendered mean that we expect a deficit on the important peace-keeping finance of 864 million dollars by the end of this year. And that is on peacekeeping, which is at the forefront of so many of your Lordships' minds through Questions in this House.
Lord Bridges: My Lords, will the Government bear in mind that any decision by the United States to pay its arrears will be preceded by a tough negotiation between Congress in Washington and the Secretary-General in New York? The Secretary-General will be under severe pressure to impose across the board reductions in staff and budgets of the United Nations. Will the Government do their best to ensure that those cuts do not damage the most efficient and vital parts of the United Nations secretariat and its agencies?
Baroness Symons of Vernham Dean: My Lords, we support Mr. Kofi Annan's effort to make the United Nations a more efficient organisation. I hope that I have been able to make that clear to your Lordships on other occasions.
However, I believe that we must also reject the call by the United States for a reduction of their regular budget ceiling to 20 per cent. from the existing 25 per cent. I suspect that much of the negotiations which precede the payment of arrears will not only focus on the United Nations and efficiencies there, but also on the desire of the United States to cut its budgetary contribution to the United Nations.

Working Family Tax Credit
3.12 p.m.
Lord Campbell of Croy Lord Campbell of Croy asked Her Majesty's Government:
What action they are taking in order to counter the possible increase in fraud, if the scheme for working families' tax credit is continued in the form at present proposed.
Lord McIntosh of Haringey: My Lords, the working families' tax credit will build on and replace family credit

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from October 1999, legislation permitting. The working families' tax credit will help make about 400,000 more families better off in work than on benefit and the Government want the help provided by the working families' tax credit to go to all those who are eligible. It will be administered by the Inland Revenue which has considerable experience and expertise in detecting and combating fraud.
Lord Campbell of Croy: My Lords, I thank the Minister for his reply. Did the noble Lord note the reported comment by the former Minister for Welfare Reform, Mr. Frank Field, in his lecture to the Social Market Foundation that serious dangers were involved in those proposals because they offered large bonuses for dishonesty for both employers and employees? Are the Government prepared to be tough on fraud, and tough on the causes of fraud?
Lord McIntosh of Haringey: My Lords, I indeed saw the report of the speech by Frank Field. Part of it can be explained by his long-standing and honourable opposition to means testing. However, I believe that there were a number of errors in the analysis. First, it is not true that employers will need to calculate the working families' tax credit. That will be done for them by the Inland Revenue and they will simply be required to make the payment. Of course, if there is collusion between employers and employees to falsify employment records, that will be serious fraud. But there is no reason to suppose that the vast majority of honest employers will do that any more than they do so with their other obligations under the tax laws.
Lord Ashley of Stoke: My Lords, is the Minister aware that it is damaging to disabled people when newspapers grossly exaggerate any possible fraud on disability benefits? Some articles refer to a figure of £1 billion, or £0.5 billion. A figure is plucked from thin air. But that is after Ministers, including the noble Baroness, Lady Hollis, have said that after 30,000 investigations into the disability living allowance there was no evidence of one single confirmed case of fraud.
Is it not also disturbing that the Department of Social Security is responsible for some of those "leaks" to newspapers? The respected journalist, David Brindle, of the Guardian has said that the department is giving information about so-called fraud to journalists. Can we not stop that kind of practice?
Lord McIntosh of Haringey: My Lords, the Question before us is about the working families' tax credit rather than disability allowances. However, I understand my noble friend's fear; and I understand that other people have the same fear. If there is any evidence of leaks in an inappropriate way by officials, I am sure he will bring that to the attention of the authorities.
Lord Higgins: My Lords, is the Minister aware that many people regard the Labour Party's promise to cut social security in order to spend more on health and education as a fraud as it has totally failed to do so? Will not the matter raised by my noble friend in his Question exacerbate the situation?
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Does the Minister recall that he set out Mr. Darling's great achievement as Chief Secretary as the setting in concrete of the spending plans for the next three years? As the Secretary of State for Social Security, how will he now change those plans?
Lord McIntosh of Haringey: My Lords, as the noble Lord has seen fit to accuse this Government directly of fraud, let me say that the undertaking by the Government was to decrease the proportion of public expenditure spent on welfare rather than to decrease the absolute amount. We have been consistent in that and have achieved that.
As regards Mr. Alistair Darling's role, the noble Lord knows that Mr. Darling has been consistent in the Treasury and the Department of Social Security, and he will see the results of that when the welfare reform White Paper appears.
Lord Addington: My Lords, can the Government tell us whether the levels of fraud in the benefits system are in any way superior to those of non-payment of legally charged taxes?
Lord McIntosh of Haringey: My Lords, that is a fascinating question and I should love to be able to answer it. I shall try to give an answer to the noble Lord, and make it more widely available. The noble Lord will understand that it would be extraordinarily difficult because both are "unknowable" statistics. If we knew where the fraud was, we would know how much there was; and if we knew where it was, we should be able directly to tackle it.
Lord Brooks of Tremorfa: My Lords, as the Government are prepared to consider introducing a registration scheme for dogs and to consult widely on that, will they be prepared similarly to consider introducing identity cards, and to undertake widescale consultation on that issue? It is understood generally to be the most efficient way of reducing fraud.
Lord McIntosh of Haringey: My Lords, in the 30th minute of Question Time I shall not be tempted into a question which is not only wide of that on the Order Paper but also, as my noble friend knows, of huge political controversy.

City of Westminster Bill [H.L.]
Read a third time, and passed, and sent to the Commons.

European Parliamentary Elections Bill
3.20 p.m.
Read a third time.
Clause 1 [Number of MEPs, electoral regions and electoral system]:
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 1:
Page 2, line 1, leave out ("a registered party, or").
The noble Lord said: My Lords, this amendment and the three grouped with it seek to change the voting system for the European elections in a very significant way, in order to give the electorate more choice and the party apparatus less choice. We have been over this ground on a number of occasions, not just on this Bill but also on the Scotland Bill and the Wales Bill. However, I think it is worth rehearsing the Government's proposal and also that contained in my amendments.
We are moving from single-member constituencies in Europe, first past the post, to regional lists covering very large areas of the country, where a number of European Members of Parliament—sometimes as few as four, sometimes 10—will be elected on the basis of a list system. For example, in London there are 10; in Scotland there are eight. The order of the list is all-important because, depending on the number of seats a party gains on a proportional system, that will lead to a number of members on the list being elected. I do not wish to go into the various systems which will be used to determine how many seats each party will get. The d'Hondt system, if one has to have that kind of system, is as good as any other. I should put in my usual caveat and say that, although I am discussing how to improve this particular system of proportional representation, the whole thing could be properly improved by sticking with the first past the post. Having made that point, I go on to look at the system the Government have proposed.
When noble Lords go into the polling booths for the European elections next year, they will be confronted with the party names. Also on the ballot paper may be the names of the candidates selected by the party in the preferred order; no one will be able to alter the order of those names. All your Lordships and the voter will be asked to do is to vote for the party. Labour voters will therefore vote for the Labour Party; Conservatives for the Conservative Party and Liberal Democrats for the Liberal Democrat Party. That will be all. The votes will then be taken away; the d'Hondt divisors will be used and the number of seats for each party will be determined. The returning officer will then say that the Labour Party deserves three seats—though frankly I do not see why it deserves any—and the top three candidates will be elected.
The decision about that order of candidates is vitally important. As the Bill currently stands, that order will be determined entirely by the party itself. The three main parties represented in your Lordships' House have all chosen slightly different ways to decide on the order of that list. It would be fair to say that the Liberal Democrat Party has chosen the most open way in the form of a postal vote of its members. The Conservative Party has chosen the second most open way; that is, to hold general meetings of its members in each area. They come along, listen to the candidates, and then vote to determine the order of candidates. As I understand it, the Labour Party's decisions will be made by the powerful people who inhabit a certain floor of Millbank Tower, and so will be slightly less democratic and open.
That is how the three parties will do it. As our parties are independent organisations, it is only reasonable that they should be able to do it in their own way. It is odd that the Labour Party, which proclaims so much faith in democracy, has chosen the least democratic method of deciding the list. I hear my noble friends say that it is not odd at all. They are probably right: it is part of the control mechanism which so inhabits the Government. The real point, whether it is the Liberal Democrat, the Conservative or the Labour method, is that the one person who has no choice is the voter.
My amendments would mean that when the voter goes into the polling station next June, the voter who wants to vote for the Conservative Party would do so by placing his cross against the person on the Conservative list he would like to see being elected above all the others. The same is true of Labour; the same is true of the Liberal Democrats; in Scotland, the same would be true of the Scottish National Party. At the end of polling, all the votes cast for the Conservative candidates would be totalled, as they would be also for the Labour, Liberal Democrat and Scottish Nationalist candidates. The total votes for the parties will then be determined. The d'Hondt divisor will be brought into play; the number of seats to be given to each party will be determined, and the returning officer—let us say that the Labour Party are to get three members—will then look at the list and pick the three members who have received the most votes from the Labour electorate; not the general electorate but the Labour electorate. Those people who vote Labour, Conservative or Liberal Democrat, will therefore determine not just the number of seats the party will gain, but who on the party's list will gain those seats.
Your Lordships may well wonder why the Government are against a proposal which is so open and democratic. We will know a little later whether or not the Liberal Democrats are also opposed to it. A number of arguments have been heard over the course of this and related Bills. One is that our European neighbours have closed lists. Yes, some of them do. Germany, Spain, France, Greece and Portugal have a closed list system. Belgium, Denmark, Italy, Luxembourg, the Netherlands, Finland, Sweden, Austria and Ireland, however, have systems where the order of the names may be changed by casting personal votes for specific candidates. In Luxembourg and Ireland there can be cross-voting for people in different parties. The idea that, by moving to a closed list system, we are moving to one which accords with all our European neighbours is simply not true.
In any case, why do the Government seem to be so distrusting of our electoral system that they think that anything anybody else does must inevitably be better? That seems to be one of the themes that runs through it. I do not ask France and Germany to change their systems to our system, and I do not see why we have this obsession that what we have done for decades, in some cases centuries, is somehow worse than what some of them have done for only the blink of an eye when it comes to democratic elections this century.
The Government will tell us that the ballot paper will be too complicated. That is simply not true. The ballot paper will be reasonably straightforward. Indeed the Electoral Reform Society has produced a ballot paper which makes that quite clear. In case the Government still think that and the noble Lord, Lord Mostyn, tries to tell us that, perhaps I may suggest that he looks at Germany and the ballot paper that they used there a few weeks ago? He will see that it is not a straightforward ballot paper. The ballot paper outlined by the Electoral Reform Society for the system I am proposing would be a good deal simpler. I do not believe that the argument that the ballot paper will be too complicated holds any water at all.
What would the electorate like? The Home Office set up a focus group. That will not surprise your Lordships: if in doubt, set up a focus group! It commissioned some research by NOP last February and found that voters felt that the proposed closed list system appeared to be depriving them of their right to select individuals. For some voters it raised the question as to whether party loyalty will precede constituency loyalty. Focus group research carried out for the McDougall Trust by NOP found that voters' reactions were immediately negative to closed party lists, as they believed that they were being deprived of their right to vote for individual candidates.
I should have thought that to be fairly reasonable and self-evident. An organisation called the Democratic Audit carried out some work based on an ICM poll commissioned by the Joseph Rowntree Reform Trust. None of these organisations is a particularly a great supporter of the Conservative Party, but I believe that members of the Government and their friends on the Liberal Democrat Benches should be listening to what they are saying.
The poll asked people to vote on closed or open lists. The report stated that two-fifths used the opportunity to vote for individual candidates, while three-fifths voted for the party list. Charter 88 states that that is a significant majority, especially given that voters will never before have used a list system. The report states:
"In real campaign conditions, we would expect up to half the voters to use the opportunity to support a particular candidate".
If somebody straightforwardly wishes to vote for the party he simply votes for the person at the top of the party's list—if the party can put names in order. It could be alphabetical order. I have no objection to the party doing that, but I believe that people should be allowed so to vote.
One of the arguments used on a number of occasions by the noble Lord, Lord Williams of Mostyn, is that the first-past-the-post system is a closed list of one. That is significant and it is right, but in many regions when a voter votes for a party he will be voting for more than one person—he will be voting for two, three or four people. I suggest that in those circumstances a voter who does not like the names at the top of the list will be less likely to vote for another person or another party because he or she will realise that the vote counts for more than one person. However, we all know that in first-past-the-post elections a significant number of people say, "I put my hand over the candidate's name
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and voted for the party". There are a minority—not many—who say, "I am not voting for my party if that is its candidate". Therefore, I believe that the closed list of one is not a good argument because only one person is elected. One can decide not to vote for that person without endangering up to three or four of one's party's seats in a particular area.
I thought that the first-past-the-post system was a bit wobbly at the last election, and I even thought that it was a bit wobbly in 1987. But just because the result is not what I would have chosen that is not a good reason for changing the electoral system. I have always made that clear. However, the most important fact is that if the Government want to move away from the first-past-the-post system they should not hark back to some of its advantages in order to justify the closed list system, for goodness sake. If we are moving to proportional representation it ought to be not merely proportional representation; it ought to give the electorate more democratic control in terms of the people they elect.
Charter 88, in its handout on the issue, stated:
"We believe that voters should be able to choose between candidates of the same party. We are especially concerned that voters are not given the impression that the new voting system is being introduced for party political benefit. We are concerned that if the Government insist on the use of closed lists voters may be left with the impression that the voting system has been manipulated for party political aims".
I could not have put it better myself. It is being manipulated for the political ends of the party.
We agree to differ on the principles of first-past-the-post, but when we get into the nitty-gritty of the systems we can make common cause. Mr. Ken Ritchie said today:
"We are all for proportional representation and we give the Government credit for having moved so quickly in introducing PR for European elections. But there is more to electoral reform than PR. We want to see voters being able to exercise more choice, and certainly not less choice, over who their MEPs will be. Such a system [the closed list] is bad for voters, bad for candidates and bad for democracy".
I hope that at this last gasp your Lordships will agree that we ought to amend the Bill to ensure that the voters have some choice not just on the party colours of the people who represent them in the European Parliament, but also on who the individual who represents them should be. I beg to move.
3.30 p.m.
Lord Evans of Parkside: My Lords, last Monday at the Report stage I made it clear that the amendment we were debating, which was the same amendment as we are debating today, was superior to those that I had tabled giving the electorate choice of candidates. I stated that I would withdraw my amendments because I thought this amendment was better.
I have made it clear from the outset that I am hostile to the entire concept of the Bill in relation to closed lists as selected by central committees. I say to my noble friend the Minister that the amendment, if accepted by the Government, will not affect the Labour Party NEC's chosen list of candidates in any way whatever. Those chosen candidates will remain on the list. It will not

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affect proportionality in relation to the parties because, as the noble Lord, Lord Mackay of Ardbrecknish, made clear, the total of the votes cast for all the candidates will be given to the party. However, the electorate will have a small say in the positions of the candidates, and in one or two circumstances there might be a difference between the party's list and the electorate's final choice. It is a modest amendment which improves what I believe is a thoroughly bad Bill.
I also draw the Minister's attention, and the attention of the Liberal Democrats, to an interesting article in the Daily Telegraph of 15th October by Mr. George Jones, the paper's distinguished political editor. He was writing about the proposals of the noble Lord, Lord Jenkins of Hillhead, for the reform of voting systems for the House of Commons. I am certain that Mr. Jones had received some interesting information from a good source. He states that during a series of consultation exercises around the country he had been taken aback by the hostility to the idea that introducing some form of proportional representation based on a list system would increase party control.
The article quotes the noble Lord, Lord Jenkins. Apparently, the initial proposal was that the names would be selected by the parties from a pre-set closed list. However, the noble Lord proposes that voters should be able to vote for individual candidates on the list. I am sorry that the noble Lord is not in his place, but I believe that that is an important article. I submit that the proposal sounds like the amendment we are currently discussing, which tries to remove some of the tight control held by the central executive over the party's list. I trust that the Liberal Democrats will give the matter further thought in view of the fact that we might have to deal with the issue again when we receive the final report of the noble Lord and his committee.
I also refer to the comment made by the noble Lord, Lord Harris of Greenwich, when he dismissed my noble friend Lord Stoddart, who asked for an explanation of the system adopted by the Government in the Bill. The noble Lord rather loftily dismissed my noble friend by stating that election manifestos do not consist of the details of a Bill. I could not remember any mention in the manifesto, but that was probably my fault. Therefore, I searched through my copy and, sure enough, I found a reference towards the end of the document on page 37. There are 14 words in the manifesto, which state:
"We have long supported a proportional voting system for election to the European Parliament".
Yes, but it offered no explanation whatever. However, it did offer an interesting explanation of the system to be adopted for both the Scottish and Welsh elections to their respective parliaments next year. When we hide behind manifesto statements of such a brief nature and then produce Bills subsequently which leave a lot to be desired as far as democracy is concerned, it tends to bring politics into disrepute.
I suggest to my noble friend that if the Government accept this amendment it may actually assist the party in Wales. I understand that there are considerable difficulties with sections of the Welsh party because of
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the selection of the candidates to contest the five seats in Wales. My information is that the three Welsh Labour Party members on the NEC selection panel completely disagreed with the majority's placement of the candidates but were outvoted by the rest of the NEC members.
There have been considerable problems in Wales, with protests from various constituency parties about the Welsh list of candidates. If my noble friend can accept this amendment it will solve the Welsh problems at a stroke. It would give the Welsh electorate the opportunity to decide the order of the candidates to contest the election in Wales.
Is this Chamber a revising Chamber, as has often been pointed out? I am not parting company with the Government on any particular or major piece of legislation. I am asking them to have second thoughts about a particular element in a particular Bill, as are other noble Lords. When it discussed this issue in Committee, the House of Commons did not spend long debating particular methods. On Second Reading, on 25th November 1997, there was a rather astonishing exchange between the Home Secretary and various Members when, introducing the Bill, he said:
"To help hon. Members, I shall arrange for a brief description of how the Belgian system operates to be placed in the Library, alongside a greater description of how the system in the Bill is intended to operate, and I shall be interested to learn how hon. Members on both sides of the House perceive the system. This will therefore be a subject to which we can return at a later stage of the Bill's passage".
Hansard records that several honourable Members rose and Mr. Straw said:
"I give way first to the right hon. Member for North-West Cambridgeshire (Sir B. Mawhinney)."
Sir Brian said:
"I want to be clear as to what the Home Secretary has said. Has he just said that, having proposed the Second Reading of a major Government Bill, he is now signalling that he is willing to change one of the fundamental aspects of that Bill?"
Mr. Straw replied:
"It may come as a surprise to the right hon. Gentleman, as a member of the previous Government, who did so badly, that we are a party and a Government who listen to argument".—[Official Report, Commons; 25/11/97, col. 814].
That is precisely what is being attempted on this occasion. An argument is being presented in relation to one aspect of the Bill. It is not an instruction to the House of Commons that it has to accept anything from the House of Lords; it is an opportunity for it to have second thoughts about this particular aspect. If the Home Secretary is correct that this is a government who listen to argument, and if the noble Lord, Lord Jenkins of Hillhead, is correctly quoted in the Daily Telegraph as saying that he has been taken aback by the hostility to closed lists which increase central party control over candidates, surely this is a timely and helpful amendment from the revising Chamber to the principal Chamber. I trust that my noble friend will give serious consideration to accepting the amendment.
3.45 p.m.
Earl Russell: My Lords, I must declare an interest as president of the Electoral Reform Society. The society put out a press release at two o'clock today from which the noble Lord, Lord Mackay of Ardbrecknish, has already quoted. I wish to quote the paragraph following the one mentioned by the noble Lord:
"At present many candidates have been selected and put on lists in positions in which they have no hope whatsoever of being elected no matter how popular they are with the electorate. Others near the top of lists will almost certainly be elected even if the electorate thinks they are useless. Such a system is bad for voters, bad for the candidates and bad for democracy".
Having declared my interest, I have also read the Companion to the Standing Orders which says that noble Lords speak not for outside interests but for themselves. I am also aware that the attitude of my Front Bench towards this amendment is different from that of the society. That attitude has very great weight with me. But, faced with two conflicting pressures, I think that frees me to consider arguments of principle, of the national interest and of democracy. That is what I propose to do.
I shall not spend long on the case against the closed list. I have been outlining it since the Second Reading of the Bill. The basic point is that democracy involves the right to choose both what party and what person will represent us. This Bill allows us to choose what party represents us; it does not allow us to choose what person represents us. That appears to be a fundamental blow to democracy. It is bad for the candidates; it is even worse for the elected members. It destroys the accountability of the member to the voters. In doing so it destroys one of the very cardinal principles of democracy. All members of elected assemblies—or of any other assemblies—will try to please those from whom their title to sit comes. It is human and it is inevitable. This Bill creates an incentive to please a party machinery and not to please voters.
We on these Benches have always upheld two principles of electoral reform. One is the principle of proportionality, which this Bill meets. The other is the principle of accountability to the voters, extension of voter choice and the use of the injection of democracy to control unaccountable power. The one principle has always been as important to us as the other. The second principle this Bill does not meet at all. It is not a representation of the people Bill; it is a representation of the parties Bill.
The contrary case must rest almost entirely in terms of the appeal to loyalty. My loyalty to my party is one of the strongest emotions that I possess. It is a greater loyalty to a collective group of people than I ever believed myself capable of. I agree—we all do—that all political effort is and must be a team effort. In my actions so far I have tried to give effect to that principle. I had been here 10 years before I voted against the party Whip. Indeed, I was once reproved by Lady Seear, as deputy Leader, for insufficient willingness to vote against the Whip. Since then I have done it twice, on both occasions on this particular issue—three offences, if you like, but all on the same point, so I might ask for the sentences to run concurrently.
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The need for a team effort necessarily goes both ways. There is sense in what I am told is a disciplinary maxim in the American army: never give an order which is not going to be obeyed.
Loyalty is something about which I have thought in many contexts. It takes many forms. Loyalty can be loyalty to a person or it can be loyalty to principles. The distinction is most classically made in the famous "Saturday night massacre" in the United States when Richard Nixon ordered the Attorney-General to sack the Special Prosecutor. A1 Haig said to the Attorney-General, "Your Commander-in-Chief is giving you an order". The Attorney-General replied, "I am sworn to obey the constitution". There you have the two principles of loyalty. Your Lordships will have no difficulty in guessing which is mine.
Loyalty can also be a loyalty to a person or to a group. When I think of my loyalty to my party, I think of the people with whom I ran up steps in Oldham in a heat wave or who held the torch for me when I looked for numbers in Winchester Cathedral Close in the rain and in the dark. If I were to vote with this Whip, they would not understand me. That, of course, is not an insuperable argument. Occasionally, one has to do things which they do not understand. What is much more important to me is that I could hear myself, if I tried to answer them, getting to the point where my voice faltered and I had no argument.
I have listened to my Front Bench on this issue many times. They argue that there has been a deal. I do not know what deal; when it was reached; where it was reached; or for what inducement. I would need to know those things. I do know that when this Bill was first announced. It certainly was not known to those who managed the business for us that it was to introduce a closed list. I do know that my honourable friends in another place voted against a closed list. If we carry this amendment, I would expect it possible that many of them might do so again.
The other argument is simply in terms of the loss of the Bill. I argued last week that I do not really believe that that is a particularly large danger. All three parties have now chosen their candidates. If the Bill were to be lost, we would have to go back to the old constituencies and to the old candidates. I do not believe that the Prime Minister wants Mr. Ken Coates returned as a Labour MEP. Therefore, I believe that the danger of the loss of the Bill is small.
We must consider always, especially when in trouble with our parties, what the effect of our vote is. I do not believe that a vote for this amendment is just a gesture. I believe there is a possibility that the amendment might carry. If it carries, I believe it will attract support in another place. I believe it is not impossible that it might be accepted. The chances of course are slim, but if we do not try to change legislation where there is a slim chance, then, my Lords, what are we doing here?
I must of course listen, and will listen with the greatest care, to what my Front Bench says in reply to what I have said. I owe them that. But I must say to them that, as I see things at present, I am minded to

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vote for the amendment; and any argument that persuades me otherwise would have to be a very good one indeed.
Lord Renton: My Lords, we have heard three very impressive speeches in favour of the amendment. I am sure that all your Lordships will carry their mind back to other occasions when Parliament has had to decide on electoral reform. Certainly in this century—it was not so true in the previous century—we have generally managed to get a high degree of agreement between the parties on that matter and we have tried also to put the interests of the people first. One's mind goes back to giving votes to women, to the lowering of the voting age, and so on. It would be very unfortunate if an amendment which should achieve agreement between the parties, even though it is something of a compromise, were to fail in your Lordships' House. I therefore implore not only the members of the Government Front Bench but also the members of the Liberal Democrat Front Bench to bear in mind those two worthy ends: meeting the interests of the voters and trying to get agreement between the parties.
Lord McNally: My Lords, when I was Member of Parliament for Stockport, South I once went to a local club. The chairman said, "Before we start the bingo, we will have a few words from our Member of Parliament". Until the intervention of my noble friend Lord Russell, that was the most daunting softening up for any speech I had to make. Of course I understand his strong commitment to proportional representation, to democracy and to open lists, and certainly no orders are going from this Front Bench. We have a position, as we are entitled to have, and that is that we will invite Liberal Democrats to vote with the Government and against the amendment.
My favourite political play is "Antigone" in which Creon explains to Antigone that politics is sometimes about getting your hands a little dirty. I fear that my noble friend Lord Russell is my Antigone.
Noble Lords: Oh!
Lord McNally: I hear the "Ohs" from former Conservative Ministers who spent 18 years getting their hands dirty, so let us have a little silence from those Benches. I also remember George Woodcock, the former General Secretary of the TUC, reminding his members on many occasions that progress was often based on shabby compromises.
Of course my party believes in the single transferable vote. At earlier stages we have argued for the open list system. We have been working—that is not a matter of deals—with the Government across a wide range of constitutional reform. We wish we could have persuaded the Government at earlier stages of different shapes for not only this Bill but also for the Bills dealing with Scotland, Wales and so on. But what do we have tonight? We have the noble Lord, Lord Evans, telling us that he thinks this is a bad Bill. We have the noble Lord, Lord Mackay, telling us that he would have
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first-past-the-post if he could get it. It seems to me that the supporters of this amendment support it because they do not want the Bill at all.
I shall tell the House what we want. We believe that the Bill is a substantial advance on whatever has been on offer before for elections to the European Parliament. We have had nominated Members of the European Parliament and we have had Members of the European Parliament elected by first-past-the-post. As has been pointed out on a number of occasions, the first-past-the-post system on large constituencies produced grotesque swings in the representation of one or other party, Labour or Conservative, and until the last election totally excluded the Liberal Democrats. Under this system not only will parties be represented according to some proportion of the votes they receive in those elections but, almost as important, we will have a geographic spread so that from the south-west for the first time we may hear a Labour voice in the European Parliament, or from the West Midlands a Liberal Democrat voice, or from the north-east a Conservative voice. I believe that that makes a healthier representation in the European Parliament.
I also believe that it will bring about a development where those who hanker after the constituency system are really and truly behind the game. These elections will bring genuinely regional voices into our politics and into the European Parliament, not block voices but individuals who are voted in from those Euro-constituencies. They will then become a voice for their region.
As the noble Lord, Lord Mackay, was generous enough to acknowledge, many of the objections rest not on what is in the Bill but on how some powers internal to various parties have been interpreted. For my part, I know the individuals who will be holding the banner for the Liberal Democrats. I know how they have been chosen. They have not been chosen by any central committee but by our members voting freely. They have produced lists with an order which is their choice and which they will put to the electorate with enthusiasm.
Of course this Bill is not everything that we wanted. However, I say to my noble friend Lord Russell that I can face exactly the same activists as he has trouble facing. I shall tell them that by securing this Bill, for the very first time we shall send to the European Parliament a delegation, a representation, of Liberal Democrats commensurate with our support in the country. That is closer to my ideal of democracy than we have ever achieved before and it is worth supporting.
4 p.m.
Lord Stoddart of Swindon: My Lords, we heard some extremely distinguished speeches this afternoon. I rise to support my noble friend Lord Evans of Parkside who made a very penetrating, indeed distinguished, speech in support of this group of amendments.
I believe that my noble friend Lord Evans speaks for a number of people on the Labour side of the House. That must be taken into account. My noble friend has had a long and distinguished career and past in the Labour movement and, indeed, in the body politic. He was a Member of another place for a long time and has been a

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Member of this House for a little while during which time he has been extremely active and has made some distinguished contributions.
However, he has also been extremely active in the Labour movement generally, serving for many years as a member of the National Executive Committee. Therefore, he knows what he is talking about and has represented a wide range of people in the Labour Party over a long period of time. What he said about the Bill and the amendments is correct. Although he and I are for the continuation of the first-past-the-post system, which is respectable, he supports an attempt to make the proposals in the Bill more workable and more responsive to the people of this country.
What he wants to do and what the amendments seek to achieve is to give the electorate a voice in who is elected to the European Parliament. I see nothing wrong in that and everything right in it. I hope that the Minister will accept the amendment, but I should say to him that I have been in this House, in another place and in the Labour Party for a long time. My guess is that if the proposal in this Bill had been put forward by a Conservative government, the Labour Party in this place, led by the Front Bench, and indeed in another place, would be opposing it. I am quite sure that my noble friends in Opposition would say that this is a disgraceful Bill which strikes at the very roots of representative democracy. It is a great pity that we are not saying so now.
Only one mistake was made from the other side; it suggested that the Labour Party is doing this for its own electoral benefit. That is not so. I do not think that will happen. Labour supporters should not believe that this will be better for the Labour Party than the first-past-the-post system or an STV system. Oh no, it is designed not to help Labour candidates; it is designed to help Liberal candidates. They will gain most from this measure.
Therefore, I hope that the Minister, as was suggested to him by my noble friend Lord Evans, will understand that this House is entitled to make recommendations to another place. Indeed, with his support we should be very pleased to make the recommendation contained in these amendments.
Lord Cockfield: My Lords, as your Lordships will know, I had at one time a relationship—fortunately, an arm's length relationship—with the European Parliament. I was always extremely concerned about the peculiar effects of the first-past-the-post system in the United Kingdom on the balance of power in the European Parliament. Therefore, I was always in favour of some reform. But, frankly, I regard the closed list system as even more objectionable than the first-past-the-post system. Therefore, the proposal which my noble friend puts forward is at least an improvement on the thoroughly objectionable proposal in the Bill promoted by the Government.
The Minister of State, Home Office (Lord Williams of Mostyn): My Lords, it almost seems that the world reserves of hyperbole have been somewhat exhausted. Therefore, I shall try to approach the matter in a calmer way.
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The fact is that for any modern functioning democracy, it is political organised parties which bring forward candidates to elections. It is the party activists, the deeply committed minority, who organise party structures to bring forward candidates. The noble Lord, Lord Mackay of Ardbrecknish, indicated that our colleagues in Europe are somehow Johnnies-come-lately, whereas in this country for centuries we have been voting democratically. That is not really so. It was after 1918 that women got the vote on a basis of any sort of equality. If the noble Lord doubts my history, I shall indicate the dates: 1832, 1868 and 1884. Those are the dates of the Reform Acts which were significantly opposed by a large number of his then party.
The noble Lord said that NOP had carried out research. He said correctly that when it carried out that research about the closed list, the reaction was immediately negative. Is it not also the case that when the systems were explained to those who were polled, they changed their views quite significantly?
The noble Lord contended, as he does always most agreeably, that he does not want the Bill at all because he favours the first-past-the-post system; and, secondly, as he did in Committee and on Report, that he is the champion of internal party democracy. Again, that is not really so because the other day he confessed, which is always good for the soul, that he is one of the three not quite hereditary clansmen in Scotland who would determine not the order of the list but whether or not anyone should be allowed to stand at all for the Scottish parliament.
The fact is that when this matter was discussed in another place, my right honourable friend the Home Secretary said that he would look at the Belgian system. He commissioned research on that which indicated that one could have quite absurd results in terms of public acceptability.
We have been over this in the past, and I shall trespass very briefly on your Lordships' time and patience. The fact is that the so-called open list system, as shown by the way it has worked in Belgium, is quite capable of producing anomalous results. That is to say, someone can be elected with a lesser total of votes than someone who fails to be elected. That has never been gainsaid. I do not think that anyone controverted that proposition when I developed it previously; indeed, the noble Lord, Lord Mackay, described it as "a fiddle and manifestly unfair."
Earl Russell: My Lords, can the Minister tell us of any electoral system which is incapable of producing anomalous results?
Lord Williams of Mostyn: My Lords, of course not. Some representation depends upon no election at all and that produces anomalous results—for instance, as the noble Earl will know, the hereditary principle.
One has to make a judgment of what the appropriate scheme is. The noble Lord, Lord Stoddart, said that the proposal would not necessarily be of universal benefit to the Labour Party. I accept that. Similarly, mention

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was made of Scotland and Wales. My noble friend Lord Evans of Parkside said that the amendment would solve the Welsh problem. I do not think that anything is capable of solving the Welsh problem, certainly not the suggestion of the noble Lord, Lord Mackay. I am not adopting a partisan stance because I think we are entitled to look for your Lordships' support. The fact is that the Conservative Party had significant electoral support in Scotland at the last general election but secured no Members of Parliament there. In Wales, 20 per cent. of the electorate voted Conservative but the party has no Members of Parliament there. As I have said on a number of occasions, we have specifically designed these schemes to do away with a monolith in Wales and in Scotland, neither of which is likely to be healthy for the Scottish parliament or the Welsh assembly.
I revert to where I began. The party, I suggest, should not be confused with the mechanism we are proposing. A number of observations have been made. The noble Lord, Lord Mackay, says that the Conservatives are very democratic internally; the noble Lord, Lord McNally, says that his party is more democratic; and the noble Lord, Lord Evans, over the years, has tried to make the Labour Party more democratic internally, but that is nothing to the point of the system adopted. If one wants a better, more democratic internal party selection system, that is one thing. What we are doing here is offering to the voters a list of party supporters in a way which has been determined by internal party choice.
Internal party choice can be good or indifferent but that is nothing to the point on the list. I do not believe that it can be gainsaid—it has not been gainsaid on any occasion when we have had these lengthy debates in Committee and on Report—that the open list system can produce results which are deeply offensive to the public. I believe I am right in saying, from memory, that the sort of NOP polling to which the noble Lord, Lord Mackay of Ardbrecknish, referred, absolutely confirmed that.
Perhaps I may give an illustration. I want to put it neutrally. I think that most people of fair mind—that means most people who agree with me—would accept that women are grossly under-represented and ethnic minorities have an even less favourable deal. I believe that it is competent and proper for a party to select what is called a closed list; to bear that in mind; and to give women a fair deal and ethnic minorities a fair deal by putting them appropriately high in the list.
4.15 p.m.
Lord Evans of Parkside: My Lords, I accept the premise that my noble friend puts forward in relation to women and ethnic minorities. However, will he accept from me that a close study of the Labour Party's list of candidates indicates clearly that there will be 13 women elected to the European Parliament under these new proposals, as there were 13 elected under the first-past-the-post system, and one representative of
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ethnic groupings—one black member—will also be elected? There is an outside chance that a second black member may be elected, but that is somewhat doubtful.
Lord Williams of Mostyn: My Lords, I do not think that focuses on the principle I am contending. I readily recognise that there are some women and some people from ethnic minorities who do not want any consideration of this sort applied to them. But I believe that a party has a moral duty to ensure that women and those from ethnic minorities are not disadvantaged.
Perhaps I may give an example from the Home Secretary's own constituency. In a multi-member ward constituency it was noticeable that those who had names which were apparently of ethnic minority origin did significantly worse than those with apparent English, Welsh or Scottish names. We can argue and differ about these things but I believe that if a party wants to bring forward a certain number of women; to redress the monstrous endemic injustice from which ethnic minorities suffer or to bring forward—let us not forget—people of particular expertise whom it wishes to have at the top of the list, it is entitled to do so.
The noble Lord, Lord Cockfield, expressed displeasure about first-past-the-post. This provision remedies that in part. He expressed displeasure about the solution we propose. But if the Labour Party, the Conservative Party or the Liberal Party have people with particular expertise in the European context, people who are knowledgeable, experienced and practised, it seems to me perfectly justifiable that the party which is bringing forward the candidates should offer those candidates in the list as this Bill offers.
Lord Shore of Stepney: My Lords, perhaps I may take my noble friend back to where he was when he discussed the Belgian system and pointed out that it contained a defect; namely, that you could get more votes—but not be elected—than someone who was elected and that that causes resentment. I think that point has been understood in the House during our debate. But it is not true that only the Belgian system is available. As the noble Lord will remember from earlier exchanges, there is a Finnish system. The Finnish system rules out the danger of someone being elected who has not had a majority of votes cast by eliminating the chance of voting for a party. It simply lists the names of the candidates. Their party loyalty is indicated as well so that when the vote is cast, if the aggregate of those votes cast were for a particular name and he comes top of the list, he will be elected. That exists in practice. What is the defect with that?
Lord Williams of Mostyn: My Lords, I remember on the earlier occasion that the noble Lord was contending for the Finnish system and the Luxembourg system. The Luxembourg system seems to have fallen by the wayside.
I return to my fundamental point, namely that it is parties that bring forward candidates. If parties internally choose their candidates, I suggest to your Lordships that they are entitled to do that and offer that list in the way they have chosen for the reasons—

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perfectly honourable and legitimate reasons—I have outlined. If the individual voter does not wish that, he or she is perfectly entitled not to use the vote for that party or to use it for another party in exactly the same way as on the presently closed system.
If the only Labour candidate in my constituency—if I were able to vote—was someone I did not care for, I would have to come to a conclusion. Do I vote on party loyalty lines, identified by the noble Earl? Do I not vote for that particular candidate? Or do I swallow my doubts and vote for that candidate.
To revert to the description of the noble Lord, Lord Shore, the "Finnish system", as I understand it, has the same weaknesses as the Belgian system. Candidates in Finland can be elected with fewer votes than candidates who are not elected.
My next observation is simply a part of the picture and is not intended to be an overwhelming argument. It will be the fact that, should we go the way that this Bill indicates, Germany, France, Greece, Spain and Portugal will all have the same system that we do; in other words, it will apply to rather more than 70 per cent. of the voters in the European Union. It will not surprise your Lordships that I have not changed my view about the propriety of that.
I listened carefully—we listen sometimes with a full House and sometimes with a scanty House—to the arguments that have been rehearsed. I do not say that impolitely because many noble Lords feel strongly about this matter. First, I feel that we were honourably right in moving away from the first-past-the-post system for European elections. We are entitled to say that this is a reasonable scheme whereby, essentially, we are voting in large regional areas. That is wholly different from and unrelated to the size of our present constituencies. It is the fact that on the lists many voters—I say this without disrespect—will not have much knowledge of the individuals offering themselves except for the fact that they are on the party list.
It has been said—again it is not accurate—that this is an unprecedented step. In fact, this is a scheme which worked in Northern Ireland. The Northern Ireland (Entry to Negotiations, etc) Act 1996, piloted by the party opposite, provided for a list-based electoral system exactly the same as this in all essentials for elections to the peace forum. Therefore it is not unprecedented. The argument that it has not happened before and the question as to where it will all end—unattractive as it is—is not even founded on recent history.
I cannot usefully contribute further to these discussions. I invite your Lordships to come to the conclusion that this is an amendment that should not be supported.
Lord Mackay of Ardbrecknish: My Lords, we have had an interesting and thoughtful debate and I am grateful to all those noble Lords who took part. In summing up perhaps I can make a few points in response to what was said.
First, I say to the noble Lord, Lord McNally, that it is not a fair proposition to say that I tabled this amendment because I do not like the Bill. The
1332
amendment does not damage the Bill. My view is that it improves the Bill because it improves the PR method being used. As to sending Liberal Democrats to the European Parliament, which seems to be the objective of the noble Lord, Lord McNally—I suppose it is a reasonable one—having an open list will not prevent that happening if it is going to happen. It makes no difference to the numbers who go; it means that those who vote Liberal Democrat will actually decide who will go. That is the important point.
I shall not embarrass the noble Earl, Lord Russell, too much. As those noble Lords who were in the House in the last Parliament will know, he and I were frequently at daggers drawn, though they were genteel daggers. We had considerable differences of opinion. However, one thing I knew was that the noble Earl would conduct his arguments with dignity and honesty. He has done that again today and, if it does not embarrass him too much, as usual I take my hat off to him for his skills in that regard.
The noble Lord, Lord Evans of Parkside, said that this does not upset the principle of the Bill. The open list system which I brought before your Lordships obeys the Labour Party's manifesto in every way as much as the closed list system brought forward by the Government. Therefore it is not a problem. In relation to the need to hasten this Bill. I must say that this Bill has made the most stately progress through both Houses of any Bill of its size. My noble friend Lord Henley reminded me that it started in the other place last November. The Bill will not be lost simply because your Lordships ask the other place to think again.
The noble Lord, Lord Williams of Mostyn, performed many of his usual clever tricks—if I may so call them—learnt, no doubt, in many years of making excellent submissions at the Bar. In doing so he introduced a series of red herrings and, so to speak, "kippered" them. He produced an argument in relation to PR. But we are not arguing for or against PR; we are arguing inside the PR system.
The noble Lord argued against the Belgian system. But it is not the Belgian system. In this system, if three people are elected from the Labour Party, the three people who will go to Brussels will be the three who obtained the largest number of votes. Nobody with more votes than the three who go will be on the list. It cannot happen. The returning officer will take the candidate with the biggest vote, the next and the next. So I am afraid that the noble Lord, Lord Williams of Mostyn, produced a bit of a red herring in that argument.
The Belgian system has nothing to do with it; this is not the Belgian system. This is not an argument about PR. It is an argument about offering the voter a choice. Towards the end of the submissions of the noble Lord, Lord Williams, he showed us that he did not believe that Labour Party voters should have a choice; he did not believe that they would exercise it properly—properly was the way he defined it. That may be what he thinks about Labour Party voters. It is a sad reflection of what the Government think about the people who returned them to power with such an excellent majority, at least

1333
in the other place. I believe that Labour voters deserve better. It is not simply a matter of giving the voters a choice between the parties and ending up with proportionality; it is about giving the voters a choice between the candidates of their favoured party.
After last year it is not easy to say this, but I say it now because it is the position that I am taking here, clearly and firmly, and the Government are not. We should trust the electorate to decide who from a party's list should go to Brussels. We should trust the electorate. As a result of the debate last week it may seem a little odd to ask your Lordships to come to the rescue of democracy and voter choice. But that is exactly what I ask your Lordships to do. I do not believe that, unlike his usual performances, the noble Lord, Lord Williams of Mostyn, made out his case and I invite your Lordships to make a judgment.
4.26 p.m.
On Question, Whether the said amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 165; Not-Contents, 140.

Division No. 1

CONTENTS

Ackner, L.

Cope of Berkeley, L.

Alexander of Tunis, E.

Courtown, E.

Allenby of Megiddo, V.

Cox, B.

Ampthill, L.

Cranborne, V.

Anelay of St. Johns, B.

Crickhowell, L.

Astor of Hever, L.

Cuckney, L.

Beaumont of Whitley, L.

Cullen of Ashbourne, L.

Belhaven and Stenton, L.

Dahrendorf, L.

Beloff, L.

Davidson, V.

Berners, B.

Denbigh, E.

Bethell, L.

Denham, L.

Birdwood, L.

Dixon-Smith, L.

Blackburn, Bp.

Elibank, L.

Blatch, B.

Ellenborough, L.

Bledisloe, V.

Elton, L.

Boardman, L.

Erne, E.

Bowness, L.

Evans of Parkside, L.

Brabazon of Tara, L.

Exmouth, V.

Brentford, V.

Ferrers, E.

Bridge of Harwich, L.

Fraser of Carmyllie, L.

Bridges, L.

Gainford, L.

Brightman, L.

Gisborough, L.

Broadbridge, L.

Glasgow, E.

Brougham and Vaux, L.

Gray of Contin, L.

Bruntisfield, L.

Halsbury, E.

Burnham, L. [Teller.]

Harding of Petherton, L.

Burns, L.

Harmar-Nicholls, L.

Butterfield, L.

Harmsworth, L.

Butterworth, L.

Harris of High Cross, L.

Byford, B.

Harrowby, E.

Campbell of Alloway, L.

Headfort, M.

Carew, L.

Henley, L.

Carnarvon, E.

Higgins, L.

Carnegy of Lour, B.

Hogg, B.

Carnock, L.

HolmPatrick, L.

Chesham, L.

Hooper, B.

Clanwilliam, E.

Howe, E.

Clark of Kempston, L.

Hussey of North Bradley, L.

Cockfield, L.

Hylton-Foster, B.

Colwyn, L.

Ilchester, E.

1334

Iveagh, E.

Platt of Writtle, B.

Kingsland, L.

Rankeillour, L.

Kinloss, Ly.

Rawlings, B.

Kinnoull, E.

Renfrew of Kaimsthorn, L.

Kintore, E.

Renton, L.

Kitchener, E.

Renwick, L.

Knight of Collingtree, B.

Ritchie of Dundee, L.

Knollys, V.

Rotherwick, L.

Lamont of Lerwick, L.

Rowallan, L.

Lane of Horsell, L.

Russell, E.

Leathers, V.

Ryder of Wensum, L.

Leigh, L.

Saatchi, L.

Liverpool, E.

St. John of Bletso, L.

Long, V.

Sandford, L.

Lucas of Chilworth, L.

Sandwich, E.

Luke, L.

Seccombe, B.

McAlpine of West Green, L.

Selkirk of Douglas, L.

McConnell, L.

Shaw of Northstead, L.

Mackay of Ardbrecknish, L.

Shore of Stepney, L.

Mackay of Drumadoon, L.

Skelmersdale, L.

Marlesford, L.

Slim, V.

Mayhew of Twysden, L.

Stallard, L.

Mersey, V.

Stenley of Alderley, L.

Miller of Hendon, B.

Stockton, E.

Molyneaux of Killead, L.

Stodart of Leaston, L.

Monk Bretton, L.

Stoddart of Swindon, L.

Monson, L.

Strange, B.

Monteagle of Brandon, L.

Strathclyde, L. [Teller.]

Mottistone, L.

Sudeley, L.

Mountevans, L.

Swansea, L.

Mowbray and Stourton, L.

Teviot, L.

Moyne, L.

Thomas of Gwydir, L.

Munster, E.

Trefgarne, L.

Waddington, L.

Naseby, L.

Weatheril, L.

Noel-Buxton, L.

Wedderburn of Charlton, L.

O'Cathain, B.

Wharton, B.

Onslow of Woking, L.

Wilberforce, L.

Oppenheim-Barnes, B.

Wilcox, B.

Palmer, L.

Wilson of Tillyorn, L.

Pender, L.

Windlesham, L.

Perry of Southwark, B.

Wise, L.

Pilkington of Oxenford, L.

Wynford, L.

NOT-CONTENTS

Addington, L.

Dean of Beswick, L.

Ahmed, L.

Dean of Thornton-le-Fylde, B.

Alli, L.

Desai, L.

Amos, B.

Dholakia, L.

Archer of Sandwell, L.

Diamond, L.

Ashley of Stoke, L.

Dixon, L.

Bach, L.

Dormand of Easington, L.

Bassam of Brighton, L.

Eatwell, L.

Bath, M.

Evans of Watford, L.

Berkeley, L.

Ewing of Kirkford, L.

Blackstone, B.

Ezra, L.

Blyth, L.

Falconer of Thoroton, L.

Borrie, L.

Falkland, V.

Brooke of Alverthorpe, L.

Farrington of Ribbleton, B.

Bruce of Donington, L.

Fitt, L.

Burlison, L.

Gallacher, L.

Carmichael of Kelvingrove, L.

Geraint, L.

Carter, L. [Teller.]

Gilbert, L.

Charteris of Amisfield, L.

Gladwin of Clee, L.

Clarke of Hampstead, L.

Goodhart, L.

Cledwyn of Penrhos, L.

Goudie, B.

Clement-Jones, L.

Gould of Potternewton, B.

Clinton-Davis, L.

Graham of Edmonton, L.

Cocks of Hartcliffe, L.

Gregson, L.

Crawley, B.

Grenfell, L.

Currie of Marylebone, L.

Grey, E.

David, B.

Hacking, L.

Davies of Coity, L.

Hamwee, B.

Davies of Oldham, L.

Hardie, L.

1335

Harris of Greenwich, L.

Newby, L.

Haskel, L.

Ogmore, L.

Hayman, B.

Orme, L.

Hilton of Eggardon, B.

Paul, L.

Hogg of Cumbernauld, L.

Pitkeathley, B.

Hollis of Heigham, B.

Plant of Highfield, L.

Hoyle, L.

Ponsonby of Shulbrede, L.

Hughes, L.

Ramsay of Cartvale, L.

Hughes of Woodside, L.

Randall of St. Budeaux, L.

Hunt of Kings Heath, L.

Razzall, L.

Hutchinson of Lullington, L.

Rendell of Babergh, B.

Islwyn, L.

Renwick of Clifton, L.

Jacobs, L.

Rodgers of Quarry Bank, L.

Jay of Paddington, B. [Lord Privy Seal.]

Russell-Johnston, L.

Sainsbury of Turville, L.

Jenkins of Putney, L.

Scotland of Asthal, B.

Judd, L.

Sefton of Garston, L.

Kirkwood, L.

Serota, B.

Linklater of Butterstone, B.

Sharp of Guildford, B.

Lockwood, B.

Shepherd, L.

Lofthouse of Pontefract, L.

Sheppard of Liverpool, L.

Longford, E.

Simon, V.

Lovell-Davis, L.

Simon of Highbury, L.

Ludford, B.

Smith of Gilmorehill, B.

McIntosh of Haringey, L. [Teller.]

Steel of Aikwood, L.

Stone of Blackheath, L.

Mackenzie of Framwellgate, L.

Strabolgi, L.

McNair, L.

Symons of Vernham Dean, B.

McNally, L.

Taylor of Blackburn, L.

Maddock, B.

Thomson of Monifieth, L.

Mar and Kellie, E.

Thornton, B.

Mason of Barnsley, L.

Thurso, V.

Methuen, L.

Tomlinson, L.

Miller of Chilthorne Domer, B.

Tope, L.

Milner of Leeds, L.

Turner of Camden, B.

Mishcon, L.

Varley, L.

Molloy, L.

Wallace of Coslany, L.

Monkswell, L.

Warner, L.

Montague of Oxford, L.

Whitty, L.

Morris of Castle Morris, L.

Wigoder, L.

Morris of Manchester, L.

Williams of Elvel, L.

Murray of Epping Forest, L.

Williams of Mostyn, L.

Resolved in the affirmative, and amendment agreed to accordingly.
4.37 p.m.
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendments Nos. 2, 3 and 4:
Page 2, line 2, at end insert—
("(2A) Each candidate shall declare that he is either—

(a) the candidate of a party and shall name that party; or

(b) an independent candidate.

(2B) There shall be added together the number of votes given for each party's candidates in each electoral region.
(2C) The number arrived at under subsection (2B) shall be the number of votes for the party for the purposes of this Act.").
Page 2, line 15, at end insert—
("(5A) After the allocation of seats to the parties, the order of candidates in each list shall be such that candidates are ranked in terms of the votes each received, with the candidate with the highest number of votes appearing first.
(5B) If two or more candidates have the same number of votes, their order on the list shall be determined by lot.").
Page 2, line 18, at end insert (", following the rearrangement required under subsections (5A) and (5B).").
On Question, amendments agreed to.
Lord Williams of Mostyn: My Lords, I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.—(Lord Williams of Mostyn.)
On Question, Bill passed, and returned to the Commons with amendments.

Competition Bill [H.L.]
The Minister of State, Department of Trade and Industry (Lord Simon of Highbury): My Lords, I beg to move that the Commons amendments be now considered.
Moved, That the Commons amendments be now considered.—(Lord Simon of Highbury.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
[The page and line refer to Bill (140) as first printed for the Commons.]
1 Clause 1, page 1, leave out lines 15 to 17.
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 1, which is grouped with Amendments Nos. 46, 47, 48, 76, 93, 99, 104, 105 and 114.
We start proceedings today, rather unusually, with amendments which are mainly to be inserted at the end of the Bill and which are in a sense peripheral to its central features. Rather, they concern how we are to transit from the existing regime in the Restrictive Trade Practices Act and the Resale Prices Act to the prohibition regime introduced by the Bill. This starting-point is a consequence of the paving amendment to Clause 1 of the Bill, which was used to introduce amendments to the transitional schedule, Schedule 13, on the issue of resale price maintenance of over-the-counter medicine. The Commons amendments overturn both the paving and the substantive amendments passed by your Lordships. I shall have more to say on the issue of over-the-counter medicines in a moment.
First, however, the new transitional schedule gives me a convenient opportunity to explain at the start of our proceedings when the Government propose to implement the Bill should it gain Royal Assent and what transitional arrangements there will be for existing agreements.
When we debated the Bill in Committee, I said:
"It is important that the main elements of the regime should be in place in good time before the prohibitions start to apply".
I added:
"if the Bill is granted Royal Assent, there will be a period between Royal Assent and the coming into force of the prohibitions. I would expect this period to be about a year. I would also expect rules under Clause 49 and guidelines under Clause 50 to be issued early in that period".—[Official Report, 25/11/97; col. 899]
Those clauses in the print we are considering today are Clauses 51 and 52.

1337
As your Lordships will know, initial draft rules and guidelines have been issued by the Office of Fair Trading and I fully expect formal drafts to be issued shortly after Royal Assent. We have now decided, however, to give business more time to prepare for the introduction of the new regime. We have decided that the two new prohibitions should be brought into force on 1st March 2000. I am sure the House will agree that this provides an ample period for business to prepare.
We further intend that the new competition commission should come into being, taking over from the Monopolies and Mergers Commission, on 1st April 1999. I am sure that all of your Lordships will agree that that is a most opportune date! This will enable the new body to be fully prepared to perform its new functions once the prohibitions come into force.
For agreements made before the Chapter I prohibition is commenced, the new schedule introduced by Amendment No. 104 will provide further generous transitional periods. As a general rule, all such agreements will receive a one-year transitional period from the commencement date which, as I have said, I expect to be 1st March 2000. But to the extent that an agreement has bene found by the Restrictive Practices Court not to be contrary to the public interest, it will receive a five-year transitional period. This includes agreements in respect of resale price maintenance for goods which have received an exemption order under the Resale Prices Act. This will—this is an important point—cover resale price maintenance for over-the-counter medicines if the court again gives an exemption to it at the conclusion of the present proceedings. The schedule also preserves the amendment passed by your Lordships which removed the director's ability to terminate this five-year transitional period early. A five-year transitional period for over-the-counter medicines would be available if merited.
There are also special arrangements for certain agreements or provisions in the utility, financial services and broadcasting sectors.
Apart from this, the main intention behind the new schedule is to ensure that businesses are not burdened by the ineffective and bureaucratic Restrictive Trade Practices Act any longer than is necessary. Hence, almost all registrable agreements made between the Bill receiving Royal Assent and the Chapter I prohibition coming into force will be non-notifiable under the Act.
When the prohibition comes into force, businesses will be fully freed from their obligations under the Act. They will therefore no longer have to furnish particulars of agreements. Restrictive Practices Court orders will fall and undertakings will cease to have effect. Instead, we will have a modern and effective prohibition against anti-competitive agreements which is aligned with the European prohibition system.
I recognise that the new schedule is a substantial addition to the Bill, but it made sense to tackle the many detailed remaining points on the transitional regime only when we had decided on the direction in which we were going. It is now possible for the rather sketchy
1338
provisions of the schedule, as introduced, to be amended with the main provisions of the Bill in mind. Many of the amendments were a response to the points put to us in this House and in another place. In other words, before finalising the transitional provisions, we needed to know where exactly we were transiting to.
We have produced a guide, a copy of which is in the Library, to assist noble Lords in navigating their way around the new schedule. I would, of course, also be happy to take questions on it. First, I would like to deal with the question of over-the-counter medicines.
When we debated at Third Reading the amendments which were subsequently removed in another place, I made plain the Government's view that it would be undesirable to set aside the formal process which has been initiated by the Director-General of Fair Trading under statutory provisions. That remains the Government's position. I went on to indicate that the European Commission might want to intervene if the case is not heard by our own court. I warned that the consequences of accepting the amendments were, therefore, unpredictable and would not necessarily be to the advantage of the sponsors of the amendments.
It has become abundantly clear that the European Commission has refrained from pursuing its own investigation under Article 85 into agreements enforcing resale price maintenance in this sector only because the director-general had initiated action. In particular, Commissioner Van Miert wrote to Margaret Beckett stating, in effect, that if Parliament stops the Restrictive Practices Court from considering resale price maintenance on over-the-counter medicines, the Commission is unlikely to have any alternative but to take up the complaints it has received under Article 85. But if the court proceedings are allowed to continue, the understanding is that the Commission will not pursue the complaints, provided that the court's decision is acceptable to the Commission.
I am sure that the House will agree that, on the principle of subsidiarity, it is better, if possible, that these matters are dealt with domestically. Indeed, the Commission itself is committed to the decentralised enforcement of competition law, and has issued a notice on co-operation between the Commission and national competition authorities which sets out how cases in which both national authorities and the Commission have jurisdiction should be allocated, and how both are to co-operate in resolving a case. Hence the Commission's willingness for this matter to be dealt with by the director-general and the Restrictive Practices Court.
If the Commission subsequently takes up a complaint, it would be bound to give due consideration to the national court's findings if it is argued they are relevant to the assessment under Article 85. We would expect the view of the court to be an important factor in any Commission consideration under Article 85. Indeed, as the Government have made clear in another place, we would want to take a robust line with the Commission if it were to take action following the court's decision which flew in the face of that decision.

1339
In the light of this, I hope that your Lordships will agree with the Government, and with the Commons, that it would be better if we let the court reach a conclusion on the proceedings which have been brought before it. Perhaps I may emphasise that we expect the court to consider fully the views relating to the retention or abolition of resale price maintenance in this sector. In particular, having taken the view in 1970 that an exemption was justified on the grounds that a plentiful and well distributed supply of pharmacies was essential. we would expect the court to take full account of the role played by local pharmacies and the harm which would be caused if, as some pharmacists fear, many would be unable to survive without resale price maintenance. Certainly, the Government recognise the important role that independent pharmacies play in providing valuable advice as well as medicines, encouraging community life, reducing transport use and making life easier for those less fortunate in the community. With that summary, I commend the amendment to the House.
Moved, That the House do agree with the Commons in their Amendment No. 1.—(Lord Simon of Highbury.)
4.45 p.m.
Lord Morris of Manchester: My Lords, community pharmacists were most grateful for the approval of my two amendments in their defence when the Bill was considered at Report stage by your Lordships' House. The first provided that if the Office of Fair Trading lost its case against resale price maintenance, the exemption would be protected for the full five-year transitional period.
My second amendment had the effect of preventing the Director-General bringing proceedings under the legislation which this Bill will repeal when it comes into force.
What was sought by my first amendment is now accepted by the Government and I pay tribute today to the Minister's part in that outcome. To the disappointment of community pharmacists threats of action by the European Commission have, as he said, persuaded the Government to allow the case now brought by the Office of Fair Trading under old legislation to continue. But community pharmacists believe they have an overwhelming case and accept that if the Government themselves cannot protect the consumer interest, it should be the Restrictive Practices Court, not the European Commission, which decides the issue. The first stage in that case, the leave application, has been listed for hearing on 7th-8th December.
Community pharmacists believe that the Restrictive Practices Court will recognise, as your Lordships' House has done and as the court itself so eloquently did in 1970, how valuable local pharmacies are to the most needy: elderly and disabled people, the poor and mothers with small children, among others, who lack mobility or depend on medicines. The approval of the two amendments by this House was much appreciated by them as well as by community pharmacists.
There are 12,000 pharmacies in Britain today. They play a vital role at the heart of their local communities dispensing invaluable but free healthcare advice along
1340
with prescription and over-the-counter medicines. My noble friend the Minister voiced the Government's recognition of the value of community pharmacy in the debates on my amendments, as he has done again today. He acknowledged what no one can seriously doubt will be the case, namely,
"that independent pharmacies would close if it was merely a matter of repealing price maintenance".—[Official Report, 9/2/98; col. 883.]
When the Bill went to another place all the main political parties made clear their support for maintaining the network of local pharmacies. The Government's position could not have been made clearer. On 11th May my right honourable friend Margaret Beckett, then President of the Board of Trade, said:
"There is no doubt that the Government strongly support and care about community pharmacies. 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".— [Official Report, Commons, 11/5/98; col. 34.]
The Minister who took the Bill through Standing Committee for the Government in another place stated:
"Independent pharmacies are small businesses that provide important services to the community. Local shops encourage community life and reduce the use of private transport and local pharmacies provide invaluable advice as well as medicines. My right hon. Friend the Secretary of State for Health has spoken of his plans to make greater use of pharmacies".
He went on,
"The Government also want to support and encourage small businesses. When the restrictive practices court considers the Director General's application under the 1976 Act, it will undoubtedly take full account of the role played by local pharmacies and of the harm that would be caused if, as they fear, many were unable to survive without resale price maintenance".—[Official Report, Commons Standing Committee G, 23/6/98; col. 562.]
More recently, back here in your Lordships' House, my noble friend Lady Hayman, the Parliamentary Under-Secretary of State at the Department of Health, stated that she was,
"particularly interested in the potential role of community pharmacists in helping patients to understand their responsibilities"—[Official Report, 13/10/98; col. 779.]
in the area of compliance. And it will certainly not escape the Restrictive Practices Court's attention that community pharmacies will need to survive if they are to go on acting in the public interest as Ministers, more especially health Ministers, so clearly want them to do.
The depth of feeling here and in another place about the threat posed to thousands of community pharmacies by the campaign against resale price maintenance is echoed by many patient groups including Disability Scotland, the Joint Committee on Mobility for Disabled People and the Disability Advice and Welfare Network, among many others. The campaign against RPM, was initiated by a large supermarket chain, Asda. Abolition of RPM, which, as my noble friend the Minister readily acknowledged, would lead to the closure of pharmacies, may serve the interests of the supermarket giants but not those of local communities.
Last week Sir Donald Acheson, the former Chief Medical Officer, said that the growth of out-of-town supermarkets has led to food deserts in inner cities,

1341
increasing the incidence of poor nutrition and disease among the neediest people in our society. On 15th October 1998, the Independent reported:
"Ministers have already signalled action to deal with food deserts on inner-city housing estates under the social exclusion initiative launched by Tony Blair last month. Eighteen task forces have been set up, including one headed by Tessa Jowell, the Health Minister, which will examine ways to support shops in poor areas".
Unquestionably, for the most vulnerable people, the local pharmacy is often the most vitally important of those shops.
Many of your Lordships will have read in recent weeks about the bankrupting of farmers as a result of low prices paid for beef and lamb by the major supermarket chains, and of the high prices paid for meat by shoppers. They will have read that supermarket profit margins, and prices paid by consumers, are higher here than in other countries. They will have read also that the largest supermarket chains now have an enormous market share, amounting to market domination.
It cannot be in the interests of the consumer for one of the few surviving High Street businesses to be swallowed up in the ever-growing market domination of the supermarket giants. No one should be persuaded that Asda's attempt to grab business from local pharmacies is motivated other than by the pursuit of more profit. Anyone who thinks otherwise will have no difficulty in believing that the earth is flat or that the moon is made of green cheese.
The consequences of the pursuit of more and more profit could be devastating. For those with low incomes and frequent healthcare needs, the survival of small businesses and local communities is essential. Local pharmacies are an essential part of those communities. This House attempted to ensure the survival of a network of these pharmacies by the amendments we made to the Bill. It is now for the Restrictive Practices Court to protect the consumer. We must all hope that right will be done.
Lord Jacobs: My Lords, I have listened again to a strong argument in favour of the small pharmacies. I had the opportunity to study the arguments of the pharmacies as to why the Restrictive Practices Court should not examine the situation. I sometimes feel that the emotion of the situation—I recall the description given in this House of an old lady in a village who needed just one prescription but who could not get any transport and whose nearest pharmacy was 30 miles away—rings bells with all of us. We can see that it would be disadvantageous to these communities to lose small pharmacies.
I have read the data regarding how many pharmacies are involved. The figure is 3,000 out of 12,000. However, there are just a few hundred pharmacies situated in the country far away from towns. I did not argue then—and I do not argue now—that those small pharmacies should be protected. It would not be difficult or unaffordable for the large pharmacies to transfer some of their revenue to support the small pharmacies.
1342
I do not say that they should do it voluntarily; it could be done by means of a graduated scale for prescription charges.
I believe not that we were hoodwinked but that we were emotionally misled on this issue. According to the data sheets to which I referred, the cost to the consumer if resale price maintenance continued would be an extra £900 million over a period of five years. That is an enormous amount of money and I find it difficult to understand why the House feels that that is not of any consequence.
It is not for the House to decide the future of small pharmacies. The matter will be considered by the Restrictive Practices Court. When that court makes its decision, I am sure that we shall all abide by it. In my opinion, the case for helping small pharmacies but abolishing RPM remains very strong.
5 p.m.
Lord Fraser of Carmyllie: My Lords, I thank the Minister for his explanation of this group of amendments. I congratulate him on introducing what I think is the longest amendment I have ever seen and also on his explanation of the various points at which these provisions will come into force. I am not sure that I took in everything that he said, but for those who will have the important task of implementing this legislation it is valuable to have on the record at such an early date exactly when it is anticipated the provisions will come into force. If I understood the Minister correctly, it will be March 2000.
I do not intend to revisit the issue of small pharmacies. I still feel strongly about the matter and I believe there is an essential contradiction between the Government's health policy and their competition policy, one of which will have to come out on top at the end of the day. It is not just rural communities which are affected. If there is one pharmacy that I wish to see retained, rather than pharmacies in some of the pretty villages up the glens in the Grampians, it is a pharmacy on one of the worst estates on the outskirts of Dundee. Pharmacies such as that one are central to government health policy and those are the ones which we wish to see retained. We have been over that ground. Commissioner Van Miert managed to terrify those who might otherwise have wished to continue the debate, and we accept that outcome.
Paragraph 23(1) of the new schedule proposed in Amendment No. 104 provides that, if the court has found an agreement,
"not to be contrary to the public interest, the transitional period lasts for five years".
I understand that five-year period in subparagraph (1) of paragraph 23 to start from March 2000. In subparagraph (3) there is envisaged a set of circumstances where, at the time these provisions come into force, the legal proceedings have not yet terminated. From the narrative that has been given of the proceedings in relation to community pharmacies, I am bound to say that, though at this time March 2000 may seem fairly distant, it would be surprising if all legal proceedings on that matter were concluded by that date. If at a point after

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March 2000 the court were to determine that agreements in place were not contrary to the public interest, will that five-year period still run from March 2000 or will it run from the time and date of the determination by the court? I may be making the matter unnecessarily complicated, but it would be useful to have clarification of that point.
I am grateful to the noble Lord for what he said about the transitional arrangements. I have no doubt that they will be studied carefully outside your Lordships' House.
Lord Simon of Highbury: My Lords, I am grateful to all noble Lords who have spoken and who have helped in formulating the Government's approach to the question of over-the-counter medicines. I quite understand that strong views are still held in the House. I thank my noble friend Lord Morris for the work he has done. I believe we are now at a stage where the Government must listen to the views of the court and formulate their health policy accordingly.
I thank the noble and learned Lord for his kind words on the expectation that we will have helped the business community by extending the date to give them time to prepare and clarifying how that will work in the transitional schedule, which is tabled in the Library for those who wish to see the detail. In answer to the noble and learned Lord's question, the five-year period starts when the court has reached its conclusion.
On Question, Motion agreed to.

COMMONS AMENDMENT
2 Clause 6, page 4, line 34, leave out ("an agreement does not") and insert ("there is a failure to").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 2. In doing so, I shall speak also to Amendment No. 3.
Amendment No. 2 corrects the drafting of Clause 6(6)(b), which provides for the cancellation of a block exemption where an obligation under the block exemption order is not complied with. Currently the clause refers to the agreement, rather than the parties to that agreement, not complying with the order. The amendment remedies that.
Amendment No. 3 fulfils a commitment made to your Lordships by my noble friend Lord Haskel in response to an amendment tabled on Third Reading by the noble Lord, Lord Kingsland, to consider whether there should be a limitation on the director's power to cancel a block exemption in respect of a particular agreement, along the lines of the limitation on the Commission's corresponding power in European law. Clause 6(6)(c) currently confers a general power for a block exemption order to specify circumstances in which the director may cancel the exemption given by a block exemption order in respect of a particular agreement. The amendment makes it clear on the face of the Bill that this power is to he limited to the ground that the agreement does not fulfil the criteria specified in Clause 9 of the Bill. The Bill will thus generally follow the position under European Community law contained in Article 7 of
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EC Regulation 19/65. It will be for the director to judge whether a particular agreement falls within the terms of Clause 9.
The power for the block exemption order to enable the director to cancel the benefit of a block exemption when there has been a breach of an obligation remains.
Moved, That the House do agree with the Commons in their Amendment No. 2.—(Lord McIntosh of Haringey.)
Lord Kingsland: My Lords, I am much obliged to the Minister for his amendment.
On Question, Motion agreed to.

COMMONS AMENDMENT
3 Page 4, line 37, leave out from ("that") to end of line 38 and insert ("if the Director considers that a particular agreement is not one to which section 9 applies, he may cancel the block exemption in respect of that agreement.").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 3.
Moved, That the House do agree with the Commons in their Amendment No. 3.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
4 Clause 13, page 8, line 22, leave out from ("with") to end of line and insert ("such date as may be specified in a notice in writing given to the applicant by the Director when the application has been determined.
() The date specified in a notice under subsection (4)(b) may not be earlier than the date on which the notice is given.").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 4. In doing so, I shall speak also to their Amendment No. 5.
These amendments are a response to amendments moved in Committee by the Liberal Democrats. The point was argued that the Bill might allow a party to an agreement which he has notified to the director to be liable to penalty before the director's decision was made known to him. We do not think that the director would impose a penalty before a person had received notice of his determination. However, the point that the Bill should be clear on this point is not unreasonable.
Moved, That the House do agree with the Commons in their Amendment No. 4.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
5 Clause 14, page 8, line 40, leave out from ("with") to end of line and insert ("such date as may be specified in a notice in writing given to the applicant by the Director when the application has been determined.
() The date specified in a notice under subsection (4)(b) may not be earlier than the date on which the notice is given.").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 5.
Moved, That the House do agree with the Commons in their Amendment No. 5.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
6 Clause 16, page 9, line 38, leave out ("does not infringe") and insert ("has not infringed").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 6. At the same time, I should like to speak also to Amendments Nos. 8, 21, 22, 26, 28, 37, 58, 59, 74 and 75. The purpose of these amendments is to correct and make consistent the tense used in the Bill in relation to a prohibition being infringed and to ensure consistency and clarity in the operation of exclusions from the Chapter I prohibition. I can give the longer speech if noble Lords wish it. I have four or five pages which are fairly generously typed.
Lord Fraser of Carmyllie: My Lords, before the noble Lord sits down, I hope that noble Lords will resist that threat.
Lord McIntosh of Haringey: My Lords, I am grateful to noble Lords. With the correction that I missed out Amendment No. 29 from the list, I commend Amendment No. 6 to the House.
Moved, That the House do agree with the Commons in their Amendment No. 6.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.
5.15 p.m.

COMMONS AMENDMENT
7 Leave out Clause 19.

MOTION MOVED ON CONSIDERATION OF COMMONS AMENDMENT No. 7
That this House do disagree with the Commons in their Amendment No. 7, but do propose the following amendment in lieu thereof—
Leave out Clause 19 and insert the following new clause—

THE PRESS DIVERSITY PROHIBITION
(".—(1) This section shall apply if a monopoly situation exists within the meaning of section 6 of the Fair Trading Act 1973 in relation to the supply of—

(a) national newspapers, or

(b) national newspapers of any particular description.

and where this section applies it applies to any person or persons in favour of whom that monopoly situation exists within the meaning of section 49(2)(b) of the Fair Trading Act 1973.
(2) Any conduct on the part of any person to whom this section applies shall be prohibited if—

(a) it constitutes an anti-competitive practice; and

(b) it may reduce the diversity and independence of the national newspaper press in the United Kingdom.

(3) For the purposes of this section "an anti-competitive practice" is a course of conduct which has, is intended to have, or is likely to have the effect of restricting, distorting or preventing competition.
(4) The prohibition imposed by subsection (2) is referred to in this Act as "the press diversity prohibition".").
Lord McNally Lord McNally rose to move, That this House do disagree with the Commons in their Amendment No. 7, but do propose the amendment set out in lieu thereof.
The noble Lord said: My Lords, I was much encouraged in an earlier debate to find the House in a frisky mood. I hope that noble Lords on the Government Benches who preach the wisdom of this House by sending messages to another place will hold firm for the next short debate.
Noble Lords were informed earlier that the previous Bill had taken rather a long time in its passage through Parliament. The Bill was introduced into this House on 15th October 1997, so it has just had its first birthday. I am not sure that the Whips made that clear when they convinced the Minister that this was a good maiden Bill for him to try to take through Parliament. The most significant event in relation to this Bill occurred on 9th February of this year when noble Lords passed an amendment standing in my name and that of the noble Viscount, Lord Astor, the noble and learned Lord, Lord Ackner, and the noble Lord, Lord Borrie, to insert specific protection for the newspaper industry against unfair competition. That amendment was removed by the Commons in Committee.
In considering this amendment today, I ask noble Lords to exercise the real but rarely used power to ask the Commons and the Government to think again. There are those who say that this House has no real influence. I ask noble Lords to cast their minds back to 9th February and their victory that night and see what the consequences have been. On Monday The Times had gone up from 10p to 30p. I wanted something more substantial for my political epitaph than the creation of 300 per cent. inflation. Nevertheless, that is a fact. The Office of Fair Trading has spontaneously mounted an inquiry into the pricing policy of The Times. We eagerly await an inquiry that newspapers tell us is a robust one. Perhaps most exciting of all, we discovered on the night of 9th February that there are almost as many independent directors of The Times in this House as there are Bishops on the Bishops' Bench. We also discovered (to paraphrase Dorothy Parker) that they represent the full gamut of emotions from A to B.
I understand that for those Labour rebels who supported the amendment that evening it becomes a little more difficult. When governments reach this stage in a parliamentary year, we know that intellectual argument is abandoned and they simply plead that defeat will disrupt their timetable and put this and other legislation into jeopardy. But I ask noble Lords to remember that this has never been a wrecking amendment; it is an amendment to make a good Bill better.
What are the differences between me and the Minister? I believe that they can be narrowed down to his belief that a cocktail produced by Clause 60 of the Bill and Articles 85 and 86 of the Treaty of Rome will create in British law a veritable legislative "Viagra", as far as concerns competition law. The Minister believes that, because the Bill incorporates prohibitions based on Articles 85 and 86 of the treaty and brings into domestic competition law, via Clause 60 of the Bill, provisions to be interpreted consistently with the corresponding provisions of Community law, predatory pricing and other abuses will be subject to the tests of predatory pricing laid down by the European Court of Justice. That is why, if the Minister runs true to form, we shall hear a good deal this evening about Tetra Pak. All I can say to the Minister is that Tetra Pak is an excellent packaging but makes a poor fig leaf.
European case law on manufactured goods and industrial products is hard to square with the realities of the newspaper industry. As Mr. Richard Fowler, QC, has said:
"In my opinion European case law could not be relied upon".
Yet the Government rest their case on an almost a blind belief in the strength of European case law. I understand that competition lawyers sometimes refer to certain sections of legislation as "Klondike clauses" because of the lucrative litigation to which they give rise. Without the specific prohibitions contained in my amendment, I believe that the Bill will offer a Klondike for lawyers with no guarantee of protection for the quality, diversity and choice of our newspapers. That is why I commend to noble Lords the amendment now before the House. It is less sweeping in its terms than the clause that noble Lords supported in February, which was removed by another place. It confines its prohibitions to anti-competitive practices. Any action that is not an anti-competitive practice would escape prohibition even if it threatened to reduce diversity in the press.
I have never opposed vigorous competition; nor do I want to fossilise the present structure of the newspaper industry. But I want the new Competition Commission to have explicit and freestanding duties to watch anti-competitive conduct that threatens press diversity. This is more likely to happen where its responsibility is specific rather than part of a wider and more general duty. The nub of my case, and the cause of the differences with the Minister, is encapsulated in a single quote from Mr. Ian McCartney, the Minister responsible in another place. When rejecting proposals to lower the threshold of what is "dominant" in the newspaper market he said:
"I see no justification for treating newspapers differently".— [Official Report, Commons; 8/7/98; col. 1165.]
My whole case is that newspapers must be treated differently. Why? I give the answer provided by Mr. Robin Cook on 20th July 1994 when he was the Labour Party spokesman on these matters. He called then for specific action against predatory pricing and unfair competition. He said that at that time Labour Party policy was,
"informed by a view of a need for a diverse media and of the importance of a diverse media for a healthy democracy".
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That is why there is justification for treating newspapers differently. They are important for the preservation of a healthy democracy. That position was adopted by spokesman after spokesman of the Labour Party before the general election.
I shall leave it to others to speculate on the reasons for the change of heart. But I say to the Minister, "U-turn if you want to", but on these Benches we remain convinced of the need for special treatment and protection. In this we are consistent, as indeed, I understand, is the Opposition Front Bench. It consistently appeased Mr. Rupert Murdoch when in government, as the diaries of the noble Lord, Lord Wyatt, now reveal, and is set fair to appease him again tonight. And much good may it do them. Let me reassure them that parties, compared with dead parrots, do have an after-life.
I make only two other points. One is to the editor and staff of The Times. When Mr. Petter Stoddart, editor of The Times, addressed a meeting in the House before the Summer Recess, he accused me of attacking the integrity of The Times journalists. Nothing could be further from the truth. I repeat my affirmation of last February: some of my best friends write for The Times. Let me go further. If the integrity of The Times journalists were ever to be under threat, I suspect they could rely more on support from these Benches than from some who will pose as their friends today.
Finally, I say this to your Lordships. My perseverance on the issue relates to a wider picture. We are told that we are on the threshold of the information age. At the dawn of that age, control of technology and information is concentrating at an alarming rate. During the summer there was a photograph in our national newspapers of a gathering of about two dozen people who between them controlled most of the means of disseminating news and information to our democratic world. That concentration of power, married with the advance in technologies, offers a challenge to democratic governments and free societies which we have scarcely begun to address.
Last week we agonised about how rich men could buy themselves influence and access by donating money to political parties. So we stop foreigners giving money to our political parties. But buy yourself a newspaper or a television station and you buy power and influence which makes and unmakes governments; it makes 10 Downing Street an ever-open door and sends Chancellors of the Exchequer scurrying to obscure mid-western locations to pay court.
The amendment will not end such power, but it will send a message. The media moguls are not self-regulators. One day we shall have to contain them. I realise that I am asking the House to exercise a rarely used power. But the independence and diversity of our national press is an exceptional cause. Let us draw a line in the sand tonight and ask the Government and another place to think again. I commend the amendment to the House.
Moved, That this House do disagree with the Commons in their Amendment No. 7 but do propose the amendment set out in lieu thereof—(Lord McNally.)
Lord Harris of High Cross: My Lords, I accept the proposition of the noble Lord, Lord McNally, that newspapers are different. Indeed, newspapers are already constrained under the Broadcasting Act and by the merger provisions of the Fair Trading Act. As the Minister will no doubt tell us at greater length, the noble Lord's purpose is to graft on to a general competition Bill a most specific clause discriminating further against newspapers with the unconcealed objective of regulating the commercial policy of one newspaper.
As one of the independent national directors of Times Newspapers in the House, I believe that it may help the subsequent debate to set the context. History tells us that The Times has lost money throughout most of this century, despite successive changes of ownership from Northcliffe to Astor and to Thomson. When the Government accepted News International's last ditch rescue attempt in 1981, Rupert Murdoch followed the agreement with the noble Lord, Lord Thomson, in accepting six independent directors—I am one of them—with the responsibility of ensuring that the proprietor should not have influence over the editor or editorial policy.
Throughout the 1980s, severe losses continued and mounted despite several changes of editor, approved by the independent directors. The circulation of The Times fell to one-third of that of the Daily Telegraph which retained the dominant market position it had in turn acquired in the 1930s through the practice of old-fashioned price competition.
The aim of price cutting was not to destroy the Independent, nor even the Daily Telegraph. It was to escape from chronic loss-making and to endeavour to increase circulation, which is essential if advertising revenues are to be increased. Advertising revenues form the major part of the income of all the broadsheet newspapers. By any standard, that strategy has proved remarkably successful. The circulation has doubled, and advertising revenue roughly likewise. The total market for broadsheet papers has been enlarged; the size of papers has increased; and the average price has reduced.
Other papers naturally did not like price competition. As Corporal Jones used to say of the enemy's response to bayonets, "They don't like it up them". Nevertheless, the Guardian managed to retain its circulation and, with some less publicised price cutting, the Daily Telegraph has also managed to remain within the one million total circulation.
The noble Lord, Lord McNally, referred to Report stage at which he said that he had one intention and one only:
"to promote the framework of fair and transparent competition in our newspaper industry, with the intention of sustaining diversity, quality and choice".—[Official Report, 9/2/98; col. 913.]
That sounds all very well, but it does not explain, let alone excuse, the noble Lord's vendetta against what was a deeply considered and widely researched policy
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by the executive and non-executive directors of Times Newspapers who carry the responsibility for its fortunes.
The noble Lord emphasises his good intentions. That is not enough. We know the road to hell is paved by little else. I wish to put a few fairly simply practical questions which are left unresolved. What constitutes fair and transparent competition? Does open price cutting have any part to play? If so, how much? If not, how could we prevent well established newspapers from colluding to raise their price, as they did comfortably enough in the 1980s? And how could a new entrant break into the market if it cannot deploy deep price cutting without the noble Lord's permission?
Closer to home, how can a declining newspaper attempt to revive its flagging fortunes if it is forbidden to deploy effective price competition? Price is not everything—that is a mistake which, to some extent, the noble Lord makes—but how important is price compared with the quality of the newspaper in building up circulation? If a declining paper such as The Times attempts a major reconstruction and relaunch, is there a better way of getting new readers to sample it than by dramatic price cutting? Those are not hypothetical questions. They are the do-or-die issues which came to a head shortly after I joined the board of Times Newspapers in 1988. When the circulation of The Times fell below that of the Guardian in 1992 or 1993, that may have been the galvanising element to radical reform.
No one supposed that cutting price would guarantee increased circulation—the key to higher advertising revenue. Many a hopeful entrepreneur has embarked on price cutting only to find that it is a spectacular way of throwing ever larger sums into a black hole. The perennial challenge for serious newspapers remains: what is the optimum blend of quality, quantity and price in a newspaper? We are not talking about baked beans, but about sophisticated products. So who is the best judge of the right mixture? Is it the scattered army of readers, faced with a wider choice in Britain than elsewhere in the world, or the noble Lord, Lord McNally, or even the Office of Fair Trading?
At Report stage, the noble Lord, Lord Peston, from his rather lofty professorial perch, airily countered my economic logic with his customary dismissive wave, although without anything remotely resembling coherent argument. Accordingly, I am setting a more scholarly example by avoiding dogmatic assertion. On this occasion I have relied on posing questions, although the answers may seem self-evident. One thing should be clear even for unworldly professors. It is that lasting success in competitive markets for complex products, such as newspapers undoubtedly are, could never be secured by price-cutting alone, however deep the proprietor's pockets.
Among other questions that remain I might ask: is a competitive dynamic market feasible in newspapers, or any other product, if no participant is to risk getting hurt? Why should one participant, say the Independent, be shielded from the decline brought about, to a degree, by its own editorial and management failures? If such

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a paper is truly vital to some people's conception of democracy as we know it, why should not readers or backers be prepared to pay enough to save it? Has the noble Lord thought of putting the Independent on the protected list, or perhaps launching a flag day?
I come to the most awkward question of all on the noble Lord's amendment. How can The Times be charged with exploiting a dominant position in the broadsheet market when it was struggling against terminal decline in the early 1990s? In the earlier debate, the noble Lord, Lord Borrie, whom I see in his place, put his finger on the nub of popular concern when he said:
"News International holds a substantial degree of market power … and is able, for long periods, to cross-subsidise its loss-making newspaper sales from its highly profitable operations in satellite television".—[Official Report, 9/2/98; cols. 915–6]
That seemed quite powerful, but the noble Lord's finger pointed in several wrong directions at the same time. First, News International does not run Times Newspapers which is a wholly owned subsidiary, but operates as an independent, free-standing company, also running The Sunday Times and the three supplements. Secondly, the price cutting has been financed entirely within Times Newspapers' own budget, with never a penny piece from satellite television. Thirdly, the only cross-subsidy comes from the highly profitable Sunday Times, just as in the Telegraph stable the Daily Telegraph subsidises the less profitable Sunday Telegraph.
All this talk about predatory pricing is an excitable distraction. Serious, destructive predatory pricing is an extremely rare phenomenon, as shown by two classic texts: McGee on the celebrated Standard Oil case in the Journal of Law and Economics, and Koller's Empirical Study on Anti-Trust in the Law and Economics Review. My experts tell me that the worst recent example of predatory pricing was the collusion of other airlines, backed by government, to drive the challenger Freddie Laker out of the market.
What we have here is a good old-fashioned circulation war, such as helped to test and shape the present newspaper industry. If price competition is forbidden, will the noble Lord try to curb competition through bigger papers, give-away offers, lotteries, travel vouchers and all the other special deals? All such promotions are quasi or substitute price cuts, offering more without extra charge.
It seems characteristic of the Liberal Democrats to prefer a namby-pamby world of harmless, ineffective competition where no one must win lest their friends get hurt. The crowning facts are fourfold. First, The Times has been a loss-maker for most of the century. Secondly, Rupert Murdoch was allowed to take over the ailing paper in 1981 because he could carry current losses, though hardly increasing cumulative losses forever. Thirdly, he has found a strategy to put The Times on the high road towards self-sustaining profitability. Fourthly, his critics are outraged by his success.
My concluding question is: why should we let the Liberal Democrats, and sundry other malcontents, vent their pique against The Times by smuggling through this wholly unnecessary amendment?
5.30 p.m.
Lord Borrie: My Lords, I was rather glad that the noble Lord, Lord Harris, made his speech before I made mine because he threw a whole number of red herrings over the trail, especially when he talked about what the 9th February amendment was about, and indeed what the noble Lord, Lord McNally, is proposing today.
The cut-price policy of The Times, which has now lasted for more than five years, cannot possibly be compared with a cut-price promotion, whether literally in price form or in the form of coupons, prizes or anything else. The policy has been going on for a long time. It is not and could not be regarded as a temporary or promotional exercise. Of course I do not know how The Times has managed it. If The Times was wholly isolated, even from the Sunday Times, let alone from the wonderful moneys coming in from other sources of related companies, I do not know how they could have paid the costs of printing, the costs of marketing and the tremendous programme, through television and elsewhere, which has advanced the cause of The Times.
No, my Lords, it has been a predatory policy. A line can be drawn between cut-pricing for a new newspaper on the scene or for an old newspaper, for that matter; but that is quite different from the policy that has now gone on for so long. It is a policy which must have been, and can be demonstrated to have been, damaging, even seriously jeopardising the very existence of rival broadsheets, whether one has the Independent or the Telegraph in mind. Even if their existence is not jeopardised because somehow or other they are enabled to survive, the service that they provide to readers must be damaged because their costs are always under close scrutiny. The mischief of The Times's policy over five years, to my mind restricting or distorting competition, has forced rivals both to follow suit and to reduce costs by cutting the service to their readers.
Leaving aside for the moment what the noble Lord, Lord Harris, has been saying—though I would love to go on—I turn to the Government's view. I have been extremely disappointed both by the manner in which they dealt with the matter in the House of Commons a few months ago and, as it seems from briefing received last week, again today.
The Government's view seems to be that if there is predatory pricing by The Times, or indeed by anyone else, then Clause 18 of the Bill, which covers industry in general and not just newspapers in particular, prohibits all forms of abuse by dominant companies; that it is fully effective; and that it is for the competition authorities—the Office of Fair Trading or the competition commission—to use it. I have carefully considered that argument. It is possibly correct, but it is doubtful. The purpose of the amendment originally passed by this House on 9th February—and, as I understand it, the purpose of the amendment in the name of the noble Lord, Lord McNally,—is to strengthen the law where it is needed in order to make more certain what the Government are saying the Competition Bill provides for.
The Government admit that the European law which is brought into the Competition Bill via Clause 60 defines dominance to mean—I paraphrase only

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slightly—such economic strength as to allow a firm to behave to an appreciable extent independently of its competitors and customers. I do not believe that The Times is in that position, because if next week The Times doubled its price would all the readers remain with it? I think not. Some of them would go, or gradually go, to other available broadsheets. It is not possible for The Times to act independently of its competitors and customers.
Mr. Richard Fowler, Queen's Counsel, is the expert in competition law to whom the noble Lord, Lord McNally, has already referred. I quote from his opinion, which is freely available—the Government's legal opinions have been kept entirely secret to themselves. Mr. Fowler said that it is:
"unlikely that The Times or News International would meet the European Court of Justice tests for dominance",
in the broadsheet or general newspaper market.
The Government rely on the case to which the noble Lord, Lord McNally, referred, the Tetra Pak case, about dominance in one market being abused in another related market. Therefore, the Government may wish to argue, as they have in another place, that as News International, with its admittedly minority stake in BSkyB, is undoubtedly dominant in the satellite TV market, abuse in the newspaper market may be a breach of Clause 18. But as Mr. Richard Fowler points out in his opinion, the European Court of Justice held in Tetra Pak that it is only in special circumstances that abuse of a dominant position could apply to conduct in another non-dominated market. It seems to me that although the Government's case is possibly correct, it is unwise for Parliament to rely on it as being correct because it builds a case for the adequacy of Clause 18 and existing European jurisprudence on a feeble foundation.
So why are the Government adamant that an amendment to the Bill to deal specifically with anti-competitive predatory pricing of newspaper proprietors should be rejected? The nub of the Government's objection seems to be an assertion rather than an argument. The assertion is that it would be wrong to treat newspapers as a special case. Why? Competition between newspapers and the availability of a multiplicity of choice is far more important in the newspaper market than it is in other markets because democracy requires that there should be a good range of choice, diversity and plurality. That is important in newspapers but may not be important in ball-bearings or baked beans.
The Government admit that the special Fair Trading Act provisions which deal with newspaper mergers—and solely and only with the merger of newspapers—and specifically refer to the need for diversity are a good thing. The Government more than once during debates in both Houses have specifically stated that they have no intention of changing the Fair Trading Act provisions and are content with them. They could have amended them or they could have got rid of them if they thought that newspapers mergers did not need to be dealt with separately and specifically, but they are keeping them.
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I say to your Lordships that a newspaper title can disappear through the pricing tactics of a rival, just as it can disappear by takeover. Therefore, there is nothing peculiar in dealing with the anti-competitive risk of the disappearance of a newspaper by special provision for abuse of power.
The Competition Bill, as it has gone through both Houses, makes special provision for a number of different markets: civil aviation, agriculture and the professions. A short while ago, your Lordships may have received from the Treasury, as I did, a substantial draft of a financial services and markets Bill which may well come before us in the next Session. It provides for a special competition regime for financial services regulators, exchanges, clearing houses and so on. The Government are very clear—and in my view, rightly so—as provided in Clause 60 of the Competition Bill, that our law should be consistent "so far as possible" with EC jurisprudence. However, the relevant Minister, when introducing the new clause on vertical agreements, which we shall deal with later tonight, said in another place that the Government do not intend to copy all the various qualifications and conditions that the European Community proposes. There would be nothing inconsistent with the Government's general approach in the Competition Bill if special provision were made concerning predatory pricing in the newspaper market. That is what the Government are refusing to do and what the noble Lord, Lord McNally, is seeking to move tonight, as he did successfully in another context some months ago.
5.45 p.m.
Baroness Oppenheim-Barnes: My Lords, I, too, support the Motion proposed by the noble Lord, Lord McNally. I would have preferred to have seen the previous sweeping amendment retained rather than this narrower version. My interest in Patman/Robinson-type legislation goes back a very long way. Although in those days I was persuaded that that would have been going too far, in the 1980 Competition Act we introduced the flexible power for the Director-General to refer a matter to the Monopolies Commission, with action to follow, if a complaint were made about predatory pricing and it had not been put right at his instigation.
I hope that when the Minister replies he will be able to tell your Lordships what is to happen in the interim period. The 1980 Act will be repealed by this Bill, but this Bill will not come into operation for another year. What will happen to the flexible powers which will vanish with the 1980 Bill until the new Bill is brought into being? Secondly, I believe that every aspect of discriminatory discounting, when it is used as a blunderbuss either to sway opinion or wrongly to gain support, as no doubt is the case in the newspaper industry today, is wrong.
I had hoped not to use the "M" word in this context. However, the noble Lord, Lord McNally, made a mistake in referring to Lord Wyatt's diaries on the subject. I was the Minister responsible at the time and I can assure your Lordships that there was no intervention from the Prime Minister of the day. Our considerations were those which would normally take

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place when such an application was made. They included the consumer interests, the national interests and, last but by no means least, unemployment interests. They were extremely important in that particular case, as vouchsafed by the noble Lord, Lord Hams. I would like the noble Lord to withdraw those remarks at an appropriate time.
The situation arises in which the Government, for whatever reason, refuse to listen to people who really do know better. The noble Lord, Lord Borrie, is second to none in his knowledge and experience of these matters. He has the voice of reason, too. For the Government to bypass such expertise, and for whatever reason to say that the interfering European Commission with its second-rate competition policy might not permit this to happen, is not an excuse. In relation to an earlier amendment the noble Lord said that if the Commission acted in a certain way the Government would take a strong line. I should be very interested to know what strong line they would take and what effect it would be likely to have.
I do not wish to detain your Lordships from what will be a most interesting debate, other than to say that I hope that your Lordships will support the Motion tonight.
Lord Haskel: My Lords, the noble Lord, Lord McNally, spoke of Dorothy Parker's emotions A to B. The amendment of the noble Lord is also based on two emotions—affection for the newspaper industry and distrust of Rupert Murdoch and News International. In my private moments I share these emotions. But there are times when I must put them aside, and this is one of them. We are here to deal with principles and not with individual cases. Individual cases are for lawyers, regulators and the courts. We are here to lay down the rules.
My noble friend Lord Borrie asks why we should not deal with specific cases. There are good practical reasons why this should not be so. Laws directed at particular cases or individual newspapers—
Lord Borrie: My Lords, I have to point out to my noble friend that I did not say that. Of course it appears that we are talking about—to use the "M" word—Mr. Murdoch, because only his organisation happens to be engaged in these practices at the present time. The law we are supposed to be talking about is a general law specific to the newspaper market. It is not specific to any particular proprietor.
Lord Haskel: My Lords, I am glad that my noble friend has clarified that point.
There are good practical reasons why laws directed at particular cases, individual newspaper proprietors or their companies, will fail. They will fail because before the ink is dry on the Royal Assent they will have thought of ways round the law. Our job is to deal with the general and not with the specific.
Quite rightly, the noble Lord, Lord McNally, wants to protect diversity and quality in the newspaper industry. We all want diversity and quality in
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newspapers—we want it in every industry. I have heard rousing speeches in this House calling for it in the City, in coalmining, in farming. Indeed, I have called for it in the textile industry, where I spent 30 years. But this understandable desire for quality and diversity does not justify special pleading. Innovation and competition produce quality and diversity, not special pleading.
Generally, I am not in favour of special pleading in your Lordships' House because it is often difficult to know where the pleading ends and the lobbying begins. Usually we try to indicate this by declaring an interest. I draw this to the attention of the noble Lord, Lord McNally, because I think it might be helpful for us to know where he stands in view of some of the articles which have appeared in recent press reports.
Lord McNally: My Lords, would the noble Lord care to expand? I have no interest to declare as far as the newspaper industry is concerned. If I had, I would have done so. If the noble Lord has any further information, perhaps he would share it with the House.
Lord Haskel: My Lords, I was referring to an article in the press which indicated that the noble Lord is in the lobbying business.
The noble Lord is concerned about price cutting. In the textile industry I experienced price wars far more cut-throat and long-lasting than the price war about which the noble Lord, Lord McNally, and my noble friend Lord Borrie are concerned. As a result of that price war many people wear good quality clothes and have nice fabrics in their home. Thankfully, price is not the only factor. That is why the share of the market taken up by the more expensive broadsheet newspapers is steadily increasing.
I shall not support the amendment. That is not because I do not have affection for the newspaper industry nor because I approve of the tactics of News International; it is because it is misplaced special pleading for a particular interest. It specifically deals with behaviour in the newspaper industry. This clouds the clarity which I think it is your Lordships' duty to inject into this Bill. Our task is to see that abuses of market dominance by predatory pricing is clearly tackled throughout the economy and not just in newspapers. Our task is to see that the rules are fair to everyone trading in the European area. The Bill does this and I say leave it alone.
Lord Astor of Hever: My Lords, I have no interest to declare, no involvement with the newspaper industry and I have never met "M"—Mr. Murdoch. But I do take an interest in The Times and for this reason I cannot support this amendment.
My family owned the newspaper for over 40 years and, like the Thomsons and Rupert Murdoch, poured money into The Times to keep it alive. The Times has seldom been a profitable concern; indeed, its history is one of journalistic success in the face of financial uncertainty.
I strongly believe that newspapers should not be prevented from using every means at their disposal—promotions, price cutting, adding new sections,

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recruiting new talent or investing in new computer systems—to improve their products and to attract new readers, thereby increasing their profitability. I do not believe that The Times should be consigned to yet more uncertainty by having its hands tied over its pricing strategy. I would much rather that The Times increased its circulation by pricing itself into the market, rather than descending into the tabloid fray.
Lord Judd: My Lords, I had not intended to intervene in this debate but, in view of some of the speeches that have been made, I feel compelled to do so.
When we debated this issue previously we put our view firmly on the record. The other place has considered our advice and rejected it. That is the right of the other place. I, for one, feel bound to accept that that is the right of the other place because it is consistent with everything that I argue about the relationship between the two Houses. But that does not mean that I have to accept that the other House is necessarily right.
My anxiety remains that, to put it kindly, the force of enthusiasm with which the Government's case has been advanced against the amendment, and the mobilisation of every possible opportunity to tell us that the Bill covers all that the amendment seeks to cover, make me uneasy. I hope I will be forgiven, after quite a considerable life time in politics, for saying so. It might be that the amendment is superfluous, but why this degree of pressure to resist it? It indicates to me that the amendment may indeed cover the issue which concerns us more thoroughly than the Government's own proposition.
Let me leave that particular argument on one side for a moment. It has been established in this debate—and I was sorry that my good noble friend seemed to skirt over it in his latest intervention—that we are not dealing with any ordinary product. We are dealing with the lifeblood of democracy; and the lifeblood of democracy is the information, the quality of information and the reliability of the sources of information on which the public rely for the formulation of their attitudes towards the issues that confront the nation. Anyone who cares about democracy must care about a pluralist media and pluralist newspapers.
I have great respect for the Minister. I do not call his personal integrity or conviction on this matter into question. I just suggest that there might have been a degree of overkill which stimulates the Bolshie part of me. The Government are repeatedly telling us about their concern for the quality of democracy, about their determination to regenerate the constitution, about the whole life of democracy and about the reform of institutions and the rest. I would be greatly reassured if the Minister could say just a bit about the strategy of the Government for not just holding the line of our media in its present diminished state but for enhancing our media, for enhancing the cause of pluralism in our media and for enhancing the cause of different sources of information on which the public should be able to rely.
I suspect—I say this in all modesty—that by simply looking at this issue in the context of the rather specialist legal debate we have had today and earlier in the year
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we may be demeaning the issues which I am trying to raise. I think it is high time that we saw a strategy for the future of democracy which has at its heart the cause of pluralism in our media.
6 p.m.
Lord Phillips of Sudbury: My Lords, I speak as a member of the Scott Trust which owns the Guardian, the Observer and other newspapers. I say that I speak as a member. In fact, I do not speak for the trust in any way.
There seem to be two primary issues in this debate. The first is whether or not the Bill under consideration should give special regard to, and special protection for, newspapers as a cultural product. The second is whether or not the protections that exist in the Bill as it stands, by incorporating Articles 85 and 86 of the Treaty of Rome, are sufficient.
I think that enough has been said in the debate so far for me not to need to belabour either of those two points. Plainly, in other legislation—the Fair Trading Act—very special consideration is given, for the best of reasons, with regard to newspapers vis-à-vis mergers. The noble Lord, Lord Borrie, gave some other striking examples of special legislative treatment of other areas of economic activity. Secondly, speaking as a lawyer, I really must plead with the Minister that the notion that the issue is beyond doubt in legal terms in relation to Articles 85 and 86 simply is not sustainable. I know my own profession well enough, and I know a little but enough about European law, to be confident that there is a real need in this Bill to make clear beyond peradventure that there are effective safeguards against predatory activities vis-à-vis newspapers. I hope therefore that those points will be carried home tonight.
Lord Desai: My Lords, in a previous debate the noble Lord, Lord Harris, referred to malcontents, and he again referred to me, for which I am very grateful. I do not want to speak about The Times, although my previous speech on this subject got me a mention in the editorial of The Times, which had always been my highest ambition. I have nothing against Mr. Murdoch. I have written for the Sun newspaper, and it pays very well. It has stopped hiring me since we came to power. I regret that, but there are some small compensations.
The new clause proposed by the noble Lord, Lord McNally, should not be argued solely in terms of The Times newspaper. That is important. The special pleading referred to by my noble friend Lord Haskel came more from the noble Lord, Lord Harris, who spoke of nothing but The Times, than from my noble friend Lord Borrie, who drew a much more general canvas. Whoever owns a newspaper—whether it is Mr. Murdoch, Mr. Black, Mr. Montgomery, or someone else—we would like him to follow such practice as not deliberately to reduce the diversity and pluralism of our newspapers.
Arguments have already been advanced that in other parts of the Bill special provision is made for particular industries. Therefore, it cannot be an objection that Clause 19 is not in the spirit of the Bill. If Clause 19 is

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ineffective, there is no harm in including it. We do not really have legislation so tightly drawn that we could not add a clause. If it were the case that Clause 19 was so feebly drafted and would be so contentious that no one could be brought under its aegis and no one could be punished, lawyers would get lots of money, and good luck to them! No harm would be done.
What people are worried about is that Clause 19 has teeth, and because it has teeth people want to do it down. I think it is a good clause. I voted for it last time and unless my noble friend tells me something entirely stunning—that he accepts the clause—I shall be hard put to follow him in the Division Lobby and I shall probably follow the noble Lord, Lord McNally.
Lord Ackner: My Lords, I take it to be common ground that independent newspapers are an essential cornerstone of the democratic process. The Fair Trading Act 1973, which has been referred to more than once, made special merger provisions for the newspaper market. The rationale for these provisions, according to a previous Secretary of State, is that, by increasing the concentration of newspaper ownership,
"you threaten freedom and variety of expression of opinion".
I should have thought that it equally follows that the elimination through predatory pricing of a competitor newspaper would lead again to the concentration of ownership and consequently, to re-quote,
"threaten freedom and variety of expression of opinion".
As I understand the Government's attitude, the main objection to the clause is that it is unnecessary. It can only be unnecessary if the law is certain. It is perfectly clear that the law is not certain. There are cases—this is such a case—where assurance should be made doubly sure. If this clause does not turn out to be necessary, I do not understand, even having listened to the noble Lord, Lord Harris of High Cross, what harm it can do. But if it is necessary and it is left out, then great harm will follow.
I submit to your Lordships that the risk of abuse of power in this field must be eliminated. Accordingly, I will support the clause.
Lord Rees-Mogg: My Lords, I wish to take the opportunity again to declare an interest. I do not have the good fortune to be one of the independent directors of The Times but I do write for that newspaper. I have been struck by a couple of points. First, the pricing of newspapers seems to me more complicated than your Lordships' House has altogether realised or indeed altogether been told. Newspaper pricing is designed to maximise the profit which arises out of the cover price of the newspaper and the advertising revenue of the newspaper. There is a third variable, which is how much you have to spend on the newspaper, how many supplements you have, and so on. That variable is very important. The cover price of a broadsheet newspaper produces probably about 30 per cent. of total revenue. The advertising revenue is usually therefore about 70 per cent. of the total revenue.
I spent 20 years deciding on cover pricing when I was on the board of The Times in the old days. You had to decide what effect a particular cover price would have
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on your circulation and, through the circulation, what effect it would have on your advertising revenue. Therefore, it is not predatory pricing if you keep your cover price low or actually reduce it with a view to increasing your advertising revenue. That is a commonsense thing to do in commercial terms.
Perhaps I may explain the matter in mathematical terms. Let us suppose that the cover price is reduced by 10 per cent. That reduces the revenue from that source, except in so far as the sales increase, from 30 per cent. to 27 per cent. Let us suppose that that produces a 10 per cent. increase in advertising revenue. That increases the advertising revenue from 70 to 77 per cent. Therefore, one would end up with a total sum of 104 rather than 100.
If the propositions which have been put are correct, obviously in this country there would be a supreme example of predatory pricing of a most unacceptable kind and we should all wish to find laws which would shut it down; that is, the free sheets. The free sheets charge nothing. What could be more unfair than that? A free evening paper is given away to anybody who chooses to have it. That draws in advertising and competes with the local evening paper which is trying to earn revenue from its cover price.
If it were true that you can just consider the cover price, as we have tended to do in this debate and in the previous debate, and say that it is unfair because the cover price is so low, then free sheets would clearly be a predatory practice.
There is one other point I should like to make. I believe strongly in the contribution which newspapers make to democracy. But in this country we have far and away the largest national press of any major country. In London we have five broadsheets and six tabloid newspapers, one of the tabloids being an evening newspaper. All those are published in London and all are fairly good newspapers, with perhaps one or two exceptions. In New York, which is comparable—a major city in a rather similar country—there are four newspapers. We have 11 newspapers in London while New York has only four.
Therefore, it is odd that we should be in a state of acute anxiety when it is, in my view—and I have lived in that world for the whole of my adult life—the competition which has created that situation. The problem with New York is that it has become monopolistic. The position is far more monopolistic in the rest of the United States, where most major cities have only one newspaper.
We have a couple of monopoly newspapers in this country. They are not the newspapers we have been talking about. They are the Financial Times, a great and good newspaper which has a monopoly in the financial and business field, and the Evening Standard, a somewhat less great and good newspaper, which has a monopoly in the London evening field. I should very much welcome it if people entered into competition with them. But it seems to me that the situation in relation to our newspapers does not justify the anxiety which has been expressed.
6.15 p.m.
Lord Razzall: My Lords, we have probably reached the stage in the debate when it is appropriate for me to sum up on behalf of the movers of the amendment. First, as a number of noble Lords have indicated, it is a pity that this has become potentially an anti-Murdoch debate. Despite the fact that a number of speakers in favour of the amendment have indicated that their support is based on general principles, we have been assisted by the fact that a number of defenders of the Murdoch position have jumped to their feet, in particular from the Cross-Benches. However, as the noble Lord, Lord Borrie, indicated, the reason that the Murdoch allegations about predatory pricing are relevant is that, as we speak today, those are the current allegations about monopolistic practices in the newspaper industry.
However, this amendment, as proposed by my noble friend Lord McNally, goes much wider than that. It seems to us on this side of the House that when noble Lords decide what to do with regard to the amendment, they must ask two questions: first, does the Bill, as returned to us from the Commons, provide satisfactory protection to the public against anti-competitive practices in the newspaper industry; and secondly, as a subsidiary question, does the newspaper industry require special treatment in the legislation because it has special characteristics that do not apply to other industries?
The answer that my noble friend Lord McNally gives to those questions is that, first, the Bill as returned does not give that satisfactory protection; and, secondly, that there are specific characteristics of the newspaper industry which require special protection to be built into the Bill.
I shall not go over the details of the technical arguments. The noble Lord, Lord Borrie, did that better than all noble Lords in this House put together could have done, being one of the world's experts on the subject. Perhaps I may briefly touch on the opinion to which he referred of Richard Fowler QC. Those of us who have been involved both with the law and the mergers and acquisitions industry know well that lawyers' opinions are lawyers' opinions and for every lawyer's opinion on one side there is usually a lawyer's opinion on the other side, in particular if large amounts of money are involved. But also those of us who have been involved with that industry are aware that one ignores an opinion of Richard Fowler QC at one's peril. As the noble Lord, Lord Borrie, indicated, his opinion is on the record. We do not know the legal basis on which the Government are relying but we have Richard Fowler's opinion that if one looks at the structure of the newspaper industry at the moment, it is unlikely, in his view, that any of the newspaper groups would pass the necessary test for dominance, thereby bringing them within the European law on which the Government are relying to control those practices.
On this side of the House, we disagree with the Government in their view that if this Bill is passed in its existing form, it will provide the protection which the Government believe it will.
Perhaps I may touch on the second and fundamental question to which a number of noble Lords have referred; namely, why the newspaper industry should
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require special treatment. It is strange that that issue should still be being debated. After all, in 1973, in the legislation dealing with mergers, it was accepted that the newspaper industry required different treatment. That is now 25 years ago. Throughout that period it has been accepted generally that the newspaper industry requires special treatment in our competition legislation. The reason for that is as the noble Lord, Lord Judd, indicated. It is the industry which is the lifeblood of our democracy. For that reason and that reason alone, the newspaper industry requires special treatment in legislation.
There are a number of fundamental differences in the newspaper industry. Currently, in aggregate, it is worth about £700 million and, in aggregate, shows a net loss of £50 million. No other industry in this country would continue year after year to have that significant net loss were there not some other reason for people wanting to run newspapers. People want to own newspapers not only to make money out of them, if they can, but also for the express and specific purpose of exercising power and influence.
When the Sun ran its headline after the 1992 election,
"It was the Sun what won it",
it did not run that headline because it thought it would increase its circulation but because it believed it had exercised political control over the democracy of this country. When Rupert Murdoch and Conrad Black, through their newspapers—and perhaps I may rephrase that before other noble Lords indicate that proprietors do not influence the policies of their newspapers—when The Times, the Sun and the Daily Telegraph run their campaign against the euro, it will not be because they wish to increase the circulation of their newspapers but because they wish to exercise power and influence over the deliberations of the democracy of this country.
For that reason and for that reason alone, as the noble Lord, Lord Judd, indicated, the newspaper industry requires separate legislation and separate protection. The purpose of my noble friend's amendment, which nobody has mentioned since he introduced it, is to lower the point at which the dominant position test kicks in in our legislation and in our jurisprudence. For that reason, we wish this amendment to be carried.
Finally, in winding up, perhaps I may deal with the point made by the noble Lord, Lord Judd. "All right", he said, effectively, "I agree with everything the noble Lord, Lord McNally, said. However, because of the constitutional position, we made that point; the Commons disagreed with us and have sent it back to us."
I ask noble Lords to bear in mind that on a similar amendment at least 23, if not 25, Labour Members of Parliament defied the three-line Whip in order to support the position that the noble Lord, Lord McNally, is producing today. Seven Select Committee chairmen signed an amendment in the other place similar to the amendment which the noble Lord has brought forward today.
I ask noble Lords finally to think carefully. To revert to our debates last week, perhaps I can paraphrase the noble Lord, Lord Richard. I urge Members of the House

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to think independently, to peruse the clause independently, then vote for the amendment, voting against the exercise of power without responsibility which, as we all know, is the prerogative of the harlot throughout the ages.
Lord Fraser of Carmyllie: My Lords, the Minister will know, if no one else knows, that during the passage of the Bill through this House at an earlier stage, if we had a consistent theme it was that the regulatory regime set out in the Bill should be as simple and coherent as possible. Accordingly, for that reason, from time to time we resisted what we saw as unnecessary overlaps of regulatory regimes, particularly in relation to the utilities, in an attempt to achieve that objective.
Our position on this amendment is that the existing law, and the law that is presently contained in the Bill, is sufficient to deal with the issue of predatory pricing in the newspaper industry. We may be wrong about that, but it is, I say to the noble Lord, Lord McNally, a consistent position that we have taken throughout the Bill and one to which we intend to stick.
I am bound to say that when such a distinguished lawyer as the noble and learned Lord, Lord Ackner, says that the law is not clear, it undoubtedly troubles me. I should like to think about that carefully. However, the conclusion of his doubts lead me not to believe that we should include Clause 19 in the Bill but, if anything, we should be looking rather more carefully at Clause 18 to ensure that if predatory pricing in the newspaper industry is to be covered, it is properly and consistently covered in that provision. I do not intend to take up much time with that. That is our position and we maintain it.
I say to the noble Lords, Lord McNally and Lord Razzall, that we take some exception to the rather grand view that this debate has become slightly anti-Murdoch. The noble Lord, Lord McNally, indicated that the position we were adopting was not one of consistency or one we have taken throughout the Bill but arose from some hope that we might re-secure the affections of the Murdoch press. I come from Scotland. It is a long time since I thought the Sun in Scotland espoused, with all the historical duplicity of Braveheart, the Scottish national cause. I have long abandoned any belief that the Tory party in Scotland will secure its support again. No, we act on the basis that we consider that the Bill should be kept as simple and clear as possible.
There is only one good reason for sending the Bill back to another place and that is, once again, to enjoy the malicious pleasure of seeing Labour Members of Parliament, both new and old, having to troop through the Lobbies in support of Murdoch.
Lord Simon of Highbury: My Lords, yet again I rise after a very high quality debate enlightened by opposition from all sides of the House. This is now becoming a regular occurrence in a very short career. However, I shall battle on because I was heartened by the early entreaty of the noble Lord, Lord McNally, that we should make this an intellectual debate. Indeed, for
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some time we were on the right track. Unfortunately, we lost the track when we started to debate how the amendment, which is what we are currently discussing, could be applied to the Bill. I shall return to that point. I make it forcibly because many people have been debating the clause as it stands. That is not what we are debating. That has been rejected. We are debating the "McNally amendment". Many of my colleagues, I think inadvertently, have spoken to the clause, which we should not be doing.
The clause has been rejected but we all recall the issues raised by it which were discussed at length in the House in a debate of very high quality. I shall try to take into account arguments that the Government have been trying to develop which are effective, in my view, in making both the clause as it existed and this amendment untenable and unworkable.
Perhaps I may say straightaway to noble Lords that the Government recognise that the newspaper industry requires and indeed receives special treatment. That is not at issue. There has been no U-turn from the Government on that point. In all our debates the Government have, I hope, been very clear about the importance of having a strong, diverse and independent press in this country. That is why we have the special merger provisions for newspapers in the Fair Trading Act. They are there precisely to protect plurality of ownership and diversity of content. Clearly, there are specific public interest issues—not least accurate presentation of news and free expression of news—which need to be considered in merger cases involving newspapers. That is why we keep the special provisions in the Fair Trading Act.
As my noble friend Lord Borrie reminded us, it is also true that many industries are treated differently. That is absolutely correct. That is why the newspaper industry is treated differently in terms of its ownership and the requirement to meet the test of a strong, diverse and independent press. I have no doubt that the question from my right honourable friend in another place, Robin Cook, which was raised by the noble Lord, Lord McNally, is answered entirely by that point.
However, the Bill deals with matters, as many of my noble friends have observed, which are common across the entire industry. That is the critical point. The Bill is not about ownership; it is about dealing with abuses of dominance and other anti-competitive behaviour which are wrong wherever they occur. That is essentially why we do not need or want to treat newspapers differently under the Bill—the very point made by the noble and learned Lord, Lord Fraser. In that sense the Bill is inclusive. It is about prohibiting abuse across industry at large.
Why do we think it is important? I turn to the point made by my noble friend Lord Judd. He asked if we have a strategic view of why this is important. I have a very strong strategic view, and that is that competition is the essence here. That is what is important in the newspaper industry, as in any other industry, because competition breeds innovation and excellence. if the noble Lord does not believe that, he does not understand our strategy. I believe that in many areas in our nation,

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the competitive instinct needs to be developed. That is why the Bill is about competition in every sector of the business. In saying that we do not want to treat newspapers differently. Do not get me wrong. It does not mean that we are complacent about the newspaper industry—far from it. This Government have acted on the need for a stronger competition law. To crack down on anti-competitive behaviour is one of our first priorities. We are serious about competition. There are no special favours. Newspapers will not be exempt from that.
Of course, as many of your Lordships will know and as the noble Lord, Lord McNally, reminded us, the Director General of Fair Trading is already investigating complaints against The Times made by other newspaper companies. If he concludes that there is a case to do so, the director may make a reference to the Monopolies and Mergers Commission under his existing powers. If he does make a reference, the MMC will investigate and report on whether there are any adverse effects to the public interest. If it finds that there are adverse effects, it may make recommendations to the Secretary of State, who would then have wide powers to impose remedies.
I say particularly to my noble friend Lord Borrie—whom we all agree is an expert in this area—that we should wait for the facts of that case to be found. No one should draw conclusions in regard to individual cases until the facts have been found. Of course, once the prohibitions come into force, the director general will have stronger powers to investigate anticompetitive behaviour and to enable him to bring it to an end much earlier.
It is absolutely clear that the prohibition in Clause 18 covers firms abusing their dominance by predatory pricing. The case law shows that beyond doubt. As the noble Lord, Lord McNally, foresaw, the case of Tetra Pak in the European Court of Justice is not only a "fig" for what I am about to say, it is also at the very root, if I do not mix my culinary metaphors, of what we are saying. Following the earlier court decision on AKZO, 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 an objective test. The ECJ also held that 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.
It is clear where the case law stands. But I should also like to examine a second point—the issue of dominance—to which many alluded. Again the jurisprudence is clear. The European Court, for example in the case of Michelin, defined dominance as a
"position of economic strength which enables an undertaking to hinder the maintenance of effective competition in the relevant market by allowing it to behave to an appreciable extent independently of its competitors and customers and ultimately of consumers".
That definition is well established and well understood. It addresses the right competition concerns. There is no case for applying something different.
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Those principles, which are established in European case law, will apply under the Competition Bill by virtue of Clause 60. As your Lordships are well aware, subsection (2) of Clause 60 makes it clear that there must be no inconsistency 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. So the principles on predatory pricing established in AKZO and Tetra Pak, and the meaning of dominance established in Michelin and other cases, will apply under the Competition Bill.
It is important to have that clearly in our minds because I should now like to address Amendment No. 7A as debated tonight in some parts, and not Clause 19, which was rejected in the other House.
First, I say to the noble and learned Lord, Lord Ackner, that it is our submission that the clause is not necessary. I understand that to be a legal term, though I use it in the way in which it was put to me. What is more important is our belief that it is unworkable and that is one of the points that I should like to make.
This amendment addresses some of the deficiencies of Clause 19. However, it has problems of its own, as any amendment which seeks to impose a different prohibition in one particular sector is bound to do, as the noble Lord, Lord Harris, reminded us. First, this amendment throws out the whole concept of dominance and introduces a rigid market share test instead. It is simply not right to introduce what is a threshold for investigation in the Fair Trading Act into the very different prohibition-based approach in the Bill. The right test for a prohibition approach is the one we have under the Bill, in which dominance means a position of economic strength which enables an undertaking to act independently of competition. That principle is established in EC case law, for example in the Michelin case.
The opinion of Richard Fowler QC was mentioned as being an open opinion which we must respect. It is interesting that he says we may have to modify the Bill to address newspaper pricing. I return to something I said earlier. Whether or not The Times is dominant depends on the facts. It is surprising that that opinion can reach a view on that position without proper investigation and I wonder whether the eminent QC had the facts in front of him when drawing up the opinion. We are not aware of that. The DGFT could only assess the matter following a thorough investigation. The implication of the opinion is that The Times cannot operate independently of competition. In my view that is a matter to be determined on the facts.
I repeat that we believe the dominance test, as brought from EC law, to be the right test. It is companies which are able to act without worrying about their competitors who are liable to be able to abuse their position. The Bill will deal with such abuses.
By contrast, the rigid market share test in the amendment means it would apply to any national newspaper business with 25 per cent. of the market. There is indeed a 25 per cent. market share threshold in the Fair Trading Act, as the noble Lord, Lord Razzall, pointed out. But that is not the threshold for imposing a

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prohibition. It is the minimum threshold for allowing an investigation by the MMC. Under the Bill, the threshold for investigation is that the director should have reasonable grounds for believing that there has been an infringement of the prohibitions. There is no market share threshold. Nor should there be. The test for dominance is based on the real economic circumstances of the case in question, not some arbitrary percentage figure.
Under the Fair Trading Act nothing is prohibited per se. We need to remember that important distinction. The prohibition approach in the Bill is a much more serious proposition. Infringements will be unlawful, liable to stiff financial penalties and to civil actions for damages. This is the strength of the prohibition approach: it provides a much stronger deterrent and more effective remedies.
The other side of the coin is that it must be clear what "abuse" means, and that companies which are not dominant will not be caught. Otherwise businesses which are not dominant, but which are, on the contrary, vigorously competing in a very competitive environment, will not know whether or not what they are doing is lawful. The unintended result of the amendment would therefore be to create uncertainty, stifling legitimate competition and innovation.
The amendment will also create uncertainty by introducing a new definition of prohibited conduct. Clause 18 prohibits the same type of conduct which is prohibited under Article 86, and is to be interpreted according to EC jurisprudence. By contrast, there is no case law on which to draw in interpreting this amendment. Again, business will be left wholly uncertain as to what is lawful and what is not. Noble Lords talked of a Klondike for lawyers. This would be bigger than the Klondike ever was. It could be, in oil terms, another Alaska. If there were that much doubt about how the clause was to be applied, by golly, our loyal friends in the profession would have a good time! These are fundamental objections.
Finally, Parliament has given a great deal of close and careful scrutiny to the question of how the Bill will apply to predatory behaviour. I have tried, because it is important, to place on the table some of the legal doubts about the application of the amended clause. The debate has been very detailed, serious and well-informed. I thank the noble Lord for that.
The conclusion reached in another place in the light of all these deliberations was that Clause 19 should be removed and that an identical amendment to Amendment No. 7A, which we are now debating, should be rejected. Although I shall not go through the arithmetic of the vote in any detail since it may not be necessary, it was a very clear decision of the other House, however many 20s one may count. We may be satisfied that the arguments have been thoroughly and carefully examined during the Bill's passage and that the concerns raised by this House have been thoroughly addressed. On that basis, I urge the noble Lord to withdraw his amendment.
Lord McNally: My Lords, I can certainly echo the Minister in regard to the thoroughness of the debate.
1368
I thank him for his unfailing courtesy in dealing with the issues that have arisen. I do not intend to delay the House long on the matter.
There are a couple of "tidying up" points. The noble Lord, Lord Haskel, made a curious intervention. I know the noble Lord to be one of the kindest men in this House; therefore I am sure that he was not suggesting that what I have been doing in relation to the Bill is in any way connected to the way in which I earn my living working for a PR company. Since entering this House, I have voluntarily given a quarterly record of what I do in PR to the Register of Members' Interests. When it was last examined by an investigative journalist, he said that it was the most thorough entry in the House. I challenge any Member to look at it. My interests in this matter go back 30 years. I know that it was a debating point, as was mine to the noble Baroness, Lady Oppenheim-Barnes. I never believed Woodrow Wyatt when he was alive, so why should I believe him now that he is dead? With the noble and learned Lord, Lord Fraser, I know that the Front Bench has arrived at its conclusions in the way that Front Benches always do—from the highest of principles.
I had hoped that the Minister, having heard the noble Lords, Lord Borrie, Lord Desai and Lord Judd, and the noble and learned Lord, Lord Ackner, might have merely echoed Peel at the end of the debates on the Corn Laws. He tore up his speech and said, "You must answer them, for I cannot." Instead, the Minister insisted on sticking to his brief, Tetra Pak and all. We had the old chestnut rolled out that the amendment is unworkable. What the Minister means is that his department does not want to make it work, which is different.
We have a difference of opinion. The Minister believes that by bringing this European jurisprudence into our law, it will provide sufficient teeth to this legislation to offer protection for our newspaper industry. I do not. I also share with the noble Lord, Lord Judd, the concerns that are coming down the track to us. Some massive problems have to be addressed in relation to the concentration of media power and how it influences our democracy.
I have no illusions that this one amendment will meet all those fears. However, it would send out a very strong signal. Yesterday, in The Times, William Rees-Mogg wrote:
"Debates in the Lords do not count for much; they scarcely travel to the other end of the Palace of Westminster, let alone to the country at large".
If your Lordships support this amendment, your voice will carry to the other end of this palace and to the country at large. It will say that this House is a bastion against this vested interest and an over-powerful executive. I ask the House to agree to my amendment in lieu of Commons Amendment No. 7. I wish to divide the House.
6.46 p.m.
On Question, Whether the said amendment in lieu of Commons Amendment No. 7 shall be agreed to?
Their Lordships divided: Contents, 87; Not-Contents, 116.

Division No. 2

CONTENTS

Ackner, L.

Linklater of Butterstone, B.

Addington, L.

Ludford, B.

Ampthill, L.

McNair, L.

Beaumont of Whitley, L.

McNally, L. [Teller.]

Bethell, L.

Maddock, B.

Biddulph, L.

Mar and Kellie, E.

Borrie, L.

Meston, L.

Brightman, L.

Methuen, L.

Brougham and Vaux, L.

Miller of Chilthorne Domer, B.

Cadman, L.

Milverton, L.

Campbell of Alloway, L.

Mountevans, L.

Carlisle, E.

Moyne, L.

Clancarty, E.

Newby, L.

Clement-Jones, L.

Nicholson of Winterbourne, B.

Craigavon, V.

Ogmore, L.

Crickhowell, L.

Oppenheim-Barnes, B.

Darcy de Knayth, B.

Perry of Southwark, B.

Desai, L.

Platt of Writtle, B.

Dholakia, L.

Razzall, L. [Teller.]

Elton, L.

Rodgers of Quarry Bank, L.

Ezra, L.

Rowallan, L.

Falkland, V.

Russell, E.

Fookes, B.

Russell-Johnston, L.

Salisbury, Bp.

Freyberg, L.

Sharp of Guildford, B.

Geddes, L.

Shaughnessy, L.

Geraint, L.

Skelmersdale, L.

Glasgow, E.

Steel of Aikwood, L.

Goodhart, L.

Steel of Leaston, L.

Gray of Contin, L.

Stodart of Leaston, L.

Greenway, L.

Swinfen, L.

Grey, E.

Taverne, L.

Thomas of Gresford, L.

Haddington, E.

Thomas of Gwydir, L.

Hamwee, B.

Thomas of Walliswood, B.

Harmar-Nicholls, L.

Thomas of Monifieth, L.

Harris of Greenwich, L.

Thurso, V.

Hunt of Wirral, L.

Tope, L.

Inchyra, L.

Tordoff, L.

Jacobs, L.

Torrington, V.

Jopling, L.

Trenchard, V.

Kinnoull, E.

Vinson, L.

Kirkwood, L.

Vivian, L.

Knight of Collingtree, B.

Waddington, L.

Lawrence, L.

Wallace of Saltaire, L.

NOT-CONTENTS

Ailesbury, M.

Crawley, B.

Alli, L.

Cuckney, L.

Amos, B.

David, B.

Archer of Sandwell, L.

Davies of Coity, L.

Bach, L.

Davies of Oldham, L.

Bassam of Brighton, L.

Dean of Beswick, L.

Bell, L.

Diamond, L.

Berkeley, L.

Dixon, L.

Berners, B.

Dormand of Easington, L.

Blackstone, B.

Evans of Parkside, L.

Bledisloe, V.

Ewing of Kirkford, L.

Burlison, L.

Falconer of Thoroton, L.

Burns, L.

Farrington of Ribbleton, B.

Carmichael of Kelvingrove, L.

Gallacher, L.

Carnegy of Lour, B.

Gilbert, L.

Carter, L. [Teller.]

Gladwin of Clee, L.

Clinton-Davis, L.

Gordon of Strathblane, L.

Cocks of Hartcliffe, L.

Goudie, B.

1370

Gould of Potternewton, B.

Murray of Epping Forest, L.

Gregson, L.

Nicol, B.

Grenfell, L.

O'Cathain, B.

Griffiths of Fforestfach, L.

Orme, L.

Grimston of Westbury, L.

Paul, L.

Hacking, L.

Pitkeathley, B.

Hardie, L.

Plant of Highfield, L.

Hardy of Wath, L.

Ponsonby of Shulbrede, L.

Harris of High Cross, L.

Ramsay of Cartvale, B.

Haskel, L.

Randall of St. Budeaux, L.

Hayman, B.

Rea, L.

Hilton of Eggardon, B.

Rees-Mogg, L.

Hogg of Cumbernauld, L.

Rendell of Babergh, B.

Hollis of Heigham, B.

Renwick of Clifton, L.

Howell of Guildford, L.

Richard, L.

Hoyle, L.

Sainsbury of Turville, L.

Hughes, L.

Sawyer, L.

Hughes of Woodside, L.

Scotland of Asthal, B.

Hunt of Kings Heath, L.

Serota, B.

Islwyn, L.

Shannon, E.

Jay of Paddington, B. [Lord Privy Seal.]

Shepherd, L.

Simon of Highbury, L.

Jeffreys, L.

Smith of Gilmorehill, B.

Jenkins of Putney, L.

Stoddart of Swindon, L.

Kintore, E.

Stone of Blackheath, L.

Lockwood, B.

Symons of Vernham Dean, B.

Lofthouse of Pontefract, L.

Taylor of Blackburn, L.

Macdonald of Tradeston, L.

Thornton, B.

McIntosh of Haringey, L. [Teller.]

Tomlinson, L.

Turner of Camden, B.

Mackenzie of Framwellgate, L.

Uddin, B.

Mallalieu, B.

Varley, L.

Mason of Barnsley, L.

Walker of Doncaster, L.

Merlyn-Rees, L.

Warner, L.

Milner of Leeds, L.

Wedderburn of Charlton, L.

Mishcon, L.

Whitty, L.

Molloy, L.

Williams of Elvel, L.

Monkswell, L.

Williams of Mostyn, L.

Montague of Oxford, L.

Willoughby de Broke, L.

Morris of Castle Morris, L.

Winston, L.

Morris of Manchester, L.

Wynford, L.

Resolved in the negative, and amendment disagreed to accordingly.
6.54 p.m.
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 7.
On Question, Motion agreed to.

COMMONS AMENDMENT
8 Clause 25, page 13, line 2, leave out ("does not infringe") and insert ("has not infringed").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 8.
Moved, That the House do agree with the Commons in their Amendment No. 8.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
9 Clause 27, page 13, line 38, after ("document") insert (", or to provide him with specified information,").
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 9, with which is grouped Amendments Nos. 11 to 15, 27, 42 and 43 and 100 to 102.
These amendments are necessary to fill a gap in the investigation provisions of the Bill as currently drafted. The current provisions are largely focused on allowing the director to require the production of documents and explanations of those documents. While "documents" are very widely defined (in Clause 59) to include information "recorded in any form", there are circumstances where it would be essential for the director to be able to require the production of information which is not in such a form but which has to be compiled for the purpose. This may happen in the context of an investigation of a dominant undertaking; for example, where under the Bill as currently drafted, the director would not be able to require the undertaking concerned to produce, say, its sales by volume unless a document containing this information already existed; instead he might have to identify and require individual receipts. Information on market shares might not be compiled systematically by an undertaking in recorded form. It could, however, be compiled, by using the knowledge and experience of the undertaking's sales manager, and this amendment would enable the director to obtain that information, which would otherwise be denied to him.
Similarly, there may be a need for information which is in recorded form to be produced in a different recorded form; for example, the information contained in a large number of individual invoices to be produced, as an overall statement of sales by volume. The power would therefore allow information to be required to be compiled or created to meet the request.
The Bill's powers to investigate suspected infringements of the prohibitions enable the director to require the production of "forecasts". The investigation powers in the Fair Trading Act 1973 had been taken to extend to forecasts. However, the Bill mentions forecasts specifically and the Fair Trading Act provisions do not. This has raised a concern that the inference may be drawn that the 1973 Act does not cover forecasts. Amendments No. 42 and 43 and 100 to 102 are necessary, in tidying up terms, to avoid that inference being drawn. They also deal with the investigation powers in the Competition Act 1980 which will continue to apply for those provisions that are not being repealed.
Moved, That the House do agree with the Commons in their Amendment No.9.—(Lord Simon of Highbury.)
On Question, Motion agreed to.

COMMONS AMENDMENT
10 Clause 27, page 13, line 41, leave out ("signed by the Director").
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 10, with which is grouped Amendments Nos. 16 to 20 and 40 and 41.
Amendments Nos. 10, 40 and 41 are concerned with an important element of the Bill; namely, that the director should be able to delegate the exercise of his functions under the Bill. It would be wrong and, indeed, impractical to require him to exercise them in person.
It might possibly be argued that the director cannot delegate his powers under Clause 27 in this way to require the production of documents because the power to do so is subject to the issuing of a
"notice signed by the Director".
It could be argued that this expressly required him to act personally and sign the notices.
We do not want there to be any risk that this argument could be successfully advanced. It is our clear intention that this power should be capable of delegation. Accordingly, to put the matter beyond doubt, Amendment No. 10 deletes the reference to the notice being "signed by the Director".
I turn to Amendments Nos. 40 and 41. The Bill was earlier amended in this House to ensure that the director's general power to delegate, under Schedule 1 to the Fair Trading Act 1973, also applied to the domestic investigation function. We need to make the equivalent amendments to the EC investigation provisions so that they operate in precisely the same way. Amendments Nos. 40 and 41 do so by deleting unnecessary references in Clauses 62 and 63 to persons acting on behalf of the director.
Amendments Nos. 16 and 20 are amendments to the power, when the premises of an undertaking are entered during the course of an investigation, to require a person to state the whereabouts of a document. In an "off-site" investigation under Clause 27, where a specified document is not produced, the investigating officer is empowered to require a person to state the whereabouts of that document,
"to the best of his knowledge and belief".
In Clauses 28 and 29 the equivalent power omits that qualification. We consider it desirable to remove that discrepancy and include these additional words, so that if a person is not certain of the exact location of a document but believes it is in a particular place, then he must give that information rather than simply stating that he does not know its whereabouts.
Amendments Nos. 17 to 19 are minor, technical amendments intended to clarify exactly what documents a warrant under Clause 29 of the Bill will authorise an investigating officer to search for, or take possession of or about which an explanation may be required to be given where premises have been entered under the warrant.
Clause 29 sets out three separate circumstances where a warrant may be obtained from a High Court judge enabling an investigating officer to enter premises in this way. As at present drafted, the Bill is unclear whether, when the warrant is issued, the investigating officer is then able to exercise his powers in subsection 29(2)(b),

1373
(c) and (e) only in relation to the category or categories of document which formed the grounds for obtaining the warrant or all of the categories in subsection (1). This amendment makes it clear that these powers relate only to the category or categories of documents which were the basis for obtaining the warrant in the first place.
Moved, That the House do agree with the Commons in their Amendment No. 10.—(Lord Simon of Highbury.)
On Question, Motion agreed to.
7 p.m.

COMMONS AMENDMENTS
11 Clause 27, page 14, line 2, leave out (""specified document" means any document which") and insert (""specified" means—")
12 Page 14, line 3, leave out ("is").
13 Page 14, line 4, leave out ("falls within a category of document") and insert ("falling within a category").
14 Page 14, line 7, after ("produced") insert ("or any information is to be provided").
15 Page 14, line 8, at end insert ("or provided").
16 Clause 28, page 15, line 6, after ("state") insert (", to the best of his knowledge and belief,").
17 Clause 29, page 15, line 39, leave out ("mentioned in subsection (1)") and insert ("in respect of which the application under subsection (1) was granted ("the relevant kind");").
18 Page 15, line 40, leave out ("that") and insert ("the relevant").
19 Page 16, line 2, leave out ("a kind mentioned in subsection (1)") and insert ("the relevant kind").
20 Page 16, line 2, after ("state") insert (", to the best of his knowledge and belief,").
21 Clause 37, page 19, line 1, leave out ("infringes") and insert ("has infringed").
22 Page 19, line 4, leave out ("infringes") and insert ("has infringed").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 11 to 22. These amendments have been spoken to with Amendments Nos. 6, 9 and 10.
Moved, That the House do agree with the Commons in their Amendments Nos. 11 to 22.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
23 Clause 37, page 19, line 6, at end insert—
("(2A) The Director may impose a penalty on an undertaking under subsection (1) or (2) only if he is satisfied that the infringement has been committed intentionally or negligently by the undertaking.").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 23. I shall speak also to Amendments Nos. 24 and 25. This amendment responds to an amendment to Clause 37 tabled by the noble and learned Lord, Lord Fraser of Carmyllie, which would
1374
have required the director's guidance to cover the criteria to be used in deciding whether to impose a penalty. Concern was expressed that undertakings might be subject to a penalty, even though they might have acted anti-competitively without deliberate intent. I do not believe that penalties would be imposed by the director without very good reason.
However, the concern which the noble and learned Lord expressed is entirely proper and the Government indicated that an amendment might need to be made in another place. We had thought that this matter might well be covered by guidance under Clause 39, but on reflection it seems to us that the better course is to make it clear on the face of the Bill that penalties cannot be imposed unless the undertaking has committed the infringement intentionally or through negligence. This is what Amendment No. 23 achieves. I hope that it will be welcome to the House.
Turning to Amendments Nos. 24 and 25, Clause 39 of the Bill requires the director to prepare and publish guidance as to the appropriate level of a penalty which an undertaking may be required to pay where an agreement or conduct infringes either of the prohibitions. We have given the commitment that the ceiling of 10 per cent. of turnover will be limited to UK turnover. The purpose of Amendment No. 24 is to inform and guide business on the circumstances in which penalties are likely to be imposed and the magnitude of such penalties. Clause 39(8) underpins this by requiring the director to have regard to this guidance when setting the amount of a penalty. As at present drafted, the subsection also requires an appeal tribunal or court also to have regard to the director's guidance.
We believe that this latter provision could be argued to have limited the independence of the appeal process from the director. To put the matter beyond doubt, this amendment removes the obligation on a tribunal and the court to have regard to such guidance.
Amendment No. 25 is necessary as a consequential amendment to delete the cross-reference, in Clause 39(10) to subsection (8) of Clause 39, because this subsection will no longer refer to "the appropriate court".
Moved, That the House do agree with the Commons in their Amendment No. 23.—(Lord McIntosh of Haringey.)
Lord Borrie: My Lords, I wish to comment on Amendment No. 23, which may reduce the important deterrent effect of the penalties which the Government have much lauded as being among the purposes of the Competition Bill. As we have heard, it requires that the director may impose a penalty only if he is satisfied that the infringement of a prohibition has been committed intentionally or negligently by the undertaking. I stress the words "by the undertaking" because my concern is that that may mean only the directing mind of the company. I am concerned about what may happen if, for example, the management of an undertaking issues express instructions to employees not to put into effect a price-fixing agreement. Then let us suppose that a middle rank employee, if you like, acts against those instructions

1375
in the course of his employment because it is his job to make contracts. I am worried that because of the amendment the director may not be able to impose a penalty on the basis that the undertaking, or the directing mind of the undertaking, has not acted intentionally or negligently; indeed he has issued express instructions to try to ensure that does not happen.
I have not invented these facts out of thin air. I refer to an actual case that occurred in the earlier part of this decade when the House of Lords in its judicial capacity dealt with ready-mixed concrete companies which had been subjected to a court order many years before that they must not make price-fixing agreements. The court orders were, of course, directed at the companies concerned. The directors of a company issued instructions seeking to put into effect the court order and to try to ensure that everyone in the company obeyed it. Unfortunately the instructions were disobeyed and people of a certain rank within the company liaised with other people in other companies and made price-fixing contracts exactly of the kind that the Restrictive Practices Court had been concerned about.
The House of Lords overruled the Court of Appeal on this matter. The House of Lords said that even though the employees had acted outside their authority and contrary to instructions, as they acted in the course of their employment the contracts they had made were attributable to the companies and the companies were liable in contempt for breaching the court orders. In the judgments much was made of the fact that the companies were liable in contempt because the law of contempt does not require intention on the part of the employer. If the employer is supposed to be the one who has the intention or is negligent, would the director be able to impose penalties under the new wording in Amendment No. 23, which the House of Commons has passed and which we are now considering?
Lord Fraser of Carmyllie: My Lords, I leave it to the noble Lord to answer that series of complicated questions. For my part, I simply thank the Minister for introducing the amendment in another place. It certainly meets the concerns which we expressed in this House.
Lord McIntosh of Haringey: My Lords, I am grateful for the observations of the noble and learned Lord, Lord Fraser of Carmyllie. I am grateful to my noble friend Lord Borne for writing to us yesterday and giving us notice of his concerns. He is right to draw attention to the implications of this change to the Bill. When I started in business—far too long ago—we were taught that, if we signed a letter, it had to be "for and on behalf of the company. When I started my own business, in 1965, I was told by our legal advisers that that was no longer necessary because the law as it stood then meant that anything we wrote on the company's letterhead was tacitly "for and on behalf of" the company. It is not entirely clear to me whether the ready-mixed concrete case to which my noble friend referred overturns that position. As I understand what my noble friend said, the agreements that took place between the ready-mixed concrete companies were not necessarily in writing, so areas of doubt remain. However, I can assure the House
1376
that acceptance of Amendment No. 23 will not undermine the effectiveness of the new regime in deterring anti-competitive behaviour or tackling it vigorously when it does occur.
The amendment introduces an important new safeguard for undertakings, reflecting the concerns expressed in this House. Penalties cannot be applied unless the director is satisfied that the undertaking has infringed the prohibition intentionally or negligently. However, I must point out that this limitation is on the imposition of penalties, not on the application of the prohibition itself. If the director is satisfied that the prohibition has been infringed by an undertaking, then he will be able to take enforcement action under the Bill to bring that infringement to an end. Only if he is satisfied that the infringement is intentional or negligent will he he able to impose penalties.
The amendment is not a licence for cavalier behaviour—not that my noble friend suggested that it was. It is clear from the principles set out in the decision of your Lordships' House in the case of the Supply of Ready Mixed Concrete (No2) that an employee, acting for an undertaking within the scope of his employment, who makes a prohibited agreement will be doing so as the company. The company will therefore be in breach of the prohibition and be liable accordingly.
The test as to whether an infringement is "intentional or negligent" mirrors that in Regulation 17/62 under which the European Commission acts when imposing fines for breaches of Articles 85 and 86. The director, in applying the test, will therefore be bound to apply European Community jurisprudence in applying the test to the Bill. Clause 60, with its purpose clause, sets this out clearly. The director will have to identify the legal person who is responsible for operation of the undertaking which has breached the prohibition. That will usually mean the company carrying on the business in respect of which the breach has occurred.
In deciding whether the undertaking has acted intentionally or negligently, the director will have to consider the degree of culpability for the infringement. For example, in the case of Deutsche Phillips the company was held liable for negligent infringement for including in agreements an export ban in error after the parent company had ordered its removal. The Commission determined that the company had not taken sufficient care to remove the offending restriction from agreements. A compliance programme which is ineffective to prevent infringements may be a mitigating factor but will not relieve the company from the imposition of penalties.
I hope that what I have said reassures my noble friend to some extent.
On Question, Motion agreed to.

COMMONS AMENDMENTS
24 Clause 39, page 20, line 4, leave out ("an appeal tribunal or the appropriate court").
25 Page 20, line 12, leave out ("subsections (8) and") and insert ("subsection").
26 Clause 41, page 21, line 19, leave out ("it is likely that the conduct infringes") and insert ("the conduct is likely to infringe").
27 Clause 43, page 22, line 10, at end insert—
("() to provide information,").
28 Clause 47, page 24, line 5, leave out ("is") and insert ("has been").
29 Clause 47, page 24, line 6, leave out ("is") and insert ("has been").
Lord McIntosh of Haringey Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 24 to 29. These amendments were spoken to with Amendments Nos. 6, 9 and 23.
Moved, That the House do agree with the Commons in their Amendments Nos. 24 to 29.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.
7.15 p.m.

COMMONS AMENDMENT
30 Clause 50, page 25, leave out lines 32 and 33.
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 30. In doing so, I shall speak also to Amendments Nos. 31 to 33 and 62 to 73. These are all minor or technical amendments intended to enhance the efficient and effective operation of appeals under the Bill. The main substantive amendments are Amendments Nos. 64 and 71.
Amendment No. 64 replaces the power of the tribunal to "reverse" the decisions of the director with the power to "set aside" such decisions. We concluded that this change was merited in light of our consultations on the Bill.
Lord Fraser of Carmyllie: My Lords, perhaps I may interrupt the noble Lord and say that we are powerfully persuaded by the arguments that lay behind these amendments.
Lord Simon of Highbury: My Lords, I was about to say that the change was made in light also of the amendment tabled by the noble and learned Lord, Lord Fraser, and the noble Lord, Lord Kingsland, on Report which proposed that the tribunal should have the power to quash decisions.
Amendment No. 71 makes it an offence to fail. I should draw attention to Amendment No. 70, because it includes aspects of the appeals procedure. Amendments Nos. 63, 65 and 67 respond to points made by the noble and learned Lord, Lord Fraser, at Third Reading, and the noble Lord, Lord Kingsland, in Committee.
Moved, That the House do agree with the Commons in their Amendment No. 30.—(Lord Simon of Highbury.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
31 Page 25, line 39, after ("to") insert ("proceedings before a tribunal in").
32 Page 25, line 40, after ("to") insert ("proceedings before a tribunal in").
33 Page 25, line 41, after ("to") insert ("proceedings before a tribunal in").
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 31 to 33.
Moved, That the House do agree with the Commons in their Amendments Nos. 31 to 33.—(Lord Simon of Highbury.)
On Question, Motion agreed to.

COMMONS AMENDMENT
34 After Clause 50, insert the following new clause—
("Vertical agreements and land agreements

VERTICAL AGREEMENTS AND LAND AGREEMENTS
.—(1) The Secretary of State may by order provide for any provision of this Part to apply in relation to—

(a) vertical agreements, or

(b) land agreements,

with such modifications as may be prescribed.
(2) An order may, in particular, provide for exclusions or exemptions, or otherwise provide for prescribed provisions not to apply, in relation to—

(a) vertical agreements, or land agreements, in general; or

(b) vertical agreements, or land agreements, of any prescribed description.

(3) An order may empower the Director to give directions to the effect that in prescribed circumstances an exclusion, exemption or modification is not to apply (or is to apply in a particular way) in relation to an individual agreement.
(4) Subsections (2) and (3) are not to be read as limiting the powers conferred by section 70.
(5) In this section—

"land agreement" and "vertical agreement" have such meaning as may be prescribed; and

"prescribed" means prescribed by an order.").

Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 34. This amendment is grouped with Amendment No. 45.
Noble Lords will recall that we spent a considerable time in Committee and on Report on the treatment of vertical agreements and, to a lesser extent, land agreements. This new clause allows the Government to provide special treatment including exclusion from the Chapter I prohibition of vertical agreements and land agreements. I should like to outline in some detail the Government's thinking in respect of these types of agreements and how we intend to use the power to be granted by this new provision.
I shall deal, first, with vertical agreements. We have said on a number of occasions that we believe that there is significant merit in granting exclusion or other special treatment for vertical agreements under the Chapter I prohibition. We believe that the new power proposed is

1379
important in ensuring that we are able to provide special treatment which is of real, practical value for business. We have discussed the approach in detail with representatives of the CBI and it has their support. There is already provision in the Bill to make exclusions, but we have considered whether additional flexibility is required. Working with the CBI, OFT and MMC on the vertical agreements task force, we concluded that the existing powers in the Bill to make exclusions may not be adequate to provide special treatment for vertical agreements which is legally sound while being of real, practical value to business. The new clause we are debating will enable special treatment or exclusion to be given specifically to vertical agreements.
We have already provided an initial draft of the order excluding vertical agreements to a few contacts, such as the CBI and the National Consumer Council, on an informal basis to see whether they agree that we are on the right track. We propose, in the light of these informal contacts, to issue formal consultation documents to a wider audience of business and other interested parties.
Finally, I should perhaps say a word on how the new power will be used after the consultation period. I am happy to explain now how we propose to define vertical agreements in the draft order to be made under the provision in the new clause. As many noble Lords may be aware, the European Commission has been conducting a review of the treatment of vertical restraints. The Commission has circulated a paper setting out its findings following its review. The paper contains possible descriptions of vertical agreements which could form the basis for a description of vertical agreements which would benefit from the special treatment under the Chapter I prohibition. The Commission is still working on these proposals. However, one definition used in the papers which we propose to adopt in our first draft is:
"agreements between two or more undertakings, each operating on a different level of the supply chain ... and in respect of the delivery and/or purchase or marketing of goods destined for resale or transformation or in respect of the marketing of services".
We see great merit in using the same language as that proposed by the Commission. Many UK businesses are already subject to EC competition law and it may be burdensome for them to apply two different tests at the EC and UK level when deciding whether they come within the scope of the UK and EC prohibitions.
The European Commission proposal for a new wide ranging block exemption is, however, still subject to numerous qualifications. We recognise that not all vertical agreements are benign and some can cause serious competition concerns. We do not intend to copy all the various qualifications and conditions that the EC propose. Nevertheless, we recognise that some vertical agreements can cause competition concerns which may not be readily dealt with by reliance on the Chapter II prohibition or the complex monopoly provisions of the Fair Trading Act.
Therefore, we need the consultation process and will continue with it. That the European Commission is still refining its proposal emphasises how right we are to deal with vertical agreements in secondary legislation.
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There is a powerful reason why the Bill should contain powers not only to define vertical agreements but to modify how the Bill should apply to them. I confirm, however, that we intend that the exclusions for both land and vertical agreements should be in place well before the prohibitions come into force, even if the European Commission has not concluded its review of vertical agreements by then. We are consulting now and we hope that the finalised orders will not be long delayed.
Moved, That the House do agree with the Commons in their Amendment No. 34.—(Lord Simon of Highbury.)
Lord Fraser of Carmyllie: My Lords, ordinarily the Opposition grumble if the approach taken is one of secondary rather than primary legislation. However, I believe that on this occasion there is sound reason underlying the thinking of the Government in allowing for much that has to be filled in to be done by way of secondary legislation. There must also be some force in what the Minister has said about drawing the provisions into line with what may emerge in a European context. The last thing we want is for British business to be required to observe two separate sets of rules. My only grumble is that, while this is a very reasonable approach to take, had it not been for the hesitancy of the previous President of the Board of Trade this is a conclusion to which the noble Lord would have come many months ago. We might have saved a good deal of time and effort with the matter ping-ponging around this Chamber or between this Chamber and another.
On Question, Motion agreed to.

COMMONS AMENDMENT
35 Clause 54, page 28. line 2, leave out ("exercised") and insert ("exercisable").
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 35. It is convenient to speak at the same time to Amendments Nos. 36, 81 to 89, 108, 110 to 113. and 115 and 116. These amendments enable the regulators to co-ordinate their activities under the Bill in a more effective manner. On a number of occasions during the passage of the Bill through this House, noble Lords raised matters which illustrated rigidities within the utility statute provisions as they would apply to the exercise of concurrent functions under the Bill. I said that the Government would reflect on those rigidities and whether a change was needed. These amendments are the result of that reflection and also respond to points made in Committee in another place. They disapply the present inflexible utility statute provisions from the exercise of Bill functions and provide a more flexible regulation-making power instead.
Moved, That the House do agree with the Commons in their Amendment No. 35.—(Lord Simon of Highbury.)
Lord Kingsland: My Lords, it appears that, while this Bill was passing through another place, the Secretary of State acquired, almost in a fit of absent-mindedness, the power to make regulations

1381
about the exercise of competition functions as between the Director General for Fair Trading on the one hand and the regulators on the other. Can the Minister assure me that this power will be used; and, if so, that a truly objective analysis will be made about which of the two sides of the equation—the regulator or director general—will be given the necessary authority?
Lord Simon of Highbury: My Lords, in arriving at a flexible solution, we shall need to consult very closely on how regulations are made. I very much hope that, as the regulation-making process takes place, the problems to which the noble Lord refers will be resolved.
On Question, Motion agreed to.

COMMONS AMENDMENT
36 Page 28, line 4, at end insert—
("(4) The Secretary of State may make regulations for the purpose of co-ordinating the performance of functions under this Part ("Part I functions") which are exercisable concurrently by two or more competent persons as a result of any provision made by Part II or III of Schedule 10.
(5) The regulations may, in particular, make provision—

(a) as to the procedure to be followed by competent persons when determining who is to exercise Part I functions in a particular case;

(b) as to the steps which must be taken before a competent person exercises, in a particular case, such Part I functions as may be prescribed;

(c) as to the procedure for determining, in a particular case, questions arising as to which competent person is to exercise Part I functions in respect of the case;

(d) for Part I functions in a particular case to be exercised jointly—

(i) by the Director and one or more regulators, or

(ii) by two or more regulators,

and as to the procedure to be followed in such cases;

(e) as to the circumstances in which the exercise by a competent person of such Part I functions as may be prescribed is to preclude the exercise of such functions by another such person;

(f) for cases in respect of which Part I functions are being, or have been, exercised by a competent person to be transferred to another such person;

(g) for the person ("A") exercising Part I functions in a particular case—

(i) to appoint another competent person ("B") to exercise Part I functions on A's behalf in relation to the case; or

(ii) to appoint officers of B (with B's consent) to act as officers of A in relation to the case;

(h) for notification as to who is exercising Part I functions in respect of a particular case.

(6) Provision made by virtue of subsection (5)(c) may provide for questions to be referred to and determined by the Secretary of State or by such other person as may be prescribed.
(7) "Competent person" means the Director or any of the regulators.").

COMMONS AMENDMENT
37 Clause 59, page 31. line 17, at end insert—
("() The fact that to a limited extent the Chapter I prohibition does not apply to an agreement, because of an exclusion provided by or under this Part or any other enactment, does not require those provisions of the agreement to which the exclusion relates to be disregarded when considering whether the agreement infringes the prohibition for other reasons.").
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 36 and 37.
Moved, That the House do agree with the Commons in their Amendments Nos. 36 and 37.—(Lord Simon of Highbury.)
On Question, Motion agreed to.

COMMONS AMENDMENT
38 Clause 60, page 32, line 2, after ("to") insert ("— (a)").
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 38. In moving this amendment I should like to speak also to Amendment No. 39. The Bill as drafted is designed to confer rights for persons to take action directly in the UK courts in respect of breach of the prohibitions. We believe that such rights of action have an important role to play in the enforcement of the prohibitions. We wish to ensure that the extent of the right of action for breach of the UK prohibitions is the same as for breach of Articles 85 and 86. Rights of action for breach of Articles 85 and 86 have been clearly held to exist by the UK courts. However, Community law is still in the process of development, for example, in terms of the class of persons who are able to claim such rights.
We want to ensure that our courts can deal with third party rights of action for breach of the domestic provisions as they evolve in the context of Articles 85 and 86. The amendments confirm this. As I said at Third Reading:
"We would not want a situation where the extent of rights of private action depended on whether the agreement affected trade between member states, often a difficult line to draw".—[Official Report, 5/3/98; col. 1325.]
Moved, That the House do agree with the Commons in their Amendment No. 38.—(Lord Simon of Highbury.)
Lord Kingsland: My Lords, am I right in thinking that the amendments to which the Minister has spoken relate to Clause 60 of the Bill? Before I turn to the two questions that I wish to put to the Minister, I should like to make a general reflection on his approach to Clause 60. This clause caused us a good deal of heart-searching as well as mind-stretching during Committee and Report stages. There are a number of expressions in Clause 60 with which all your Lordships find great difficulty. The Minister will recall that, at the time, the noble and learned Lord, Lord Brightman, suggested to him that this was a Bill which pre-eminently should have an index of defined expressions. Noble Lords will have noted that in the course of this Session of Parliament no

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less than four important Bills have had such an index. I refer to the Data Protection Bill, the School Standards and Framework Bill, the Scotland Bill and the Government of Wales Bill. The Scotland Bill and the Data Protection Bill have 44 defined expressions; the Schools Standards and Framework Bill has 62; and the Government of Wales Bill 42.
Many noble Lords remain puzzled as to why it should be an appropriate approach in those Bills but not with regard to this Bill. When he was at the Bar, the noble and learned Lord, Lord Brightman, was regarded as the greatest draftsman of his generation. The Minister will recall that he actually did the Minister's work for him. I believe that in the application of Clause 60, it would have been of benefit to this House.
I have two questions on Clause 60. First, does the clause apply to Part I of the Act in its entirety? Secondly, on the definition of compatibility, am I right to conclude that compatibility here means that the jurisprudence of the European Court of Justice will prevail in all circumstances except those in which the court, having striven to make them prevail, finds that, in that particular set of circumstances, they cannot?
7.30 p.m.
Lord Simon of Highbury: My Lords, perhaps I may briefly reflect on the input into the debate of the noble and learned Lord, Lord Brightman. We discussed it closely. The decision was not to provide the index here. That issue has been well discussed and well argued in this case. However, as noble Lords know, many Bills do not include indexes. The decision was that there would not be an index in this Bill.
The answer to the first question as to whether it applies to Part I in the entirety is yes. On compatibility, we are satisfied that the drafting of Clause 60 accurately expresses the concept that Community jurisprudence is to be followed unless the court is driven to some different interpretation by some provision in that part of the Bill. In all other respects, Part I is not to be interpreted as an ordinary statute. For example, "products" is to be read as including services. An "effect on competition" is to be read as meaning an appreciable effect. That is not how those terms would be interpreted if used in an ordinary UK statute. Interpretation of the Bill is not a two stage process. One does not construe the prohibitions and then compare them with Community jurisprudence. One construes them from the outset on the basis of Clause 60.
On Question, Motion agreed to.

COMMONS AMENDMENTS
39 Clause 60, page 32, line 3, at end insert—
("(b) the civil liability of an undertaking for harm caused by its infringement of Community law.").
40 Clause 62, page 32, line 43, leave out from ("Director") to end of line 44.
41 Clause 63, page 34, line 3, leave out from ("Director") to end of line 4.
42 Clause 66, page 36, line 12, after ("estimates") insert ("forecasts").
43 Page 36, line 14, after ("estimates") insert ("forecasts").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 39 to 43 en bloc.
Moved, That the House do agree with the Commons in their Amendments Nos. 39 to 43—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
44 After Clause 68, insert the following new clause—

REPORTS: MONOPOLY REFERENCES
(". In section 83 of the Fair Trading Act 1973—

(a) in subsection (1), omit "Subject to subsection (1A) below"; and

(b) omit subsection (1A) (reports on monopoly references to be transmitted to certain persons at least twenty-four hours before laying before Parliament).").

Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 44. I shall speak also to Amendments Nos. 103, 106 and 107. These amendments are intended to reduce the risk of leaks of market sensitive information, and to protect the interest of companies and their investors, including the many individual members of the public who are shareholders.
The amendments repeal Section 83(1A) of the Fair Trading Act 1973 which requires that copies of a Monopolies and Mergers Commission monopoly report must be sent to every person named in the report as a person in whose favour a monopoly situation exists at least 24 hours in advance of the report being laid before the House and published.
We believe that monopolists—the word is not intended necessarily as being derogatory; it is the way it is described in legislation—named in reports should have some prior warning of the publication of reports in order to prepare themselves to respond to press inquiries. For that reason we intend that named monopolists should be told the date and time of publication on the day before. In addition, immediately after publication of the report, they will receive a copy of the press notice announcing the Secretary of State's decision. They will also be able to collect a copy of the report from officials. Those steps will bring the practice for monopoly reports into line with that for merger reports which has worked perfectly satisfactorily.
By introducing these measures at the same time as repealing the duty in Section 83(1A) of the Fair Trading Act, we believe that we are striking the right balance between the needs of individual named monopolists and the needs of the market and investors regarding the security of price sensitive information.
Moved, That the House do agree with the Commons in their Amendment No. 44—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
45 Clause 70, page 39, line 4, leave out ("or") and insert
("() section (Vertical agreements and land agreements), or").
46 Clause 73, page 40, line 35, leave out ("Schedule 13") and insert ("Schedule (Transitional provisions and savings)").
47 Clause 75, page 41, line 11, leave out ("73(2)").
48 Page 41, line 11, after ("section") insert ("and paragraphs 1 to 7 and 35 of Schedule (Transitional provisions and savings)").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 45 to 48.
Moved, That the House do agree with the Commons in their Amendments Nos. 45 to 48.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
49 Clause 75, page 41, leave out lines 17 to 20.
Lord McIntosh of Haringey: My Lords, this is the privilege amendment. I beg to move that the House do agree with the Commons in their Amendment No. 49.
Moved, That the House do agree with the Commons in their Amendment No. 49.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
50 Schedule 1, page 43, line 10, leave out ("before") and insert ("at").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 50, and speak to Amendments Nos. 51 to 53, 60 and 61. These are minor drafting amendments which improve clarity of certain provisions in Schedules 1 and 3. The provisions relate to clawback in the exclusions from Chapter I prohibition for mergers, for agreements that have received directions under Section 21(2) of the RTPA, and for agreements relating to agricultural products.
The existing wording might be said to refer to a person failing before the end of the period in which information has been required by the director to comply with the requirement to provide information. The amendments make clear that the test is whether at the time the period ends he has failed to comply.
Moved, That the House do agree with the Commons in their Amendment No. 50.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
51 Schedule 1, page 43, line 11, leave out ("fails") and insert ("has failed").
52 Schedule 3, page 52, line 38, leave out ("before") and insert ("at").
53 Page 52, line 39, leave out ("fails") and insert ("has failed").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 51 to 53.
Moved, That the House do agree with the Commons in their Amendments Nos. 51 to 53.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
54 Schedule 3, page 53, line 38, leave out ("which").
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 54 and speak to Amendments Nos. 55 to 57. These are minor and tidying amendments. They tighten the definition of "trading practices" in relation to European Economic Area regulated markets: that is to say, investment markets set up in another European Economic Area member state which operate without requiring that the members be physically present in the territory where they are established. The amendments bring the definition into line with the definition of practices in relation to recognised investment exchanges in the Financial Services Act.
Moved, That the House do agree with the Commons in their Amendment No. 54.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
55 Schedule 3, page 53, line 39, after ("(a)") insert ("which").
56 Page 53, line 41, leave out ("(b)") and insert ("and which").
57 Page 53, line 43, after ("(c)") insert ("which").
58 Page 54, leave out lines 3 to 6 and insert ("an agreement to the extent to which it is made in order to comply with a legal requirement.").
59 Page 54, line 7, after ("conduct") insert ("to the extent to which it is").
60 Page 56, line 1, leave out ("before") and insert ("at").
61 Page 56, line 2, leave out ("fails") and insert ("has failed").
62 Schedule 7, page 64, line 31, after ("12") insert ("and paragraph 5 of Schedule 8").
63 Schedule 8, page 71, line 5, leave out from ("indicate") to end of line 14 and insert ("—

(a) under which provision of this Act the appeal is brought:

(b) to what extent (if any) the appellant contends that the decision against, or with respect to which, the appeal is brought was based on an error of fact or was wrong in law; and

(c) to what extent (if any) the appellant is appealing against the Director's exercise of his discretion in making the disputed decision.").

64 Page 71, line 20, leave out ("reverse") and insert ("set aside").
65 Page 71, line 21, after ("appeal") insert ("or any part of it").
66 Page 71, line 25, leave out ("or make") and insert—

("(d) give such directions, or take such other steps, as the Director could himself have given or taken, or

(e) make").

67 Page 71, line 28, at end insert—
("() If the tribunal confirms the decision which is the subject of the appeal it may nevertheless set aside any finding of fact on which the decision was based.").
68 Page 71, line 42, leave out ("Council") and insert ("Competition Commission").
69 Page 72, line 40, leave out ("also").
70 Page 72, line 47, at end insert—
("() as to the evidence which may be required or admitted in proceedings before the tribunal and the extent to which it should be oral or written;
() allowing the tribunal to fix time limits with respect to any aspect of the proceedings before it and to extend any time limit (whether or not it has expired);").
71 Page 73, line 15, at end insert—
("() A person who without reasonable excuse fails to comply with—

(a) any requirement imposed by virtue of sub-paragraph (1)(c), or

(b) any requirement with respect to the disclosure, production, recovery or inspection of documents which is imposed by virtue of sub-paragraph (1)(e),

is guilty of an offence and liable on summary conviction to a fine not exceeding level 3 on the standard scale.").
72 Page 73, line 32, at end insert—
("() Any sums received in consequence of rules under this paragraph are to be paid into the Consolidated Fund.").
73 Page 74, line 6, at end insert—
("() Rules may also make provision giving the tribunal powers similar to those given to the Director by section 36.").
74 Schedule 9, page 74. leave out lines 21 to 24.
75 Page 75, line 20, at end insert—
("() In this paragraph "decision" means a decision of the Director (whether or not made on an application)—

(a) as to whether or not an agreement has infringed the Chapter I prohibition, or

(b) as to whether or not conduct has infringed the Chapter II prohibition,

and, in the case of an application for a decision under section 14 which includes a request for an individual exemption, includes a decision as to whether or not to grant the exemption.").
76 Page 76, leave out lines 42 to 46.
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 55 to 76 en bloc. They have been spoken to with Amendments Nos. I, 6, 30, 50 and 54.
Moved, That the House do agree with the Commons in their Amendments Nos. 55 to 76.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
77 Schedule 10, page 77, line 32, after ("above") insert ("("a general matter")").
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 77 and speak to Amendments Nos. 78 to 80. It would be convenient also to consider Amendments Nos. 90 and 109.
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These are technical amendments to Schedule 10 with a related repeal in Schedule 14 modifying the textual amendments that Schedule 10 makes to the Telecommunications Act 1984.
Moved, That the House do agree with the Commons in their Amendment No. 77.—(Lord Simon of Highbury.)
Lord Kingsland: My Lords, the Minister said that Amendments Nos. 77 to 80 were technical amendments, and so, in a sense, they are. There is one matter there, however, which may or may not be a cause of concern, depending upon how the noble Lord answers my question.
The noble Lord will recall that in the Committee and Report stages of this Bill a great deal of energy and effort was devoted to the question of the bridge between the Bill and the regulatory regime, in particular in relation to telecommunications. On one construction of the amendments in another place it seems to me that it could be argued that the bridge had been reintroduced, this time not with the Bill itself but with the 1973 Act.
It is important to be clear about this. If the amendments are simply saying that the subject matter of the purposes of the regulatory regime can be dealt with in both jurisdictions, that seems to be quite acceptable; but what would not be acceptable, and indeed not consistent with what the noble Lord decided in relation to the Bill, would be for the regulatory purposes of the regulatory regime to be reintroduced into the competition regime. I would be very grateful it' the noble Lord would clarify that point.
Lord Simon of Highbury: My Lords, I understand that concerns have been raised that the wording that Amendments Nos. 77 and 78 add to the new subsection (3C), which the Bill already inserts in the Telecommunications Act, might in some way be interpreted as altering and extending the ability of the Director-General of Telecommunications to have regard to the subject matter of his statutory duties when exercising concurrent functions under the Fair Trading Act. I do not accept that this is the effect of the provision as drafted. Deliberately, there is nothing in the wording which imposes any duty in respect of or suggests that particular regard should he had to these general matters. Either would be a clear departure from the present position.
I am happy, however, to put on record that it is not the intention to alter the present ability of the Secretary of State or the Director-General of Telecommunications to have regard to the subject matter of the Telecommunications Act duties when, for example, the Director is exercising concurrent functions under the Fair Trading Act, and in particular not to alter that ability in a way which overrides or downplays any other relevant duty. It is the intention to make sure that both may continue to have regard to such subject matter, if it is relevant in the fulfilment of the function.
Moved, That the House do agree with the Commons in their Amendment No. 77.—(Lord Simon of Highbury.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
78 Schedule 10, Page 77, line 33, after ("function") insert ("; but that is not to be taken as implying that, in relation to any of the matters mentioned in subsection (3) or (3A) above, regard may not be had to any general matter.").
79 Page 77, line 33, at end insert—
("() Section 50 is amended as follows.").
80 Page 77, line 34, leave out ("In section 50").
81 Page 77, line 48, at end insert—
("() In subsection (4), omit paragraph (c) and the "and" immediately after it.").
82 Page 78, line 38, after ("(5)") insert ("—
(a)").
83 Page 78, line 39, at end insert—
("(b) after paragraph (b), insert "and";
(c) omit paragraph (d) and the "and" immediately before it.").
84 Page 79, line 38, at end insert—
("() In subsection (4), omit paragraph (c) and the "and" immediately after it.").
85 Page 80, line 33, at end insert—
("() In subsection (5), omit "or in subsection (3) above".
() In subsection (6), omit "or in subsection (3) above".").
86 Page 81, line 19, at end insert—
("() In subsection (4), omit paragraph (c) and the "and" immediately after it.").
87 Page 82, line 17, at end insert—
("() In paragraph (4), Omit sub-paragraph (c) and the "and" immediately after it.").
88 Page 83, line 5, after ("(4)") insert ("—
(a)").
89 Page 83, line 6. at end insert—
("(b) after sub-paragraph (b) insert "and";
(c) omit sub-paragraph (d) and the "and" immediately before it.").
90 Page 84, line 19, at end insert—
("() In section 95 (modification by orders under other enactments)—

(a) in subsection (1), omit "or section l0(2)(a) of the 1980 Act";

(b) in subsection (2)—

(i) after paragraph (a) insert "or";

(ii) omit paragraph (c) and the immediately before it;

(c) in subsection (3), omit "or the 1980 Act".").

Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 78 to 90.
These amendments were spoken to with Amendments Nos. 35 and 77.
Moved, That the House do agree with the Commons in their Amendments Nos. 78 to 90.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.
91 Schedule 10, page 89, leave out lines 9 and 10.
Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 91. I shall speak also to Amendments Nos. 92 and 94.
1390
Amendments Nos. 91 and 92 respond to a matter raised by the noble Lord, Lord McNally, on behalf of the noble Lord, Lord Ezra, at Report stage in this House. They deal with an interaction between the Bill and provisions in the Railways Act 1993. The amendments would preclude the Rail Regulator or the Director General of Fair Trading from requiring modifications to access agreements, to the extent that these are not already excluded as legal requirements, as a possible remedy for breach of the Chapter I prohibition.
This is a worthwhile clarification of the position and I am grateful to the noble Lord for raising this point. I should emphasise, however, that the amendment does not prevent action being taken against anti-competitive provisions in access agreements that are not the subject of a legal requirement. In such a case the parties would be in breach of a prohibition and would be exposed to penalties. Third parties would be able to seek damages and interim measures could also be applied.
Amendment No. 94 disapplies the Rail Regulator's statutory duties under the Channel Tunnel Rail Link Act 1996 when he is exercising concurrent functions under the Bill, in the same way that the utility regulators' statutory general duties have been disapplied from the exercise of the regulators' concurrent functions.
Moved, That the House do agree with the Commons in their Amendment No. 91.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
92 Schedule 10, page 89, leave out lines 12 to 24 and insert—
(""(6A) Neither the Director General of Fair Trading nor the Regulator may exercise, in respect of an access agreement, the powers given by section 33 (enforcement directions) or section 36(2) (interim directions) of the Competition Act 1998.
(6B) Subsection (6A) does not apply to the exercise of the powers given by section 36(2) in respect of conduct—

(a) which is connected with an access agreement; and

(b) in respect of which section 36(1)(b) of that Act applies.").

93 Page 89, line 33, at end insert—
("() Omit section 131 (modification of Restrictive Trade Practices Act 1976).").
94 Page 89, line 45, at end insert—
("() In section 21 (duties as to exercise of regulatory functions), in subsection (6), at the end of the paragraph about regulatory functions, insert "other than any functions assigned to him by virtue of section 67(3) of that Act ("Competition Act functions").
(7) The Regulator may, when exercising any Competition Act function, have regard to any matter to which he would have regard if—

(a) he were under the duty imposed by subsection (1) or (2) above in relation to that function; and

(b) the matter is one to which the DGFT could have regard if he were exercising that function.".").

Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 92 to 94.

1391
Moved, That the House do agree with the Commons in their Amendments Nos. 92 to 94.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.

COMMONS AMENDMENT
95 Schedule 11, page 92, line 38, at end insert—
("or the Broadcasting Act 1996 (c.55.);").
Lord Simon of Highbury: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 95. I shall speak also to Amendments Nos. 96, 97 and 98.
These are straightforward amendments to correct omissions in Schedule 11 to the Bill. Schedule 11 lists persons to whom and functions for which information obtained under the Bill may be disclosed. Amendment No. 97 adds to Schedule 11 the Independent Television Commission, and Amendment No. 95 adds the Broadcasting Act 1996, which contains the ITC's relevant functions. Amendment No. 98 adds to the schedule the Director of Passenger Rail Franchising and the International Rail Regulator. Amendment No. 96 adds the International Rail Regulator's relevant functions under subordinate legislation made for the purpose of implementing three EC directives on the development of the Community railways.
Moved, That the House do agree with the Commons in their Amendment No. 95.—(Lord Simon of Highbury.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
96 Schedule 11, page 92, line 47, at end insert—
("() any subordinate legislation made (whether before or after the passing of this Act) for the purpose of implementing the Council Directive of 29th July 1991 (No 91/440/EEC) on the development of the Community's railways, the Council Directive of 19th June 1995 (No 95/18/EC) on the licensing of railway undertakings or the Council Directive of 19th June 1995 (No 95/19/EC) on the allocation of railway infrastructure capacity and the charging of infrastructure fees;").
97 Page 93, line 4, at end insert—
("() the Independent Television Commission;").
98 Page 93, line 11, at end insert—
("() the Director of Passenger Rail Franchising;
() the International Rail Regulator;").
99 Schedule 12, page 93, line 32, at end insert—
("() In sections 35 and 37 to 41, for "the Restrictive Practices Court", in each place, substitute "a relevant Court".
() After section 41 insert
"Meaning of "relevant Court".
41A. In this Part of this Act, "relevant Court", in relation to proceedings in respect of a course of conduct maintained in the course of a business, means any of the following courts in whose jurisdiction that business is carried on—

(a) in England and Wales or Northern Ireland, the High Court;

(b) in Scotland, the Court of Session.".

() In section 42 (appeals from decisions or orders of courts under Part III)—

(a) in subsection (1), at the end add "; but this subsection is subject to subsection (3) of this section";

(b) in subsection (2)(b), after "Scotland," insert "from the sheriff court"; and

(c) after subsection (2) add—

"(3) A decision or order of the Court of Session as the relevant Court may be reviewed, whether on a question of fact or on a question of law, by reclaiming to the Inner House." ").
100 Page 94, line 4, at end insert—
("() In section 85, in subsection (1)(c), after "estimates" (in both places) insert "forecasts".").
101 Page 95, line 21, after ("estimates") insert ("forecasts").
102 Page 95, line 25, after ("estimates") insert ("forecasts").
103 Page 96, line 4, at end insert—
("() Omit section 22 (which amends the Fair Trading Act 1973).").
104 After Schedule 12, insert the following new schedule—

SCHEDULE
  TRANSITIONAL PROVISIONS AND SAVINGS
    PART I

      GENERAL
      Interpretation
      1.—(1) In this Schedule—

      "RPA" means the Resale Prices Act 1976;

      "RTPA" means the Restrictive Trade Practices Act 1976;

      "continuing proceedings" has the meaning given by paragraph 15;

      "the Court" means the Restrictive Practices Court;

      "enactment date" means the date on which this Act is passed;

      "Director" means the Director General of Fair Trading;

      "document" includes information recorded in any form;

      "information" includes estimates and forecasts;

      "interim period" means the period beginning on the enactment date and ending immediately before the starting date;

      "prescribed" means prescribed by an order made by the Secretary of State;

      "regulator" means any person mentioned in paragraphs (a) to (g) of paragraph 1 of Schedule 10;

      "starting date" means the date on which section 2 comes into force;

      "transitional period" means the transitional period provided for in Chapters III and IV of Part IV of this Schedule.

      (2) Sections 31, 45, 51, 53, 55, 56, 57 and 59(2) and (3) and paragraph 12 of Schedule 9 ("the applied provisions") apply for the purposes of this Schedule as they apply for the purposes of Part I of this Act.
      (3) Section 2(5) applies for the purposes of any provisions of this Schedule which are concerned with the operation of the Chapter I prohibition as it applies for the purposes of Part I of this Act.
      (4) In relation to any of the matters in respect of which a regulator may exercise powers as a result of paragraph 35(l), the applied provisions are to have effect as if references to the Director included references to the regulator.
      (5) The fact that to a limited extent the Chapter I prohibition does not apply to an agreement because a transitional period is provided by virtue of this Schedule does not require those provisions of the agreement in respect of which there is a transitional period to be disregarded when considering whether the agreement infringes the prohibition for other reasons.
      General power to make transitional provision and savings
      2.—(1) Nothing in this Schedule affects the power of the Secretary of State under section 74 to make transitional provisions or savings.
      (2) An order under that section may modify any provision made by this Schedule.
      Advice and information
      3.—(1) The Director may publish advice and information explaining provisions of this Schedule to persons who are likely to be affected by them.
      (2) Any advice or information published by the Director under this paragraph is to be published in such form and manner as he considers appropriate.

    PART II

      DURING THE INTERIM PERIOD
      Block exemptions
      4.—(1) The Secretary of State may, at any time during the interim period, make one or more orders for the purpose of providing block exemptions which are effective on the starting date.
      (2) An order under this paragraph has effect as if properly made under section 6.
      Certain agreements to be non-notifiable agreements
      5. An agreement which—

      (a) is made during the interim period, and

      (b) satisfies the conditions set out in paragraphs (a), (c) and (d) of section 27A(1) of the RTPA,

      is to be treated as a non-notifiable agreement for the purposes of the RTPA.
      Application of RTPA during the interim period
      6. In relation to agreements made during the interim period—

      (a) the Director is no longer under the duty to take proceedings imposed by section 1(2)(c) of the RTPA but may continue to do so;

      (b) section 21 of that Act has effect as if subsections (1) and (2) were omitted; and

      (c) section 35(1) of that Act has effect as if the words "or within such further time as the Director may, upon application made within that time, allow" were omitted.

      Guidance
      7.—(1) Sub-paragraphs (2) to (4) apply in relation to agreements made during the interim period.
      (2) An application may be made to the Director in anticipation of the coming into force of section 13 in accordance with directions given by the Director and such an application is to have effect on and after the starting date as if properly made under section 13.
      (3) The Director may, in response to such an application—

      (a) give guidance in anticipation of the coming into force of section 2; or

      (b) on and after the starting date, give guidance under section 15 as if the application had been properly made under section 13.

      (4) Any guidance so given is to have effect on and after the starting date as if properly given under section 15.

    PART III

      ON THE STARTING DATE
      Applications which fall
      8.—(l) Proceedings in respect of an application which is made to the Court under any of the provisions mentioned in sub-paragraph (2), but which is not determined before the starting date, cease on that date.
      (2) The provisions are—

      (a) sections 2(2), 35(3), 37(1) and 40(1) of the RTPA and paragraph 5 of Schedule 4 to that Act;

      (b) section 4(1) of the RTPA so far as the application relates to an order under section 2(2) of that Act; and

      (c) section 25(2) of the RPA.

      (3) The power of the Court to make an order for costs in relation to any proceedings is not affected by anything in this paragraph or by the repeals made by section 1.
      Orders and approvals which fall
      9.—(1) An order in force immediately before the starting date under—

      (a) section 2(2), 29(1), 30(1), 33(4), 35(3) or 37(1) of the RTPA; or

      (b) section 25(2) of the RPA,

      ceases to have effect on that date.
      (2) An approval in force immediately before the starting date under section 32 of the RTPA ceases to have effect on that date.

PART IV
  ON AND AFTER THE STARTING DATE
    CHAPTER I

      GENERAL
      Duty of Director to maintain register etc.
      10.—(1) This paragraph applies even though the relevant provisions of the RTPA are repealed by this Act.
      (2) The Director is to continue on and after the starting date to be under the duty imposed by section 1(2)(a) of the RTPA to maintain a register in respect of agreements—

      (a) particulars of which arc, on the starting date, entered or filed on the register;

      (b) which fall within sub-paragraph (4);

      (c) which immediately before the starting date are the subject of proceedings under the RTPA which do not cease on that date by virtue of this Schedule; or

      (d) in relation to which a court gives directions to the Director after the starting date in the course of proceedings in which a question arises as to whether an agreement was, before that date—

      (i) one to which the RTPA applied;

      (ii) subject to registration under that Act;

      (iii) a non-notifiable agreement for the purposes of that Act.

      (3) The Director is to continue on and after the starting date to be under the duties imposed by section 1(2)(a) and (b) of the RTPA of compiling a register of agreements and entering or filing certain particulars in the register, but only in respect of agreements of a kind referred to in paragraph (b),(c)or(d) of sub-paragraph (2).
      (4) An agreement falls within this sub-paragraph if—

      (a) it is subject to registration under the RTPA but—

      (i) is not a non-notifiable agreement within the meaning of section 27A of the RTPA, or

      (ii) is not one to which paragraph 5 applies;

      (b) particulars of the agreement have been provided to the Director before the starting date; and

      (c) as at the starting date no entry or filing has been made in the register in respect of the agreement.

      (5) Sections 23 and 27 of the RTPA are to apply after the starting date in respect of the register subject to such modifications, if any, as may be prescribed.
      (6) In sub-paragraph (2)(d) "court" means—

      (a) the High Court;

      (b) the Court of Appeal;

      (c) the Court of Session;

      (d) the High Court or Court of Appeal in Northern Ireland; or

      (e) the House of Lords.

      RTPA section 3 applications
      11.—(1) Even though section 3 of the RTPA is repealed by this Act, its provisions (and so far as necessary that Act) are to continue to apply, with such modifications (if any) as may be prescribed—

      (a) in relation to a continuing application under that section; or

      (b) so as to allow an application to be made under that section on or after the starting date in respect of a continuing application under section 1(3) of the RTPA.

      (2) "Continuing application" means an application made, but not determined, before the starting date.
      RTPA section 26 applications
      12.—(1) Even though section 26 of the RTPA is repealed by this Act, its provisions (and so far as necessary that Act) are to continue to apply, with such modifications (if any) as may be prescribed, in relation to an application which is made under that section, but not determined, before the starting date.
      (2) If an application under section 26 is determined on or after the starting date, this Schedule has effect in relation to the agreement concerned as if the application had been determined immediately before that date.
      Right to bring civil proceedings
      13.—(1) Even though section 35 of the RTPA is repealed by this Act, its provisions (and so far as necessary that Act) are to continue to apply in respect of a person who, immediately before the starting date, has a right by virtue of section 27ZA or 35(2) of that Act to bring civil proceedings in respect of an agreement (but only so far as that right relates to any period before the starting date or, where there are continuing proceedings, the determination of the proceedings).
      (2) Even though section 25 of the RPA is repealed by this Act, the provisions of that section (and so far as necessary that Act) are to continue to apply in respect of a person who, immediately before the starting date, has a right by virtue of subsection (3) of that section to bring civil proceedings (but
      1396
      only so far as that right relates to any period before the starting date or, where there are continuing proceedings, the determination of the proceedings).

    CHAPTER II

      CONTINUING PROCEEDINGS
      The general rule
      14.—(l) The Chapter I prohibition does not apply to an agreement at any time when the agreement is the subject of continuing proceedings under the RTPA.
      (2) The Chapter I prohibition does not apply to an agreement relating to goods which are the subject of continuing proceedings under section 16 or 17 of the RPA to the extent to which the agreement consists of exempt provisions.
      (3) In sub-paragraph (2) "exempt provisions" means those provisions of the agreement which would, disregarding section 14 of the RPA, be—

      (a) void as a result of section 9(1) of the RPA; or

      (b) unlawful as a result of section 9(2) or 11 of the RPA.

      (4) If the Chapter I prohibition does not apply to an agreement because of this paragraph, the provisions of, or made under, the RTPA or the RPA are to continue to have effect in relation to the agreement.
      (5) The repeals made by section 1 do not affect—

      (a) continuing proceedings; or

      (b) proceedings of the kind referred to in paragraph 11 or 12 of this Schedule which are continuing after the starting date.

      Meaning of "continuing proceedings"
      15.—(l) For the purposes of this Schedule "continuing proceedings" means proceedings in respect of an application made to the Court under the RTPA or the RPA, but not determined, before the starting date.
      (2) But proceedings under section 3 or 26 of the RTPA to which paragraph 11 or 12 applies are not continuing proceedings.
      (3) The question whether (for the purposes of Part III, or this Part, of this Schedule) an application has been determined is to be decided in accordance with sub-paragraphs (4) and (5).
      (4) If an appeal against the decision on the application is brought, the application is not determined until—

      (a) the appeal is disposed of or withdrawn; or

      (b) if as a result of the appeal the case is referred back to the Court—

      (i) the expiry of the period within which an appeal ("the further appeal") in respect of the Court's decision on that reference could have been brought had this Act not been passed; or

      (ii) if later, the date on which the further appeal is disposed of or withdrawn.

      (5) Otherwise, the application is not determined until the expiry of the period within which any party to the application would have been able to bring an appeal against the decision on the application had this Act not been passed.
      RTPA section 4 proceedings
      16. Proceedings on an application for an order under section 4 of the RTPA are also continuing proceedings if—

      (a) leave to make the application is applied for before the starting date but the proceedings in respect of

      1397
      that application for leave are not determined before that date; or

      (b) leave to make an application for an order under that section is granted before the starting date but the application itself is not made before that date.

      RPA section 16 or 17 proceedings
      17. Proceedings on an application for an order under section 16 or 17 of the RPA are also continuing proceedings if—

      (a) leave to make the application is applied for before the starting date but the proceedings in respect of that application for leave are not determined before that date; or

      (b) leave to make an application for an order under section 16 or 17 of the RPA is granted before the starting date, but the application itself is not made before that date.

      Continuing proceedings which are discontinued
      18.—(1) On an application made jointly to the Court by all the parties to any continuing proceedings, the Court must, if it is satisfied that the parties wish it to do so, discontinue the proceedings.
      (2) If, on an application under sub-paragraph (1) or for any other reason, the Court orders the proceedings to be discontinued, this Schedule has effect (subject to paragraphs 21 and 22) from the date on which the proceedings are discontinued as if they had never been instituted.

    CHAPTER III

      THE TRANSITIONAL PERIOD
      The general rule
      19.—(1) Except where this Chapter or Chapter IV provides otherwise, there is a transitional period, beginning on the starting date and lasting for one year, for any agreement made before the starting date.
      (2) The Chapter I prohibition does not apply to an agreement to the extent to which there is a transitional period for the agreement.
      (3) The Secretary of State may by regulations provide for sections 13 to 16 and Schedule 5 to apply with such modifications (if any) as may be specified in the regulations, in respect of applications to the Director about agreements for which there is a transitional period.
      Cases for which there is no transitional period
      20.—(1) There is no transitional period for an agreement to the extent to which, immediately before the starting date, it is—

      (a) void under section 2(1) or 35(1)(a) of the RTPA;

      (b) the subject of an order under section 2(2) or 35(3) of the RTPA; or

      (c) unlawful under section I, 2 or 11 of the RPA or void under section 9 of that Act.

      (2) There is no transitional period for an agreement to the extent to which, before the starting date, a person has acted unlawfully for the purposes of section 27ZA(2) or (3) of the RTPA in respect of the agreement.
      (3) There is no transitional period for an agreement to which paragraph 25(4) applies.
      (4) There is no transitional period for—

      (a) an agreement in respect of which there are continuing proceedings, or

      (b) an agreement relating to goods in respect of which there are continuing proceedings,

      to the extent to which the agreement is, when the proceedings are determined, void or unlawful.
      Continuing proceedings under the RTPA
      21. In the case of an agreement which is the subject of continuing proceedings under the RTPA, the transitional period begins—

      (a) if the proceedings are discontinued, on the date of discontinuance;

      (b) otherwise, when the proceedings are determined.

      Continuing proceedings under the RPA
      22.—(1) In the case of an agreement relating to goods which are the subject of continuing proceedings under the RPA, the transitional period for the exempt provisions of the agreement begins—

      (a) if the proceedings are discontinued, on the date of discontinuance;

      (b) otherwise, when the proceedings are determined.

      (2) In sub-paragraph (I) "exempt provisions" has the meaning given by paragraph 14(3).
      Provisions not contrary to public interest
      23.—(1) To the extent to which an agreement contains provisions which, immediately before the starting date, are provisions which the Court has found not to be contrary to the public interest, the transitional period lasts for five years.
      (2) Sub-paragraph (1) is subject to paragraph 20(4).
      (3) To the extent to which an agreement which on the starting date is the subject of continuing proceedings is, when the proceedings are determined, found by the Court not to be contrary to the public interest, the transitional period lasts for five years.
      Goods
      24.—(1) In the case of an agreement relating to goods which, immediately before the starting date, are exempt under section 14 of the RPA, there is a transitional period for the agreement to the extent to which it consists of exempt provisions.
      (2) Sub-paragraph (1) is subject to paragraph 20(4).
      (3) In the case of an agreement relating to goods—

      (a) which on the starting date are the subject of continuing proceedings, and

      (b) which, when the proceedings are determined, are found to be exempt under section 14 of the RPA,

      there is a transitional period for the agreement, to the extent to which it consists of exempt provisions.
      (4) In each case, the transitional period lasts for five years.
      (5) In sub-paragraphs (1) and (3) "exempt provisions" means those provisions of the agreement which would, disregarding section 14 of the RPA, be—

      (a) void as a result of section 9(1) of the RPA; or

      (b) unlawful as a result of section 9(2) or 11 of the RPA.

      Transitional period for certain agreements
      25.—(1) This paragraph applies to agreements—

      (a) which are subject to registration under the RTPA but which—

      (i) are not non-notifiable agreements within the meaning of section 27A of the RTPA, or

      (ii) are not agreements to which paragraph 5 applies; and

      (b) in respect of which the time for furnishing relevant particulars as required by or under the RTPA expires on or after the starting date.

      (2) "Relevant particulars" means—

      (a) particulars which are required to be furnished by virtue of section 24 of the RTPA; or

      (b) particulars of any variation of an agreement which are required to be furnished by virtue of sections 24 and 27 of the RTPA.

      (3) There is a transitional period of one year for an agreement to which this paragraph applies if—

      (a) relevant particulars are furnished before the starting date; and

      (b) no person has acted unlawfully (for the purposes of section 27ZA(2) or (3) of the RTPA) in respect of the agreement.

      (4) If relevant particulars are not furnished by the starting date, section 35(1)(a) of the RTPA does not apply in relation to the agreement (unless sub-paragraph (5) applies).
      (5) This sub-paragraph applies if a person falling within section 27ZA(2) or (3) of the RTPA has acted unlawfully for the purposes of those subsections in respect of the agreement.
      Special cases
      26.—(1) In the case of an agreement in respect of which—

      (a) a direction under section 127(2) of the Financial Services Act 1986 ("the 1986 Act") is in force immediately before the starting date, or

      (b) a direction under section 194A(3) of the Broadcasting Act 1990 ("the 1990 Act") is in force immediately before the starting date,

      the transitional period lasts for five years.
      (2) To the extent to which an agreement is the subject of a declaration—

      (a) made by the Treasury under section 127(3) of the 1986 Act, and

      (b) in force immediately before the starting date,

      the transitional period lasts for five years.
      (3) Sub-paragraphs (1) and (2) do not affect the power of—

      (a) the Treasury to make a declaration under section 127(2) of the 1986 Act (as amended by Schedule 2 to this Act),

      (b) the Secretary of State to make a declaration under section 194A of the 1990 Act (as amended by Schedule 2 to this Act),

      in respect of an agreement for which there is a transitional period.

    CHAPTER IV

      THE UTILITIES
      General
      27. In this Chapter "the relevant period" means the period beginning with the starting date and ending immediately before the fifth anniversary of that date.
      Electricity
      28.—(1) For an agreement to which, immediately before the starting date, the RTPA does not apply by virtue of a section 100 order, there is a transitional period—

      (a) beginning on the starting date, and

      (b) ending at the end of the relevant period.

      (2) For an agreement which is made at any time after the starting date and to which, had the RTPA not been repealed, that Act would not at the time at which the agreement is made have applied by virtue of a section 100 order, there is a transitional period—

      (a) beginning on the date on which the agreement is made; and

      (b) ending at the end of the relevant period.

      (3) For an agreement (whether made before or after the starting date) which, during the relevant period, is varied at any time in such a way that it becomes an agreement which, had the RTPA not been repealed, would at that time have been one to which that Act did not apply by virtue of a section 100 order, there is a transitional period—

      (a) beginning on the date on which the variation is made; and

      (b) ending at the end of the relevant period.

      (4) If an agreement for which there is a transitional period as a result of sub-paragraph (1),(2)or(3) is varied during the relevant period, the transitional period for the agreement continues if, had the RTPA not been repealed. the agreement would have continued to be one to which that Act did not apply by virtue of a section 100 order.
      (5) But if an agreement for which there is a transitional period as a result of sub-paragraph(1),(2)or(3) ceases to be one to which, had it not been repealed, the RTPA would not have applied by virtue of a section 100 order, the transitional period ends on the date on which the agreement so ceases.
      (6) Sub-paragraph (3) is subject to paragraph 20.
      (7) In this paragraph and paragraph 29—
      "section 100 order" means an order made under section 100 of the Electricity Act 1989; and
      expressions which are also used in Part I of the Electricity Act 1989 have the same meaning as in that Part.
      Electricity: power to make transitional orders
      29.—(1) There is a transitional period for an agreement (whether made before or after the starting date) relating to the generation, transmission or supply of electricity which—

      (a) is specified, or is of a description specified, in an order ("a transitional order") made by the Secretary of State (whether before or after the making of the agreement but before the end of the relevant period); and

      (b) satisfies such conditions as may be specified in the order.

      (2) A transitional order may make provision as to when the transitional period in respect of such an agreement is to start or to be deemed to have started.
      (3) The transitional period for such an agreement ends at the end of the relevant period.
      (4) But if the agreement—

      (a) ceases to be one to which a transitional order applies, or

      (b) ceases to satisfy one or more of the conditions specified in the transitional order,

      the transitional period ends on the date on which the agreement so ceases.
      (5) Before making a transitional order, the Secretary of State must consult the Director General of Electricity Supply and the Director.
      (6) The conditions specified in a transitional order may include conditions which refer any matter to the Secretary of State for determination after such consultation as may be so specified.
      (7) In the application of this paragraph to Northern Ireland, the reference in sub-paragraph (5) to the Director General of Electricity Supply is to be read as a reference to the Director General of Electricity Supply for Northern Ireland.
      Gas
      30.—(1) For an agreement to which, immediately before the starting date, the RTPA does not apply by virtue of section 62 or a section 62 order, there is a transitional period—

      (a) beginning on the starting date, and

      (b) ending at the end of the relevant period.

      (2) For an agreement which is made at any time after the starting date and to which, had the RTPA not been repealed, that Act would not at the time at which the agreement is made have applied by virtue of section 62 or a section 62 order, there is a transitional period—

      (a) beginning on the date on which the agreement is made; and

      (b) ending at the end of the relevant period.

      (3) For an agreement (whether made before or after the starting date) which, during the relevant period, is varied at any time in such a way that it becomes an agreement which, had the RTPA not been repealed, would at that time have been one to which that Act did not apply by virtue of section 62 or a section 62 order, there is a transitional period—

      (a) beginning on the date on which the variation is made; and

      (b) ending at the end of the relevant period.

      (4) If an agreement for which there is a transitional period as a result of sub-paragraph (1), (2) or (3) is varied during the relevant period, the transitional period for the agreement continues if, had the RTPA not been repealed, the agreement would have continued to be one to which that Act did not apply by virtue of section 62 or a section 62 order.
      (5) But if an agreement for which there is a transitional period as a result of sub-paragraph (1), (2) or (3) ceases to be one to which, had it not been repealed, the RTPA would not have applied by virtue of section 62 or a section 62 order, the transitional period ends on the date on which the agreement so ceases.
      (6) Sub-paragraph (3) also applies in relation to a modification which is treated as an agreement made on or after 28th November 1985 by virtue of section 62(4).
      (7) Sub-paragraph (3) is subject to paragraph 20.
      (8) In this paragraph and paragraph 31—
      "section 62" means section 62 of the Gas Act 1986;
      "section 62 order" means an order made under section 62.
      Gas: power to make transitional orders
      31.—(1) There is a transitional period for an agreement of a description falling within section 62(2)(a) and (b) or section 62(2A)(a) and (b) which—

      (a) is specified, or is of a description specified, in an order ("a transitional order") made by the Secretary of State (whether before or after the making of the agreement but before the end of the relevant period); and

      (b) satisfies such conditions as may be specified in the order.

      (2) A transitional order may make provision as to when the transitional period in respect of such an agreement is to start or to be deemed to have started.
      (3) The transitional period for such an agreement ends at the end of the relevant period.
      (4) But if the agreement—

      (a) ceases to be one to which a transitional order applies, or

      (b) ceases to satisfy one or more of the conditions specified in the transitional order,

      the transitional period ends on the date when the agreement so ceases.
      (5) Before making a transitional order, the Secretary of State must consult the Director General of Gas Supply and the Director.
      (6) The conditions specified in a transitional order may include—

      (a) conditions which are to be satisfied in relation to a time before the coming into force of this paragraph;

      (b) conditions which refer any matter (which may be the general question whether the Chapter 1 prohibition should apply to a particular agreement) to the Secretary of State, the Director or the Director General of Gas Supply for determination after such consultation as may be so specified.

      Gas: Northern Ireland
      32.—(1) For an agreement to which, immediately before the starting date, the RTPA does not apply by virtue of an Article 41 order, there is a transitional period—

      (a) beginning on the starting date, and

      (b) ending at the end of the relevant period.

      (2) For an agreement which is made at any time after the starting dale and to which, had the RTPA not been repealed, that Act would not at the time at which the agreement is made have applied by virtue of an Article 41 order, there is a transitional period—

      (a) beginning on the date on which the agreement is made; and

      (b) ending at the end of the relevant period.

      (3) For an agreement (whether made before or after the starting date) which, during the relevant period, is varied at any time in such a way that it becomes an agreement which, had the RTPA not been repealed. would at that time have been one to which that Act did not apply by virtue of an Article 41 order. there is a transitional period—

      (a) beginning on the date on which the variation is made; and

      (b) ending at the end of the relevant period.

      (4) If an agreement for which there is a transitional period as a result of sub-paragraph (1),(2)or(3) is varied during the relevant period, the transitional period for the agreement continues if, had the RTPA not been repealed, the agreement would have continued to be one to which that Act did not apply by virtue of an Article 41 order.
      (5) But if an agreement for which there is a transitional period as a result of sub-paragraph(1),(2)or(3)ceases to be one to which, had it not been repealed, the RTPA would not have applied by virtue of an Article 41 order, the transitional period ends on the date on which the agreement so ceases.
      (6) Sub-paragraph (3) is subject to paragraph 20.
      (7) In this paragraph and paragraph 33—
      "Article 41 order" means an order under Article 41 of the Gas (Northern Ireland) Order 1996;
      "Department" means the Department of Economic Development.
      Gas: Northern Ireland - power to make transitional orders
      33.—(1) There is a transitional period for an agreement of a description falling within Article 41(1) which—

      (a) is specified, or is of a description specified, in an order ("a transitional order") made by the Department (whether before or after the making of the agreement but before the end of the relevant period); and

      (b) satisfies such conditions as may be specified in the order.

      (2) A transitional order may make provision as to when the transitional period in respect of such an agreement is to start or to be deemed to have started.
      (3) The transitional period for such an agreement ends at the end of the relevant period.
      (4) But if the agreement—

      (a) ceases to be one to which a transitional order applies, or

      (b) ceases to satisfy one or more of the conditions specified in the transitional order,

      the transitional period ends on the date when the agreement so ceases.
      (5) Before making a transitional order, the Department must consult the Director General of Gas for Northern Ireland and the Director.
      (6) The conditions specified in a transitional order may include conditions which refer any matter (which may be the general question whether the Chapter I prohibition should apply to a particular agreement) to the Department for determination after such consultation as may be so specified.
      Railways
      34.—(1) In this paragraph—
      "section 131" means section 131 of the Railways Act 1993 ("the 1993 Act");
      "section 131 agreement" means an agreement—

      (i) to which the RTPA does not apply immediately before the starting date by virtue of section 131(1); or

      (ii) in respect of which a direction under section 131(3) is in force immediately before that date;

      "non-exempt agreement" means an agreement relating to the provision of railway services (whether made before or after the starting date) which is not a section 131 agreement; and
      "railway services" has the meaning given by section 82 of the 1993 Act.
      (2) For a section 131 agreement there is a transitional period of five years.
      (3) There is a transitional period for a non-exempt agreement to the extent to which the agreement is at any time before the end of the relevant period required or approved—

      (a) by the Secretary of State or the Rail Regulator in pursuance of any function assigned or transferred to him under or by virtue of any provision of the 1993 Act;

      (b) by or under any agreement the making of which is required or approved by the Secretary of State or the Rail Regulator in the exercise of any such function; or

      (c) by or under a licence granted under Part I of the 1993 Act.

      (4) The transitional period conferred by sub-paragraph (3)—

      (a) is to be taken to have begun on the starting date; and

      (b) ends at the end of the relevant period.

      (5) Sub-paragraph(3)is subject to paragraph 20.
      (6) Any variation of a section 131 agreement on or after the starting date is to be treated, for the purposes of this paragraph, as a separate non-exempt agreement.
      The regulators
      35.—(1) Subject to sub-paragraph (3), each of the regulators may exercise, in respect of sectoral matters and concurrently with the Director, the functions of the Director under paragraph 3. 7. 19(3), 36, 37, 38 or 39.
      (2) In sub-paragraph(1)"sectoral matters" means—

      (a) in the case of the Director General of Telecommunications, the matters referred to in section 50(3) of the Telecommunications Act 1984;

      (b) in the case of the Director General of Gas Supply, the matters referred to in section 36A(3) and (4) of the Gas Act 1986;

      (c) in the case of the Director General of Electricity Supply, the matters referred to in section 43(3) of the Electricity Act 1989;

      (d) in the case of the Director General of Electricity Supply for Northern Ireland, the matters referred to in Article 46(3) of the Electricity (Northern Ireland) Order 1992;

      (e) in the case of the Director General of Water Services, the matters referred to in section 31(3) of the Water Industry Act 1991;

      (f) in the case of the Rail Regulator, the matters referred to in section 67(3) of the Railways Act 1993;

      (g) in the case of the Director General of Gas for Northern Ireland, the matters referred to in Article 23(3) of the Gas (Northern Ireland) Order 1996.

      (3) The power to give directions in paragraph 7(2) is exercisable by the Director only but if the Director is preparing directions which relate to a matter in respect of which a regulator exercises concurrent jurisdiction, he must consult that regulator.
      (4) Consultations conducted by the Director before the enactment date, with a view to preparing directions which have effect on or after that date, are to be taken to satisfy sub-paragraph (3).
      (5) References to enactments in sub-paragraph (2) are to the enactments as amended by or under this Act.

    CHAPTER V

      EXTENDING THE TRANSITIONAL PERIOD
      36.—(1) A party to an agreement for which there is a transitional period may apply to the Director, not less than three months before the end of the period, for the period to be extended.
      (2) The Director may (on his own initiative or on an application under sub-paragraph (1))—

      (a) extend a one-year transitional period by not more than twelve months;

      (b) extend a transitional period of any period other than one year by not more than six months.

      (3) An application under sub-paragraph (1) must—

      (a) be in such form as may be specified; and

      (b) include such documents and information as may be specified.

      (4) If the Director extends the transitional period under this paragraph, he must give notice in such form, and to such persons, as may be specified.
      (5) The Director may not extend a transitional period more than once.
      (6) In this paragraph—
      "person" has the same meaning as in Part I; and
      "specified" means specified in rules made by the Director under section 51.

    CHAPTER VI

      TERMINATING THE TRANSITIONAL PERIOD
      General
      37.—(1) Subject to sub-paragraph (2), the Director may by a direction in writing terminate the transitional period for an agreement, but only in accordance with paragraph 38.
      (2) The Director may not terminate the transitional period, nor exercise any of the powers in paragraph 38, in respect of an agreement which is excluded from the Chapter I prohibition by virtue of any of the provisions of Part I of this Act other than paragraph 1 of Schedule 1 or paragraph 2 or 9 of Schedule 3.
      Circumstances in which the Director may terminate the transitional period
      38.—(1) If the Director is considering whether to give a direction under paragraph 37 ("a direction"), he may in writing require any party to the agreement concerned to give him such information in connection with that agreement as he may require.
      (2) If at the end of such period as may be specified in rules made under section 51, a person has failed, without reasonable excuse, to comply with a requirement imposed under sub-paragraph (1), the Director may give a direction.
      (3) The Director may also give a direction if he considers—

      (a) that the agreement would, but for the transitional period or a relevant exclusion, infringe the Chapter I prohibition; and

      (b) that he would not be likely to grant the agreement an unconditional individual exemption.

      (4) For the purposes of sub-paragraph (3) an individual exemption is unconditional if no conditions or obligations are imposed in respect of it under section 4(3)(a).
      (5) In this paragraph—
      "person" has the same meaning as in Part I;
      "relevant exclusion" means an exclusion under paragraph 1 of Schedule 1 or paragraph 2 or 9 of Schedule 3.
      Procedural requirements on giving a paragraph 37 direction
      39.—(1) The Director must specify in a direction under paragraph 37 ("a direction") the date on which it is to have effect (which must not be less than 28 days after the direction is given).
      (2) Copies of the direction must be given to—

      (a) each of the parties concerned, and

      (b) the Secretary of State,

      not less than 28 days before the date on which the direction is to have effect.
      (3) In relation to an agreement to which a direction applies, the transitional period (if it has not already ended) ends on the date specified in the direction unless, before that date, the direction is revoked by the Director or the Secretary of State.
      (4) If a direction is revoked, the Director may give a further direction in respect of the same agreement only if he is satisfied that there has been a material change of circumstance since the revocation.
      (5) If, as a result of paragraph 24(1)or(3), there is a transitional period in respect of provisions of an agreement relating to goods—

      (a) which immediately before the starting date are exempt under section 14 of the RPA, or

      1406

      (b) which, when continuing proceedings are determined, are found to be exempt under section 14 of the RPA,

      the period is not affected by paragraph 37 or 38.

    PART V

      THE FAIR TRADING ACT 1973 (c. 41.)
      References to the Monopolies and Mergers Commission
      40.—(1) If, on the date on which the repeal by this Act of a provision mentioned in sub-paragraph (2) comes into force, the Monopolies and Mergers Commission has not completed a reference which was made to it before that date, continued consideration of the reference may include consideration of a question which could not have been considered if the provision had not been repealed.
      (2) The provisions are—

      (a) sections 10(2), 54(5) and 78(3) and paragraph 3(1) and (2) of Schedule 8 to the Fair Trading Act 1973 (c. 41),

      (b) section 11(8)(b) of the Competition Act 1980 (c. 21),

      (c) section 14(2) of the Telecommunications Act 1984 (c. 12),

      (d) section 45(3) of the Airports Act 1986 (c. 31),

      (e) section 25(2) of the Gas Act 1986 (c. 44),

      (f) section 13(2) of the Electricity Act 1989 (c. 29),

      (g) section 15(2) of the Water Industry Act 1991 (c. 56),

      (h) article 16(2) of the Electricity (Northern Ireland) Order 1992,

      (i) section 14(2) of the Railways Act 1993 (c. 43),

      (j) article 36(3) of the Airports (Northern Ireland) Order 1994;

      (k) article 16(2) of the Gas (Northern Ireland) Order 1996.

      Orders under Schedule 8
      41.—(1) In this paragraph—
      "the 1973 Act" means the Fair Trading Act 1973;
      "agreement" means an agreement entered into before the date on which the repeal of the limiting provisions comes into force;
      "the order" means an order under section 56 or 73 of the 1973 Act;
      "the limiting provisions" means sub-paragraph (1) or (2) of paragraph 3 of Schedule 8 to the 1973 Act (limit on power to make orders under paragraph I or 2 of that Schedule) and includes any provision of the order included because of either of those sub-paragraphs; and
      "transitional period" means the period which—

      (a) begins on the day on which the repeal of the limiting provisions comes into force; and

      (b) ends on the first anniversary of the starting date.

      (2) Sub-paragraph (3) applies to any agreement to the extent to which it would have been unlawful (in accordance with the provisions of the order) but for the limiting provisions.
      (3) As from the end of the transitional period, the order is to have effect in relation to the agreement as if the limiting provisions had never had effect.
      Part III of the Act
      42.—(1) The repeals made by section 1 do not affect any proceedings in respect of an application which is made to the Court under Part III of the Fair Trading Act 1973, but is not determined, before the starting date.
      (2) The question whether (for the purposes of sub-paragraph (1)) an application has been determined is to be decided in accordance with sub-paragraphs (3) and (4).
      (3) If an appeal against the decision on the application is brought, the application is not determined until—

      (a) the appeal is disposed of or withdrawn; or

      (b) if as a result of the appeal the case is referred back to the Court—

      (i) the expiry of the period within which an appeal ("the further appeal") in respect of the Court's decision on that reference could have been brought had this Act not been passed; or

      (ii) if later, the date on which the further appeal is disposed of or withdrawn.

      (4) Otherwise, the application is not determined until the expiry of the period within which any party to the application would have been able to bring an appeal against the decision on the application had this Act not been passed.
      (5) Any amendment made by Schedule 12 to this Act which substitutes references to a relevant Court for references to the Court is not to affect proceedings of the kind referred to in sub-paragraph(1).

    PART VI

      THE COMPETITION ACT 1980 (C. 21.)
      Undertakings
      43.—(1) Subject to sub-paragraph (2), an undertaking accepted by the Director under section 4 or 9 of the Competition Act 1980 ceases to have effect on the coming into force of the repeal by this Act of that section.
      (2) If the undertaking relates to an agreement which on the starting date is the subject of continuing proceedings, the undertaking continues to have effect for the purposes of section 29 of the Competition Act 1980 until the proceedings are determined.
      Application of sections 25 and 26
      44. The repeals made by section 1 do not affect—

      (a) the operation of section 25 of the Competition Act 1980 in relation to an application under section 1(3) of the RTPA which is made before the starting date;

      (b) an application under section 26 of the Competition Act 1980 which is made before the starting date.

    PART VII

      MISCELLANEOUS
      Disclosure of information
      45.—(1) Section 55 of this Act applies in relation to information which, immediately before the starting date, is subject to section 41 of the RTPA as it applies in relation to information obtained under or as a result of Part I.
      (2) But section 55 does not apply to any disclosure of information of the kind referred to in sub-paragraph (1) if the disclosure is made—

      (a) for the purpose of facilitating the performance of functions of a designated person under the Control of Misleading Advertisements Regulations 1988; or

      (b) for the purposes of any proceedings before the Court or of any other legal proceedings under the RTPA or the Fair Trading Act 1973 or the Control of Misleading Advertisements Regulations 1988.

      (3) Section 56 applies in relation to information of the kind referred to in sub-paragraph (1) if particulars containing the information have been entered or filed on the special section of the register maintained by the Director under, or as a result of, section 27 of the RTPA or paragraph 10 of this Schedule.
      (4) Section 55 has effect, in relation to the matters as to which section 41(2) of the RTPA had effect, as if it contained a provision similar to section 41(2).
      The Court
      46. If it appears to the Lord Chancellor that a person who ceases to be a non-judicial member of the Court as a result of this Act should receive compensation for loss of office, he may pay to him out of moneys provided by Parliament such sum as he may with the approval of the Treasury determine.").
      105 Leave out Schedule 13.
      106 Schedule 14, page 105, line 37, at end insert—
      ("In section 83, in subsection(1)"Subject to subsection (1A) below" and subsection (1A).").
      107 Page 106, line 32 at end insert—
      ("Section 22.").
      108 Page 106, line 40, at end insert—
      ("In section 50(4), paragraph (c) and the "and" immediately after it.").
      109 Page 106, line 43, at end insert—
      ("In section 95(1), "or section 10(2)(a) of the 1980 Act."
      In section 95(2), paragraph (c) and the "or" immediately before it.
      In section 95(3), "or the 1980 Act".").
      110 Page 107, line 12, at end insert—
      ("In section 36A(5), paragraph (d) and the "and" immediately before it.").
      111 Page 107, line 45, at end insert—
      ("In section 43(4), paragraph (c) and the "and" immediately after it.").
      112 Page 108, line 17, at end insert—
      ("In section 31(5), "or in subsection (3) above". In section 31(6), "or in subsection (3) above".").
      113 Page 108, line 44, at end insert—
      ("In section 67(4), paragraph (c) and the "and" immediately after it.").
      114 Page 108, line 47, at end insert—
      ("Section 131.").
      115 Page 109, line 45, at end insert—
      (") in paragraph (4), sub-paragraph (c) and the "and" immediately after it.".
      116 Page 110, line 35, at end insert—
      ("() in paragraph (4), sub-paragraph (d) and the "and" immediately before it.".
      Lord McIntosh of Haringey: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 96 to 116 which have been spoken to with Amendments Nos. 1, 9, 35, 44, 77 and 95.
      Moved, That the House do agree with the Commons in their Amendments Nos. 96 to 116.—(Lord McIntosh of Haringey.)
      On Question, Motion agreed to.

      Prison Expenditure
      7.47 p.m.
      The Earl of Longford The Earl of Longford rose to ask Her Majesty's Government whether they are continuing a policy of cutting expenditure in real terms per prisoner and of cutting the total expenditure in real terms on the probation service and on prisoner education.
      The noble Lord said: My Lords, people sometimes ask questions in order to attack the Government, occasionally in order to defend them. This time I raise the question in the spirit of interrogation.
      I am grateful to the noble Lords who have stayed for this debate, particularly to the two maiden speakers. I hope that on future occasions they will have a larger audience. They must not be discouraged; having got this off their chest, they may feel happier and they can speak very controversially next time.
      My Lords, I will speak crudely and I will not take up the full time I am allowed. Mr. Michael Howard, when he was Home Secretary, introduced a completely new approach to penal policy, backed up by the Cabinet. It was based on the idea that prison works. In practice it led to an enormous increase in the prison population, from something over 40,000 to 66,000. That was as a result of government policy. At the same time, resources were cut. That belongs to the past, however. What has happened since Labour came into power? I go into prisons once or twice a week. I have not yet found anybody who thinks that anything has got any better under my own Government. Some will say it has got worse, because the Conservative policies of cutting the amount of money spent per prisoner, the education service and the probation service, have been working their way through.
      Now we are hopeful. We may have arrived at an historic moment. Mr. Straw has given indications that he is at heart a penal reformer. We know he is a Christian socialist and therefore I should say he must be penal reformer. He has not shown it previously, but with a recent important event he has begun to demonstrate it now. This is the publication of the report of the Home Affairs Select Committee of the House of Commons. It comes out drastically for the end of "Howardism". I do not wish to speak personally against Mr. Howard; I have no personal animosity against him. On the only occasion I met him he was quite charming. However, Howardism was an evil message and it is being repudiated by that all-important Select Committee of the House of Commons.
      The question arises: does the Home Secretary intend to repudiate Howardism or continue with it? Speaking broadly, it has been continued since Labour came into power. The crucial question is: will the Home Secretary repudiate it now? I hope so. Today I heard him speak and answer questions for an hour and a quarter in the House of Commons. He said more than once that he welcomed the report. What does that mean? Does "welcome" mean anything in practice or is it just a word? I heard only the first hour and a quarter of his comments; something drastic may have happened later, but I doubt it. I understood him to say that it was a matter for the judges. He would be the first to agree that it depends on the level of crime, and I accept that, on balance, the level of crime has increased in the past five years.
      The dramatic and horrible increase in the prison population cannot, therefore, be due to an increase in crime. As the Select Committee was quick to point out, that, coupled with the restrictions on expenditure, has made rehabilitation much more difficult. One is bound to ask the question: is the Home Secretary going to repudiate Howardism or is he going to repudiate the Select Committee? The Minister is a great lawyer; in other words, he knows how to deal with difficult questions. I hope that he will be able to provide an answer, but I do not expect a dramatic statement. I did not expect a dramatic statement from Mr. Straw today, but the time will come when he has to make one.
      I do not intend to detain the House long at this time of night. The question is simple. I totally share the Government's ideals and I have great regard for Mr. Straw as a Christian socialist, although I hardly know him. Is he going to come out as a genuine penal reformer or will he carry on the doctrine of the former Home Secretary?
      Those doctrines were totally opposed to the policies pursued by earlier Conservative Home Secretaries. We have one very enlightened former Home Office Minister with us tonight, but there were several. Their policies were totally different from those pursued by Mr. Michael Howard. I do not suppose anyone in this country has contributed more to the study of penal reform than the noble Lord, Lord Windlesham, and it will be particularly interesting to hear from him.
      The question is perfectly plain. Will the Government pursue the fatal policies of Mr. Michael Howard, backed by the Cabinet, or will they return to the older tradition pursued by all the best Home Secretaries, whether Conservative or Labour?
      7.54 p.m.
      Lord Bach: My Lords, I rise to make my maiden speech with more than the usual trepidation. Not only is there the fear of the maiden itself, but I am very conscious that by choosing to speak in this debate I am daring to trespass on what is without doubt the territory of the noble Earl, Lord Longford, who has asked a Question of my noble friend the Minister. His reputation as the champion of those incarcerated in Her Majesty's prisons, and as the leading advocate for penal reform, is unrivalled. I have for years admired him—not always

      1411
      uncritically—and to follow him in your Lordships' House is a huge privilege. Indeed, a few weeks ago he was good enough to give me a piece of advice on the subject of my maiden speech. He said, "Get two friends to sit either side of you so that they can say how well you have done."! I have the two friends either side of me, but the second part has not yet been fulfilled.
      Over the past 25 years or so, I have been inside more prisons that your average recidivist—not, at least yet, as a guest of Her Majesty, but in the course of my profession as a junior barrister in criminal cases, particularly in the East Midlands and Leicester, mostly defending—not always successfully—as can be shown by my frequent visits to prison!
      However, I must confess to your Lordships that many years ago a close relative of mine was sent to prison by the courts and, moreover, I confess that I am immensely proud of her. My grandmother was a younger sister of Emmeline Pankhurst and, as a suffragette, was sent to Holloway Prison for three weeks. Your Lordships will understand why I am so proud of her.
      One of the descriptions given of me on my elevation was as a barrister who defended pop stars and footballers, with the clear implication—or so I read it— that I was a sort of legal fat cat who did not rely on legal aid to make my living. To coin a phrase used by my noble friend the Minister in our debate last Thursday, I wish. The truth is that I have tended to represent those at the bottom of society whose chances of riding higher are remote and who have committed some crime ranging from being minor nuisances to serious villains, but always leaving behind them distress, unhappiness and, of course, victims who themselves are invariably less privileged than most of us.
      It is in this context that the Prison Service and the Probation Service must do their work and it is to the immense credit of both services that they do it so positively and optimistically. To them, no case is hopeless, no individual not worth bothering with. They need and deserve the support of government and this they receive. The recent Home Office consultation paper setting out plans for the two services to work much more closely together, and the increased spending promised in the Comprehensive Spending Review, announced in July, are to be warmly welcomed.
      Without doubt, the most depressing part of my work is representing young people. Here are kids, nearly always male, who often have little sense of what is right and what is wrong; who often have not enjoyed the love and security that should be the right of every child; and these kids, frankly, make the lives of others hell. When you meet them, they often seem on the surface as normal and lively as other youngsters, but beneath the bravado and cockiness there is an emptiness and sadness about their lives that could make you weep. Few are "lost souls"; the majority grow out of crime. But while it lasts, they literally cause mayhem and chaos to the lives of those whom they have wronged.
      What is to be done with them? I am delighted that the Government are making youth crime their priority. I warmly welcome the proposals in the Crime and
      1412
      Disorder Act. The delays in youth justice have been scandalous and parents have been allowed to shirk their responsibilities.
      One of the most frightening figures to be found in the latest prison statistics is that in the space of one year, 1996 to 1997, the number of male offenders aged between 15 and 17 sent to custody grew by no less than 32 per cent. and in 1997 was double the figure only three years earlier.
      Experience has taught me two things. The first is so obvious that it is sometimes forgotten in these debates. All offenders—young and old, male and female—fear the prospect of prison more than anything else. So there is a case for saying that the threat of custody can act as a deterrent. On the other hand, prison, whether for the young or the old, seldom works. I am on the side, on balance, of those who say that prisons make bad people worse—may be prison makes sad people worse—rather than those who say that prison works.
      Reconviction figures, particularly for young people, are frightening. Between 1990 and 1995, the percentage of 14 to 16 year-olds recommitted to prison within two years of discharge ranged between 88 and 89 per cent; for 17 year-olds, it ranged between 77 and 86 per cent. Those figures in themselves are the reason why the Government are so right to make youth offending their number one target. Custody is, of course, essential in many of those cases, but the figures tell a depressing story.
      I end by paying tribute to both the prison and probation services. In particular, I have worked very closely over many years, in the court setting, with the Leicestershire probation service. I pay tribute to the way in which its often hard-pressed officers perform their duties—with realism, with humanity and, above all, with optimism. Realism, humanity and optimism are not a bad way of approaching these difficult issues.
      8.2 p.m.
      Lord Addington: My Lords, it is my first and very happy duty to congratulate the noble Lord, Lord Bach, on an excellent maiden speech. It was on a subject he knows about and which he has studied with great care. I think it was Shakespeare who said "The first thing we do, let's kill all the lawyers." I have no doubt that the noble Lord, Lord Bach, will be towards the end of the queue.
      The noble Lord spoke about a problem that exists predominantly among young men between the ages of 15 and 35 who find themselves stuck in a cycle of offending and re-offending. The problem came to my notice primarily because of my work as a counsellor and fund-raiser for Apex Trust some years ago. I noticed the incredibly high number of its client base who had literacy problems. I am severely dyslexic, but I found that I was giving correct spellings to something like half the group with which I was associated. I am someone—I have told this story before and I may as well tell it again—who was congratulated for having good handwriting on his 30th birthday invitation.
      I went to the head of the organisation and said, "Do you think you might have a look at the dyslexics in your group?" He said, "Why do you think so?" I told him,

      1413
      "Because 10 per cent. of the population have this problem, predominantly male. We also have the situation that your client base tends to be male and tends to be educationally under-achieving." He said, "Good idea. Look into it further." I then discovered that I was about number 403 on the list of people who had actually made the connection.
      Surveys in Sweden, in New York, and more recently in London by a group called Dyspel have all come up with the same figure. Approximately 50 per cent. of the prison population have dyslexia or dyslexia-related difficulties. That must have some effect on the way you are recruiting your criminals, but it must also have some effect on the way you deal with them. At the moment we are patently failing in both departments.
      The first part of the problem has something to do with the education system. I shall not burden the Minister with having to answer for a department other than his own because I shall pose, I hope, some unpleasant questions for him in relation to his. If a group has been taught from school, which will be their main influence at this time—it has to be remembered that they are very young when they get involved in the cycle of offending—that they are under achievers, that they are lazy and that they are stupid, then they have no self-esteem. Dyslexia is often said to be a middle-class disease because middle-class parents ask why their children are not achieving. Working-class parents tell them to stop annoying the teacher and stop annoying them very often because, unfortunately, traditionally in our society, the working class do not regard academic attainment as something which is primarily their concern. There are of course exceptions.
      If this recruitment ground is giving us the number of offenders who are known about, something must be done after the schools have failed. We must start to give ourselves a second chance. A justice system that has a probation service and a prison service where you can sit a person down and discuss their problems offers that opportunity. Furthermore, if it succeeds in identifying problems, it will have a chance to do something about them. However, this requires at least initial training for staff in both services on how to identify the problem. I speak as somebody who has gone through this and has seen many other young people go through it. One characteristic of virtually all undiscovered dyslexics is very low self-esteem. The effect on adult dyslexics who discover that they have a problem but that they are not stupid, that they are not in some way abnormal—they can think naturally, they can hold a discussion, but they cannot put a few symbols on a piece of paper in an accepted format to convey information—is amazing. It is as if a great weight is taken off their shoulders.
      We have the opportunities within the Probation Service to make an assessment when people come up for sentencing. If this is done, there will be a chance for them, in the sentencing processes, to have further counselling and, one hopes, some form of lessons. Dyslexics tend to respond terribly well to a computerised medium for learning. Unfortunately, it is a little too late for me to benefit from that at school, but it is something which is coming along. Voice
      1414
      recognition may also help, but that is something for the boffins to work out. We must get a process of recognition going.
      Anyone who has dealt with people in prison at any level knows that prisoners attend classes because, first, they want a reduction in sentence, any that is going, and, secondly, they are bored. It is a wonderful opportunity at least for people to understand their own difficulty and then to open up the way to help. It means that those people will stand a chance of getting some form of qualification or acquiring, shall we say, a more user friendly attitude to the workplace outside. Work placement is said to cut down the re-offending rate by something like a third. I think 35 per cent. is the exact figure.
      The opportunity to deal with this type of problem will be with us for a very long time. If we really want to make prison work—I hate using that expression but it may be appropriate in terms of the legal system and the reduction of crime—we must tackle the matter head on. There will be initial costs. It will mean a programme of training. But some form of investment, in time and money, and a little restructuring might well produce a real cut in re-offending rates and the overall amount of crime in our society.
      This is too good an opportunity to miss. The study is out; it is available. I suggest that the Government get on and do something with it.
      I hope that I have helped stir up a little bit of thought. I hope that the next maiden speaker takes the opportunity to make as big an impact as the noble Lord, Lord Bach.
      8.8 p.m.
      Lord Ahmed: My Lords, I rise to make my maiden speech. I begin with the name of God Almighty, most gracious, most merciful. I express my gratitude to the staff and noble Lords for the warm welcome they have given me since my introduction.
      When I came to England, I attended Spurley Hey comprehensive school in Rotherham. The local authority decided to close it down. I was elected to the Rotherham town hall in 1990. Four years later the local authority decided to abolish it. Well, my Lords, I was introduced into your Lordships' House last Tuesday and on Wednesday the reform debate started. I have decided not to buy a house in London and I am staying in a hotel!
      I welcome Her Majesty's Government's commitment to modernise the Probation Service and improve prison regimes so that they are constructive and help prevent reoffending. While I accept that the great majority of prison and probation staff are hard-working and committed professionals who do their best to serve the public in difficult and often dangerous circumstances, I believe that, at a time when the police and other organisations accept the existence of institutional racism, the Prison Service too should acknowledge that there is a serious problem of racism within the Prison Service.
      In the past five years the prison population has risen by 50 per cent., from 43,000 to 65,000, and it is expected to rise to over 82,000 within the next seven

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      years. Much to my dismay there has been an increase of almost 100 per cent. in Muslim inmates between 1990 and 1997. There are many explanations for the sharp increase in the number of prisoners from the ethnic minorities. Some would explain that it is perhaps due to the high unemployment, poverty and deprivation. Others argue that it is due to institutional racism and stereotyping. Whatever is the case, the figures are alarmingly gloomy.
      The Government's commitment to being tough on crime and its causes, with measures backed by an extra £3 billion over the next three years, will be of benefit to thousands of young people, ethnic minorities included. Statistics from the Policy Studies Institute report show that the chance of obtaining employment for a graduate Muslim youth is equal to that of an unqualified white youth. I believe that black and Asian youth should be targeted to reduce the high unemployment levels within these communities.
      I now turn to the allegations of institutional racism in the police forces and prisons. I am pleased to learn that many chief police officers have accepted that there is a problem and that they have to grasp the nettle and take immediate action. Ministers have announced targeting recruitment from the ethnic minority communities to reflect the population. There is a serious problem within the Prison Service. The proportion of prison officers' grade who are Asian is 0.68 per cent. and 0.73 per cent. Afro-Caribbean, compared with 6 per cent. Asian and 12 per cent. black inmates. HMP Winson Green, Birmingham, has a total of 995 inmates, with 131 Muslims and not one single Muslim staff member. HMP Long Lartin has 380 officers with no Muslim staff but a 15 per cent. ethnic minority inmate population.
      Lack of understanding has caused enormous problems in relation to the religious, spiritual and dietary requirements of minority prisoners. For example, inmates suffering from racist attacks inside prison are normally moved to another wing, or the protection unit, or the punishment block, where they are kept locked up for 23 hours a day for their own protection. A further example is that in many prisons the Friday prayer is held on a Thursday, due to lack of understanding of the importance of a holy day for the Muslim community.
      The Home Office has recently decided to appoint a special adviser on the spiritual needs of Muslim prisoners but it has said that organisations which nominate candidates to fill the post have to fund it themselves. Many Church of England ministers are employed full-time as chaplains and they have a special role under the Prisons Act 1952. It is really time that we had at least one full-time adviser on the needs of Muslim prisoners paid for out of public funds. I also suggest that when the time comes to reform the 1952 Act there should be statutory recognition of the fact that Britain is now a multi-religious society.
      I was glad to hear the noble Lord the Minister reiterate yesterday that the Government accepted the recommendations of the Chief Inspector of Prisons that Immigration Act detainees should not be held in the prisons. Unfortunately, we have a record number in the
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      prisons. I hope that the Government will soon implement arrangements for reducing the need for detention and will find alternatives.
      I now turn to the case of two Kashmiri prisoners held at HMP Long Lartin. Qayum Raja and Mohammed Riaz were convicted in 1984 and sentenced to 14 and 10 years respectively. In 1988 the Home Secretary increased their sentences by 10 years each. which later in 1994 were quashed by the High Court, London. Two years later, the then Home Secretary, Michael Howard, reinstated the increased sentences. To date, these sentences stand, but I am aware that the cases are currently under review by my noble friend Lord Williams' office and the Home Secretary. The Kashmiri community has expressed to me its growing lack of faith in the legal process. I hope my noble friend can take this on board and bring about a speedy review.
      The prisons-probation consultation document talks about partnership and responsiveness. Perhaps I may end by urging Her Majesty's Government to respond to the needs of the ethnic minorities and build partnerships within the ethnic minority communities to ensure that both community penalties and prison sentences are effective and break the ever rising cycle of reoffending.
      8.16 p.m.
      Lord Windlesham: My Lords, it is a great pleasure to follow the noble Lord, Lord Ahmed, and to be the first to congratulate him on his maiden speech. The noble Lord is a leading figure in the British Muslim community, is chairman, and I believe founder, of the Muslim Councillors' Forum, and is a distinguished representative of the entire community in South Yorkshire, from which he comes. In joining the House he helps to broaden the diversity of interests which are represented and which is one of its contemporary functions. His speech was informative and was sharp in places—I am sure that the noble Lord who is due to reply from the Front Bench will have taken note of what he said. Both the noble Lord and the previous maiden speaker conveyed that they have quickly got the knack, when their party is in power, of combining loyalty to their party, which is proper and understandable, while at the same time not avoiding the necessity to make criticisms of some aspects of the administrative policies for which the Government have to take responsibility.
      It is a tightrope that the noble Earl, Lord Longford, has walked with immense skill for half a century. He has remained a loyal member of his party, and at the same time has been one of the most noted and effective penal reformers of the day. We are grateful to him for initiating this debate and for giving us another opportunity to debate matters of such importance and topicality. I say to the noble Earl that it may not be very often that he has had three relatively new Members of the House on his own side speaking in a debate of this kind initiated by him.
      I want to confine my remarks to one issue only. It touches on what the noble Lord, Lord Addington, said. I refer to the provision of, and accessibility to, education in prison. In doing so, I declare an interest because I have had the privilege of being a patron of the Prisoners

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      Education Trust since its inception about nine years ago. At times it has been a struggle to keep going, but with the indomitable leadership of Elizabeth Andrew and the generous financial support of several national charitable foundations and other donors, it has been possible to persevere and, indeed, make steady progress.
      The trust is a small organisation confronted by a large need. Its function is to act as an independent pressure group, as a source of original research and expertise, and as a provider of specialist educational services within prison establishments. Like many others, it is concerned with the use that is made of the time spent in prison. The Prisoners Education Trust has a simple message which cannot be repeated too often or too vehemently. It is that the purpose of imprisonment is not simply to punish offenders, relevant though that is, but to use the time spent in custody in a constructive way so as to reduce the prospects of reoffending in the future.
      In that process, education, along with learning craft skills and obtaining some insight into the causes and consequences of offending behaviour, are the essential ingredients. Some mild encouragement can be found in the references made in the 1997–98 annual report of the Prison Service to developing constructive regimes. That was followed by the establishment of a new directorate of regimes on 1st January 1998.
      Perhaps I may pause here to say to the House, and in particular to the noble Lord, Lord Williams of Mostyn, how greatly I admire the work of Richard Tilt who has recently announced that for personal reasons—as I understand it, nothing to do with policy—he has found it necessary to retire early from his post as Director General of the Prison Service. His inheritance was the most difficult in our modern penal history, and the way in which he has carried out his duties over the past few years has been the subject of widespread admiration. Perhaps the noble Lord, Lord Williams, will pass on this commendation to Mr. Tilt.
      I return to the less happy side of things. I am unable to dissent from what the noble Earl, Lord Longford, said about the origins of the present crisis and the numbers in prison. The resulting financial and population pressures mean that education has taken a low priority in most establishments. The trend, as measured by the somewhat crude measurement—it is the only one which has been used until now—of average hours spent in education per prisoner per week, appears to be downwards over the past two years or so.
      While it is true that not all prisoners need or are suitable for education, even so, the statistic is shattering: it is one hour and a half, 1.5 down from 1.7 hours. The most recent annual report of the Prison Service did not quote a figure, and perhaps it was right not to do so. The statistic relates to the prison population as a whole, and not simply to those who wish to take advantage of such educational facilities as there are.
      But as regards more specifically targeted programmes in which the Prisoners Education Trust has specialised—open and distance-learning programmes in particular—there are numerous hurdles to be overcome. The trust commissioned a three-year research study by
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      a noted criminologist from Cardiff, Professor Mike Maguire. That study found that in many prisons, library access is limited to once a week. Difficulties are experienced in obtaining books, other materials and quiet places to study. A major problem was identified of which governors are aware, but perhaps they are not fully aware of all the consequences. The abrupt transfer of prisoners from one establishment to another is made necessary by overcrowding. This is not hearsay, but is the basis of a three-year study. The restrictions on what inmates may take with them frequently excludes their books or study packs and these may or may not be sent on to whichever establishment the prisoner moves, which may be a considerable distance away. It also may take place some time after the prisoners have been transferred.
      Finally, I wonder what justification the Minister can possibly give for those prisoners who undertake education—and I accept that by no means all are suitable—generally receiving considerably lower wages than those who are working. That can only encourage the message that education is less important than work. The sums of money are small, but the impact is large.
      I conclude by saying that I believe—as do most other noble Lords taking part in the debate—in providing adequate educational facilities in prisons and encouraging the inmates to make use of them; indeed, it is an effective way of changing behaviour and building self-respect. Contrary to what was said earlier in the debate, I believe that the prison population is stabilising. It has risen sharply in the past five years. I was one of those noble Lords and Members of another place who was present earlier this evening to receive a briefing from the Director of Research and Statistics at the Home Office. One cannot be too hopeful, but I judge that there are some grounds for hoping that, albeit at a very high level, stabilisation may have been reached. Therefore, now is surely the moment for a determined effort, backed by adequate resources, to raise the standards of educational provision throughout the Prison Service. The general public are the potential victims of renewed offending, and they will suffer if nothing is done.
      8.28 p.m.
      Lord Mackenzie of Framwellgate: My Lords, I begin by saying what a pleasure it is to follow the noble Lord, Lord Windlesham, a man of immense knowledge and experience. Also, I thank my noble friend Lord Longford for coining a new word in my dictionary; namely, "Howardism". That is an interesting term. I am a firm advocate of "Strawism".
      This evening I feel that I am something of an ugly duckling in the pond but what I have to say must be said and it is important. I fully support the comments of the noble Lord, Lord Windlesham, about education and the Prisoners Education Trust. It is absolutely essential and I support everything that he said. While I have great sympathy with the underlying basis of the Question tabled by my noble friend Lord Longford, I have little doubt that I shall be coming at it from a different direction. I also warmly welcome the report of the Select Committee on Home Affairs on alternatives to prison,

      1419
      which contains a lot of useful information and recommendations. I hope that the Home Secretary considers it carefully.
      I have some 35 years' experience as a police officer, in every rank up to chief superintendent, and, in my judgment, the general public of this country are, quite frankly, fed up to the back teeth with the blight caused by crime. Communities are plagued with burglaries, car theft and wanton damage. We see evidence of that daily. New tube carriages are defaced by mindless scratching of windows, cars are broken into and homes violated. To continue looking at the problem from the point of view of the offender as opposed to that of the victim quite honestly upsets many people.
      At the end of the day, prisoners are volunteers. It is fully accepted that prisons should be decent, humane places and I would not demur at that. However, continual calls for better and more resources for prisoners probably offend people outside who have led deprived lives for many years and have not resorted to committing crime.
      I think your Lordships would agree that an important purpose of a prison sentence is deterrence—not just for the offender but for other like-minded persons. Over the years I have interrogated many prisoners, from murderers to shoplifters. Those whom I would class as professional criminals—and I accept that they are a relatively small minority—were quite prepared to take the risk of being caught if they knew that their sentence would be lenient.
      I was a detective when corrective training and preventive detention were on the statute book. Crime was much less prevalent then. Relatively severe sentencing went out of fashion in the '60s and '70s under both governments—it is not a party point—and crime rose significantly. In my judgment, it is only since we started to give realistic sentences that crime has begun to fall quite dramatically—almost a million fewer crimes reported in the past few years. That is a million fewer victims.
      Obviously I welcome the fact that criminals are being rehabilitated, although I have doubts about the willingness of some child molesters, for example, to undergo voluntarily what are considered to be helpful programmes. Similarly, I fully accept the need for better training to equip offenders to lead productive lives outside. It goes without argument that that is in everyone's interest.
      The difficulty I have is with the myriad of prisoner welfare organisations. That sends a signal which suggests that prison welfare is more important than the welfare of victims. I think it should be made clear more often that the responsibility for crime lies with those who commit it and not with society.
      I recently read a book by Charles Murray, the American authority on the growth of the underclass, on the effectiveness of prison as part of a crime reduction strategy. A small number of persistent criminals commit a large volume of serious crime. I include in that definition burglary, robbery and professional theft. It follows that if these "career" criminals can be taken out of circulation, crime—against the public, that is—will
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      diminish. That is precisely what has happened in the United States over the past few years, where crime has dropped dramatically alongside, I have to say, an increasing prison population. Janet Reno, the left of centre US Attorney-General, is quoted as saying:
      "Heavier sentences have turned things around".
      I think that your Lordships need to take note of that. Indeed, only last week, a Department of Justice report showed that in the 15 years up to 1995, assault, burglary and car theft were more common in this country than in the United States. That is a rather surprising statistic.
      In this country the police strategy of targeting known criminals, the sensible tightening of bail laws and the elimination of the nonsense of being able to remain silent without prejudice, together with the introduction by this Government of the Crime (Sentences) Act, have resulted in reported crime reducing—a fact now supported by the recently published British Crime Survey.
      I often hear it said that it is not the prison sentence that deters; it is the fear of being caught. The noble Lord, Lord Bach, in his excellent maiden speech, touched on this point. That is not true, in my experience. In the area that I policed, in the north east of England, juvenile crime was rampant in the early 1990s. Time after time we arrested the same youngsters and took them before the courts: they were released time after time to continue reoffending time after time. If anything was proof that the fear of being caught but with no proper sentence was not a deterrent, that was it.
      That is why juvenile crime is such an important part of this Government's priorities. It has also been argued that there is little difference between the deterrent value of a prison sentence on the one hand and of a community based sentence on the other. Apart from the obvious fact that at least in prison the offender cannot continue to prey on the public, the argument loses sight of the fact that like is not being compared with like. Offenders are sent to prison, in the main, as a last resort. They have invariably been through all the community based sentences already, so to compare the recidivism rate with that of first offenders is a nonsense.
      Finally, there is the question of cost. The quite reasonable point has been made that prison is expensive. Of course it is, but so is crime. Research by Northumbria police in relation, for example, to juvenile offending, showed that the true costs of police, probation, social services, courts and the costs—both financial and emotional—to victims, when taken into account, are so high that it is cheaper to impose custodial sentences.
      In conclusion, I would simply say that financial decision making is about choices. If the choice is between the welfare of prisoners as opposed to the support and welfare of those who do not have a choice—the victims—I know where my vote would go.
      8.38 p.m.
      Lord Judd: My Lords, I think that we would all agree that this has been an interesting short debate. We

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      are deeply grateful to my noble friend Lord Longford for giving us the opportunity to look at this important issue.
      I was particularly struck by the two maiden speeches in this debate. It seems to me that it is unquestionable that we are now a multicultural society and therefore our civil institutions must reflect that reality in their make-up. If they are to have a credibility and to be effective, they must be seen to be part of the society of which they are theoretically institutionally a part. They must be felt to be. I understood clearly, therefore, what my noble friend Lord Ahmed said.
      I recognise clearly from my noble friend Lord Bach's graphic speech the description of the young people with whom he found himself confronted in the course of his work. I declare an interest, as I have before when we have discussed these matters, in that I have the privilege of being the president of the YMCA in England. We are doing some interesting work with young offenders in prisons and in young offenders' institutions. What my noble friend Lord Bach described is certainly what we encountered. Also, the reality of the absence of a multicultural dimension is familiar to us.
      It is also tremendously important and has been a challenging experience to have among us my noble friend Lord Mackenzie of Framwellgate. The police come in for a great deal of criticism these days, much of it valid and serious—indeed, grave—but countless policemen do a tireless, demanding and sometimes dangerous job on behalf of the community. We would be foolish therefore not to listen to the experience and the perspective of one who found himself in the front line of that task.
      I recognise in what he says something of which we must all be cautious. He speaks with the voice of realism about many of the communities most acutely affected. They are not the middle-class communities or the rural homes to which we can retreat at weekends; they are the people in the deprived, disadvantaged estates of our country. In recent years I have come to live in one of the most beautiful valleys of north-west Cumbria. I shall never forget being taken by community workers around one of the most horrific, deprived estates of Carlisle on a clear winter day and seeing the reality of the problems with which those people lived. On that same clear winter day I looked out at the blue sky and bright sunlight and saw the hills where I lived. There is a great need for a sense of realism in how we approach these issues and I believe that my noble friend Lord Mackenzie of Framwellgate brings that realism to our consideration.
      However, tonight I crave the indulgence of the House because I want to concentrate on a point that I have made before but intend to go on making. If we have learnt anything in our work at the YMCA, it is that often—as my noble friend Lord Bach described—young people lack any sense of personality, personal significance or dignity. One of our first tasks therefore must be to enable them to discover themselves so that they can begin to develop their sense of responsibility, and we must then help them forward.
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      I often describe our work as a realisation that it is necessary for someone to take the hand of the offender and walk with the offender back into a full, creative, positive life. That is not to deny the importance of punishment; but it is in the context of the punishment that we immediately need to begin the job of rehabilitation. That is what the Probation Service, in one way or another, has been doing so outstandingly well throughout its tradition. It is a service for which I have unlimited respect and which, in my view, cannot have too many resources for what it is endeavouring to do.
      Also, in that process, if we are to be successful in our endeavour, it is important for resources to be spent on education. I was cheered to hear my noble friend Lord Mackenzie make the point that education is crucial in the prison process. We know that with the shortages and other difficulties faced by the Prison Service in trying to perform its task, too often it has been the educational services that have been cut.
      I want to make a point about which I feel increasingly strongly. In some parts of the media it is portrayed that there is a tough-headed approach to crime and a soft approach to crime. My view is that the situation is quite the reverse of how it is sometimes portrayed in the downmarket media. The hard-headed approach to crime relates to how we enable the offender to become a positive, responsible citizen who will not offend again; who will become somebody who contributes to the future of society. That is the tough-headed approach and that is why the emphasis must be on rehabilitation, on education, on working with the prisoners and helping them back into society. It is not only what happens in prison that is important, but also what happens when the person comes out of prison in terms of how they can be helped back into a full and confident life. It is that simple.
      We must also recognise that if we do not spend the resources in those areas, the cost to society in the future—in reoffending, in future disruption and future mayhem for those least able to cope with it in their already stretched communities—will be great. The cost to the police and to the Prison Service itself will be immense as we try to cope with the problem being regenerated. It therefore makes economic sense as well as sense in terms of penal policy to rehabilitate; it is an investment in less expenditure in the future. The Government therefore deserve all the encouragement possible in that direction.
      Perhaps I can conclude with this observation. I believe it is good that the Government emphasise the need for a clearer understanding of what is right and wrong and, in the midst of it all, for people to take personal responsibility. I applaud that. But I make the observation—perhaps in this House of all places we should recognise this—that it is not simply a question of "Do as we say"; it is, "Do as we do". If the messages which are being sent out to the young about what is acceptable behaviour, what is clever behaviour, what is the successful way to the top in society; if naked greed is too great an element in the upper echelons of society, where is our moral authority in appealing to the young? Where is the consistency? Where is the credibility? Therefore it is not only a question of what we do within

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      the prison and probation services; it is the whole way we tackle the debate about the values which should operate in our society as a whole.
      8.47 p.m.
      Lord Dholakia: My Lords, the noble Earl, Lord Longford, has repeatedly drawn attention to prisons in this country and I am grateful to him for giving us this further opportunity to debate the matter today. I have followed him on a number of occasions in this House on issues concerning prisons, whether through Starred Questions or debate. The problem with following the noble Earl is that I now receive copies of letters from inmates which are normally addressed to him—and there are a remarkably high number.
      Perhaps I can also take the opportunity to thank the two noble Lords who made maiden speeches. If it is any consolation to them, I made my maiden speech around one year ago and there were only four Members in the Chamber at the time.
      It is difficult to overstate the damage done by the last government's expenditure cuts since the mid-1990s to the work of the prison and probation services. I look forward to hearing what the noble Lord, Lord Henley, says in regard to some of the cuts in the Prison Service generally. Those cuts, including the reduction in prison staff, saw a change in the number of prisoners to staff members from 1.7 in 1993 to 1.47 in June 1998.
      Prisoners now spend increasing time in their cells. The percentage of prisoners held in prisons which unlock inmates for 12 or more hours per weekday fell from 40 per cent. in 1994–95 to 37.5 per cent. in 1995–96. In 1996–97, the Prison Service changed its key performance indicator for the time unlocked and now measures the percentage of prisoners held in prisons which unlock those on standard and enhanced regimes for 10 or more hours per weekday, not 12 hours as previously. The percentage fell from 65 per cent. in 1996–97 to 62 per cent. in 1997–98. The Prison Service target for 1998–99 is 60 per cent.
      There was also a reduction in the level of purposeful activity in prisons from an average of 26.2 hours per prisoner per week in 1994–95 to 23.3 hours in 1997–98. The Prison Service aims to increase that to 24 hours per week in 1998–99.
      There was a fall in the number of probation officers working in prisons from 645 to 560 between mid-1995 and December 1997. There has been a postponement in the repair and refurbishment programme. The problems were clearly identified by Her Majesty's Chief Inspector of Prisons.
      There are easy ways of raising money for prisons. I applaud the former Home Secretary for spending a day in Brixton prison, which raised over £100,000. Let us imagine the amount that would have been raised had we kept him there for four years! It would have met all the deficits and cuts that we are talking about.
      Turning to more serious matters, to many of us the impact of the cuts in prison education has been the most distressing element of all. According to a Written Answer by the noble Lord, Lord Williams, to my noble friend Lord Harris of Greenwich, on 3rd September
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      1998, 84 per cent. of prisons cut the number of education hours in 1996–97; 56 per cent. did so in 1997–98; and 71 per cent. have done so in 1998–99. According to the same Written Answer, the average number of education hours per prisoner fell from 4.9 hours in 1995–96 to 3.8 hours in the first quarter of this year. That is very sad. The sooner the trend is reversed, the better.
      Prison education is crucial to cutting crime. Everyone who has worked with offenders knows ex-prisoners for whom education has been an essential part of their rehabilitation. Many prison inmates have problems with literacy and numeracy, and basic education can greatly increase their chances of employment.
      Prison education is not a soft option. It is a vital means of reducing risk to society by diverting prisoners from re-offending. The more prison education is cut back, the greater the risk that prisons will educate their inmates in nothing but the tricks of the criminal trade.
      I welcome the Home Secretary's statement on 21st July on the comprehensive spending review settlement in which he said that the settlement would provide an additional £660 million for the Prison Service over the next three years. According to the statement some of the money will be used for additional prison places and to clear the urgent backlog of repairs and maintenance. But it also provides for a significant increase in purposeful activity over the next three years, including improvements in education for juveniles and adults and an increase in the number of probation officers providing through-care support.
      A Written Answer in the House of Commons from Mr. George Howarth to Mr. Alan Beith on 31st July stated that there will be an extra £72 million for rehabilitation and other programmes in prison in 1999–2000; £60 million in 2000–01; and £70 million in 2001–02 in real terms at 1998–99 prices. However, after an increase next year of 1.7 per cent., there will be a 0.2 per cent. reduction in the second year, (2000–01) and a 0.6 per cent. reduction in the third year. So in real terms we are not talking of additional money being available but a genuine cut.
      Perhaps I may touch briefly on the Probation Service. It has also suffered significant cuts in expenditure and staffing. Before the review settlement, the Association of Chief Officers of Probation estimated that in real terms the Probation Service in England and Wales was facing a cut of around 25 per cent. over a four-year period, equating to an expenditure reduction of approximately £1,000 million. That was at a time when the number of offenders supervised by the service—on community sentences, in prison and on post-release supervision—had increased from 136,000 in 1992 to 184,700 in 1997.
      I welcome the Home Secretary's Statement on the comprehensive spending review settlement. He said that there would be an additional £18 million of grant for the Probation Service next year instead of the £6 million cut planned by the previous government. A Home Office circular to the Probation Service issued on the same day stated that the Home Office grant to the Probation Service would rise from £329 million in 1998–99 to £396 million in 2001–02.

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      I have paid tribute on more than one occasion to the Home Office's recent willingness to provide improved financial support. I wish to highlight my own interest in the matter as chairman designate of NACRO. I must draw attention to one result of the cuts in the Probation Service which has caused us particular concern; namely, the dramatic reduction in the service's voluntary work with many prisoners released from short-term sentences who are not subject to compulsory post-release supervision. NACRO is keen to work in partnership with the Probation Service to improve the level of help and support given to such ex-prisoners. That will help increase the prospect of steering them away from crime and further offending.
      I associate myself and this side of the House with the remarks offered about Mr. Tilt by the noble Lord, Lord Windlesham. Perhaps they can be conveyed to him.
      8.57 p.m.
      Lord Henley: My Lords, I am grateful to the noble Lord, Lord Dholakia, for making his remarks with such brevity. That allows me my eight minutes before I must sit down to allow the noble Lord, Lord Williams, his full 12 minutes to wind up the debate—which I dare say will not nearly be enough to cover the number of points addressed.
      I also wish to express my thanks to the noble Earl, Lord Longford, for introducing the debate. It is six months since our last major debate on prisons. It is a subject that many of us in this House would like to see addressed with greater frequency.
      I also offer my congratulations to the noble Lords, Lord Bach and Lord Ahmed, on their maiden speeches. Like the noble Lord, Lord Bach, I received advice from the noble Earl, Lord Longford, many years ago when I made my maiden speech. I imagine that many noble Lords have over the past 50 years, and many more will in the ensuing years. I pay particular welcome to the noble Lord, Lord Ahmed. It is gratifying to see another northerner taking his seat in this House. The noble Lord is from Yorkshire; I am from Cumberland. It is also gratifying to see someone somewhat younger than myself taking his seat as a life Peer. It was always said in defence of the hereditary principle that it brought younger people into the House. Speaking as a youngish middle-aged hereditary Peer, I am now finding that many of the new life Peers are considerably younger than myself.
      Perhaps I may also take the opportunity of welcoming the noble Lord, Lord Mackenzie of Framwellgate, to such debates. I have not had the opportunity of congratulating him on his maiden speech, which he made during an education debate some days ago. I imagine that we shall have much to say to each other in the future on debates such as this. I dare say that there is much on which the noble Lord and myself might agree when it comes to prison matters.
      The noble Lord, Lord Dholakia, asked me to comment on the previous government's record. I do not want to take up too much of my time; however, I should like to remind the House, as I did in the debate on
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      25th March, which, in the absence of the noble Lord, Lord Williams, was wound up by the noble Lord, Lord Hoyle, that between 1979 and 1997 the prison budget almost doubled in real terms. That is a considerable figure.
      I went on to put to the noble Lord, Lord Hoyle, a question relating to the cuts in the prison budget. I referred to a Written Answer produced by the Minister responsible for prisons, Joyce Quin—I believe on 31st July last year—when she stated that the planned expenditure for prisons for 1997–98 was £1,774.5 million and would be reducing to £1,733.3 million in 1998–99. That would follow a planned expenditure increase under the previous government.
      On that occasion, I asked for an answer but I did not receive one. Since then we have had the fundamental expenditure review. Therefore, I hope that on this occasion the noble Lord, Lord Williams of Mostyn, will be able to give me an answer to those questions. I hope that he will be able to tell me by how much the Government are planning to increase expenditure on prisons. In the light of the remarks that I am about to make, I am sure that he realises that it is important that in certain circumstances expenditure on prisons should be increased. This debate is about funding.
      The one issue that I want to address in the four minutes that I have left follows on from what the noble Lord, Lord Windlesham, said about the importance of education in prison. My remarks relate to the report on prisons and drugs misuse produced in July of this year by the All Party Parliamentary Drug Misuse Group. It is important in terms of expenditure on prisons.
      The noble Lord will remember well the White Paper that we produced in 1995 on drugs misuse. It related to drugs misuse throughout society, taking the situation much wider than just prisons. That White Paper had general support from all parties—and quite rightly so. Following that White Paper this year, the new Government produced a successor paper known as Tackling Drugs to Build a Better Britain. I hope that the noble Lord will accept that that White Paper built on what we had already started, which was something that had all-party support.
      It was regrettable that that report made virtually no mention of the problems of drug misuse in prisons other than a rather brief reference to how the Prison Service should direct its resources. I am grateful for the fact that the Prison Service then produced a supplement—its response—entitled Tackling Drugs in Prison.
      It is also important that we should look at the report from the all-party group, a group that we all support and recognise as carrying out a valuable job. I would be grateful if the Minister could address himself to a number of its recommendations. I appreciate that in the 12 minutes that he has to respond to my remarks he may not be able to respond to those particular points. However, I would be grateful if he could tell me when the Government intend to respond formally to that report, or perhaps he could write to me on the subject.
      Two of the principal demands made by the all-party group related to reducing supply and reducing demand. In relation to reducing supply, the group talked strongly

      1427
      about the need to make sure that drugs did not get into prisons. Obviously, if drugs cannot get into prisons, there is less likely to be a problem. It talked firmly about the need for every prison to have a sniffer dog. That involves resource problems. It is also important that visitor centres should provide a relaxed environment for bona fide visits while managing to deter drug deliveries. I would be grateful to hear from the Government exactly how they intend that the Prison Service should take that forward.
      The all-party group also talked firmly about the importance of doing everything possible to reduce demand. Having taken evidence from a number of people who had been in prison, it referred to the problems of boredom in prison and the fact that many people are locked up for possibly too long and it recognised the importance, therefore, of them having other things to occupy their minds in order to try to prevent the use of drugs. Therefore, I would be grateful to hear from the noble Lord what the Government intend to do to encourage the Prison Service to improve education, training and work as a means of occupying the time of as many prisoners as possible so that such problems as I have discussed, and those to which the all-party group referred, do not become more serious.
      9.5 p.m.
      Lord Williams of Mostyn: My Lords, we are all grateful to the noble Earl, Lord Longford, for introducing this matter yet again. I also thank the noble Lord, Lord Windlesham, for his customary courtesy in his references, echoed by the noble Lord, Lord Dholakia, and others, about the quality of Richard Tilt, who is, on any view, a considerable public servant. He has done extremely well. Jack Straw said publicly that he wanted him to continue in post but, for his own personal reasons, which I perfectly understand, Mr. Tilt felt that the time had come for a change. However, he has generously offered to stay on until his successor is appointed.
      We have heard two excellent maiden speeches. This is not the usual pack that one brings out on these occasions. Both noble Lords were listened to with great care. Their speeches were wholly different, one from another, and each contained extremely stimulating thoughts from new Members.
      The noble Earl, Lord Longford, asked me two questions. One was: Is "Howardism" still the policy of the Home Office? Perhaps I may give a citation.
      "It was a mistake of the previous government to believe that just one phrase 'prison works' was necessary. The phrase has a spurious and superficial logic. It is superficial because if the criminal is in prison clearly he cannot be committing crime outside. It is spurious because it does not take into account the effect of over crowded prisons on the criminal and the fact that 99.9 per cent. of all criminals will one day be released. Society will then find that prisons do not work".
      The citation has a double provenance. It comes from the admirable report of the Select Committee on Home Affairs, to which the noble Earl referred, and it is, of course, a verbatim quotation from the noble Lord, Lord Baker of Dorking, who, as Kenneth Baker, was Home Secretary.
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      If the noble Earl refers to "Howardism" as being that spurious and superficial logic of "prison works", added to a denial that other social causes have something to do with crime, added to a lack of early intervention, added to an under-funded Probation Service, added to a lack of flexible remedies, and added to a lack of sensible prompt intervention, I repudiate it. For once the noble Earl and I are in full agreement. He also asked whether or not Jack Straw was a penal reformer. There are no two ways about that. He wanted to be Home Secretary, and if I may modestly say so, although the post was in his disposal and not mine, I am a prison and probation Minister because I wanted that. He is a penal reformer and he has made a good stab at it so far.
      The noble Earl asked in his Question whether we shall continue the former policy of cutting expenditure in real terms on the Probation Service and on prisoner education. The answer is an unequivocal, unambiguous no. How have we started? We have gone about it on a co-operative basis because we believe that we cannot succeed—I echo entirely what the noble Lord, Lord Mackenzie of Framwellgate, said—without public co-operation and public confidence. Therefore, for the first time statistics are now being published on an automatic basis, whether they are comfortable or not. For the first time the reports of the Chief Inspector of Prisons are being published without delay. Subject to factual correction, which does not take a long time, I sign them off immediately.
      We are working towards the Prisons-Probation Review. It is a genuine consultative document. I was extremely heartened by the warm welcome for it from the Probation Service. I think that is a recognition that in the past efforts have been fragmented and there has not been sufficient common purpose between the police, the criminal justice system, the Probation Service and the Prison Service. All of these different organisations and persons are working towards what ought to be common cause. For the past nine to 12 months I have been working with the Prison Service and the coroners to reach the agreed conclusion that investigation statements relating to deaths in prison custody should, as a matter of assumption, be available to family members unless there are good, demonstrable reasons why they should not be. That is a significant advance. Your Lordships will know that my colleague who deals with police, Mr. Michael, echoed that only this week in the context of deaths in police custody.
      The question of racism was raised. This is a problem endemic to our society and there is no point in pretending otherwise. What has Jack Straw done? He has set up the inquiry into the monstrous, wicked murder of Stephen Lawrence. He has directed that there must be proper representation not a mechanical quota. Proper targets are to be set for the Prison Service, the Probation Service and the police service. He reiterated that only this week. Whatever criticism might be levelled against him, it simply cannot be suggested that he will tolerate racism even for a single moment.
      We have commissioned the Effective Practice Initiative, which we are publishing this week. That is not simply jargon. It is an extremely impressive document about what works in the context of the

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      Probation Service. Curiously, it is the first time for 90 years that national guidelines of that kind have been set out. As far as I am aware, it is unique in the whole world as a document which sets targets, sets down best practice and gives targets to work towards. The noble Lord, Lord Dholakia, asked me about figures. New money for the Prison Service over the next three years will be £660 million. The Prison Service will make efficiency savings over the same period of £109 million. Therefore, there will be more than £200 million of new money for regimes. I shall discuss regimes in a moment.
      I hope I do not say this in a presumptuous way but the noble Lord, Lord Windlesham, made a most important point about the disincentive relating to the earnings prisoners receive for education as opposed to work. In some prisons I have visited there is no differential, but in others there is. We are reviewing the wages paid to prisoners to ensure that they do not suffer financially by attending education rather than going to work. I know the noble Lord will recognise from his own personal experience that the emphasis will be particularly to encourage those prisoners who need to improve their basic skills.
      I mentioned regimes. We appointed a new directorate this year. We cannot manage this deeply intractable problem without structure, without discipline and without targets, and therefore accountability. The director, Martin Narey, is supported by assistant directors. This is an important management decision which will have enormous consequences. The assistant director for young offenders is Felicity Clarkson; for women, Linda Jones—she is a former chief probation officer. That is important; she was not appointed by chance—for adult males, lifers and parole, Peter Dawson; and for prisoner employment (I return to that matter because it is so important) Kevan Brewer. Penny Robson is the service's chief education officer.
      The noble Lord, Lord Addington, mentioned dyslexia. We shall introduce dyslexia screening. This will form part of the induction programmes in the dispersal estate. Advice will go to governors about educational programmes being made accessible—I echo the noble Lord's point because it is a valid one—to prisoners with dyslexia. The language and literacy unit based at South Bank University, as the noble Lord knows better than I, did the Dyspel work and is advising education services on the way forward. I can assure the noble Lord that the problem is being taken seriously. I agree with him that historically dyslexia has been overlooked and has been regarded as a sign of dullness rather than as a problem which needs to be addressed.
      Literacy and numeracy are serious, continuing problems—even more serious than those described by the noble Lord, Lord Addington. Nearly 60 per cent. of prisoners are at Level 1 or below for literacy, which is equivalent to 13 or 14 years of age. Seventy-five per cent. are at Level 1 or below for numeracy. That means that those prisoners will not be eligible for 96 out of every 100 jobs available. Prison education will therefore be increasingly focused on basic educational skills, life and social skills and IT skills. I say in parenthesis, though it is extremely relevant, that the work that David
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      Blunkett is doing in what I call mainstream education is absolutely invaluable. We need to bear in mind that this is the deeply depressing position after 50 years of compulsory public education for children up to the age of 15 and, more lately, 16. I appreciate that education was compulsory and free, but up to a lower age, over the century, as the noble Lord is indicating to me.
      My point is that, since the education Act at about the time of the Second World War, children have been educated compulsorily and at public expense from the age of five, now to the age of 16, and are leaving enormously expensive full-time education without basic skills. It is important to look not just at the Home Office's contribution but also at the contribution which David Blunkett is so admirably making elsewhere.
      The director-general is considering bids from governors for funds to be invested in education. We are talking about £250 million over three years to deliver our manifesto commitment on constructive regimes.
      I have been speaking for 11 minutes. It is a shame, first, that there are so few of us here and, secondly, that I have so short a time in which to deal with these matters of deep and enduring concern.
      There will be an additional £127 million for the Probation Service. Next year there will be not the cut of £6 million referred to by the noble Lord, Lord Dholakia, but an increase of £18 million. The Probation Service say to me that that is not enough. It is a good start. I attended the NAPO conference in York on Friday and was enormously pleased and impressed to see their energy and commitment to improve the situation and make things work. They recognise that the resource is not open-ended, but they are, I think, pleased that their work is recognised and that the Home Office is now reversing the underfunding that the service would otherwise have suffered.
      The noble Lord, Lord Henley, spoke about drugs. I will deal with that subject with reference to supply and demand. I think I have partly addressed demand. I entirely agree with what the noble Lord said. If prisoners who come from a drug culture, which an alarmingly high number do, are hanging around in prison doing nothing productive, they will want drugs to pass the time. One of the answers is to have focused, intensive programmes. I have to admit that before I knew anything about these topics I had the same prejudices as the man in the street: "What is an anger management programme? Just a bit of silly, sociological jargon." It is not. It is infinitely more difficult to go on such a course to address one's own problems, deficiencies and possible optimistic outcomes than to sit about all day doing nothing and trying to obtain illegal drugs. There are detoxification units and drug-free wings. One of the key performance indicators is related to positive drug tests. The key performance indicator for the future is to ensure that the rate of positive drug tests is lower than 20 per cent. Some of your Lordships and many of the public would say that that is not a very high aim. Look around the streets of any large city or any rural area and see the size of the problem.
      The other question—which the Home Secretary is addressing, as I know from personal experience, having attended a meeting with him on this point—is how drugs

      1431
      get into prisons. There has to be decent humanity with regard to family visits, but we must not be naïve. Within the past fortnight I attended a meeting with Richard Tilt, the Home Secretary and colleagues in the Home Office to view videos from one prison to see how hard drugs were being taken in, secreted in the baby's clothes, in the wife's or the girlfriend's clothing or in the friend's trousers. Very determined efforts are made to get the drugs in. I want to maintain a decent balance of civilization, family connection and decency about visits,
      1432
      but equally we have to recognise that, if people abuse these privileges, they will not remain as they are for ever. I would not be surprised if an announcement on these matters were not made shortly by the Home Secretary.
      I have spoken for 14 minutes, and I do not apologise for that. I believe that 14 minutes on this topic may well be time better spent than for example on the European Parliamentary Elections Bill.
      House adjourned at twenty minutes past nine o'clock.

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