Sitting of 21 January 1999

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

    Fairness at Work White Paper
    Mr. David Borrow: What assessment he has made of the impact on families of the new rights proposed in the Fairness at Work White Paper. [65190]
    The Minister of State, Department of Trade and Industry (Mr. Ian McCartney): The measures in our proposed legislation will encourage a partnership approach and a fairer workplace environment, which will benefit all employees and their families.
    We are introducing nine specific measures, which will help parents and carers to balance work and family life by providing three months' parental leave for mothers, fathers and adoptive parents, by providing domestic time off in emergencies for all employees and by simplifying and improving women's maternity rights.
    Our proposals were developed in consultation with the key stakeholders. Four out of five employers who commented on the White Paper's family-friendly employment proposals supported them in some measure. Our proposals to simplify the maternity provisions received almost universal support.
    Mr. Borrow: I am sure that many families will welcome the White Paper. Does my hon. Friend agree that employers in both the public and private sectors benefit from the operation of family-friendly policies? Will he influence his Department to spread best practice from both public and private sectors to employers who do not yet operate family-friendly policies?
    Mr. McCartney: I thank my hon. Friend for that question. Our fairness at work proposals have received a great deal of support throughout government, employers' organisations and trade unions, which are working together to improve best practice. The Bill will result in a significant change in culture, with the support of virtually every employer in Britain.
    Mr. Desmond Swayne: Has the Minister assessed the impact of parental leave provisions on the employment of women in the future, given that his departmental assessment is that those provisions will cost £110 million?
    Mr. McCartney: The hon. Gentleman should realise that the parental leave directive was agreed by employers and trade unions, which made joint recommendations. As a consequence, the overwhelming majority of employers support the measures, which will at last give men and women a chance to balance their work responsibilities with their caring responsibilities at home.
    Mr. Jim Marshall: Does my hon. Friend accept that many family members work in companies that employ fewer than 20 people and that, in some cases, those are among the worst employers in the country? In view of that, will he give further thought to reducing the number of employees in a company who are excluded from the provisions of the proposed legislation?
    Mr. McCartney: The proposals are comprehensive. My hon. Friend is asking about a different issue, which will be dealt with in the fairness at work Bill under recognition issues. There will be no change in those proposals. Employers of whatever size will have opportunities to be represented on issues of discipline and grievance procedures. Application of the proposals will be universal and parental leave has the support of employers' organisations.
    Mr. Tim Boswell: May I take this opportunity to welcome the new team, although it is nice to have to deal with one of the old lags first. Will the Minister enlighten the House in two respects? First, will he clarify which is the authorised version of the recognition proposals—the version according to Derby, South or the version according to Hartlepool—that has finally been adopted?
    Secondly, on fairness at work more generally, will the Minister explain how he can make statements about universal support and a wide welcome for his family-friendly policies when he seems incapable of producing an overall assessment of the compliance cost to British industry?
    Mr. McCartney: From one old lag to a very old lag, I thank the hon. Gentleman for welcoming my continuing presence at the Department. I may qualify for unfair dismissal under the Bill.
    Opposition Members must realise that we have taken into account the effects of the proposals on all workers in Britain. The hon. Gentleman is a little off-beam. He simply cannot accept the changing culture in the workplace, with employers and employees striving for better partnership arrangements, including a partnership that reflects their rights and responsibilities. When we publish the Bill soon, he will see in the round the comprehensive nature of our proposals and the overwhelming support that they will receive from people in the workplace—both employees and sensible employers.

    Investment
    Fiona Mactaggart: What discussions he has had with his international partners on the prospects for an international agreement on investment; and if he will make a statement. [65191]
    The Minister for Trade (Mr. Brian Wilson): Negotiations in the Organisation for Economic Co-operation and Development of a multilateral agreement on investment are no longer taking place. The United Kingdom and the European Union as a whole have called for investment to be on the agenda of a future round of negotiations in the World Trade Organisation. Decisions on the content of that agenda will be taken at the WTO ministerial meeting later this year. In the meantime, the UK is participating in the analytical work of the WTO trade and investment working group.
    Fiona Mactaggart: Many people in my constituency who expressed concerns about the MAI process will be relieved at its collapse. They urge me to ensure that the future process is less deformed and takes better account of environmental, social and developmental issues in discussions on international investment. Will the Minister reassure me that a framework will be provided for future negotiations?
    Mr. Wilson: I endorse my hon. Friend's comments. I came late to this issue, but there was no doubt that, from the outset, the perception arose that this was a multinational conspiracy, and that it was the developed world putting one over on the less-developed world. It does not matter about the accuracy of those perceptions, the fact that they were allowed to run made it extremely difficult to secure the agreement that was being sought.
    We should start with a clean sheet of paper and seek to obtain an agreement on investment rules that serves both the developed and the less developed world. We must also make it clear from the outset that it must be done on the basis of consensus, and that it must take full account of environmental and social issues, such as conditions of employment.

    Small Firms
    Mr. Howard Flight: If he will make a statement on Her Majesty's Government's policies to assist small firms. [65192]
    The Minister for Small Firms, Trade and Industry (Mr. Michael Wills): Small and medium businesses are crucial to a successful enterprise economy, and the Government are firmly committed to stimulating the creation, competitiveness and growth of new and small businesses.
    The key principles underlying the Government's approach include fostering an enterprise culture that encourages innovators and risk takers; providing and maintaining a supportive economic environment; identifying and removing barriers to growth and providing high quality business support for firms at all stages of
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    their development. The Government also work within the European Union to help to further these aims throughout Europe.
    Mr. Flight: I welcome the new Minister to his post. Is he aware of the recent national insurance contributions regulations, which can impose huge additional taxation on entrepreneurial businesses, specifically on approved and unapproved pension schemes when companies go to the market to float for money, and on share conversions in management buy-outs where the business is succeeding? If he is aware of that, please could he make appropriate representations to his colleagues at the Department of Social Security for some amelioration of the situation? If he is not fully aware of it, please could he look into in the matter?
    Mr. Wills: I thank the hon. Gentleman for his kind words of welcome. The Government are proud of their record on corporate taxation. We have conducted a major reform, and as a result corporation tax is at its lowest level ever—20 per cent. for small firms. That is the lowest level of any major European economy.
    Yvette Cooper: I welcome my hon. Friend to his new position, and wish him well at the Dispatch Box. Is he aware of the importance to small firms of proper enforcement of the Late Payment of Commercial Debts (Interest) Act 1998? A company in my constituency received a letter from Rentokil saying that it was prepared to continue business only on its own late terms with limited interest. Since I wrote to the Department, Rentokil has withdrawn that letter, and has promised to comply with the Act. What other action is the Department taking to ensure compliance with the Act?
    Mr. Wills: I thank my hon. Friend for her kind words of welcome. I reassure her that the Government are committed to changing the whole culture of payment. The 1998 Act was an important start, but we realise that we must do more. That is why we have established the better payment practice code. The better payment practice group contains representatives from all sides of industry, including large and small firms. It ensures that the spirit as well as the letter of the Act is implemented. I understand that Rentokil has agreed to comply with both the spirit and the letter of the Act.
    Mr. Brian Cotter: I welcome the Minister to his new post. Is he aware that, in a survey this month, more than 50 per cent. of small business owners said that they would not consider starting a business because of the burden of legislation they now face? Will he give an assurance that legislation this year will not affect the viability of small businesses?
    Mr. Wills: The Government are committed—[Interruption.] We are, indeed, committed to small firms and to ensuring that as many people as possible start up small firms. I am delighted to tell the House that the latest evidence from Barclays bank and National Westminster is that business start-ups are up in the third quarter of last year compared with the third quarter of 1997. It shows that the Government's policies on small firms are working.

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    As regards legislation, we are aware of the problems that small firms experience in complying with regulations. That is why we have set up the better regulation task force to ensure that regulations are implemented effectively and sensitively in relation to small firms and, indeed, all businesses.
    Mr. John Healey: An important part of the Government's policies to support small firms is help with start-ups—especially in areas such as Rotherham, where the ratio between employers and population is only about half the national average. We welcome the Government's commitment to supporting 10,000 new start-ups in the high-tech sector this year, but what steps is the Department taking to support start-ups in other industries?
    Mr. Wills: We are committed to helping all start-ups. The competitiveness White Paper is particularly dedicated to helping businesses to start up when we think that they have a high growth potential that will create jobs, productivity and growth, but, as I have said, we are committed to helping all start-ups. That is what business links are tasked with, and that is what we shall continue to deliver.
    Mr. John Redwood: I congratulate the Minister on his appointment. Under Labour, only a few people are born to office. Some seek office to live well, and some have office thrust upon them. As the Minister has no salary and does not do red boxes, I assume that he is in the latter category.
    One of the most important things that the Government can do to assist small firms is to ensure that the law applying to companies is fully and fairly enforced on all of them, so that they can trade on equal terms. The Opposition welcome the institution of a rogue director hot line, which the Government have set up to help small firms in this context. Does the Minister agree that Mr. Derek Draper should be referred to the hot line for his violations of company law at 3C Ltd? Does he agree that new Labour establishment should be referred to it for the failure of Progress Ltd. to submit accounts for that Blairite magazine—and does he think that he should be referred to it for his failure to submit the necessary paperwork relating to one of his companies?
    Mr. Wills: I hoped that the right hon. Gentleman might start the new year with a more gracious approach, but he has reassured me nevertheless by continuing in the spirit that he adopted last year.
    Of course—
    Mr. John Bercow: Spit it out!
    Mr. Wills: That is exactly what I am about to do, and the hon. Gentleman will welcome the answer when I give it.
    Let me set the record straight in relation to my own affairs. Fellows of All Souls—of which I believe the right hon. Gentleman is one—used to conduct their research in libraries, and they used to employ researchers. It appears that they now conduct their research in The Times diary, in which that story appeared. Unfortunately, those who snout around in the inaccurate and the meretricious come
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    up with the meretricious and the inaccurate, which is what the story was. Every company with which I have been associated has filed its returns in compliance with the deadlines set by Companies house.
    As for the other matters to which the right hon. Gentleman referred, I am sure that the Department will examine them closely, fairly and without doing anyone any undue favours.

    Science Spending
    Dr. Stephen Ladyman: What assessment he has made of the strength of the relationship between science spending and UK competitiveness. [65193]
    The Secretary of State for Trade and Industry (Mr. Stephen Byers): Our ability to compete effectively as a knowledge-driven economy will depend on our commitment to scientific research and its exploitation.
    In partnership with the Wellcome Trust, we will spend an extra £1.4 billion on science and engineering over the next three years. That will ensure that we can retain our position as a world-class country in terms of science, reversing the decline in investment for which the last Government were responsible.
    Dr. Ladyman: I congratulate my right hon. Friend on his new post, and thank him for his answer.
    Given what my right hon. Friend has said about the link between science and competitiveness, and given that the Government, through the comprehensive spending review, have already been more generous to public-sector science than most scientists dreamed was possible, will my right hon. Friend tell us what plans he has to stimulate further science and research in the private sector? In particular, will he tell us what thought he has given to fiscal incentives such as tax rebates for companies that reinvest a significant proportion of their income in research?
    Mr. Byers: I thank my hon. Friend for his warm words of welcome. I agree that the £1.4 billion extra is an excellent first start, as is the 20 per cent. increase in the Department's innovation budget, but I regard it just as a start. It is beginning to deliver our commitment as a Government to science, but we can do more.
    My hon. Friend has drawn the House's attention to the possibility of tax incentives for the private sector to support research and development. It is true that, with the exception of the pharmaceutical industry, spending in the private sector on research and development has declined dramatically over recent years. We need to do something to remedy that. We will look closely at how we can introduce a financial regime—a tax regime—that will promote and encourage investment in those important sectors.
    Mr. Ian Bruce: I also welcome the right hon. Gentleman to his post.
    May I make a serious point about the level at which science, information technology and so on is represented within Government? I have long argued that we should have a Minister of State, rather than an Under-Secretary of State, in the Department of Trade and Industry to do

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    that important job, but what signal does it give to the rest of business that the Secretary of State's Department has two unpaid Ministers dealing with science and technology? Surely that is a worthwhile job within Government, not just an add-on that is not even paid. Will he please start fighting for science and technology in his Department?
    Mr. Byers: Whether the Ministers are unpaid or not, they have managed to achieve far more in their period of office than the hon. Gentleman's Government ever did. The fact that we have secured an extra £1.4 billion for the science base shows that we are achieving value for money from our Ministers. I should have thought that he would congratulate the Department on that fact. If it helps him, he will be pleased to know that, as the Cabinet Minister responsible for the Department, I shall take a close personal interest in how we can encourage and exploit the science base and the knowledge that we have.
    Mr. Ian Pearson: I congratulate my right hon. Friend on his appointment. In particular, I welcome his comments about the boost to the science and engineering base. Is he aware, however, that, under the Tories, spending on development fell to a paltry 3 per cent. of total civil Government R and D expenditure, perpetuating the problem of Britain being good at R but bad at D, and of commercial ideas that were generated in Britain being exploited elsewhere? Will he talk to his colleagues in the Department for Education and Employment about what can be done to improve the percentage of expenditure that goes on D, so that we can have a joined-up Government approach to tackling the development gap?
    Mr. Byers: My hon. Friend makes a good point. I have already begun discussions with my right hon. Friend the Secretary of State for Education and Employment about how the Department of Trade and Industry and the Department for Education and Employment can jointly deal with the many weaknesses that exist because of the situation that we inherited. There is no doubt that it is one of those sectors where we have the potential to be world class. It has been neglected and we now have a Government who are delivering on that important agenda. We intend to move forward and to deliver on our commitment to the science base and to our scientists, so that we can ensure that we are world class in the century ahead.
    Mr. John Redwood: I too congratulate the Secretary of State on becoming the third Labour holder of that office in under two years. I wish him every success in trying to clear up the dreadful mess that was left behind by his predecessor—a mess both in the Department and in the wider business world. I trust that the plight of British industry will be at the top of the Secretary of State's list of priorities.
    Given the Government's enthusiasm for the promotion of genetically modified food, does the Secretary of State see any conflict of interest in Lord Sainsbury, the Minister in the other place with responsibility for technology, being an investor in Sainsbury's, the first supermarket to promote that food; an investor in Diatech and Innotech, two companies that are involved in the technology sector; and having links with the Gatsby Trust, which finances research in the sector—while at the same time controlling
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    policy and grants to the industry? Will the Secretary of State ask his Minister to step aside and find a Minister who has no actual or apparent conflict of interest to do the work?
    Mr. Byers: I shall not be asking that Minister to step aside because steps have been taken to ensure that there is no conflict of interest. On the day on which the House of Lords has produced a significant report on GM foods, I would have expected that, as the principal Opposition spokesman on such matters, the right hon. Gentleman would have addressed the substance of that report. The fact that he has failed to do so says so much more about his priorities than it does about his real desire to move the debate forward in this important area.
    I have no doubt that there is no conflict in my Department on these matters. I will ensure that there is an open and transparent public debate about GM foods which will restore public confidence in this important area. I can guarantee that, but it will not be helped if, instead of seeking to rebuild public confidence in our science and scientists, he simply stands on the sidelines sniping continuously. That is no way to conduct a responsible and reasonable debate.

    Internet
    Dr. George Turner: What steps he will take to encourage UK business and industry to use the internet. [65194]
    Ms Christine Russell: What steps he is taking to encourage the development of electronic commerce in the UK. [65201]
    The Minister for Competition and Consumer Affairs (Dr. Kim Howells): The opportunities offered to businesses large and small by the internet are enormous. That is why the Government placed the use of the internet, and in particular the development of electronic commerce, at the heart of our recently published White Paper. Our goal is an ambitious one: to make the UK the best place in the world for electronic trading. The White Paper set out a wide-ranging agenda of modernisation to achieve this, including an electronic commerce Bill to remove legal barriers, and an extra investment of some £20 million in the information society initiative, to provide practical support and assistance to small firms.
    Dr. Turner: I thank my hon. Friend for that full answer. Given the prediction, which he will acknowledge, that, before the year 2002, there may be a 30-fold increase in the use of electronic commerce throughout the globe, does my hon. Friend agree that that represents a major threat to those who are complacent about its importance as well as some amazing opportunities for those who wish to grasp them? I accept what my hon. Friend said about the legislative background, but does he agree that the Government need to be pro-active so that British companies recognise the opportunities and have access to the skills and finance that they may require?
    Dr. Howells: My hon. Friend is quite right. On checking, I can tell my hon. Friend that e-commerce is currently valued at $12 billion a year world wide and that by the year 2002 it is reckoned that it will be $350 billion

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    to $500 billion a year and we must have a considerable piece of that action. The Government have launched the adviser skills initiative to ensure that businesses advisers can deliver consistent and integrated advice on information technology and best business practice.
    We now have an e-commerce resource centre operating on the internet which will provide businesses with the information, advice and the tools necessary to exploit fully the opportunities of e-commerce. We are drawing up an electronic code of conduct for businesses, which will enable traders to have effective redress and access to complaints procedures and to be identified by a digital hallmark so that everybody involved in e-commerce has confidence that business will be delivered securely.
    Ms Christine Russell: Will my hon. Friend join me in congratulating the business link in my constituency of Chester, which runs a large number of innovative and imaginative programmes and courses to help small firms in particular gain further experience and access to business? I believe that people from 200 small firms attended the last training course. How does my hon. Friend think that the forthcoming e-commerce Bill will further extend the opportunities, particularly for small businesses and start-up businesses?
    Dr. Howells: I should certainly like to congratulate the business link in my hon. Friend's constituency. Across the country, there are also other initiatives that are extremely interesting and take the issue seriously—which, from the jibes that I heard coming from the Opposition Benches a moment ago, is more than Conservative Members can do. The electronic commerce Bill will establish trust in electronic trading by introducing a voluntary licensing scheme for organisations providing secure message services. The Bill will modernise the law so that it recognises electronic signatures and will, whenever it makes sense to do so, remove current laws that insist on the use of paper. The Bill will introduce voluntary licensing agreements for bodies providing electronic signature services and confidentiality services. It will also provide new powers and proper authority for law enforcement agencies to gain legal access to encryption keys and other information protecting the secrecy of stored or transmitted data.
    Mr. Tony Baldry: Clearly, this is going to be a complex Bill. Will the Minister say when the draft Bill will be published? Is it intended that it shall be introduced in the House or in another place? The Minister will be aware that the Trade and Industry Select Committee is about to conduct an inquiry into e-commerce. Will the Government consider the Committee's work effectively as pre-legislative scrutiny work?
    Dr. Howells: I congratulate the Committee on the interesting and pioneering work that it has done. The Government hope very much to introduce the Bill just after Easter. I have absolutely no doubt that full account will be taken of the Committee's work.
    Mr. David Chidgey.: May I also welcome the new Front Benchers to their new positions, and welcome their support for e-commerce? I should like to take the Minister a stage further in his remarks on the
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    regulation of access to e-mail transmission codes. He will be aware of the public's great concern about how access to the codes should be controlled—about the "trusted third party" concept. He will be equally well aware of the great concern about whether organisations such as GCHQ should become a so-called trusted third party. If the House is really concerned about controlling criminal activity on the internet, would it not be much better to press for control of pre-paid mobile telephones, which are used by drug dealers, than to try to foist control by a Government agency on electronic commerce?
    Dr. Howells: That is a long and complex question, and I truly hope that it will not be a long and complex answer. I hope also that the hon. Gentleman's question was not a first bid for his party's leadership. Strong encryption is very useful, as it is used to protect the movement of huge amounts of money through cyberspace. We shall be very careful in ensuring that the libertarian and anarchic spirit of the worldwide web is not circumscribed so that growth is prevented. I should not like any Government—ours, the Americans' or any other one—so to circumscribe the internet and e-commerce that growth is prevented. We need growth.

    Deregulation
    Mr. Richard Page: How many regulations affecting business have been revoked by his Department since May 1997. [65197]
    The Minister for Competition and Consumer Affairs (Dr. Kim Howells): Between 1 May 1997 and 31 December 1998, my Department revoked 16 statutory instruments affecting business and also simplified a further 16 statutory instruments affecting business.
    Mr. Page: That is an appallingly low figure, and the Minister should be suitably ashamed of presenting it to the House. Is he aware that, when in opposition, his colleague—who has recently become a Treasury Minister, because of an unexplained and unexpected vacancy—berated my right hon. Friend the Member for Henley (Mr. Heseltine) when he achieved more than 1,000 deregulations? The Minister now offers an appallingly low figure. Will he now go back to his officials and tell them: "I do not wish the Government to be so humiliated again. Get working on deregulation, so that when that hon. Member asks me that question again in a year—which he will do—I can give a really super answer, helping to take the burdens off the back of small business men and women"?
    Before he answers that, I have a further question: how many regulations has his Department put on to the backs of small businesses?
    Dr. Howells: I was going to ask how the hon. Gentleman—whose friendship I greatly value—could say that with a straight face, but he did not. The list of regulations passed by the Conservative Government between 1979 and 1996 reads like "War and Peace". I have not even got past the first chapter. They passed 45,000 regulations during that period. In the three years before they lost power in May 1997, they passed 10,000 new regulations. Since we came to office, we have introduced 2,700 new regulations. I hope that that answers the hon. Gentleman's question.

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    I am not one of nature's regulators. I should like regulation to decline significantly in this country, but, by God, we have a mountain to climb to get there, because the Conservatives left an enormous avalanche of legislation for us to tackle.
    Mr. Denis MacShane: I thank my hon. Friend for his reply and welcome him as the representative of the anarchist-libertarian wing of new Labour. Has he noticed that the number of regulations that the Labour Government have repealed corresponds exactly with the 16 Tory Back Benchers who have turned up on this historic day, when Question Time is taking place in the morning? Does that reflect their lack of interest in the subject or the fact that more than 200 of them have second jobs, directorships and consultancies and are out lining their pockets instead of being here doing their parliamentary business?
    Dr. Howells: I can answer only a small part of that. I suspect that there is great confusion among the Conservatives about regulations because, clinically, they are still in denial about them.
    Mr. Christopher Chope: The Minister has spoken about the need to simplify regulations. Will he undertake to simplify the working time regulations, which are the most complex and burdensome regulations imposed on British business in a generation? They have been much criticised by the chambers of commerce and are proving difficult to implement. Will he look at them again and come back with simpler regulations? Will he guarantee that, in future, he will always follow the advice of the better regulation task force, which also criticised those regulations? The Government prided themselves on setting up the unit, but was that not just a lot of rhetoric? Is not the reality that the regulations coming from this Government are more burdensome and complex than ever?
    Dr. Howells: I have every confidence that my hon. Friend the Minister of State, Department of Trade and Industry will ensure that every regulation introduced by his unit will be good, necessary and relevant.

    Post Office
    Mr. Bob Laxton: When the Government intend to publish their White Paper on the future of the Post Office. [65198]
    The Secretary of State for Trade and Industry (Mr. Stephen Byers): My right hon. Friend the Member for Hartlepool (Mr. Mandelson) said in his statement to the House on 7 December on the future of the Post Office that a White Paper would be published early in the new year. Work is proceeding with the intention of publishing the White Paper as soon as possible.
    Mr. Laxton: I welcome my right hon. Friend to his new job. The Post Office is a little disappointed that the White Paper has not already been published. The Dutch and German post offices have been gobbling up companies in Europe pretty rapidly. I very much welcome the Post Office's decision to buy into German Parcels. That will greatly assist its future in Europe. To be specific,
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    will the White Paper allow the Post Office the greatest possible commercial freedom? Will the new regulator have sufficient powers to ensure that the Post Office improves on its excellent service to businesses and the community?
    Mr. Byers: I thank my hon. Friend for his words of welcome. The Post Office is not disappointed with the time scale in the White Paper. It is closely involved in discussions about the White Paper and is fully aware of the issues that we wish to address. On 7 December, my predecessor made it very clear that we want a new future for the Post Office. We want to lift the cloud of uncertainty that was created by the previous Government and ensure that it is no longer starved of investment. We are in the process of doing that and the Post Office is already using its new freedoms. For example, it acquired German Parcels at the beginning of this year. The consumer will also benefit from the proposed cut in the price of a second-class stamp—the first cut in many years—which will be welcomed by tens of thousands of people who use second-class mail. This is the future for the Post Office. We are delivering on our promise and supporting the Post Office, instead of neglecting it as the Conservatives did.
    Mr. Stephen Dorrell: I welcome the Secretary of State to his new responsibilities. Will he explain why he thinks that taxpayers should continue to be involuntary risk-bearing shareholders in the Post Office? Will he also explain why he thinks it is in the interests of the Post Office that it should be denied access to the capital markets to allow it to participate in the consolidation of postal services around Europe to which the hon. Member for Derby, North (Mr. Laxton) referred?
    Mr. Byers: I thank the right hon. Gentleman for his words of welcome. As a former Treasury Minister, he will know very well that the financial regime under which the Post Office operated under the previous Government was—
    Mr. Dorrell: Not as good as it could have been.
    Mr. Byers: The right hon. Gentleman is absolutely right. We are now tackling those deficiencies. That is why we have restricted the external financing limits which ensured that the bulk of the profits made by the Post Office went back to the Treasury. We are now allowing the Post Office to keep a far bigger proportion of its profits so that it can invest in the future. Taxpayers have an interest because they are the consumers. We want a Post Office offering high-quality services at affordable prices and we now have a regime to achieve those objectives.
    Mr. Martin O'Neill: I welcome my right hon. Friend to the Front Bench and congratulate him on his involvement in negotiations regarding the Post Office in his previous role. Can he confirm that the recent acquisition of German Parcels and the circumstances surrounding it necessitated a degree of commercial confidentiality that is consistent with commercial freedom? Opposition Members must realise that the new Post Office will behave in a different way, but, at the

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    same time, there will be processes involving the regulator, which will entail a degree of accountability and transparency consistent with its new freedoms.
    Mr. Byers: My hon. Friend makes an important point, with which I agree. We need to put in place a proper system of liberalisation and tough regulation for the new Post Office. The White Paper will address those issues, but Opposition Members must acknowledge that, because we are in a new relationship with the Post Office, we shall need to respect commercial confidentiality; otherwise, we shall make the Post Office vulnerable to foreign competition. Opposition Members may want that, but we certainly do not. We want a Post Office that will be a partner in change, not the victim of change. That is what we want and we have now put in place the regime to ensure that it happens.

    Energy Policy
    Mr. Owen Paterson: If he will make a statement on the Government's energy policy. [65199]
    The Secretary of State for Trade and Industry (Mr. Stephen Byers): The Government are committed to competition, and to an energy policy based on secure, diverse and sustainable energy supplies at competitive prices.
    Mr. Paterson: The Secretary of State did not mention that the Government are committed to raising 10 per cent. of energy from renewable resources by 2010. If half that energy were to come from wind, 10,000 to 20,000 turbines would have to be built. The 800 that have been built—in areas such as the Shropshire-Wales border—are an environmental disaster and bitterly resented by locals. Contrary to the Secretary of State's statement, they generate energy at three to five times the cost of other sources. They are extraordinarily unreliable. They have to be closed down in freezing weather, when demand is at its peak—
    Madam Speaker: Order. The hon. Gentleman must ask a question; otherwise, I will refer him to an Adjournment debate, as that sounds like a very good subject for such a debate.
    Mr. Paterson: Will the Government abandon this foolish policy?
    Mr. Byers: A long question deserves a short reply. A paper on renewables will be published by the Government shortly.
    Mr. George Stevenson: In the review of energy policy, will my right hon. Friend consider the activities of the Coal Authority, particularly in regard to abandoned and disused mine shafts? Is he aware that the Coal Authority's records in this regard are notoriously unreliable? Will he therefore consider urgently what action the Coal Authority should take to make sure that its records are accurate and clearly show not only the siting, but the status and condition of the abandoned mine shafts?
    Mr. Byers: My hon. Friend makes a very important point, which affects many communities up and down
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    the country. The Government take the matter seriously and, as a matter of urgency, we will be asking the Coal Authority to review its procedures to ensure that accurate information is available, so it can plan accordingly.
    Mr. Eric Forth: In congratulating the Secretary of State on his appointment, may I ask him to confirm that the motto of his Department will from henceforth be, "Let Byers beware"? Why have the Government sought on environmental grounds successively to increase the tax on fuel duty for motor vehicles, while simultaneously reducing the tax on domestic fuel, which pollutes the atmosphere as much as, or even more than, vehicle fuel?
    Mr. Byers: I thank the right hon. Gentleman for his welcome. As far as fuel is concerned, we know that the Conservative Government sought to dramatically increase the rate of VAT.
    Mr. John Bercow: Do not split infinitives.
    Mr. Byers: The hon. Gentleman must be careful, otherwise someone will split his infinitives for him. There are many Labour Members who would gladly volunteer to do so. The hon. Gentleman is trying to divert me from the important political point that I was making. The previous Conservative Government put VAT on domestic fuel at 17 per cent. Even in opposition, we managed to defeat that and, in government, we were able to reduce VAT to 5 per cent. That has been welcomed by consumers, and we are looking at how we can ensure that, in terms of a proper, sustainable environmental policy, we can have fuel that is not costly—the right hon. Gentleman would like that—and within a safe and secure environmental policy.

    Regional Start-ups
    Dr. Phyllis Starkey: What measures he is planning to help new start-ups in the regions. [65200]
    The Minister for Small Firms, Trade and Industry (Mr. Michael Wills): Support for start-ups is seen as making a significant contribution to economic growth, prosperity and competitiveness. The recent competitiveness White Paper set out a commitment for business link partnerships to provide sustained, tailored advice and support to innovative start-ups with real growth potential. Our target is that at least 10,000 businesses a year will receive such support by 2001.
    Dr. Starkey: My hon. Friend will be aware that UK science is at the international forefront in biotechnology, but that there is a relatively poor take-up of biotechnology in start-ups of small firms in the UK, compared with the United States. The major advantage in the United States is the ready availability of venture capital for such biotechnology firms. What action are the Government taking to ensure that venture capital is readily available here in every region?
    Mr. Wills: My hon. Friend draws attention to an important matter. It is crucial that start-ups, especially in

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    high technology, get access to the right sort of capital. The competitiveness White Paper set up plans to that end. We are setting up an enterprise fund worth £150 million over three years. There will be a national venture capital fund, which we are currently discussing with leading financial institutions. We also want to set up regional venture capital funds, and we will work with the regional development agencies to develop that proposal.

  CULTURE, MEDIA AND SPORT (MILLENNIUM EXPERIENCE)
  The Secretary of State was asked—
  CULTURE, MEDIA AND SPORT (MILLENNIUM EXPERIENCE)

    Corporate Sponsors
    Mr. Eric Forth: If he will list the corporate sponsors of the millennium dome. [65225]
    The Minister for Tourism, Film and Broadcasting (Janet Anderson): Last November, the New Millennium Experience Company announced confirmed sponsorship of £120 million from Tesco, Manpower, BT, BSkyB, Marks and Spencer, Boots the Chemist, McDonald's, British Airways, GEC, British Aerospace, the Corporation of London, British Airports Authority and Camelot. In addition, Thames Water is funding the innovative grey water recycling facility at the dome. That is a fantastic achievement in anyone's books.
    Mr. Forth: I welcome the Minister to this aspect of her responsibilities and thank her for her answer, which already shows an openness that we had come not to expect from her predecessor. May I urge her to go yet further and confirm that, henceforth, the secrecy that we came to expect—in retrospect, we can understand why it existed—will be swept aside, and she will share with the House and the country all aspects of the financing of the dome project, so that we can see that there is nothing hidden, nothing secret and nothing to be ashamed of, and, most importantly, that all the sponsorship is absolutely clean and above board?
    Janet Anderson: We have always been very open about the project. I shall continue to be as open as my right hon. Friend the Member for Hartlepool (Mr. Mandelson), who always answered fully any questions raised in the House. The right hon. Gentleman would do his country better service if he would get behind the project and give it the support that it deserves.
    Mr. Andrew Reed: I welcome the list of sponsors. What sponsorship was in place when the Government took office in May 1997, and what would have happened to the dome if we had let that legacy stand? More importantly, what progress has been made on the spirit zone, and what sponsorship will be available to ensure that the dome celebrates the millennium in the way that was intended, as a religious festival marking 2,000 years since the birth of Christ?
    Janet Anderson: My hon. Friend has raised an important point. When the Government took over, no sponsorship whatever was in place. More than
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    £120 million of sponsorship has now been committed to the millennium experience and the New Millennium Experience Company is well on the way to reaching its £150 million target. Good progress has also been made on the spirit zone, both in design and construction and in raising the necessary sponsorship.
    Mr. Peter Ainsworth: I hope that you will forgive me, Madam Speaker, for remarking that this is an odd occasion: here we are at the butt end of Trade and Industry questions, and it is rather like an end-of-run panto in which the demon king, consumed in a puff of his own sulphur, has left the show for good.
    I warmly and sincerely welcome the Minister to her new role as fairy godmother to the project. I wish her well in answering questions on it, even though she is not responsible for the project. She obviously is not a former flatmate of the Prime Minister, as one has to be a crony to get a top job. Will she make a new start and undertake to be open, frank and honest in all her dealings concerning the project, and to give it to us warts and all? Will she begin by telling us how many of the zones still have to be fully sponsored?
    Janet Anderson: I say to the hon. Gentleman, as I said to the right hon. Member for Bromley and Chislehurst (Mr. Forth), that I wish that Conservative Members would get behind this unique national project. This country is rapidly becoming recognised internationally as the country of the millennium. Raising £150 million of private sector sponsorship is a considerable challenge, but no one has ever before decided to stage such a unique national event. I remind the hon. Member for East Surrey (Mr. Ainsworth) that, when this Government took office, the previous Government had not raised one penny of private sector sponsorship for the project.

    Mind Zone
    Mr. Tony McWalter: What plans he has for the Millennium Experience to celebrate the human capacity to think. [65226]
    The Minister for Tourism, Film and Broadcasting (Janet Anderson): The mind zone, one of fourteen exhibits in the millennium experience dome, will celebrate the unique creativity of the human brain by exploring the nature of our senses and perceptions through traditional art and advanced technology.
    Mr. McWalter: I thank my hon. Friend for that answer and express my pleasure in welcoming her to her new duties. I am a member of the National Committee for Philosophy, a post which naturally carries no remuneration. Those functions that require recognition, such as the contribution that philosophers have made to our culture in the past thousand years, may be left out because some bodies are unable to get the high levels of sponsorship that will be needed to obtain space in the dome. Will my hon. Friend be receptive to representations

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    from professions such as philosophers and others to ensure that the contribution made by such people to our culture is given full expression in the dome, and that the dome is not a dumb dome, as some have suggested that it might be?
    Janet Anderson: I reassure my hon. Friend that we are well aware of his expertise in this area and proud to have him as a colleague. We are always willing to meet anyone who has an interest in the dome. The mind zone will show how medical imaging technology allows us to follow the response of our brains to sensory input. Visitors will interact with advanced, intelligent robots in the robot zoo and enjoy a specially commissioned film showing images that challenge the very limits of our senses.
    Mrs. Virginia Bottomley: Is the hon. Lady aware that so much of the thought of the past millennium, and the creativity and achievements of people around the world, has been inspired by the Christian faith? In spite of her earlier and welcome answer, is she aware that many people feel that the millennium dome has been hijacked by new Labour to act as a party political launch pad, including much of the language and imagery? It is essential, when she advises her noble Friend who has taken responsibility for the millennium experience, that she tells him that the dome is not a party political launch pad but a celebration of the achievements of our nation in the past millennium while looking forward to the future.
    Janet Anderson: I assure the right hon. Lady that we have never attempted to make the dome a party political launch pad. Indeed, my right hon. Friend the Secretary of State, at a well-attended event held yesterday to explain what we are doing for the millennium, made it plain that the project was started by the Conservatives. If the right hon. Lady wishes to make cheap political points, I remind her that her right hon. Friend, Michael Heseltine—[Interruption.] I am sorry, I mean the right hon. Member for Henley (Mr. Heseltine). He has been involved in the project from the start. I hope that the right hon. Lady will get behind this unique national project, which is recognised internationally as a symbol of the millennium. She should give it her full support.

    Dome (Maintenance Costs)
    Mr. Gordon Prentice: What is the estimated annual cost of maintaining the fabric and structure of the dome. [65227]
    The Minister for Tourism, Film and Broadcasting (Janet Anderson): The New Millennium Experience company estimates that the cost of necessary maintenance inspection work on the dome fabric and structure during 2000 to be about £30,000. Such regular inspections will help keep maintenance costs to a minimum.
    Mr. Prentice: I warmly congratulate my hon. Friend on taking up her new and challenging responsibilities. May I remind her that, although it seems like only yesterday, it was two months ago that the right hon. Member for Hartlepool (Mr. Mandelson) told us the dome would be with us for a quarter of a century?
    Mr. Eric Forth: Well, he wasn't!
    Mr. Prentice: I was not responsible for scripting that.
    My hon. Friend has told us that £30,000 will be spent on the upkeep of the dome during 2000. Would it not be a good idea to spend a little more on the extra bit of paint that might extend the design life of the dome beyond 25 years, taking, perhaps, the Eiffel tower as an inspiration for what can be done?
    Janet Anderson: I thank my hon. Friend for his question and for taking the issue seriously, unlike Opposition Members. The lifetime of the dome's roof is estimated at 25 years, which is one reason why there is that cut-off. However, as the Prime Minister has said, the dome is too good to pull down, and we want to find a fitting use for it beyond 2000. The Deputy Prime Minister's Department is responsible for English Partnerships, and he has asked officials to work out proposals for the best mechanism by which to encourage and assess expressions of interest, including a timetable and criteria against which bids may be judged.

Business of the House
12.32 pm
Sir George Young: May I ask the Leader of the House to give us the business for next week?
The President of the Council and Leader of the House of Commons (Mrs. Margaret Beckett): The business for next week will be as follows:
MONDAY 25 JANUARY—Second Reading of the Sexual Offences (Amendment) Bill.
TUESDAY 26 JANUARY—Second Reading of the Tax Credits Bill.
WEDNESDAY 27 JANUARY—Until 2 o'clock, there will be debates on the motion for the Adjournment of the House.
Opposition Day [4th Allotted Day].
Until about 7 o'clock, there will be a debate on Terrorist Mutilations in Northern Ireland. Followed by a debate on the London Underground. Both debates will arise on opposition motions.
THURSDAY 28 JANUARY—Motions on The Social Security Benefits Up-rating Order, The Social Security (Contributions) (Re-rating and National Insurance Fund Payments) Order and the Guaranteed Minimum Pensions Increase Order.
FRIDAY 29 JANUARY—The House will not be sitting. The provisional business for the following week will be as follows:
MONDAY 1 FEBRUARY—Second Reading of the House of Lords Bill.
TUESDAY 2 FEBRUARY—Conclusion of Second reading of the House of Lords Bill.
WEDNESDAY 3 FEBRUARY—Until 2 o'clock there will be debates on the motion for the Adjournment of the House.
Opposition day [5th Allotted Day].
There will be a debate on an Opposition motion. Subject to be announced.
THURSDAY 4 FEBRUARY—MOtiOn on the Police Grant Report (England and Wales).
Motions on the English Revenue support Grant Reports.
FRIDAY 5 FEBRUARY—The House will not be sitting.
Sir George Young: The House is grateful for the business for next week, and for an indication of the business for the following week.
On the House of Lords Bill, may I ask—I hope for the last time—that the Government respect the convention that all the Committee stage of that constitutional Bill will be taken on the Floor of the House? The right hon. Lady has come to the altar on that point, but she has not yet said yes. Will she also explain who will answer parliamentary questions on constitutional issues, and when? May we have a debate, in Government time, on the White Paper published yesterday?
The right hon. Lady has announced a debate on the police grant for England and Wales, and she will be aware of widespread concern about the level of provision. Will she assure the House that we may have a full three-hour debate on that subject?
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Can the right hon. Lady give the House the date for the Budget?
Can the right hon. Lady tell us the position on the constituency week in February, the notional date for which is fast approaching?
Finally, the right hon. Lady has announced two Opposition day debates. If one so-called Opposition party both deepens and broadens its co-operation with the Government—and there are more and more areas on which that party is in effect part of the Government—is it not time to reallocate Opposition days to a party that is not compromised in that way, and which will oppose the Government without pulling its punches?
Mrs. Beckett: The right hon. Gentleman asks me about House of Lords reform. I can now give him an answer about the handling of the Bill, although I was not willing to do so before. The short and simple nature of the Bill enables me to say that we will take all of it on the Floor of the House, which will be for the convenience of the House.
The right hon. Gentleman should know that views differ in the House as to whether we are required to take all the Committee stages of all such Bills on the Floor, but this is such a short and simple measure that we certainly accept that it is for the convenience of the House to do so, although, for example, we thought it right to split the Greater London Authority Bill.
The Minister with responsibility for constitutional issues will answer questions on those issues, which means me on questions of House of Lords reform. As to when, it will be at the appropriate time. The right hon. Gentleman asked for a debate on the White Paper as such. As the House will appreciate, I have just announced a two-day Second Reading debate. Subject to the views of the Chair, some of those issues might well be raised then and we will certainly discuss the matter through the usual channels if it is thought that it needs to be considered further.
Similarly, the right hon. Gentleman asked for a longer debate on the police support grant and on various other issues. Again, that is a matter for discussion through the usual channels. I am not unfavourable to the idea of giving greater time to the police support grant debate and we can consider it. I cannot give him a date for the Budget—I will do so as soon as I can—nor can I add to what I told him about the constituency week in February. I understood his final remarks about Opposition days to be an opening in a general passage of arms about political matters, not a serious application to change such days.
Mr. Dale Campbell-Savours: Has there been any progress on the debate that I have been calling for on the treatment by National Westminster bank of its customers, in particular the Tanning Shop franchisee customers? Is my right hon. Friend in a position to join me in asking the Chairmen of the Select Committees on Treasury and on Trade and Industry to take evidence in joint session from the management of that bank—in particular, Mr. Robert Munn and Mr. Peter Stern, who know the truth about how shabbily NatWest has treated many of its customers nationally?
Mrs. Beckett: I cannot accede to my hon. Friend's request for a debate, although he is right to say that he

1023
has raised the matter on a number of occasions. He will know that the Chancellor of the Exchequer announced a review of banking services in the pre-Budget report. My hon. Friend raises a particular case on behalf of his constituents and asks me to invite the Chairmen of two of our Select Committees—Treasury and Trade and Industry—to have a joint session on the matter. With the greatest possible respect, it is not for me to set the agenda for Select Committees. However, I am confident that if he contacts my hon. Friends who hold those posts, they will give him a sympathetic hearing.
Mr. Paul Tyler: May I suggest to the Leader of the House that it would be somewhat bizarre if we could not extend the debate on the House of Lords Bill to wider consideration of House of Lords reform? I hope that that will be possible. Perhaps some discussions can take place through the usual channels to ensure that it is. Clearly, since all parties want the Bill to be a first step towards more comprehensive reform, it would be extraordinary if we were prevented from having such a discussion.
Is it the present intention of the Government in due course to put the fuller proposals for reform of the House of Lords to the people in a referendum? Do they intend to do so in this Parliament, if that can be achieved? Does the right hon. Lady agree that it would be curious if the House of Lords were subjected to effective reforms that made it more accountable, democratic and representative, but the House of Commons were not given that opportunity at the same time?
Mrs. Beckett: First, the hon. Gentleman asked me to give an indication of the handling of the debate. I was somewhat cautious in my response to the right hon. Member for North-West Hampshire (Sir G. Young) earlier. The Government have provided time for a two-day debate, thus facilitating a very full debate which we hope will enable hon. Members to air several matters. The hon. Gentleman will appreciate that I am in no way seeking to fetter the discretion of the Chair in the difficult decisions that must be made.
The hon. Gentleman asked whether it was our intention to have a referendum, perhaps in this Parliament. We are in no way at the stage of announcing such conclusions to the House. On reflection he will probably agree that there may be a creative tension between those who want to see speedy progress on this matter and those who wish to insert a referendum into the process, since that in itself would have a legislative requirement, apart from any other.
Finally, the hon. Gentleman said that the outcome of the process might be to make the House of Lords more democratic and representative than this Chamber. I do not for a second accept that that could possibly be the outcome. It certainly could make the second Chamber have some tenuous link with democracy and representation of a kind that it certainly lacks now. If, however, his remarks were a reference to a perceived lack of legitimacy of this House because of our electoral system, that is not a view I share.
Several hon. Members rose—
Madam Speaker: Order. After hearing the last two questions put to the Leader of the House I must remind
1024
hon. Members that we are asking about the business for next week. The use of this period is deteriorating and I take the opportunity of putting it on record that business questions must relate to next week's business. It is not an occasion to make long comments about personal or constituency cases. Nor should matters be raised that relate to the right hon. Lady's ministerial responsibilities as President of the Council, for which a separate question period is set aside. Hon. Members will be aware of that. Today, I expect brisk questions relating directly to next week's business. I know that I shall also get short responses from the Leader of the House, who is sympathetic to my approach on this matter.
Ms Joan Walley: In view both of the publication today of the House of Lords Select Committee report and of next week's business on the future of the House of Lords, can my right hon. Friend tell the House whether there will be an early opportunity to discuss genetically modified foods, particularly given the concerns of those who wish to have the choice not to buy GM foods?
Mrs. Beckett: I welcome the Select Committee's report as a useful contribution to the debate. Not everyone will agree with it and I am not committing myself about the attitude that the Government will take. I am simply saying that anything that contributes to the debate is welcome. I fear that I cannot promise my hon. Friend an early debate on this matter, but we shall take her request into account.
Mr. Alan Clark: Will the right hon. Lady confirm that it is not too late to put into next week's business an urgent debate on the corruption of EC Commissioners? Her right hon. Friend the Prime Minister dismisses any criticism of the EC Commission by attributing to those who make it a desire to pull out of the whole show immediately, but enormous sums of taxpayers' money have been misappropriated by individual commissioners, in particular by the French commissioner Madame Cresson. It is to be hoped that in such a debate right hon. and hon. Members on both sides of the House would be rather less docile than those who followed the instructions of the Prime Minister in the European Parliament last week.
Mrs. Beckett: I fear I cannot undertake to find time for a debate on that matter in the near future. Nor do I share the right hon. Gentleman's rationale for having such a debate. My perception is that the European Parliament and, indeed, representatives from many parties in that Parliament have expressed great concern and taken a tough line on fraud. Certainly this Government have done so. Those representatives emerge from last week's events with a strengthened means of scrutiny. I do not doubt that they will use those means and, if necessary, return to the subject.
Mr. Tam Dalyell: In view of Monday's Adjournment debate on sanctions against Iraq and Tuesday's ten-minute Bill on parliamentary approval of military strikes, could a Minister see Denis Halliday, the former United Nations co-ordinator, who happens to be in Britain on Tuesday? He resigned his job on principle because he disagreed with the policy on Baghdad.
Mrs. Beckett: I understand that my hon. Friend the Member for Glasgow, Kelvin (Mr. Galloway) has invited

1025
all hon. Members to a meeting with Mr. Halliday on 26 January. I cannot know at this moment whether any of my ministerial colleagues will be able to meet him, but my hon. Friend is a classic example of how a Member's assiduity can obtain opportunities for debate on the Floor.
Mr. Eric Forth: Does the Leader of the House accept that the announced departure of the leader of the Liberal party, which causes us all such sadness, gives the House an opportunity urgently to consider the anomalous position, largely created by him, whereby he was attempting to be at the same time part of the Government and part of the Opposition? Is she aware that that is causing concern not only among Opposition Members but among senior Labour figures? Will she provide time in next week's business to sort the matter out once and for all and decide whether the Liberal Democrats are part of the Government or a serious Opposition party?
Mrs. Beckett: If I were a Conservative, I would be cautious about making remarks about a serious Opposition party, because if the Conservatives were judged on performance, they might find themselves in some difficulty. It is not the act of a serious Opposition Member of any party to veto private Members' Bills through frivolous activity, as the right hon. Gentleman did in the previous Session. I cannot undertake to find time for a debate on the private affairs of any political party, no matter how dear the subject may be to the heart of many Members.
Mr. Keith Vaz: Will the Leader of the House find time next week for a debate on the position of the textile industry, following the announcement by the American Government that tariffs are to be imposed on textiles produced in Britain for import to America? Is not that an important subject for debate next week?
Mrs. Beckett: I understand my hon. Friend's concern, which I know is shared. I fear that I cannot undertake to find time for a special debate next week, other than the one that is taking place on Wednesday morning.
Mr. John Hayes: Will the Leader of the House pay attention to early-day motion 188, on the EU Commission, which requires urgent debate next week?
[That this House deplores the failure of Socialist MEPs to support measures to protect taxpayers' money from fraud, preferring instead to protect members of the EU Commission accused of fraud and nepotism; and applauds the efforts of Conservative MEPs to hold certain Commissioners to account on behalf of the taxpayers of Europe.]
Further to the question of my right hon. Friend the Member for Kensington and Chelsea (Mr. Clark), I hope that the right hon. Lady will also pay attention in planning next week's business to the widespread public disgust at the behaviour of 52 Labour Members of the European Parliament who did not have the courage of their convictions in pursuing their own motion. Would not that
1026
debate allow the Government to confirm that the behaviour of Edith Cresson does not accord with what we would expect of one of our Ministers?
Mrs. Beckett: I repeat that I will not be able to find time for a debate on that matter; nor do I share the hon. Gentleman's view of the premise for such a debate. There is a reform plan. We utterly condemn, as anyone must, any suggestion of fraud, corruption or incompetence and have supported measures to deal with them. As for the attempt to pretend that what happened resulted solely from the actions of Labour representatives in the European Parliament, he should know that members of his party saw the sense of our representatives' actions and voted with them.
Mr. Harry Barnes: The Prime Minister would like people to become middle class, which is difficult for those who do not have a job, house or, in some cases, a vote. The homeless normally fall into all three categories. Can we therefore have a debate next week on homelessness and particularly on the inability of the homeless to vote? That ability could be delivered quickly to homeless people, even though it is more difficult to achieve jobs and houses.
Mrs. Beckett: I certainly know of my hon. Friend's long campaign to encourage people to ensure that they have the opportunity to exercise their voting rights. It is a campaign that every hon. Member from every party should support. I appreciate that one of the effects of being homeless, among other damaging effects, is that someone can be disfranchised.
I hope that my hon. Friend is aware that my right hon. Friend the Home Secretary currently has these matters under review. I think that the remarks made by my right hon. Friend the Prime Minister have been to some extent misreported. He is saying that we ought to move further and further away from seeing barriers of class as a barrier to advancement. I hope that all hon. Members support that.
Mr. Peter Luff: Will the Leader of the House find time for an early debate on the defence industry? I am sure that she will understand that, as a Member of Parliament for a significant British Aerospace factory in a sector undergoing rapid restructuring, I was deeply concerned by the Prime Minister's comments yesterday at Question Time, in which he seemed to suggest that he would give primacy to European rather than British interests in the restructuring of the defence industry. Such a debate would enable Opposition Members to express their deep concern at the implications of that approach.
Mrs. Beckett: I am afraid that I cannot find time next week for a debate on the defence industry. Nor do I share the hon. Gentleman's view that the Prime Minister said anything yesterday that caused the need for such a debate. My right hon. Friend perfectly properly takes a robust attitude to the defence of Britain's armed forces and to their exercising the role to which their professionalism and skill entitle them in international deliberations and events.
Mr. Ted Rowlands: Will my right hon. Friend—[Interruption.] Will my right

1027
hon. Friend reconsider next week's business to include a whole day's debate on the transfer of functions order for the National Assembly for Wales? It is a document of enormous constitutional significance. The corresponding functions were transferred to Scotland by means of a schedule to the Scotland Bill and were therefore subject to scrutiny. Will my right hon. Friend give us an assurance that there will be proper scrutiny of the order and a full debate on it?
Mrs. Beckett: I am afraid that I cannot undertake to give my hon. Friend such a day's debate in the near future. He raises some matters of considerable importance, and I undertake to draw his remarks to the attention of my right hon. Friends.
Mr. Andrew Lansley: The right hon. Lady has said that she cannot now announce the date of the Budget, but will she say that she is seeking an early date from the Chancellor of the Exchequer? She will know that yesterday's figures from a survey of independent forecasters predicted 0.6 per cent. growth in the United Kingdom this year compared to the Budget forecast of up to 1.5 per cent. So a central part of the pre-Budget report has been proved wrong already and it is urgent that the Chancellor come forward with a new economic forecast at an early date.
Mrs. Beckett: I am afraid that I am still not in a position to give the hon. Gentleman a date for the Budget. Nor is it part of my role to press for an early Budget. The timing of the Budget is a matter for consideration by the Government as a whole, and especially the Chancellor.
Nor does the case that the hon. Gentleman makes provide the justification for an early Budget. My right hon. Friend the Prime Minister dealt with the point yesterday. One of the ways in which the Conservative party is making itself faintly ridiculous is, in the light of what happened not only in Asia and subsequently in Russia but in Brazil, to pretend that the Government are causing any problems that might beset the British economy.
Mr. John Cryer: May we have a debate or at least a statement next week on the new guidelines issued on education action zones? The new guidelines are specifically designed to make it easier for businesses to take over and lead the zones, which presents the fairly nauseating prospect of companies such as McDonald's or the Edison project taking over the powers of local education authorities.
Mrs. Beckett: I am afraid that I cannot provide time for an early debate on the matter. I understand the concerns that my hon. Friend raises about the guidelines. I feel confident that he will have a number of opportunities to raise those concerns. There are a number of examples of businesses with a strong local presence becoming involved and contributing to the local education system, and most hon. Members would not object to that.
Mr. Robert Syms: Can the Leader of the House find time for a debate next week on the 175th anniversary of the Royal National Lifeboat Institution? Hon. Members on both sides of the House would like the opportunity to discuss the institution's
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good work. It is based on public subscription and is not funded by the taxpayer. It saves many lives in the seas around this country and southern Ireland. The headquarters are in Poole, and those of us with coastal constituencies would like an opportunity next week to express our appreciation for the good work that the institution does.
Mrs. Beckett: I am sure that the whole House shares the hon. Gentleman's words of commendation for the RNLI's work. I am sorry that I cannot find time for a debate next week. Had we had a little more notice, we might have looked for an opportunity to press for the matter to be touched on in some way. The whole House shares the congratulations and encouragement that the hon. Gentleman has offered. Perhaps there is no need for a debate and we can simply record our thanks and congratulations.
Mr. David Chaytor: In view of last week's decision by the new German Government to terminate their nuclear reprocessing contract with British Nuclear Fuels, the subsequent ministerial meetings this week, and the traditional culture of secrecy that surrounds all matters of nuclear power in this country, does my right hon. Friend agree that next week is the right time to debate the implications for the nuclear industry of the current question mark over reprocessing?
Mrs. Beckett: I can understand the concern that lies behind my hon. Friend's question and why he is pressing for an urgent debate. When a matter arises which clearly raises serious issues, it is always difficult to know when to press for a debate on it. I certainly cannot find time for one next week. Matters might not yet be sufficiently resolved for there to be as constructive a debate as my hon. Friend would wish. I feel confident, however, that he will use any opportunities available to him to continue to press the matter.
Mr. Ian Bruce: Will the right hon. Lady use her ingenuity to fit into next week's debate on the social security uprating the issue of long-term unemployment? The problem is that the long-term unemployed are claiming a lot of social security benefits. I have written to the Prime Minister pointing out that, despite the 70,000 people who are supposed to have got into some sort of scheme or back to work through the new deal, the long-term unemployment statistics published by the Government show that the number of unemployed 18 to 24-year-olds remains static, and the number of long-term unemployed whom the new deal is supposedly helping has risen by 46 per cent. in one category. The matter is of great urgency to all hon. Members and should be dealt with urgently.
Mrs. Beckett: I remind the hon. Gentleman that it is not for me to use my ingenuity to fit other issues into next week's debate; rather, it is for hon. Members to use their ingenuity, subject to the generosity of the Chair. The hon. Gentleman quotes figures on the unemployment record and some categories of unemployed. I must admit that I am not familiar with them, so I am not in a position to query them. My understanding of the overall position, on

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which I have seen a great many figures, is that it is steadily improving, although not, of course, as fast as all hon. Members would like.
Mr. John McDonnell: My right hon. Friend has announced a debate on transport in London next week. Can that be extended to include security at Heathrow airport in the light of yesterday's reports of further lapses in security? This is the third time in the past decade that lapses in security have been exposed. They put at risk not only my constituents but the whole travelling public.
Mrs. Beckett: My hon. Friend is entirely right to say that this matter has occurred before, as all hon. Members will recall. The Deputy Prime Minister has ordered an immediate and full investigation. He has also made it plain that tough action will be taken if security is breached, and that there will be a wider check of security procedures at other airports. However, although my hon. Friend is welcome to try, I suspect that it might test the Chair if he were he to attempt to work that matter into a debate on London Underground—unless he can tie it to Heathrow station.
Madam Speaker: Which I do not think the hon. Gentleman would be able to do.
Mr. Owen Paterson: May we have a debate on the Government's energy policy? Commitments on Kyoto and on achieving the cheapest price of electricity possible for each consumer, and commitments to the Government's friends in the mining industry have, according to reports in The Times yesterday, run slap-bang into another policy dear to the Government's heart: the working time directive. Such a debate would allow the right hon. Lady's successor at the Department of Trade and Industry, the right hon. Member for Hartlepool (Mr. Mandelson), who is just leaving the Chamber, to explain the policies that he put into practice.
Mrs. Beckett: I do not accept that there is a difficulty. The implementation of policy is always a balancing act. I also do not accept—nor, I am sure, does my right hon. Friend—that there is an inherent contradiction in the Government's approach to these matters. I fear that I cannot find time for a debate on the issue in the near future.
Mr. Geraint Davies: Can my right hon. Friend find time next week for an urgent debate on the London fire service and its funding? The service is threatened because of the budgetary crisis. In New Addington in Croydon it serves an isolated community with many young families and a history of fires. There have been cases of arson in local schools and in a local chemical factory. There is great concern, so can she consider finding time for such a debate?
Mrs. Beckett: I fear that I cannot find time next week for a debate specifically on the fire service, but my hon. Friend will have noted that there is to be a debate on English revenue support grant orders the following week. He may be able to work it into that.
Mr. John Bercow: May we have an early statement to clarify the Government's intentions on
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the handling of the Second Reading debate on the Bill to reform the House of Lords? Yesterday afternoon, the Leader of the House invoked the precedent of Dick Crossman in November 1968 to justify the fact that she, rather than her right hon. Friend the Prime Minister, was making the statement on reform. Is she aware that, in the instance to which she referred during the last major legislation to reform the House of Lords, the Second Reading debate on the Bill was opened by the then Prime Minister, Harold Wilson? In view of her admirable respect for precedent, will she guarantee that the Second Reading debate next Wednesday will be opened by the Prime Minister?
Mrs. Beckett: One should always respect precedent, but not necessarily be bound by it. In our exchanges yesterday, I was correcting misinformation given to the hon. Member for Woodspring (Dr. Fox), who I am sure did not intend to mislead the House when he referred to other precedents. It is 30 years since that debate was instigated by the then Prime Minister.
There are a variety of precedents concerning who has spoken in debates on this and other constitution reforms. If the hon. Member for Buckingham (Mr. Bercow) has looked at the record, he will know that in those days matters were handled differently between Prime Ministers and departmental Ministers. Most of the subsequent changes were introduced during the premiership of Baroness Thatcher, who now sits in the House of Lords. The hon. Gentleman is a great admirer of hers, so I am sure that he would not wish us to discard those precedents.
Mr. Ben Bradshaw: Will my right hon. Friend find time next week for a debate on the timing and details of the implementation of the recommendations of the Jenkins commission? This has been official Labour party policy since the time of the late John Smith, and it would give the Government a chance to show that they are in the business of honouring their manifesto promises.
Mrs. Beckett: As my hon. Friend will be aware, we are indeed in the business of honouring our manifesto promises. It is entirely possible that there will be a referendum on this matter before the end of this Parliament. I fear, however, that it will not be in this Session, so I cannot find time for a debate next week.
Dr. Julian Lewis: Will the Leader of the House at least try to prevail on the Prime Minister to come to the House next week and make a statement on the recent announcement that the leader of the Liberal Democrats is to retire—and, in particular, tell us whether that retirement signifies the welcome demise of plots to replace our successful first-past-the-post electoral system with the outrageously undemocratic system of proportional representation, which has given the Green party in Germany control of the Foreign Ministry on the basis of less than 7 per cent. of electoral support?
Mrs. Beckett: I fear that I could not possibly encourage my right hon. Friend to come to the House to comment on the political affairs of another party. Indeed, I am sure that he would refuse to do so. As for the hon. Gentleman's other comments, no doubt we shall return to those matters during the months ahead.
Mr. William Ross: In your statement earlier today, Madam Speaker, you said that

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business questions should relate solely to next week's business. Nowadays, business for the next two weeks is always announced, although the business for the second week is provisional. Do you intend to bar all questions about business for the second week?
Madam Speaker: No. My point is that Members should refer to business that is before us—business for next week, or for the week after. At present, Members are asking the Leader of the House questions that do not relate to business at all. That has been the habit in recent times. I am anxious for Members to discuss the business for the next week and for the week after, if the Leader of the House has announced it.
Sir Patrick Cormack: Will the right hon. Lady confirm that, during the debate on the House of Lords reform Bill, a Minister will open and close the debate on each day? Is that the intention? Will the right hon. Lady also try to ensure that the point about the White Paper is clarified in next week's business statement, so that we know whether we are debating just the Bill or both topics?
May I raise an important matter that relates directly to constitutional business? Will the right hon. Lady make a statement next week about the Government's intentions on the taking of questions on constitutional matters, which are at the forefront of their legislative programme? At present, in her capacity as Lord President, the right hon. Lady answers questions only once a month, sharing a quarter of an hour with the House of Commons Commission and sometimes being given less than 10 minutes. I am sure she agrees that is wholly inadequate for such a crucial issue. Can the Order Paper be rearranged; and will the right hon. Lady announce her intentions to the House so that constitutional questions are properly dealt with?
Mrs. Beckett: The hon. Gentleman asked me about the handling of a debate. All the matters that he raised can be examined through the usual channels. It is entirely possible that the debate will be opened and closed each day by a Minister, but if it is thought convenient to the
1032
House for fewer Front-Bench speeches to be made, that too can be considered. No firm conclusions have been reached, but the matter can be cleared up through the usual channels. The same applies to discussing the White Paper in the context of the debate.
I am grateful to the hon. Gentleman for his follow-up question. I was slightly puzzled as to what his right hon. Friend the Member for North-West Hampshire (Sir G. Young) was getting at, but I understand now. Speaking off the cuff, I do not think it necessary for us to seek so much more time for questions on constitutional matters—I feel that the present structure provides enough opportunities for such matters to be raised if that is considered necessary—but I shall undertake to look at the matter again; it, too, can be considered through the usual channels.
Mr. Clive Efford: My right hon. Friend will know that the report on events following the murder of Stephen Lawrence may well be handed to the Home Secretary next week, or during the following week. The issue has implications for policing in London and in the country as a whole, and also for race relations. If the report is handed to the Home Secretary next week, will my right hon. Friend allow the fullest possible time for a debate, given the amount of concern expressed by several Members on both sides of the House?
Mrs. Beckett: My hon. Friend is right that there is great concern among hon. Members on both sides of the House about that matter. I was not aware that the report might be with my right hon. Friend the Home Secretary as early as my hon. Friend suggests, but I will draw his remarks to my right hon. Friend's attention.
I know that my hon. Friend will appreciate, as I am sure the whole House will, that it is a matter for consideration as to whether my right hon. Friend will wish to encourage a debate very early when the report has just been received and there has not been much time to consider it, or think it better to have the debate a little later when there has been more time to come to a mature view. Those are matters on which there is merit on both sides. As I say, I undertake to ensure that they are given consideration.

Points of Order
1.10 pm
Sir David Model: On a point of order, Madam Speaker. I wonder whether you could help Back-Bench Members. Last Thursday, we only got to Question 13. Today, we only got to Question 10, because we had long rambling questions and long rambling answers from those on the Treasury Bench.
Do you agree, Madam Speaker, that a good example could be set to the House? If Ministers do not know the answer to a question, instead of giving a long answer, which offers us every form of assistance short of help, they should do as Mr. Attlee would have done and simply say, "That is an interesting point. I will make a note of it." We could then get on to the next question. Progress is incredibly slow in the House, which is extremely frustrating to those of us on the humble Back Benches.
Madam Speaker: The hon. Gentleman is absolutely correct. I am very concerned about the lack of progress at Question Time. He and others will recall that I have made more than one statement about that in the hope of guiding Members.
I watch the progress of questions and answers; I not only listen to them daily, but regularly look at the number of questions asked and answers given. I speak to those responsible because I am extremely concerned that many Back Benchers do not get an opportunity to ask their questions because they are not reached.
There are two reasons why we are not making progress. One is the length of answers given by Ministers at the Dispatch Box; the other is the length of questions from Opposition Front-Bench Members, as well as from all Back-Bench Members. I do not wish to embarrass Members by intervening too often, but I am going to have to when Members stand and give a long preamble before
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they actually come to the question. I reiterate that I am also concerned about long ministerial answers. I have also taken that up with those responsible.
Since the House came back in November, the position has deteriorated even more. Only this week, I have been working on the matter with those concerned in the hope that we shall make better progress. I am keen to support Back Benchers when they take the trouble to table questions to ensure that as many as possible are able to be called to ask them.
Mr. Geraint Davies: On a point of order, Madam Speaker. Yesterday, the hon. Member for Croydon, South (Mr. Ottaway) raised a point of order in which he asked me to come to the House to apologise because I had suggested to the House that the 1983 Conservative manifesto did not contain a commitment to abolish the Greater London council. However, I had made no such statement. The previous day, I had asked the hon. Member for Croydon, South whether he would apologise if he found that the Conservative manifesto did not contain such an undertaking. I should like to put that correction on the record. I also suggest that the hon. Gentleman's point of order was an abuse of that procedure.
Madam Speaker: That seems to have sorted the record out, but I hope that the hon. Gentleman gave notice to the hon. Member for Croydon, South (Mr. Ottaway) that he was raising the matter today. It is usual to do so.
Mr. John Bercow: Did you?
Mr. Davies: No, I did not. [HON. MEMBERS: "Disgraceful."] The hon. Member for Croydon, South did not give—
Madam Speaker: Order. I think that the matter has probably been resolved, but it is usual to give notice when invoking another Member in such an issue.

Orders of the Day
  Road Traffic (NHS Charges) Bill
  As amended (in the Standing Committee), considered.
  Road Traffic (NHS Charges) Bill
    New clause 1

      ABOLITION OF EMERGENCY TREATMENT FEE
      '.—Section 158 of the Road Traffic Act 1988 (Payment for emergency treatment of traffic casualties) shall cease to have effect.'.—[Dr. Harris.]
      Brought up, and read the First time.
      1.14 pm
      Dr. Evan Harris: I beg to move, That the clause be read a Second time.
      In previous debates on the Bill, we have heard the Government boast of the abolition of the emergency treatment fee as it applies to hospitals. The Liberal Democrats strongly support that on the basis that the fee was bureaucratic and on the basis of the Government's further justifications for the move, which are that it is offensive to patients arriving in hospital to be asked to pay a fee and that the amount raised does not compensate for the bureaucratic nightmare of collecting it.
      The Bill, in its current form, is inadequate because it does not remove the emergency treatment fee as chargeable by general practitioners. Liberal Democrats see hardly any difference between the bureaucracy involved in collecting the general practitioner emergency treatment fee and that involved in collecting the hospital emergency treatment fee. There is also very little difference between the difficulties of approaching people who may have been injured in an accident, albeit always the driver in the case of the GP fee, and patients arriving in hospital for treatment following a road traffic accident. There is certainly no difference in the lack of information about whether it is worth while for the fee to be collected by front-line health service staff.
      I wonder whether the Government, even at this late stage, will consider accepting the new clause on the basis that it fits in with the rationale of their original motives in the Bill.
      The Parliamentary Under-Secretary of State for Health (Mr. John Hutton): As I understand it, the hon. Gentleman is seeking to remove the right of independent contractors—GPs—to claim the emergency treatment fee. Has the hon. Gentleman sought the views of the British Medical Association on this matter and what opinion has it expressed to him?
      Dr. Harris: I intend to deal with those points during my presentation of the rationale behind this new clause.
      Two questions need to be answered by those proposing the new clause. First, should GPs receive a fee for the treatment given and, secondly, if they do, should that come direct from an individual patient? General practitioners receive a fee for giving contraceptive advice. That fee comes not from the person to whom they have given the advice but from the health authority and it is in addition to their capitation fee. They are also rewarded
      1036
      for meeting screening targets. The normal way for GPs to be reimbursed, other than through their capitation fee, is through an item-of-service claim.
      General practitioners are used to claiming from health authorities for specific items of service. Those proposing this new clause are not suggesting that GPs should not be reimbursed for their time, but that the current method is discriminatory because, in the first instance, GPs must approach a patient or even a third party for the fee. That does not fit in with the current arrangements for GP reimbursement. I can assure the Minister that, if an alternative mechanism of claiming for a GP's time and effort in a roadside attendance can be arranged through regulation, no GP need be out of pocket.
      In case the Minister is not aware of this, I shall remind him of the difficulties that GPs face currently when collecting the fee. I asked the BMA for its view on the collectability of the fee and, in the first instance, it could not find any GP who regularly made an effort to collect it. My hon. Friend the Member for Isle of Wight (Dr. Brand), who is a practising GP, although on a part-time basis because of his onerous parliamentary duties, said that during his time as a GP, he has never found it worth the effort to collect the fee. He said that he does know some people who do put in the effort, but they question whether it is worth while.
      If I explain the procedure that GPs have to follow to collect the fee, the House will begin to see why it is not worth retaining, even if there were not strong arguments for the principle being wrong. The BMA has produced a guidance sheet for GP members on the Road Traffic Act 1988 emergency treatment fee. Section 158 of that Act applies and that is what the new clause would abolish. The guidance says:
      "Under the Road Traffic Act 1988 doctors may generally claim a fee for providing emergency medical or surgical treatment to a person suffering bodily and/or fatal injury arising out of the use of a motor vehicle on a public highway.
      A fee of £21.30 may be claimed for rendering treatment to an individual involved in a road traffic accident; and a fee of 41p may be claimed for each complete mile and additional part of a mile for any distance in excess of two miles which a practitioner must travel in order to provide the emergency treatment.
      The payment may be claimed by any doctor whenever he or she is the first person to provide treatment.
      The person who is using the vehicle at the time the event occurred out of which the bodily injury arose is the person responsible for the payment of the practitioner's fee."
      We therefore have a situation in which GPs are approaching drivers of vehicles who may or may not have been injured—presumably they have survived—to ask for 41p per mile, perhaps after quickly hammering out the figures on a calculator. Such a situation is highly inappropriate, as the Government have recognised elsewhere in the Bill by abolishing the hospital emergency treatment fee.
      Mr. Andrew Dismore: The hon. Gentleman is making a mountain out of a molehill. As a personal injury solicitor, I have had to deal with cases on behalf of accident victims many times, and it was a straightforward matter. If a claim is made, the docket is passed to a solicitor, who will either pass it to the driver's insurers or claim it back from the other insurance company. It is a

      1037
      very straightforward process that is easily administered. Sometimes, the victim will pay out the fee and collect it back. I do not see what all the fuss is about.
      Dr. Harris: Lawyers involved in processes in which they are paid always claim that the process is smooth and easy. If the hon. Gentleman will be patient, I shall explain the advice that the BMA gives to its doctors on how to claim the fee, with or without the services of the legal profession. I should say that I know of no solicitor who would charge a lower fee. Perhaps the hon. Gentleman is particularly generous—which is why he is no longer practicing—in being prepared to do such work for less than the £21.30 plus 41p per complete mile in excess of two miles, assuming that a doctor is the first person to reach an accident. Another invidious principle is the requirement to work out who is the first doctor on the scene, and therefore who can claim the fee. If the hon. Gentleman is patient, I shall explain the process as GPs see it.
      The BMA advice continues:
      "Practitioners should take the following steps to recover their fees:
      (i) An oral request may be made to the person who was using the vehicle at the time of the occurrence which led to the provision of the emergency treatment."
      That presumes that the person is alive, conscious and able to hear such an oral request. I suspect that any GP who pauses at the scene of an accident to make such a request is being forced by the current regulations—if he or she is obeying them—to put secondary considerations before his or her duty of care to patients.
      The advice goes on to say that, if an oral request is not made,
      "A written request must be made to the above-defined person. This request must be served upon that person within seven days from when emergency treatment was given. It must be signed by the claimant, stating his name and address, the circumstances in which the emergency treatment was effected, and that the claimant was the first person to provide such emergency treatment. The request may be served by delivering it to the person who was using the vehicle, or by sending it by recorded delivery addressed to him/her at his/her usual or last-known address."
      The amount of administration that such a process involves for a GP, or for his or her staff, makes it not worth while to collect the fee. A greater consideration is the offence that might be caused to a person in hospital who receives such a request within seven days of an accident. Nothing could be better calculated to damage doctor-patient relationships.
      Mr. Dismore rose—
      Dr. Harris: Perhaps the hon. Gentleman will offer more legal advice.
      Mr. Dismore: It is all very well hearing about such situations in theory, but, in practice, such situations do not occur. A docket is sent in, and it is paid. What is all the fuss about? The BMA may have established a long and complicated procedure, but such situations are dealt with very differently in reality.
      Dr. Harris: I question that. I have asked the BMA what action GPs must take to collect the fee. I should prefer to
      1038
      believe the BMA and former colleagues of mine about the advice given by the BMA than to believe the advice of a solicitor who may or may not be involved in the case. It depends on whether GP practices have a contract with a local firm of solicitors.
      On many occasions, I have heard the Secretary of State call for less NHS time and money to be spent on legal fees and more on patient care. The interventions of the hon. Member for Hendon (Mr. Dismore) suggest that he would like that reversed and thinks that every GP should have a contract with a local firm of solicitors to maximise their income. That may be good for solicitors, but it is not good for general practitioners and it certainly is not good for patients, who, directly or indirectly, are on the receiving end of the demands for payment.
      The guidance given to doctors under existing legislation suggests that they must approach an accident victim within seven days of an accident to ask for the money. The £21.30 fee has not been raised since the introduction of the provision in 1988, but it is still a significant sum. The measure is highly regressive because it is a charge made to patients. It is offensive to them in principle and because of the time scale.
      The GP may well not know who the driver was. It is not the first question that a doctor at the scene of an accident asks and it may not even be the last. The guidance helpfully goes on to explain:
      "When a practitioner experiences difficulty in ascertaining the name and address of the person who was using the vehicle, s/he should make application to the appropriate chief constable."
      That is astonishing advice to give busy front-line staff. It continues:
      "In these circumstances this official is required by the Act to supply the practitioner with any information at his/her disposal as to the identification marks of any motor vehicle which the practitioner alleges to be a vehicle out of the use of which the bodily injury arose, and as to the identity and address of the person who was using it at that time."
      That is overly bureaucratic. It is a waste of time and energy for the front-line staff in the health service. Chief constables and their officers have better things to do than to chase £21.30 fees across counties, across police authorities and across the country to reimburse GPs for roadside advice given. I believe that in their heart of hearts, the Minister and the other Labour Member present—Labour Members, I should say, because I see the Whip as well—know that it is nonsense. It would be easier and more logical for them to accept the new clause. We should be happy to support them if they did. I hope to hear specific reasons from the Minister why that cannot be done.
      The BMA advice goes on:
      "The fees payable under the Act are recoverable by court proceedings as if they were a simple contract debt due from the person who was using the vehicle to the practitioner rendering service."
      That may be why lawyers are so interested in the retention of the measure. If no money comes forward, there is more work for solicitors.
      Mr. Dismore rose—
      Dr. Harris: If the hon. Gentleman does not mind, I shall let him make his comments when I have finished this point.

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      The guidance goes on:
      "However, in the event of a doctor being unable to obtain this fee, s/he may claim an ordinary 'Emergency Treatment Fee' from the relevant health authority (as covered by paragraph 33.8 of the Statement of fees and allowances)."
      That means that after the general practitioner has gone through all those hoops without making progress and all that time and money has been wasted, there is provision to claim an ordinary fee for treatment from the health authority, just as a GP would for a patient who was not on his list but needed urgent and necessary treatment. Surely the Government can accept the new clause and recognise that the usual way to provide for such a fee is for doctors to be able to claim it back from the health authority without going through such hoops.
      Mr. Dismore: The hon. Gentleman is not reflecting reality. He has had a few pot-shots at lawyers. No lawyer will ever get rich on this fee. In 20 years in practice, I have never known a GP sue a victim to get the money back. It is just an extra line to add to the column of calculations. I have never charged anyone for it and I do not know anyone who has.
      Dr. Harris: That adds to the force of my argument. No one benefits from the regulations. I was being charitable to the Government, who want to retain the charge, by supposing that there might be some group of professionals lobbying for the retention of the system. I do not blame GPs for wanting to retain the income, but they can do that through item-of-service claims from the health authority. If lawyers are not getting rich on it, patients find it offensive, GPs find it hardly worth the trouble and health authorities eventually have to pick up the tab, that is the definition of a bad law. Bad laws are repealed when a suitable legislative opportunity arises and the Minister must accept that this is such an opportunity. I am simply asking the Government to accept new clause 1, either here or in another place.
      1.30 pm
      Mr. Simon Hughes: Can my hon. Friend tell the House what percentage of the total revenue value is collected under present arrangements? Another argument in support of his proposition that a bad law is one that practically nobody uses is the fact that most people do not avail themselves of the legislation.
      Dr. Harris: I thank my hon. Friend for that intervention. Indeed, the hon. Member for Rutland and Melton (Mr. Duncan), who cannot be here today, asked that question in Committee. The Minister replied that he did not know how much money was collected and said that the
      "information.… is not collected centrally"
      and acknowledged that that was a familiar refrain. Many of us consider it to be a euphemism for saying that the information is not collected deliberately.
      If the Government were able to ascertain by means of a simple survey of a random sample the sum of money that was collected by GPs, I expect that they would find that it was precious little. I am sure that health authorities have accounts of how much they dole out under the emergency treatment provision, although the road traffic cases would have to be separated from the rest.
      1040
      I accept that the information is impossible to obtain, except by means of survey, but all the evidence so far suggests that it is hardly collected. Even if the fee were to raise a substantial sum, the Liberal Democrats would still consider it inappropriate. The fact that it offends patients and is a direct charge on drivers who may be patients for NHS care is sufficient reason for that charge to be abolished, just as the Government propose to abolish the hospital emergency treatment fee.
      The Minister said in Committee:
      "we are removing the right of NHS hospitals to collect the emergency treatment fee. It is right that we do that because it is a nightmare to collect. Front-line NHS staff are involved in recovering charges, which is not appropriate; the fee is set at a level that calls into question its worth; and we sympathise with the plight of some drivers who are faced with a bill for treatment."
      —[Official Report, Standing Committee B, 12 January 1999; c. 65-6.]
      There is no difference between the GP emergency treatment fee and the hospital one. Indeed, hospitals could arrange for solicitors to act on their behalf. I did not notice the hon. Member for Hendon proposing on Second Reading or in Committee that hospitals could employ solicitors. What applies to GPs should also apply to hospitals. As the Minister pointed out, the only difference is that GPs are independent contractors. I accept that, but there is still a provision for those independent contractors to receive the fees to which they are entitled.
      Will the Minister consider accepting the new clause? Ultimately its implementation will cost nothing as the fee can be collected by health authorities. The new clause would fulfil what I believe to be the intentions of those who drafted the Bill and avoid offending drivers and patients who are asked to pay directly that small but significant fee to the NHS.
      Mr. Philip Hammond: The Opposition support the new clause, as it is identical to the one tabled in Committee by my hon. Friend the Member for Rutland and Melton (Mr. Duncan), who sadly is unable to be here today. He sends his apologies, as he is attending the funeral of His Grace the Duke of Rutland.
      The issue was debated extensively in Committee, but was not voted on owing to some confusion over the interrelationship between new clause 1 and clause 18 of the Bill. I understand that it has now been established that new clause 1 stands alone, and can be considered alone today.
      As the hon. Member for Oxford, West and Abingdon (Dr. Harris) said, all parties to the discussion recognise that the emergency treatment fee has caused disproportionate costs to those collecting it and distress to those from whom it is collected. The previous Government made it clear that it was their intention to abolish the emergency treatment fee as soon as a convenient legislative opportunity arose. It was not a burning issue—more of a tidying—up exercise. This Bill is such an opportunity.
      The Minister's immediate predecessor—now the Chief Secretary to the Treasury—referred to the charge as a "sick tax" and a "tax on accidents". Fortunately for the right hon. Gentleman, fate intervened to prevent the Committee from hearing his explanation of the retention of what my hon. Friend the Member for Rutland and Melton has described as a "fag-end" of a charge.

      1041
      The Minister has indicated in Committee that his motivation for retaining the charge is essentially permissive, and that he seeks to leave it to individual GPs to decide whether or not it is worth collecting the charge. That runs the risk of different practices being adopted in different places, and of public confusion being generated. The Minister will agree that concern about different treatment of similar cases is one of the consistent themes of the debate about the NHS.
      At £21.30, the charge is probably irrelevant to most GPs, but it is also insulting. Either they are expected to attend accidents as part of their contracted NHS work—and should, as the hon. Member for Oxford, West and Abingdon said, be suitably rewarded by the NHS for that work—or, if that work is viewed as independent and outside the NHS GP contract, they should be able to levy a charge that reflects the real contribution that they make at the incident. We should bear it in mind that, for the most part, the patients are not the GP's own patients but passing strangers, and that the GP has happened to be the first person available at the scene.
      The Minister and the House may recall a case that was widely reported in the press a few months ago, in which a doctor on an American Airlines flight rendered life-saving assistance to another passenger, and sent the airline a bill for £240 which the airline refused to pay. The doctor, in a much-publicised case, sued the airline in London for payment of his bill. The public attitude at the time was that the airline's compensation to the doctor—a bottle of champagne, which probably had about the value of the £21.30 charge that we are talking about—was wholly inappropriate and insulting in the circumstances of a life-saving intervention. It was widely thought to be a mean recompense for the work that he had done.
      The Minister has presented the retention of the emergency treatment fee as an opportunity for GPs—as essentially a permissive measure, allowing GPs to charge the fee. However, is it not in fact essentially restrictive in its operation? Does not the emergency treatment fee define the amount that a GP—a private contractor—is able to charge for attending a road accident, and set that amount at an artificially low level?
      If the levying of a charge by a GP at the scene of an accident is to be seen as an act of private medicine—something that the GP carries out outside the terms of his NHS contract—the charge is limiting, and too low. If, on the other hand, it is to be seen as part of a GP's NHS duties, it is very important that the application of the emergency treatment fee, and the charging of it to patients, should be universal, because it will rightly lead to public discontent if people in the same situation are treated in different ways on different occasions.
      The emergency treatment charge, and the cost and distress caused by its collection, can no longer be justified by the same logic that the Government have used to argue for the abolition of the charge in hospitals. It is a fag-end of a charge and no longer has any constructive use in the context of the rest of the Bill.
      Mr. Hutton: We discussed this aspect of the Bill extensively in Committee. Most of the arguments that we have heard today were substantially rehearsed then. I made it clear in Committee that I had some sympathy
      1042
      with the arguments but, for the reasons that I gave then, and which I will briefly rehearse again today, I will invite the House to reject the new clause if the hon. Member for Oxford, West and Abingdon (Dr. Harris) forces a Division.
      I must correct one or two misunderstandings that have arisen today. The hon. Member for Oxford, West and Abingdon implied that the emergency treatment fee was last increased in 1988; that is not the case—I am sure that it was merely a slip on his part—as it was last increased in 1995 by the previous Government. The hon. Member for Runnymede and Weybridge (Mr. Hammond) said that they intended to abolish it—unfortunately, they never got round to doing it, although they had 18 years in which to have a fist at it—but I understand that, far from the position being as the hon. Gentleman said, Ministers in the previous Administration decided ultimately not to abolish it. That might be food for thought for the hon. Gentleman when he considers whether his hon. Friends should support the new clause.
      I want to re-emphasise the fact that we have received no representations at all from the medical profession asking us to remove the right to claim the emergency treatment fee. The failure of the hon. Member for Oxford, West and Abingdon to tell the House the result of his consultation with the medical profession was conspicuous. I asked him whether it had expressed a view to him about whether the emergency treatment fee should be abolished. I understand its position to be that it wants the right to claim the fee to be retained in the legislation.
      As a general principle of how we legislate, I am not sure that it is a terribly good idea to introduce changes at this stage of a Bill's progress without consulting the relevant people—in this case, the medical profession—in the way that the hon. Member for Oxford, West and Abingdon implied that he had.
      Dr. Harris: I made it clear at the beginning of my speech that we were seeking to abolish not the right of general practitioners to claim the fee but the provision whereby they have to approach the patient, whether directly or through a solicitor. That is crucial. The general practitioners to whom I spoke—at least one of whom is present in the House—would welcome the opportunity to claim the fee through the health authority, in the normal way, and not directly from the patient.
      Mr. Hutton: I will come to that point in a minute, but we should be quite clear that the hon. Gentleman and his supporters, without having first sought the views of the medical profession, are proposing to remove from general practitioners the right to claim the fee. As I understand it, the profession's views are clear: it wants to retain the option to claim an emergency treatment fee. He is proposing a change in the law that does not command the support of the medical profession, to whose views he has turned only very late in the day. That is not a scientific or appropriate way in which to progress the argument.
      Mr. Hammond: The Minister appears to be allowing the medical profession to dictate the legislative agenda. I will be very interested to see whether that deference continues when we consider the NHS Bill later in the Session.
      Mr. Hutton: The hon. Gentleman is perhaps reading more into my remarks than he should. I am saying that

      1043
      the Liberal Democrats are proposing a change in the law that they have not trailed in advance with the medical profession and on which they have not sought its views. The point I am making is that it is appropriate, when the law is being changed, to consult properly those parties who will be affected by the change. The hon. Member for Oxford, West and Abingdon has not done that on this occasion and that is another reason why I will urge my hon. Friends to reject the new clause.
      1.45 pm
      Mr. Simon Hughes: The Minister is trying to use an answer that is not the substantive answer as a defence to the proposition made by my hon. Friend the Member for Oxford, West and Abingdon (Dr. Harris). My hon. Friend's case has two elements, the most important of which is that it is inappropriate for somebody to seek the fee from the victim at the roadside, or later through solicitors. What would be the Minister's view if the proposition were simply that a different method of collecting the money for the service were used? For example, the health authority could be asked for payment rather than the person affected directly.
      Mr. Hutton: As the hon. Gentleman is aware, that is a possible option. It was raised by the hon. Member for Oxford, West and Abingdon and I shall try to deal with the points that he raised in a minute. We have considered the issue carefully and the Department has received approaches from various representative bodies. We know that general practitioners continue to want the right to collect the fee as independent contractors, if they consider collection worthwhile in terms of effort and the effect on those from whom the fee is claimed. We are not minded to remove a right that has belonged to GPs since 1934.
      It was suggested in Committee that if collecting the emergency treatment fee were a problem for hospitals, that must also be true for GPs and independent doctors. We have checked that point. We also received no representations from independent doctors on the emergency treatment fee, other than ones wishing to see it remain. Indeed, some representations suggested that it should be increased. We have not received any representations from the profession asking us to abolish the right to claim the emergency treatment fee.
      Dr. Peter Brand: Can the Minister say how many independent contractors have made those representations? I am not surprised that we have not seen massive numbers of GPs calling for the abolition of the charge, because most GPs do not claim it or even carry the paperwork to claim it. It is against the ethos of most people working in primary care in the health service.
      Mr. Hutton: I wish to correct one misunderstanding held by the hon. Gentleman. The right to collect the emergency treatment fee is not limited to GPs in the national health service but is, in theory, available to any legally qualified medical practitioner, whether he has a contract with the national health service or not. I said earlier that I had some sympathy with the arguments made by the Liberal Democrats, but the profession has not made representations to the Government for such a change.
      Mr. Simon Hughes: Answer the question.
      Mr. Hutton: I have answered the question. I have repeatedly made it clear to the House that no
      1044
      representations have been made asking Ministers to abolish the emergency treatment fee. Those members of the profession whom we have consulted want to retain the right as an option.
      The hon. Member for Oxford, West and Abingdon also raised the issue of the impact of the change on the national health service's budget. Although we are able to recover the loss of income in the hospital sector through the new tariff, if the emergency treatment fee were scrapped for GPs, health authorities would have to meet the costs in every case. There is no method to recoup the lost income in that situation. The new clause would impose an additional, unquantifiable financial burden on the national health service, and the Liberal Democrats have not told us where the additional resources to pay for that would come from. I have some sympathy with the argument of the hon. Member for Oxford, West and Abingdon, but for the reasons that I have advanced, today and in Committee, I shall urge my hon. Friends to reject the new clause.
      Dr. Harris: That answer is wholly unsatisfactory for a series of reasons, and I have to press the Minister further. Although these points were discussed in Committee, the extra information that the Minister has given has been much less satisfactory than that given in Committee.
      It is not the job of an Opposition party to consult on legislative opportunities. If we were to be given some civil service time, we could do a poll within a few days, and certainly well before the Bill completes its proceedings here and in the other place. Our question would not be the Minister's, which is, "Do general practitioners want to retain the right to receive income for this item of service?" We would ask, "Do GPs wish to retain the right to receive income from individual patients rather than claiming it back from the health authority?"
      Sir Robert Smith: Ministers confuse the situation further by saying that they want to keep the option. They may not want to use the option, but they want to keep it. Out-patients lying in the street will not know as a general practitioner approaches whether or not that GP plans to use the option. There will be random charges on people depending on who is their GP.
      Dr. Harris: That is an important point. In the last part of what the Minister said, he stated that switching the claim from patient to health authority would increase costs on health authorities. If he says that that cost would be unquantifiable, he must accept that there is currently an unquantifiable direct cost on patients. The difference between the situation that he envisages and the current situation is that patients pay the difference. The unquantifiable cost is put directly on patients.
      In making his point, the Minister concedes my other point: doctors do not mind where the income comes from. In fact, doctors would largely object, as does my hon. Friend the Member for Isle of Wight, to claiming the money directly, or through a solicitor, from the patient.
      Dr. Peter Brand: There is some confusion about emergency treatment and fees for road accidents. There is a perfectly respectable way in which to pay GPs for providing emergency treatment to people other than their own patients. Most GPs accept that they have an

      1045
      obligation to patients on their own list and on the lists of their partnership. The national health service is there to provide all necessary treatment.
      When the need arises for a doctor to give emergency help to someone else's patients, the GP can, under every circumstance except that of a road traffic accident, make a perfectly proper claim to the NHS through his or her health authority. We urge the Minister to remove the limitation on emergency treatment—
      Mr. Deputy Speaker (Mr. Michael J. Martin): Order. The hon. Gentleman is making a speech rather than an intervention.
      Dr. Harris: I understood my hon. Friend's point although it was curtailed. If he feels that I did not, I should be happy to hear him make a speech.
      At present, the retention of the provision allowing general practitioners to claim a fee directly from the patient makes a difference only to those patients already on the relevant GP's list. If the patient is not on the GP's list, the general trend is to claim an emergency treatment fee from the health authority. The law forces the GP to make an extra claim only on those patients who have a relationship with that doctor. Nothing is so calculated to damage the doctor-patient relationship as people on a GP's list being asked by their doctor for an additional treatment fee for treatment outside the surgery in a car crash.
      The Minister has not said how many doctors have written, of their own volition, to say that they want to retain the option to reclaim the fee. The question should be whether doctors want to retain the fee from the patient, not the health authority. Will the Minister quantify the representations that he has had, and, if possible, will he place them in the Library before the Bill goes to the other place?
      It is the Government's duty to ask questions of the profession. The key question is whether GPs think it appropriate to have the power to collect the money directly from the patient.
      The Liberal Democrats believe that progress can be made on health service provision even in the face of opposition from doctors. The Minister put a most un-Bevanite concept to the House when he said that if an unquantified number of doctors object to the way in which they are paid, no legislative progress can be made. We Liberal Democrats do not accept that concept. As the hon. Member for Runnymede and Weybridge (Mr. Hammond) hinted, this Government have a tradition of caving in to general practitioner vested interests, for example, on the composition of primary care groups and a number of other issues.
      If the question were put in the way that I suggested, I do not believe that the medical profession would object or, even if it did, that the Government should not legislate. After all, hospitals were not consulted on whether their emergency treatment fees should be abolished and they are so strapped for cash that I am sure that they would want to claim that extra income if they thought it worth while.
      I shall hone down my questions for the Minister. How many responses to the consultation were received? Will he place them in the Library, so that we can see
      1046
      them? Will he ask the question correctly before the Bill ends its progress in another place? Does he agree that, regardless of the view of the medical profession, if the policy is deemed to be right and in the patient's interests, he should follow it?
      Finally, what is the view of patients? That question remains unanswered, I suspect because it was not asked. It is a simple matter for the Minister to ask the Patients Association whether patients should be liable to pay a general practitioner for NHS treatment within seven days in an emergency situation.
      I regret that the Minister's reply did not satisfy me. He placed the burden of legislation on the Liberal Democrats, which we would be more than willing to accept if the Government were prepared to ask us for legislative ideas outside the House. The Government are capable of undertaking those consultations, finding the answers and considering the principle of the charging mechanism. I urge the Minister to come back with more encouraging comments.
      Mr. Simon Hughes: We want to bring this matter to an early conclusion. I hoped that the Minister would respond positively to my hon. Friend the Member for Oxford, West and Abingdon. I shall add one point and, if we still receive no response from the Minister, I think both the Conservatives and the Liberal Democrats will have to press the matter, because we should have had a concession.
      The Minister is new to his post, but he gave some of the weakest arguments in defence of the Government's position that I have ever heard during debates on health service legislation. He does not have the figures and he did not say that the change would bring in a large amount of revenue for the health service. Nor did he say that it would be in the patients' interests. All he said was that the provision gives an option, which virtually no one uses, to collect some money, which is probably not very much. That is no way to run the health service. If we were talking about the Government forgoing billions of pounds, I could understand it, but we are not.
      My hon. Friend the Member for Isle of Wight (Dr. Brand), who has regular experience of these matters, pointed out how general practitioners in the health service reclaim fees for work that they do that is over and above work for their patients and their practice. In a rationed, streamlined and intelligent health service for the next century, what on earth is the argument for having one system to reclaim money for all sorts of activities, and a different system—which most GPs do not want to use because they consider it embarrassing and unethical—to reclaim money for one small category of people for one sort of work that GPs do? There is no logic to such a system. If we are trying to reduce the burden of bureaucracy on my hon. Friend the Member for Isle of Wight, his wife and other practitioners in the health service, for heaven's sake let us have one system, which will allow one piece of paperwork whereby one collects money in one way at one time and reduces the charges to the rest of the system.
      Unless the Minister gives the House some comfort, we will not only force the new clause to a vote now, but we will be obliged to oppose the Bill on Third Reading because the Government's position has no logic. Also, we will ask our colleagues in the other place, where the

      1047
      Government do not yet have a majority, to ensure that common sense prevails. If we cannot get common sense from Ministers in this House perhaps, before the consistutional changes up the Corridor, there will have to be another Government defeat in the Lords, in the interests of the patients of the British national health service.
      Dr. Harris: I should like to sum up because there are now more Labour Members in the Chamber than before. I wish to make it clear to the Government that it is because of their motives and words that we shall press the new clause to a Division. As the Minister said in Committee, the money is a nightmare to collect. Front-line staff are involved in recovering charges. If Government policy is dictated by what is acceptable to GPs, today's announcement by the General Medical Services Committee on the Government's outrageous rationing decisions will give the Government serious pause for thought. On that note, I commend new clause 1 to the House.
      Question put, That the clause be read a Second time:—
      The House divided: Ayes 28, Noes 208.

      Division No. 43]

      [2 pm

      AYES

      Kirkwood, Archy

      Livsey, Richard

      Allan, Richard

      Llwyd, Elfyn

      Beith, Rt Hon A J

      Moore, Michael

      Bell, Martin (Tatton)

      Morgan, Alasdair (Galloway)

      Brake, Tom

      Öpik, Lembit

      Brand, Dr Peter

      Rendel, David

      Bruce, Malcolm (Gordon)

      Russell, Bob (Colchester)

      Burnett, John

      Sanders, Adrian

      Chidgey, David

      Stunell, Andrew

      Cotter, Brian

      Tyler, Paul

      Foster, Don (Bath)

      Willis, Phil

      George, Andrew (St Ives)

      Hancock, Mike

      Tellers for the Ayes:

      Harris, Dr Evan

      Sir Robert Smith and

      Heath, David (Somerton & Frome)

      Mr. Colin Breed.

      Hughes, Simon (Southwark N)

      Kennedy, Charles (Ross Skye)

      NOES

      Ainsworth, Robert (Cov'try NE)

      Chisholm, Malcolm

      Allen, Graham

      Clapham, Michael

      Anderson, Janet (Rossendale)

      Clark, Dr Lynda (Edinburgh Pentlands)

      Ashton, Joe

      Clarke, Tony (Northampton S)

      Austin, John

      Clelland, David

      Barnes, Harry

      Coaker, Vernon

      Bayley, Hugh

      Coffey, Ms Ann

      Beckett, Rt Hon Mrs Margaret

      Coleman, Iain

      Begg, Miss Anne

      Colman, Tony

      Benn, Rt Hon Tony

      Connarty, Michael

      Berry, Roger

      Cook, Frank (Stockton N)

      Best, Harold

      Cooper, Yvette

      Blizzard, Bob

      Corbyn, Jeremy

      Borrow, David

      Corston, Ms Jean

      Bradley, Keith (Withington)

      Cox, Tom

      Bradley, Peter (The Wrekin)

      Cranston, Ross

      Bradshaw, Ben

      Cryer, Mrs Ann (Keighley)

      Brown, Russell (Dumfries)

      Cryer, John (Hornchurch)

      Buck, Ms Karen

      Cummings, John

      Butler, Mrs Christine

      Cunningham, Jim (Cov'try S)

      Campbell, Mrs Anne (C'bridge)

      Davies, Rt Hon Denzil (Llanelli)

      Campbell, Ronnie (Blyth V)

      Davies, Geraint (Croydon C)

      Caplin, Ivor

      Davis, Terry (B'ham Hodge H)

      Caton, Martin

      Dean, Mrs Janet

      Cawsey, Ian

      Dismore, Andrew

      Chapman, Ben (Wirral S)

      Doran, Frank

      Chaytor, David

      1048

      Dowd, Jim

      Marshall, Jim (Leicester S)

      Drew, David

      Martlew, Eric

      Eagle, Angela (Wallasey)

      Merron, Gillian

      Eagle, Maria (L'pool Garston)

      Michie, Bill (Shef'ld Heeley)

      Efford, Clive

      Milburn, Alan

      Ellman, Mrs Louise

      Miller, Andrew

      Etherington, Bill

      Mitchell, Austin

      Fisher, Mark

      Moran, Ms Margaret

      Fitzpatrick, Jim

      Morgan, Ms Julie (Cardiff N)

      Flynn, Paul

      Mullin, Chris

      Follett, Barbara

      Murphy, Denis (Wansbeck)

      Foster, Michael Jabez (Hastings)

      Naysmith, Dr Doug

      Foulkes, George

      Norris, Dan

      Fyfe, Maria

      O'Brien, Bill (Normanton)

      Galloway, George

      O'Hara, Eddie

      Gardiner, Barry

      Organ, Mrs Diana

      Gerrard, Neil

      Osborne, Ms Sandra

      Godman, Dr Norman A

      Palmer, Dr Nick

      Goggins, Paul

      Pearson, Ian

      Gordon, Mrs Eileen

      Perham, Ms Linda

      Griffiths, Jane (Reading E)

      Pickthall, Colin

      Griffiths, Nigel (Edinburgh S)

      Pike, Peter L

      Grocott, Bruce

      Plaskitt, James

      Grogan, John

      Pollard, Kerry

      Gunnell, John

      Pond, Chris

      Hall, Patrick (Bedford)

      Pope, Greg

      Hanson, David

      Pound, Stephen

      Heal, Mrs Sylvia

      Prentice, Ms Bridget (Lewisham E)

      Healey, John

      Prentice, Gordon (Pendle)

      Henderson, Ivan (Harwich)

      Prosser, Gwyn

      Heppell, John

      Quin, Ms Joyce

      Hill, Keith

      Quinn, Lawrie

      Hinchliffe, David

      Radice, Giles

      Hoey, Kate

      Rammell, Bill

      Home Robertson, John

      Rapson, Syd

      Hughes, Ms Beverley (Stretford)

      Reed, Andrew (Loughborough)

      Hughes, Kevin (Doncaster N)

      Rooker, Jeff

      Hurst, Alan

      Ross, Ernie (Dundee W)

      Hutton, John

      Ruane, Chris

      Iddon, Dr Brian

      Russell, Ms Christine (Chester)

      Jackson, Helen (Hillsborough)

      Ryan, Ms Joan

      Jenkins, Brian

      Salter, Marlin

      Jones, Helen (Warrington N)

      Savidge, Malcolm

      Jones, Ms Jenny (Wolverh'ton SW)

      Sawford, Phil

      Jones, Martyn (Clwyd S)

      Sedgemore, Brian

      Keeble, Ms Sally

      Shaw, Jonathan

      Kelly, Ms Ruth

      Sheldon, Rt Hon Robert

      Kennedy, Jane (Wavertree)

      Shipley, Ms Debra

      Kilfoyle, Peter

      Simpson, Alan (Nottingham S)

      King, Andy (Rugby & Kenilworth)

      Skinner, Dennis

      Kingham, Ms Tess

      Smith, Rt Hon Andrew (Oxford E)

      Ladyman, Dr Stephen

      Smith, Angela (Basildon)

      Laxton, Bob

      Smith, Miss Geraldine (Morecambe & Lunesdale)

      Lepper, David

      Smith, John (Glamorgan)

      Leslie, Christopher

      Soley, Clive

      Lewis, Ivan (Bury S)

      Southworth, Ms Helen

      Linton, Martin

      Starkey, Dr Phyllis

      Lloyd, Tony (Manchester C)

      Steinberg, Gerry

      Lock, David

      Stewart, David (Inverness E)

      Love, Andrew

      Strang, Rt Hon Dr Gavin

      McAllion, John

      Stringer, Graham

      McAvoy, Thomas

      Stuart, Ms Gisela

      McCabe, Steve

      Sutcliffe, Gerry

      Macdonald, Calum

      Taylor, Rt Hon Mrs Ann (Dewsbury)

      McDonnell, John

      Taylor, David (NW Leics)

      McGuire, Mrs Anne

      Thomas, Gareth R (Harrow W)

      McIsaac, Shona

      Timms, Stephen

      McNulty, Tony

      Tipping, Paddy

      McWalter, Tony

      Todd, Mark

      Mahon, Mrs Alice

      Touhig, Don

      Mallaber, Judy

      Turner, Dr George (NW Norfolk)

      Mendelson, Rt Hon Peter

      Twigg, Stephen (Enfield)

      Marek, Dr John

      Vis, Dr Rudi

      Marsden, Paul (Shrewsbury)

      Wareing, Robert N

      Marshall, David (Shettleston)

      1049

      White, Brian

      Worthington, Tony

      Whitehead, Dr Alan

      Williams, Rt Hon Alan (Swansea W)

      Tellers for the Noes:

      Wood, Mike

      Mr. Mike Hall and

      Woolas, Phil

      Mr. Clive Betts

      Question accordingly negatived.

    New clause 2

      DUTY OF INSURERS TO SUBMIT ANNUAL REPORT TO PARLIAMENT
      'It shall be the duty of any person liable to pay a charge to the Secretary of State under section 1 to submit by 30th June in each year following the passing of this Act a report to each House of Parliament, stating in respect of the preceding calendar year—

      (a) the total of any such payments made to the Secretary of State, and

      (b) the effect, if any, of making those payments on the cost to that person's customers of purchasing motor insurance.'—[Mr. Harris.]

      Brought up, and read the First time.
      Dr. Harris: I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker: With this, it will be convenient to discuss new clause 3—Secretary of State's report on payments made under the Act—
      '—The Secretary of State shall submit a report to each House of Parliament by 30th June in each year following the passing of this Act stating in respect of the preceding financial year the total of any payments made to him under the provisions of this Act.'.
      Dr. Harris: The new clause would open up the legislation to the wider public so that its effects as a whole are explicit. The Minister and the House may know from the Second Reading debate that we are opposed to the Bill in principle because we believe that it surreptitiously introduces indirect charging of patients for NHS services. It is clear that, if the Bill became an Act, car insurance premiums would increase to cover the money that insurers would have to pay to the NHS for trauma treatment of third parties injured in road traffic accidents. We oppose that, and on Second Reading we made clear the reasons for our opposition.
      New clause 2 sets out to bring to the attention of the House and to the public at large the effect of indirect charging of patients through their insurance. It creates a duty on insurance companies liable for the charge to present to each House of Parliament by 30 June each year a report stating in respect of the preceding calendar year, first, the total of any payments made to the Secretary of State and, secondly any effect of making those payments on the costs to their customers of purchasing motor insurance.
      There has been a great deal of debate about how much car insurance premiums will rise as a result of the Bill. It must be noted that the debate has been about not whether premiums will rise but how much they will rise. We have had various estimates. The Department of Health is quoted in a House of Commons Library research paper as saying that every insurance premium would
      "increase by £6 to £9."
      1050
      The Association of British Insurers says on page 1 of its newsletter No. 28 from December 1998 that the Bill will "lead to premium increases." The Automobile Association is quoted on page 17 of the Library research paper as saying that the Bill would have the effect of
      "adding around £10 to the cost of the average £260 annual motor policy."
      The Independent said in December 1997 that the
      "NHS bill may put £20 on car premiums".
      It is not disputed that the Bill will lead to an increase. The figures are all within the same ball park.
      The Minister may argue that the Bill should not lead to an increase in car insurance premiums because hospitals already have the power to charge the insurers of third parties injured in road traffic accidents, but they do not do so because of the bureaucratic difficulties involved. That is by the by. Premiums were not loaded to cover reimbursement of the NHS to the extent that is now envisaged. Indeed, the Government expect that the Bill will generate income for the health service over and above that which is generated at the moment. That is predicated on an increase in payments to the NHS.
      If we are to have a sensible debate about paying for the NHS, it is vital that people are aware of how they are paying for it. People know that they pay income tax. The polls show that people would gladly pay more to improve the services provided by the NHS. We are unable to have that debate with more than one party as other parties have decided that they will not use that approach to raising income. It is important that the general public know, and are allowed to find out, how much they are paying through the back door, because the amount that they pay through general taxation has been politically limited by political parties, and newspaper proprietors who beseech political parties not to pursue certain policies.
      2.15 pm
      Mr. Hammond: Will the hon. Gentleman confirm for the record whether he seeks to start a debate on a genuinely new approach to NHS funding? Or is the Liberal Democrats' only proposal to increase income tax to fund the NHS yet further out of general taxation?
      Dr. Harris: Not at all. The hon. Gentleman will know that his party—somewhat later than mine—has called for a debate on NHS funding. We have made it clear that we are not minded to believe that the private sector is an effective source of income to help take the strain of NHS provision. We do not believe that it is possible to save the NHS by urging people not to use it, but we accept that that argument and others could be put in such a debate. If the Government intend to increase direct charges for prescriptions and other items, or to increase indirect charges through some form of insurance, they could be explicit and honest in such a debate. We would welcome that debate. We have our own ideas to put forward, but we are certain that, until we have an explicit, honest and rational debate, it is premature to increase surreptitiously the amount that individual users of the NHS pay through regressive, indirect means such as charges on motor insurers.
      Mr. Simon Hughes: I wish to make a point supplementary to the point made by the Conservative spokesman, the hon. Member for Runnymede and

      1051
      Weybridge (Mr. Hammond). The debate goes much wider than the question whether income tax should rise. We should put on the agenda what charges should remain—including prescription charges. The debate is also about funding residential care and nursing care for the elderly, which could be a subject for a royal commission, and where the social security system fits in. I hope that my hon. Friend will make it clear to his colleagues in today's debate that we are willing to participate with all other parties in what we would call a commission on the future of the health service. We should have the debate outside Parliament, in the open, with patients, the professionals and the pharmaceutical industry.
      Dr. Harris: That is the critical point. If people do not know by how much car insurance premiums have risen, they will not know the effect that the Government's legislation is having on their pockets. Far too little attention is given to indirect charges in other public services. That is why we seek to make that information available by means of new clause 3, which has been tabled by Conservative Members and which we support, and of new clause 2.
      I do not accept the ABI's rather mild representations that the information will be commercially sensitive. It has said that premiums will increase, and I do not believe that it will be impossible for insurance companies to work out how much they are paying to the NHS and by how much premiums have had to rise to take on the onus of funding the health service as well as insuring people. Car insurance is a highly competitive market, and of course some information will be commercially sensitive, but the information called for in new clause 2 cannot be refused by the Minister on the basis of the ABI's objections.
      The Government claim that they support open government and wish to be honest with the people. We hear such rhetoric. Indirect charging is a litmus test of whether the Government will be explicit about costs. I urge the Minister to accept new clause 2 in the name of openness. It will certainly improve the Bill.
      Mr. Hammond: I listened with interest to the hon. Member for Oxford, West and Abingdon (Dr. Harris). I was a little surprised to hear him say that he supported new clause 3, tabled by my hon. Friends and me, because it was tabled as an alternative to new clause 2, tabled by the Liberal Democrats.
      Parliament will want to monitor the Bill carefully, as it introduces a major new charge in the NHS. Hon. Members will want to look at the legislation's effect on both NHS revenues and insurance premiums paid by the motoring public for two reasons: first, because it is important to see the impact of the measure; and, secondly, because the measure is innovatory, so people will be anxious to establish its overall effect. One issue that it will be important to consider is whether its impact is equitable.
      The hon. Member for Oxford, West and Abingdon spoke about the increases in insurance premiums that will undoubtedly flow from the introduction of the measure, but it is not clear whether insurance premiums will increase uniformly across the board. Different insurance companies have different client profiles and claims experiences, and the measure's impact on insurance premiums is likely to differ radically between different groups of motorists.
      1052
      An issue that deeply concerns us is the anti-rural bias, which this side swipe at the motorist by the Labour Government undoubtedly has. We shall bear that in mind when we monitor closely how the measure impacts not just on motorists in the aggregate, but on sub-groups of motorists.
      It is undeniable that careful parliamentary scrutiny of what flows from the legislation will be needed. When considering new clauses 2 and 3 as alternatives to each other, the question is what is practicable and workable, and how much commercially sensitive information it is reasonable to expect private sector companies to provide. In Committee, the Minister referred to the opportunities that will arise for parliamentary scrutiny when the Government change the charges levied under the Bill, as they propose to do periodically. To ensure that the scrutiny debates that take place on those occasions are properly informed, information about the measure's overall impact must be available.
      Mr. Hutton: It may help the hon. Gentleman if I make it clear now, as I did in Committee, that we want hon. Members to have access to the fullest possible range of information to allow them to review the operation of the scheme. I made that clear in Committee; if it will help the hon. Gentleman now, I am happy to repeat it on the Floor of the House.
      Mr. Hammond: I am grateful to the Minister for repeating that. If he can answer in the affirmative the specific question that I am about to ask, it will go a long way towards reassuring Opposition Members. New clause 3 proposes that the Secretary of State submit a report to each House of Parliament annually, giving details of the total amount raised through charges under this legislation. That differs somewhat from new clause 2, proposed in the name of the Liberal Democrats, which places a duty on insurers—those who will pay the charges—to report to Parliament, giving detailed information on the impact that those charges have had on the calculation of their premiums and on their specific businesses.
      The Association of British Insurers agrees with us that companies that operate in a commercially sensitive area should not be asked for too much information about how they run their businesses and calculate their premiums, and about the profile of their customers. Those experienced in these matters, of whom I am not one, could deduce valuable commercial information from the type of information that new clause 2 proposes should be supplied to Parliament.
      I am relatively new in this place, but I find it curious that an outside body such as a commercial company should have to report directly to Parliament. It seems more appropriate that the Secretary of State should gather whatever information is needed and report to Parliament; he could then be answerable for his report in this place.
      New clause 3 achieves, without the disadvantages of new clause 2, much of what the Liberal Democrats seek to achieve. Information about premiums may be difficult for a commercial company to define in a meaningful way for the lay reader, and I would question the value of some of the information that the Liberal Democrats seek to have provided to the House. Indeed, in a briefing note that it has issued to all hon. Members, the ABI says:
      "Insurers are already required to produce company accounts and should not be bound to reveal additional commercial information to Parliament. Information on total receipts should be available from the NHS itself".

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      That is the essential point. The information that would have to be presented to Parliament under new clause 3 could be derived by the Secretary of State entirely from the compensation recovery unit, from his own records and from Government agencies, without imposing additional burdens on companies operating in the commercial sector. It could be derived without imposing additional burdens on the machinery of government and its agencies because, in a properly run organisation, which I am sure the compensation recovery unit is, that information will be readily available.
      Thus new clause 3 seeks to use aggregate information that is readily available. Because it is presented in an aggregate form, it avoids the pitfalls that the ABI has identified in terms of the revelation of confidential information, while still providing the House with the critical overall figures that will tell us how successful the measure has been in terms of funding the NHS. That information would be directly available under new clause 3. It would also inform an intelligent analysis of the impact, in aggregate, on motor insurance premiums.
      I suspect that trying to use central data to determine the impact on individual groups of motorists or individual motorists would be a fruitless exercise. On the sound basis of some aggregate data which the Secretary of State could provide, hon. Members, in pursuing the scrutiny process, may rely on anecdotal information collected from constituents on the differing impact on premium rates across the spectrum.
      2.30 pm
      Mr. Tim Collins: Is there not another difficulty with new clause 2 in addition to those that my hon. Friend has brilliantly analysed? New clause 2 requires insurers to provide information according to the preceding calendar year, yet many insurers operate on entirely different financial years, so the new clause is even more onerous than it seems.
      Mr. Hammond: I thank my hon. Friend for that contribution. He is absolutely right. The problem is compounded by the fact that settlements of claims are often not made for two, three or four years. It may be difficult to gain an informed view from information that relates to the preceding year.
      The hon. Member for Oxford, West and Abingdon referred to what the Opposition health team calls the "information not collected centrally" syndrome. In Committee, the Minister, with some humility, recognised that syndrome. We have seen it on innumerable occasions when seeking information from the Department through parliamentary questions. The Department hides behind the decentralised structure of the health service as it was: it is becoming an increasingly recentralised structure, as the Government implement various measures. The decentralised structure of the health service enables the Secretary of State to say that information is not collected centrally. It is perfectly clear that a well-run health service requires information to be collected centrally. We have no doubt that it is available to NHS regional executives, and could be collected by the Secretary of State if he chose to do so.
      Mr. Simon Hughes: I agree with the hon. Gentleman. Now that it has been accepted across government that the
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      collection of statistics should be more independent and that there should be an independent statistical department, there is no excuse for the Government not to do what is necessary. In the health service in England, statistics could be collected regionally—no one would object if it were done region by region, because we could add up the figures for each region ourselves —or centrally by the Department in Richmond house. The information can be gathered without the Government saying, "No, we don't like it."
      Mr. Hammond: I entirely agree with the hon. Gentleman. The NHS is a vast organisation spending billions of pounds and employing hundreds of thousands of people. The collation of information is essential for the proper management of an organisation of that scale. I hope that the Minister will reflect on that. Indeed, the Secretary of State has shown his willingness to make more information available. He famously told the BBC "Today" programme back in September that he would ensure that, as soon as possible, data on total waiting lists—those awaiting a first consultation with a specialist and those awaiting in-patient surgical treatment—would be available.
      The Secretary of State seems not to be keen on an independent audit or examination of the figures. On the same broadcast, he referred to a reputable firm of chartered accountants that specialises in collating data on the NHS as a "tinpot firm". That appropriately sums up the Secretary of State's attitude to the independent scrutiny of these matters.
      We want an assurance that the Government will not hide essential information about the impact of the Bill behind a smokescreen by saying that the money is distributed to individual hospital trusts and that the information is available only at that level. In Standing Committee, reference was made to the fact that information was available in the published accounts of hospital trusts. It is not practical for parliamentarians who want properly to scrutinise these matters to plough through the annual accounts of thousands of hospital trusts up and down the country and aggregate the information. In a well-run Department of Health, the information should be available in an aggregate form.
      Can the Minister satisfy the Conservative Opposition that the data referred to in new clause 3 will be regularly made available to Parliament? We would be satisfied if he could assure us that information on the amount of money collected by the compensation recovery unit and distributed to NHS trusts will be included in the quarterly data series. Alternatively, if the Secretary of State is unable to do that, the presentation to Parliament of that information in an annual report, as the new clause suggests, would achieve the same end, although somewhat more tardily.
      The intentions of the new clause would be better served by an assurance from the Government that the data required will be included in the quarterly data series. If the new clause were carried and the data were provided annually, the information could be out of date when any proposed changes to the amounts to be charged were scrutinised.
      We seek an assurance that the aggregate figure, which is readily available to the Secretary of State, will be regularly made available to Parliament. I can see no basis

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      on which the Government could object to that. It would enable Parliament to perform its work of properly scrutinising the outcome of the legislation. That is important in itself, but also because these are the first new charges of any substance that the Government have introduced in the NHS. We and the Government will want to assess carefully the effectiveness of these measures and their impact on the overall funding of the NHS. I hope that the Minister can give us some reassurance about his willingness to make the data available.
      Mr. Robert Syms: I support my hon. Friend on new clause 3. It is less prescriptive than new clause 2. Having listened to what the Minister said, I do not think that the Government and the official Opposition are too far apart. We are looking for reassurance that statistical information will be available by which we can measure the effectiveness of the operation of the legislation.
      The Association of British Insurers supports the concept of parliamentary scrutiny, as we all do. It is important that the collection system be seen to be fair and efficient. Earlier, the Government took credit for raising between £120 million and £140 million through this proposal, and said that it would not cost anyone anything. However, as we have heard, insurance costs will be incurred. How the data can be collected efficiently will be an important matter for hon. Members to consider.
      The impact on insurance premiums may be different for different categories. The young may pay disproportionately higher premiums, so may be hit much harder. If the Minister could move a little more in our direction, we could be reassured that there will be enough information to have a sensible, reasonable debate about the effectiveness of the legislation, how it is operating and what impact it has on the national health service, insurance payers and our constituents; and, having sat on the Committee considering the Bill, I for one would be satisfied.
      Mr. Hutton: The arguments in support of both these new clauses rest on a number of assumptions that I do not accept. The first assumption is that the Government have been less than open about the impact of the legislation, especially on motorists and on NHS funding. That is not so. The new clauses would lay down new obligations to disclose information, but that is unnecessary for reasons that I shall outline.
      The Opposition assume that the Government are trying to withhold information, but we are not. Throughout the passage of the Bill, we have tried to help Members to appreciate the fundamental issues underpinning the legislation. We want to make the maximum amount of information available to allow proper scrutiny by the House of the proposed measures. For a general reason, I feel that there is no substance in the underlying arguments in favour of either new clause. Both would impose additional obligations on the Government to disclose information to the House.
      The arguments for the new clauses are based on a second false assumption —that we are imposing a new charge on people who use the national health service. We are not doing that. The Bill will simply streamline and improve arrangements for collection of existing charges, which are recoverable under legislation dating back to the 1930s. It is concerned with ensuring that the NHS can
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      recover the costs of treating road accident victims, not from motorists or patients but from insurance companies, when a successful claim for compensation has been made following a road traffic accident.
      Mr. Hammond: I do not accept the Minister's assertion that this is not a new NHS charge. The Government are giving teeth to a mechanism that has enabled the collection of a piffling £15 million or £16 million a year in charges, to ensure that £150 million a year is collected. The man in the street, however, sees little difference between the introduction of a wholly new charge and the ratcheting up tenfold of an existing charge, converting a relatively meaningless exercise into the raising of a significant amount.
      Mr. Hutton: With respect, I think that most members of the public can distinguish between the more effective collection of an existing charge and the laying down of a new charge for the use of the national health service. I do not think that the hon. Gentleman's argument is very coherent, and I am not sure that he will consider it to be so after he has had a chance to reflect on it.
      There is no logic, or foundation in fact, for hon. Members' justification of the new clauses. It is underscored by the assumption that the Government are trying to withhold information from the House and from individual Members, which has led to the demand in new clause 2 for an unprecedented obligation on insurance companies to give the House information directly in the form of annual reports, and the demand in new clause 3 for the Secretary of State to make that information available annually.
      The hysteria among Liberal Democrats seems to have subsided. I assume that they now have the hustings for the leadership vacancy that has arisen under better control. Perhaps, in the current spirit of harmony between the two sides of the House, we can begin to examine the real issues created by the Bill, rather than the fantasy and hyperbole that featured in much of what the Liberal Democrats said in Committee.
      We are discussing a simple mechanism that will facilitate the recovery of NHS charges. We want the NHS to benefit from significant additional resources. We have some sympathy with what the hon. Member for Runnymede and Weybridge (Mr. Hammond) said, but we want to be sensitive to issues of commercial confidentiality. We are aware of the burdens on business, and we do not intend to impose unnecessary and unreasonable burdens on insurance companies, which is one of the reasons why we do not support new clause 2.
      I should make it clear that the Department has never refused to offer MPs information about amounts collected by the NHS under existing road traffic legislation—
      Dr. Harris: Will the Minister give way?
      Mr. Hutton: No, I will not.
      As I said, the Department has never refused to offer information, and we have no intention of withholding it in the future.
      The hon. Member for Runnymede and Weybridge helpfully stated that, according to information received, just over £16 million was recovered last year under the existing scheme. The Department of Health already

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      collects such information: we aggregate trust accounts relating to road traffic income. The information is readily available now, and will continue to be available to hon. Members in future.
      Mr. Hammond: I suspect that the information to which the Minister refers will be extracted from trust accounts, and that there will therefore be a delay. The new regime for which the Bill provides will give the Minister an opportunity to obtain the information directly from the compensation recovery unit, a Government agency. Assuming that the unit is computerised, I would expect the information to be available on a quarterly basis, and very soon after the event.
      2.45 pm
      Mr. Hutton: The hon. Gentleman has done the House a favour by drawing attention to one of the benefits of the changes that we are introducing. The compensation recovery unit will have the advantage of up-to-date information technology, including new software, that will enable the information to be available to the House more quickly. I am not sure that we shall be able to provide it on a quarterly basis, but as a result of access to more efficient information technology, we shall generally be able to provide it sooner.
      I assure the hon. Gentleman, and others who are worried, that we have no intention of withholding such information from the House. It is important information; it will inform debates on any regulations laid before the House; and we want scrutiny of the legislation to be as well informed as possible.
      One of the difficulties that we have encountered with the Bill so far is caused by the desire on the part of Liberal Democrats in particular to misrepresent what we are doing. I understand that—it is a purely opportunistic political exercise—but we do not intend to withhold crucial information from the House. We want the House to be well informed, and we will ensure that it is.
      For the reasons that I have given, I do not believe that there is any substantive argument for either new clause.
      Dr. Harris: Will the Minister give way?
      Mr. Hutton: No.
      We do not accept the arguments of the hon. Member for Oxford, West and Abingdon (Dr. Harris) for his new clause, which we consider to be unreasonable and unfair. We do not intend to legislate along those lines.
      I hope that the hon. Member for Runnymede and Weybridge and his colleagues will accept my assurance that we intend to make it absolutely clear that the information will be made readily available. We are committed to reviewing the scheme after six months, and to publishing the results of our review. I hope that, on that basis, the hon. Gentleman will not press new clause 3, and the hon. Member for Oxford, West and Abingdon will not press new clause 2.
      Dr. Harris: It is interesting that the Minister should ask me not to press new clause 2, but—with uncharacteristic
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      churlishness—should refuse twice to allow me to intervene to ask him a specific question that might have enabled me to decide whether to press it.
      We do not doubt that information, particularly that requested in new clause 3, can be made available, and that the Government will do their best to make it available. That is why the Liberal Democrats did not table a similar new clause. We are reassured. Although we support—as we did in Committee—measures to enable the Government to provide the information, I believe that it will be available by means of parliamentary questions, the six-monthly review and other channels. As I said in Committee, I feel that it would be more readily available if payments were made to health authorities — which I think should be done for other reasons—but I think that it can be obtained from trusts and, probably, from the compensation recovery unit.
      We tabled new clause 2 because we feel that the crucial information that is required relates not to the global sum raised, but to the effects on individuals' car insurance. That will, of course, be a matter for debate. I was trying to help the House to decide whether this is a valuable way of raising money for the NHS by urging the Government to consider incorporating measures that will force insurance companies to make their own calculations on the effects, to help Members and the general public to educate themselves as to how much NHS revenue will result from the higher premiums.
      I understand the Conservatives' views on commercial information. I am sure that it is possible to word legislation more tightly to enable information to be obtained from insurance companies and examined without the sharing of commercially confidential information. Liberal Democrats want to extract a flat figure representing the amount that insurance companies think ordinary people are contributing to the increased amount that is being collected.
      I accept the Minister's opening point that the charge is not new. If hon. Members check the record, they will find that Liberal Democrats have at no point stated that we believe the charge to be new. We think that there was an opportunity to get rid of a charge, but it is clear at any rate that the Government will have increased income. That is one of their reasons for introducing the legislation.
      The measure will generate additional income from an existing charge by making its recovery more compulsory, by nationalising it, in effect, and by making it more efficient. If one wants to raise revenue by that method, the Bill is a good way in which to do it. Because we do not want to do that, we oppose the measure; it is not because the Bill is badly drafted, or would achieve its aim inefficiently. However, we do want to see exactly how the extra amount is raised from individual drivers' car insurance.
      Global sums of millions of pounds are difficult for people to understand in their everyday life. Indeed, the Government rely on fazing people with large figures when, uniquely and cleverly—although rather sneakily—they present extra money for the health service in three-yearly cumulative totals, not the usual year-on-year totals. I hope that any figures that come from the Government do not, if they apply to more than one year, repeat the habit of rolling up matching funding from one year with the previous year's allocation and the new allocation. That is a bad habit, which makes it difficult for people to understand.

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      People understand the amount of money that they pay in the pounds, shillings and pence on their car insurance. I ask the Minister to give me some assurances that there will some way to estimate, even from the Government's figures— although I am not convinced that I would necessarily accept them 100 per cent.—what the charges will be.
      Mr. Hammond: I am delighted to hear a Liberal Democrat using the currency of pounds, shillings and pence. I am not sure where that leaves the hon. Gentleman in the Liberal Democrat leadership stakes.
      The hon. Gentleman said that he wanted to know what the extra cost of the measure to ordinary people would be. Does he not understand that the problem is that there is no single ordinary person—there is no average motor insurance payer? The impact will range from zero on some insured people to substantial on others. The figure that has been quoted of £9 or £10 as an average—
      Mr. Deputy Speaker: Order. I sometimes give leeway to those on the Front Bench, but I cannot allow the hon. Gentleman to get away with a speech during an intervention.
      Dr. Harris: I think that the hon. Member for Runnymede and Weybridge (Mr. Hammond) would have been helped by leaving out his preface, which I am sure hon. Members will be bored with in a few weeks. It is not my intention to digress on to those matters. You will note, Mr. Deputy Speaker, that Liberal Democrats have been careful not to rise to provocation from other hon. Members.
      I understand the point that the hon. Member for Runnymede and Weybridge makes—that there is no single figure, but there will be ranges. We would like an undertaking from the Government that they will do their best to put their research capabilities to the task of giving a range, from zero to what the extra cost will be for each individual car insurance payer because of the charges. What is certain is that £160 million means nothing to people in terms of what they pay on their car insurance. The range of costs that the hon. Gentleman talks about—from zero to £20—would mean something.
      I think that hon. Members on both sides of the House accept that it would be more sensible to have those figures collected in an orderly way, rather than hearing scare stories from the insurance industry, the AA or political parties of any persuasion about what those costs will be.
      I return to my original proposition: it is important not only that the Government should be open about the amount of income that is raised by the measure—I accept the Minister's assurances on that—but that it be clear to individual taxpayers, drivers, voters and patients how much the Government's decision not to use this opportunity to abolish these indirect charges is costing them. I still look to the Minister for advice on that point. However, even if he is unable to give me any help, it is not our intention to divide the House on the matter.
      Mr. Hammond: I am happy to take what the Minister said at face value and to accept his good intentions.
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      However, we will look to ensure that the data is made available as quickly as the technology used by the compensation recovery unit allows.
      Mr. Hutton indicated assent.
      Mr. Hammond: The Minister nods. If we can accept that there is a genuine intention by the Government to make that data available regularly as fast as possible, we will be satisfied. I thank the Minister for that assurance.
      Mr. Hutton: I can give the hon. Member for Runnymede and Weybridge the assurance that he seeks.
      Dr. Harris: I beg to ask leave to withdraw the motion.
      Motion and clause, by leave, withdrawn.

    Clause 3

      INFORMATION CONTAINED IN CERTIFICATES
      Dr. Harris: I beg to move amendment No. 2, in page 3, line 43, leave out '2nd July 1997' and insert '1st April 1998'.
      I am sure that the House is aware that the amendment is the last to be considered at this stage of the Bill. It seeks to right an injustice. It would leave out 2 July 1997 and insert 1 April 1998 as the date for which the charges will apply for in-patient treatment—and it should be out-patient treatment as well.
      The Government have defended 2 July 1997 as the date from which the charges will apply on the basis that that was when the Chancellor of the Exchequer first said that the Government were going indirectly to raise additional money for the NHS from people, through their car insurance. Presumably, they thought that insurance companies could make provision to weight their insurance premiums accordingly from 2 July 1997, so that the extra income that was raised through the Bill could be collected from their customers through increased insurance premiums; that is the logical approach that one might imagine the Government were taking.
      If that is the case, surely the Government must accept that there will be some lag time before the insurance industry is able to adjust to the more efficient way in which the Government are collecting the charge, and the increased amount of charge that the Government are collecting.
      I think that hon. Members on both sides of the House will recognise that it would have been impossible for someone to change his car insurance premium on 2 July 1997 after he heard that car insurance premiums might be affected from 2 July 1997. The insurance industry has said reasonably that costing the effects of the measure outlined briefly by the Chancellor on 2 July 1997 might take about three months. Logically, assuming that insurance renewals come due evenly throughout the year, another six months would elapse before, on average, insurance companies were able to reclaim, or to build into their costing, the effect of the more efficient collection of charges—and, indeed, a higher overall collection of charges. That is why, by simple arithmetic, 1 April 1998 has been chosen by the Liberal Democrats as the date on which the new tariff should apply.

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      In Committee, we looked at 1 April 1999, so that everyone would be able to see car insurance premiums increase as the insurance industry adjusted to the new situation; but following debate in Committee, we felt that, on Report, a compromise of 1 April 1998 would be fair. It would not be seen retrospectively to penalise those insurance companies that were either no longer in a position to seek to redress the losses that they will make because of the new legislation and the Government's failure to build in a time lag, or that felt that they were unable to make provision in the marketplace to make up for the loss of income from premiums to pay the charges to which they would be due.
      Can the Minister defend the date of 2 July 1997 on any basis other than the one that he gave in Committee? Will he not recognise that even a fast-acting insurance industry that accepts the Bill must have some time to adjust, so that it does not penalise those members of the industry that are not selling insurance, and does not seek to reclaim old debts by stacking the insurance premiums for new customers over and above those who were lucky enough to reinsure just before 2 July 1997.
      3 pm
      Mr. Hammond: Conservative Members are always concerned about retrospection in legislation. From Second Reading and from reading the debates in Committee—I was not privileged to be a member of the Standing Committee that considered the Bill—the only argument that has been advanced for setting the start date at 2 July 1997 is that that is the day on which the Chancellor announced his intention to legislate.
      I submit that, announcing an intention to do something, is not the same as doing it, especially when it relates to parliamentary legislation. Businesses should not be required to change their patterns of operation or, in some cases—in this instance it may be a relatively minor issue—make major changes to their businesses, on the basis of an announced intention by the Government of the day. That could have pernicious and unfortunate effects if it were carried into other areas.
      We at least maintain the fiction that Government proposals are subject to scrutiny by both Houses of Parliament and to amendment during that process. The Government, and the Minister who is with us today, maintain the fiction that the Government listen attentively to the points raised in Committee and will consider any worthwhile amendments. It is perhaps not surprising that substantial amendments are not often accepted in Committee. The suggestion that, once the Chancellor or some other such estimable person has announced an intention to do something that requires legislation, everybody in the country should drop tools and act as if it were already the law of the land, displays a tremendous arrogance. It displays the Government's arrogant attitude towards the legislative process.
      Even if the industry should have responded immediately to the announcement by so great a person as the Chancellor, by its very nature, the insurance industry could not have adjusted its prices immediately to take account of the additional effective burden being imposed upon it. I do not like to second guess the Minister, but no doubt he will say that the charges were always in
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      place and, in theory, could always have been collected. However, it is an essential part of the Government's argument for the Bill that they were not collected. It is beyond doubt that a reasonable commercial organisation will base its behaviour on what is happening and what will happen in the world rather than on what might be theoretically capable of happening.
      Humble Back-Bench Members—Ministers have the privilege of being driven around—will be familiar with the process of purchasing motor insurance for themselves. They will know that, customarily, it is done on an annual basis. Indeed, annual motor insurance is the best deal available because cover for shorter periods tends to be more expensive. On 2 July, any insurance company faced with the Chancellor's announcement, would have had a portfolio of current motor insurances, some of which might have had only one day to run and some of which might have had up to 364 days to run. It would be impossible for an insurance company to respond equitably to an increased burden of costs imposed upon it by the Government on the day that the announcement is made, even leaving aside the question of whether business should feel obliged to respond immediately to a mere announcement of an intention to legislate.
      When I say that an insurer would be unable to respond equitably, I mean that the insurance company needs to ensure that the relevant insured persons bear the additional cost of the measure. Inevitably, the only action open to an insurer will be to increase the premiums on renewal from the date of the announcement. That means that those who, by definition, are not covered for some part of the first year after the announcement, will gradually be forced to pay the additional cost of meeting the unrecovered portion of the extra premiums that that company would have charged had it issued policies—there are no such policies in the United Kingdom—that would enable it to make immediate changes and collect supplementary premiums from it policyholders.
      The Liberal Democrat amendment appears to be illogical. The date mentioned should be 2 July 1998, the date by which all annual motor policies—the vast majority of policies—in force on 2 July 1997 would have fallen due for renewal. It would have been more appropriate for the amendment to have proposed the date of 2 July 1998 or a date after the Bill is enacted.
      I note from the briefing presented by the Association of British Insurers that it supports the Liberal Democrat amendment. I suspect that, behind that lies the belief that something is better than nothing and that it is seeking to limit the damage done to the business by the element of retrospection involved in a start date of 2 July 1997.
      Going beyond the motor insurance business, an important point of principle for the insurance industry is at stake. The industry operates on the basis of actuarial calculations of risks faced during the insured period. It would be a serious matter for the insurance industry in its broadest sense if the Government took to introducing legislation which impacted on the costs of that industry and which took effect from the date of announcement, notwithstanding the fact that, by its very nature the insurance industry needs a lead time in which to levy additional charges in the form of increased premiums on its customers. That would leave insurers facing risks that they had not taken into account when setting their premiums for a period up to one year for motor insurance or even longer for other forms of insurance.

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      A further anomaly can be seen in the treatment of the Motor Insurers Bureau. Under the Bill as currently drafted, the Motor Insurers Bureau will have this charge imposed upon it on a date after the Bill has become an Act. I accept that it may not have been clear at the time of the Chancellor's announcement that the Motor Insurers Bureau was to be included in the scope of the measure. For the Government to be logical and consistent, however, they should now be saying that the start date for the bureau should be the date on which it first became publicly recorded that the bureau would be subject to the charges under this Act.
      Either commercial insurance companies should benefit, as the Motor Insurers Bureau will, from a start date after the Bill's passage, or the Motor Insurers Bureau should be treated the same as insurance companies. If the latter option were chosen, the start date should be not 2 July 1997—I accept that the Chancellor did not announce on that date that the provisions would be extended to the bureau—but 8 December 1998, which, as far as I can determine, is the date on which Ministers first announced in the House that the provisions would extend to the Motor Insurers Bureau. Is the Minister able to deduce any logic in applying a seemingly entirely arbitrary start date to the Motor Insurers Bureau?
      I do not expect for one moment that the Government will accept amendment No. 2, but the issue of start dates and retrospection is worthy of reconsideration. I ask the Minister to assure the House that he will examine the issues that have been raised, not only as a means of tidying up the legislation but of addressing an important issue of principle that may have greater implications for the insurance industry in the future. It would be unfortunate if the Bill set a precedent of retrospection which may have much more serious consequences in the future. I hope that Ministers may yet decide that, in the other place, they want to tidy up that part of the Bill.
      Mr. Hutton: The Government have already very carefully considered all those issues of principle. We believe that the arrangements that we have established in the Bill, and the way in which we plan to implement them, are the fairest and most sensible way of proceeding. The entire purpose of the exercise is to ensure that the national health service properly recovers the costs of treating road accident victims, and that has always been the principle behind the legislation. We are simply ensuring that that principle—which has been accepted in the House for 70 years—operates in practice. The beneficiaries of the arrangements will be the NHS and those who use it, our constituents.
      A significant extra sum will be collected for the NHS because of our proposed arrangements. The fundamental reason why we cannot accept amendment No. 2 is that it would strike at the very heart and purpose of the Bill, by denying the NHS significant new resources for a further considerable time. We are not prepared to allow that to happen.
      Sir Robert Smith rose—
      Mr. Hutton: I shall not give way to the hon. Gentleman.
      The hon. Member for Runnymede and Weybridge (Mr. Hammond) made it sound as though our announcement on 2 July was made in an insignificant
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      place. It was not. The announcement was made in the House, during the Chancellor's Budget statement. In such circumstances, it was therefore perfectly reasonable to say to the insurance industry, "You have been given sufficient notice of our intention to proceed on those lines." That is our view.
      Sir Robert Smith rose—
      Mr. Hutton: I shall not give way.
      The Government are therefore unable to give the assurance sought by the hon. Member for Runnymede and Weybridge—that we might review the operation of that aspect of the Bill. We do not intend to do so.
      Mr. Hammond: Will the Minister give way?
      Mr. Hutton: With very great respect, we need to make some progress. The issues have already been discussed in Standing Committee, and hon. Members are anxious to conclude the proceedings.
      The hon. Member for Runnymede and Weybridge also mentioned the Motor Insurers Bureau. The point is that, for the first time, the MIB is being introduced into the arrangements, which is a significant change. We have therefore decided to propose the arrangements outlined in the Bill. As it is a new departure, we believe that our proposed arrangements are the appropriate and most sensible way of proceeding.
      Our argument is clear and consistent. Our arrangements are sensible and will guarantee maximum income for the NHS, which is what we want to ensure. We cannot accept the Liberal Democrats' amendment.
      3.15 pm
      Dr. Harris: The Minister's answer was entirely unsatisfactory, as it did not deal with the points that I made or the points that were made so clearly and precisely by the hon. Member for Runnymede and Weybridge (Mr. Hammond). It is not adequate for the Government simply to say, "We're not going to be fair to the insurance industry. We'll be quasi-retrospective about it, because we want to maximise income." The issue is not one of income maximisation. If it were, why do we not simply set unfair higher fees, which would be another way of maximising income?
      I listened very carefully to every word that the Minister said. At no point did he address the substantive issue of dates; indeed, no date other than 2 July passed his lips. Our amendment to change the date on which the changes will apply will not strike at the Bill's "heart and purpose" but merely create the appropriate date on which the changes should apply. It is difficult for me to be persuaded by the Government's argument if they do not deal with the substantive points that have been made.
      I should like to know whether the official Opposition feel that the Minister's reply dealt with the arguments that they made. Merely reciting the Bill's purpose is not a sufficient way of debating significant concerns about retrospectivity. It is a matter of fairness. The Government of course want to maximise income, but if that is the only principle they are pursuing, they will be riding roughshod over the principle of natural justice.

      1065
      As the Minister has not addressed the substantive issues raised by me and the hon. Member for Runnymede and Weybridge, the Liberal Democrats shall press the amendment to a vote. The hon. Member for Runnymede and Weybridge has just finished making a very clear speech, which the Minister entirely failed to answer. It is therefore incumbent on Conservative Members to put their votes where they mouths are, and not continue to abstain in Divisions on substantive legislation simply because they want to spend more time on Thursday afternoons shoring up their constituencies. We did not change the hours of the House so that they could abstain in Divisions, as they did in the previous one.
      It is still mid-afternoon, and Liberal Democrat Members are keen to engage the Government in debate. When I press the amendment to a Division—as I shall if the Minister has nothing further to say—I hope that Conservative Members will support us with their votes and not only with their words.
      Mr. Hammond rose—
      Mr. Deputy Speaker: Order. I should tell the hon. Member for Runnymede and Weybridge (Mr. Hammond) that the tradition in the House is that the hon. Member who moved the amendment should be the last to speak to it, so that he or she may be able to withdraw it.
      Mr. Hammond: I should like merely to respond to the point that the hon. Member for Oxford, West and Abingdon (Dr. Harris) made—
      Mr. Deputy Speaker: Perhaps the hon. Gentleman can do so on another occasion.
      Question put, That the amendment be made:—
      The House divided: Ayes 24, Noes 225.

      Division No. 44]

      3.18 pm

      AYES

      Allan, Richard

      Livsey, Richard

      Ashdown, Rt Hon Paddy

      Moore, Michael

      Beith, Rt Hon A J

      Morgan, Alasdair (Galloway)

      Brand, Dr Peter

      Öpik, Lembit

      Breed, Colin

      Rendel, David

      Burnett, John

      Russell, Bob (Colchester)

      Burstow, Paul

      Sanders, Adrian

      Cotter, Brian

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

      Foster, Don (Bath)

      Taylor, Matthew (Truro)

      George, Andrew (St Ives)

      Tyler, Paul

      Harris, Dr Evan

      Heath, David (Somerton & Frome)

      Tellers for the Ayes:

      Hughes, Simon (Southwark N)

      Mr. Tom Brake and

      Kennedy, Charles (Ross Skye)

      Mr. Phil Willis.

      NOES

      Abbott, Ms Diane

      Bayley, Hugh

      Adams, Mrs Irene (Paisley N)

      Begg, Miss Anne

      Ainsworth, Robed (Cov'try NE)

      Benn, Rt Hon Tony

      Allen, Graham

      Bennett, Andrew F

      Anderson, Donald (Swansea E)

      Benton, Joe

      Anderson, Janet (Rossendale)

      Berry, Roger

      Armstrong, Ms Hilary

      Best, Harold

      Ashton, Joe

      Betts, Clive

      Austin, John

      Blizzard, Bob

      Barnes, Harry

      Blunkett, Rt Hon David

      1066

      Borrow, David

      Hodge, Ms Margaret

      Bradley, Keith (Withington)

      Hoey, Kate

      Bradley, Peter (The Wrekin)

      Home Robertson, John

      Bradshaw, Ben

      Hopkins, Kelvin

      Brown, Russell (Dumfries)

      Hurst, Alan

      Buck, Ms Karen

      Hutton, John

      Butler, Mrs Christine

      Iddon, Dr Brian

      Campbell, Mrs Anne (C'bridge)

      Jackson, Helen (Hillsborough)

      Campbell, Ronnie (Blyth V)

      Jenkins, Brian

      Caplin, Ivor

      Jones, Helen (Warrington N)

      Casale, Roger

      Jones, Ms Jenny (Wolverh'ton SW)

      Caton, Martin

      Jones, Martyn (Clwyd S)

      Cawsey, Ian

      Jowell, Ms Tessa

      Chapman, Ben (Wirral S)

      Keeble, Ms Sally

      Chaytor, David

      Keen, Ann (Brentford & Isleworth)

      Chisholm, Malcolm

      Kelly, Ms Ruth

      Clapham, Michael

      Kennedy, Jane (Wavertree)

      Clark, Dr Lynda (Edinburgh Pentlands)

      Khabra, Piara S

      Clarke, Charles (Norwich S)

      Kilfoyle, Peter

      Clarke, Tony (Northampton S)

      King, Andy (Rugby & Kenilworth)

      Clelland, David

      King, Ms Oona (Bethnal Green)

      Coaker, Vernon

      Kingham, Ms Tess

      Coffey, Ms Ann

      Ladyman, Dr Stephen

      Coleman, Iain

      Laxton, Bob

      Colman, Tony

      Lepper, David

      Cook, Frank (Stockton N)

      Leslie, Christopher

      Cooper, Yvette

      Lewis, Ivan (Bury S)

      Corston, Ms Jean

      Linton, Martin

      Cox, Tom

      Livingstone, Ken

      Cranston, Ross

      Lloyd, Tony (Manchester C)

      Cryer, Mrs Ann (Keighley)

      Love, Andrew

      Cryer, John (Hornchurch)

      McAllion, John

      Cummings, John

      McAvoy, Thomas

      Cunningham, Jim (Cov'try S)

      McCabe, Steve

      Dalyell, Tam

      McDonagh, Siobhain

      Darvill, Keith

      Macdonald, Calum

      Davies, Rt Hon Denzil (Llanelli)

      McDonnell, John

      Davies, Geraint (Croydon C)

      McGuire, Mrs Anne

      Davis, Terry (B'ham Hodge H)

      McIsaac, Shona

      Dean, Mrs Janet

      Mackinlay, Andrew

      Doran, Frank

      McNulty, Tony

      Drew, David

      McWalter, Tony

      Eagle, Angela (Wallasey)

      Mahon, Mrs Alice

      Eagle, Maria (L'pool Garston)

      Mallaber, Judy

      Efford, Clive

      Mandelson, Rt Hon Peter

      Ellman, Mrs Louise

      Marek, Dr John

      Etherington, Bill

      Marsden, Paul (Shrewsbury)

      Field, Rt Hon Frank

      Marshall, David (Shettleston)

      Fisher, Mark

      Martlew, Eric

      Fitzpatrick, Jim

      Merron, Gillian

      Fitzsimons, Lorna

      Michie, Bill (Shef'ld Heeley)

      Follett, Barbara

      Miller, Andrew

      Foster, Michael Jabez (Hastings)

      Moran, Ms Margaret

      Fyfe, Maria

      Morgan, Ms Julie (Cardiff N)

      Galloway, George

      Morley, Elliot

      Gapes, Mike

      Mullin, Chris

      Gardiner, Barry

      Murphy, Denis (Wansbeck)

      Gerrard, Neil

      Naysmith, Dr Doug

      Godman, Dr Norman A

      Norris, Dan

      Goggins, Paul

      O'Brien, Bill (Normanton)

      Gordon, Mrs Eileen

      O'Hara, Eddie

      Griffiths, Jane (Reading E)

      Olner, Bill

      Griffiths, Nigel (Edinburgh S)

      O'Neill, Martin

      Grocott, Bruce

      Organ, Mrs Diana

      Grogan, John

      Osborne, Ms Sandra

      Hall, Mike (Weaver Vale)

      Palmer, Dr Nick

      Hall, Patrick (Bedford)

      Pearson, Ian

      Hanson, David

      Perham, Ms Linda

      Heal, Mrs Sylvia

      Pickthall, Colin

      Healey, John

      Pike, Peter L

      Henderson, Doug (Newcastle N)

      Plaskitt, James

      Henderson, Ivan (Harwich)

      Pollard, Kerry

      Heppell, John

      Pope, Greg

      Hill, Keith

      Pound, Stephen

      Hinchliffe, David

      Prentice, Ms Bridget (Lewisham E)

      1067

      Prentice, Gordon (Pendle)

      Starkey, Dr Phyllis

      Prescott, Rt Hon John

      Steinberg, Gerry

      Prosser, Gwyn

      Stewart, David (Inverness E)

      Quin, Ms Joyce

      Strang, Rt Hon Dr Gavin

      Quinn, Lawrie

      Stringer, Graham

      Radice, Giles

      Stuart, Ms Gisela

      Rammell, Bill

      Sutcliffe, Gerry

      Rapson, Syd

      Taylor, Rt Hon Mrs Ann (Dewsbury)

      Raynsford, Nick

      Taylor, David (NW Leics)

      Reed, Andrew (Loughborough)

      Thomas, Gareth R (Harrow W)

      Robinson, Geoffrey (Cov'try NW)

      Timms, Stephen

      Rooker, Jeff

      Tipping, Paddy

      Ross, Ernie (Dundee W)

      Todd, Mark

      Ruane, Chris

      Touhig, Don

      Russell, Ms Christine (Chester)

      Turner, Dr George (NW Norfolk)

      Ryan, Ms Joan

      Twigg, Stephen (Enfield)

      Savidge, Malcolm

      Vaz, Keith

      Sawford, Phil

      Vis, Dr Rudi

      Sedgemore, Brian

      Wareing, Robert N

      Shaw, Jonathan

      White, Brian

      Sheldon, Rt Hon Robert

      Whitehead, Dr Alan

      Shipley, Ms Debra

      Wicks, Malcolm

      Simpson, Alan (Nottingham S)

      Williams, Rt Hon Alan (Swansea W)

      Skinner, Dennis

      Wood, Mike

      Smith, Rt Hon Andrew (Oxford E)

      Woolas, Phil

      Smith, Angela (Basildon)

      Smith, Miss Geraldine (Morecambe & Lunesdale)

      Tellers for the Noes:

      Smith, John (Glamorgan)

      Mr. Kevin Hughes and

      Soley, Clive

      Mr. Jim Dowd.

      Southworth, Ms Helen

      Question accordingly negatived.
      Order for Third Reading read.
      3.30 pm
      Mr. Hutton: I beg to move, That the Bill be now read the Third time.
      Today and in Committee we have had the opportunity to look carefully at the Bill and its purpose. We are trying to streamline, improve and manage more effectively the existing scheme for recovering the cost to the national health service of treating road traffic accident victims. We are determined to do that for a number of reasons that we have repeatedly spelt out during proceedings on the Bill.
      The NHS needs the extra resources that the scheme will provide, and the Bill is badly needed. It will free hospital staff from the burden of questioning patients when the care and treatment of those patients should be uppermost in everyone's mind. Patients will no longer be confused or worried about a scheme that does not affect them directly.
      It is worth emphasising that since the 1930s the insurance industry has had the primary obligation to meet the costs of treating road traffic accident victims. We want there to be no misunderstanding about the Bill.
      The scheme will raise a good deal of money for the NHS, not, as some hon. Members wanted, going to another tier of NHS administration—an outcome that the Liberal Democrats tried to secure in Committee—but going directly to hospitals, where it can be used to the immediate benefit of patients. In the overall scale of NHS finance, the amounts may not be great, but they are substantial injections to the budgets of the hospitals that stand to receive them and the sooner the Bill is enacted, the sooner the benefits will be received.
      A number of specific concerns have been raised and it would be helpful if I took the opportunity to set the record straight. We reject the accusation that we are imposing a
      1068
      new tax or a new charge. It is vital to remember that NHS charges can be recovered only when it has been recognised that the patient has a claim against another person in respect of his or her injuries. In such cases, insurers have always known that the victim is entitled to use and claim for private sector treatment if he or she so wishes. The insurer has no choice but to pay. However, insurers have largely escaped paying equivalent NHS charges simply because of the lack of a system for their recovery. The Bill will fundamentally address that by putting into place a new, effective, streamlined costs recovery system.
      There has also been concern about the new scale of charges. What is new about the Bill is the move towards recovering amounts more closely in line with the actual costs to the NHS. Many of the points made during scrutiny of the Bill have concerned the move to those new, higher costs and some unease has been expressed about their calculation and their future uprating. Much of that concern has been needless and has involved party political point scoring, primarily by the Liberal Democrats.
      The figures have been arrived at openly and honestly using information which is in the public domain and freely available. Our costs have been derived from work undertaken by the Transport Research Laboratory and published in its research paper 272, with co-operation from the police, the NHS and the Department of Social Security compensation recovery unit. The calculations and source data were all contained in the regulatory appraisal—we have nothing to hide.
      We have rightly rejected calls for reports to be filed at set intervals on the tariff, the amounts collected and so on. The Bill is no different from any other—including all the previous road traffic measures which have governed NHS charge recovery. Its subordinate legislation, which I understand is the source of some concern to hon. Members, will come before the House in the normal fashion and hon. Members will have every opportunity to question and discuss planned changes. In response to a direct question from the hon. Member for Runnymede and Weybridge (Mr. Hammond) today, I made it quite clear that it is the Government's intention to assist hon. Members in discussing the impact of the Bill and the new arrangements that we are introducing and to make sure that all hon. Members have access to the most up-to-date, relevant and timely information to allow them to reach their own decisions about the operation of the new arrangements.
      Some concern has been expressed about the effect of the changes on the motorist. Much of it has been based on ill-informed speculation. Large insurers have gone on record as saying that the measure probably will not affect their premiums, yet the scaremongers persist. Let me make it quite clear today that we have calculated and openly published our estimate of what the scheme would mean if the total NHS charges were averaged out and spread evenly among all drivers. If that were the way in which the insurance industry raised the charges, we estimate that the effect would be an increase of 2 to 3 per cent., or £6 to £9 on the average premium.
      Mr. Hammond: I understand what the Minister is saying, but does he accept that the costs will not be averaged out and will affect some motorists more seriously than he suggests?
      Mr. Hutton: The hon. Gentleman has tended to anticipate my remarks and he has done so again.

      1069
      We expressed the figures in those terms to make it quite clear that under our insurance system, drivers who cause accidents carry a greater risk and pay higher premiums. If there were an effect on premiums, it would be likely that careless drivers would contribute most.
      The allegation by some Opposition Members that the Bill would affect rural motorists as a specific group of drivers is completely unfounded. The premiums will reflect risk. Drivers at high risk will pay more. Safe drivers should face no increase.
      Sir Robert Smith: Will the Minister give way?
      Mr. Hutton: No.
      For those reasons and many others, this is a sensible and sound Bill. It will assist the NHS in recovering the costs of treating road traffic accident victims. It will provide additional resources to the national health service. It is what our constituents want. The money will benefit the hospitals in our constituencies. I endorse the Bill and urge the House to support it on Third Reading.
      3.37 pm
      Mr. Hammond: I should make it clear at the outset, as my right hon. and hon. Friends have done during the Bill's progress, that we do not object in principle to the Government's purpose in introducing the legislation. Indeed, I welcome the shift in the Labour party's thinking that it represents.
      The Minister is sheltering—as Ministers have done before—behind the claim that the measure represents no new charge. That is disingenuous. The Minister has made it quite clear that the Bill will increase tenfold the yield from road traffic accident victims. It is currently £15 million or £16 million. Technically I am sure that the Minister is right to say that it is not a new charge, but the impact on the tax and charge-paying public will be that of a new charge. One cannot increase something tenfold and then say that nothing has changed.
      To say that, because the charge was there in theory but was not used in practice, starting to use it is a mere technicality and not a change in policy is similar to saying that because we have had nuclear weapons for 50 years, suddenly starting to use them would not be a major decision or a major change.
      The Government have also sought to gain some comfort from the fig leaf of indirect charging. I understand the political attractiveness of that, but the fact that insurance companies will pay the NHS charges and then recover the cost through premiums to motorists is not intellectually distinct from directly charging users of the NHS. Worse, perhaps, is the fact that taking the fig leaf and using it to protect themselves has led the Government to set their face against the logic of the Bill, and the way in which, quite possibly, that logic must be extended.
      The Bill represents an important turning point. The Labour party has crossed the Rubicon with this measure. After years of arguing against charges, the Labour Government have used precious legislative time not to abolish a charge that was yielding very little, but to beef it up so that it produces substantial sums. The Government
      1070
      could have abolished the charge in the same amount of legislative time that it has taken to make it effective and productive of large amounts of revenue. It appears that Labour has overcome its objection to the principle of charges.
      I do not seek to beat the Government over the head, as this is a small but important victory in the battle to end the dominance of dogma in their approach to the health service, but to begin the rational debate, for which my right hon. Friend the Member for Maidstone and The Weald (Miss Widdecombe) and I have called—as have the Liberal Democrats today—about how to fund the voracious appetite of a modern health service for resources.
      The Government and the official Opposition are both publicly committed to year-on-year, real-terms increases in spending on the NHS from general taxation. That is not an issue. Except for a few diehards—who are usually to be found, although not today, below the Gangway on the Government Benches—and the Liberal Democrats, almost no one now believes that we still live in a era where taxes can be jacked up endlessly to meet the demands of the NHS.
      Notwithstanding the commitment to year-on-year, real-terms increases—and whether it is 0.5 per cent. more over the life of this Parliament, as the Government are now delivering, or 0.5 per cent. less is very interesting, but makes no real or meaningful impact on the resource constraints facing the NHS—the fact remains that a health service that is funded exclusively from general taxation in an environment of broadly low tax, both domestically and internationally, will remain heavily resource-constrained.
      My right hon. and hon. Friends and I argue that without compromising or eroding in any way that commitment to year-on-year rises in spending from general taxation on our health care system, the system in its totality needs more resources than general taxation is likely to be able to provide. To address that issue, we must think laterally. If the Bill signals the Government's willingness to consider any source of funding for the NHS, it is a small but important start to the process.
      The basis for considering any method of providing additional funds for health services must be the test of whether it is fair, equitable and sensible. It might surprise the Minister to learn that, for the most part, we believe that the Bill passes that test. It is sensible to introduce it and to put on the statute book the measures that the Minister proposes.
      The principal area where, in our opinion, it does not pass the test—and the principal concern that we have expressed throughout the Bill's passage—is the discriminatory targeting of the motorist. We have seen the interesting spectacle of two Labour demons colliding in the Bill; the taboo on NHS charges has run smack into the desire to clobber the motorist at every opportunity. The charge on the motorist to be introduced by the Government is regressive, and has an anti-rural basis. It comes on top of the £9 billion of extra taxes that the Chancellor is imposing on the motorist over the lifetime of this Parliament.
      In effect, the motorist is being double-taxed. He is being asked to pay more than his fair share into the Consolidated Fund of general taxation through the dramatic increases in motoring taxes proposed by the Government. He is then being asked to pay again, on a discriminatory basis, for his use of the NHS.

      1071
      The Government have done something else—they have accepted the principle of insurance as a basis of spreading the burden of costs of health care. Indeed, they are sheltering behind the existence of compulsory motor insurance as an argument for the motorist being a unique category. Everybody would agree that the Government would never have considered introducing a £10,000 cap on the charge to be levied on an individual without any means test if the individual himself had had to pay the charge, rather than its being paid by his insurance company and the very considerable costs involved being spread across all motorists through the mechanism of insurance premiums.
      There are other areas where those treated on the NHS—often at very great expense—are insured. It is not logical for the Government to ignore that and say that the motorist is in a unique category and everybody else is different. Some poor, rural motorists may find it odd that they are being targeted to pay the additional charges when people returning to the United Kingdom from expensive skiing holidays with broken arms or in need of complex knee surgery—with insurance companies that have paid for their treatment in Switzerland, France or Italy—have their often very expensive treatment here on the NHS, without any requirement at all for them, or more precisely their insurers, to contribute as motorists are being asked to contribute.
      Ministers have often said that the principle of equity in the NHS is important, and Labour Back Benchers support that. One is bound to ask, "If motorists, then why not also other insured, compensated victims who need NHS treatment?" I did not know much about the operation of the compensation recovery unit until I started to look at the provisions of the Bill. I have learnt that one of the unit's main functions is to recover benefit that has been paid out in cases where, for example, employers have paid compensation after industrial accidents. If benefit is clawed back by the compensation recovery unit on behalf of the Treasury—where it has been paid out to the victim of an accident who, subsequently, has been reimbursed or compensated by the insurer of the employer—why should the NHS charges that that person has incurred, or has imposed upon the system, not similarly be recovered from insurers?
      I cannot understand the logic of the Government's position. They are saying that someone who carries compulsory motor insurance must be expected to pay for the cost to the NHS caused by treating third-party victims, while someone who carries compulsory employers' liability insurance need not reimburse the cost of NHS treatment carried out following an industrial accident or another insured risk—while the insurer must reimburse the cost of the benefits paid out. Where is the logic? There is none—it is as simple as that.
      It is unfortunate that the Government have closed their mind to the logic, as that has led to a clearly inequitable outcome, with motorists being the victims. Effective charging is being introduced for one group of the population only, and that charging is being introduced without any form of means testing. Undoubtedly, if the Government were to propose any wider form of charging, they would be looking at the ability of those charged to pay. In this case, everyone's insurance premiums will go up. As Liberal Democrat Members noted, the effect will be highly regressive, and I believe that it will be especially burdensome in rural areas.
      1072
      The Government have repeatedly assured the House that the proceeds of the charges will constitute extra money and be a little bonus for the NHS hospitals involved. I do not believe that. The original statement of the intention to make the charges effectively collectible was made by the Chancellor in his 1997 Budget. It is not credible to suggest that the revenue to be raised in that way had not been factored into the Government's calculations in deciding what total Treasury spending on the NHS should be. Surely the Chancellor must have considered that revenue as part of the wider equation in setting the Department of Health budget in aggregate.
      I am concerned about the impact on individual health authorities. The measure will channel about £150 million from insurers to individual hospital trusts, but it is extremely unlikely that that money will be spread evenly, principally because the incidence of road accidents varies. Certain hospitals specialise in high-level trauma such as is often suffered in accidents, and hospitals near the motorway network routinely treat many accident victims. It is likely that the revenue will be heavily skewed towards such hospitals.
      In allocating money to individual health authorities, will the Government ensure that the revenue that a hospital trust receives as a result of the Bill will not be taken into account and used as a reason for reducing the overall allocation to the hospital's health authority from general taxation? I am tempted to suspect that, over time, the Department of Health will take into account the revenue streams flowing to hospitals that specialise in trauma when setting the allocation to the host health authority. At a disaggregated level the money from the charges could be used to reduce the receipts of the authorities involved.
      The Labour party used to recite almost as a mantra the slogan, "An NHS free at the point of need and funded out of general taxation". We have reaffirmed our commitment to a service that is free at the point of need and to increasing year on year the real-terms expenditure on that service from general taxation. Beyond that, we believe that there is a need to bring in additional resources by other means and that we should consider every option, provided that it is fair, equitable and sensible. There is an urgent need for an open debate on the subject.
      If the Bill represents a genuine transformation in Labour party attitudes—a rejection of stale dogma and a willingness to engage in constructive debate about how to feed the voracious appetite of our health services over and above the funding that can be found from general taxation—we welcome that as an important step forward.
      3.55 pm
      Sir Robert Smith: I did not intend to speak, but the Minister refused to take an intervention on a point that interested me. It is a pity that Ministers are not more willing to take interventions; if they were, that could speed up our proceedings. He seemed to be saying that the fact that a motorist pays a higher premium proves that he is a more dangerous driver than others. It would be more correct to say that the motorist comes from a category that insurance companies consider to be a higher risk. Young motorists can be perfectly safe drivers, but they are penalised with a higher premium because they come from a group that is seen to have a higher risk of causing accidents.

      1073
      The Bill will cause some drivers to pay considerably higher premiums because, as others have said, one cannot get something for nothing. If the Government are right, and the money can be delivered to the health service at no extra cost, why are they not aiming for a higher sum? If there is no cost to be met, they should be raising far more.
      On Second Reading, our health team made it clear that the Bill should be opposed on principle. Having heard the arguments in Committee, I feel even more strongly that it should also be opposed on Third Reading. I am disappointed by the Government's attitude to the concept of retrospective legislation and their inability to accept any compromise or meeting of ways. They insist that, because something has been announced by a Minister, it must, de facto, be assumed that it will become the law of the land. That is absurd if we are to continue to have a legislative process and a House of Commons.
      Other Departments have accepted amendments or compromises and agreed to introduce changes on Report or in another place, in response to concerns expressed in Committee or by groups outside. To say that, because insurance companies will have read in the newspapers that the Chancellor has declared that he wants to do something, it must be calculated, ipso facto, that that will definitely happen is a disgraceful way to treat the House and the country. The Chancellor has made other claims on which he has not delivered. He cannot have it both ways.
      It must be accepted that, until legislation has passed all its stages, the process of lobbying and the right to make changes continue to exist. In this Parliament, with such a large majority, the Government seem to have decided to close their ears to representation and they are telling the wider public that they do not want to hear their views because they do not plan to act on them.
      Someone planning an energy Bill in the previous Parliament would have been slightly put out by an increase in VAT on energy consumption, because the then Government were defeated in trying to pass such a measure. I hope that, in another place, perhaps with different Ministers and the more considered debate that is possible there, the Government will amend the Bill and make it less damaging.
      3.58 pm
      Mr. Syms: I have followed the Bill's progress on Second Reading and in Committee. The debate has been interesting and we have not always reached the expected conclusions. The Minister said that the legislation would be judged on whether it streamlined the process and created an improved, more efficient scheme. Certain aspects of the Bill will certainly improve the scheme. The abolition of the emergency treatment charge has been widely welcomed by Government and Opposition Members.
      Our earlier debate on whether the charge should remain for general practitioners or private hospitals was somewhat bedevilled by lack of information on both sides. We were not quite sure what was collected, who collected it or whether it was worth collecting. The Government said that they did not want to get rid of it because the GPs would be unhappy and some Opposition Members said that perhaps it was not worth having, but we did not have enough information to take the debate much further.
      1074
      As my hon. Friend the Member for Runnymede and Weybridge (Mr. Hammond) said, there is a point of principle at stake, because the Government have gone for a group of insured people in order to raise money. Throughout debate on the Bill, we have asked whether the Government have started on a slippery slope that will lead to more charges for, perhaps, home owners or for people involved in skiing or other sporting accidents. The official Opposition have expressed concerns that the Bill will breach a principle, and consequently affect many people's lives.
      We support funding the national health service through general taxation and we believe that it should be free to those who use it. However, all Governments have to consider ways to supplement the health service's income and it has been an education to watch how quickly this Government have moved to try to raise money from private motorists. The Minister said that careless drivers would pay the charge, but, as the hon. Member for West Aberdeenshire and Kincardine (Sir R. Smith) pointed out, the young pay higher insurance premiums than other drivers, as do certain categories of people with medical difficulties. The insurance companies determine those charges, but if—as most Conservative Members believe—the Bill leads to higher insurance premiums, some of those least able to afford the charges may be affected.
      In Committee, I raised the pot of gold argument. The Government have taken the credit for some £120 million to £160 million additional resources for the NHS, but they seemed to suggest that it would come from nowhere and not cost anyone because the charge was in place and the insurance companies were collecting it. However, as my hon. Friend the Member for Runnymede and Weybridge said, the money will have to come from somewhere, and we all know that it will come from charges by insurance companies on motorists. Motorists will pay an extra £120 million to £160 million, which will fund the NHS. That may not be a bad outcome, but the Government should be more open and acknowledge that motorists face an additional charge.
      We also raised the issue of retrospective legislation. On 2 July 1997, the Chancellor announced a charge, without giving any details. Even if an insurance company had rapidly decided that it wanted to recoup the charge, it would not necessarily have been able to do so. I hope that the Government will reconsider that issue.
      We have been accused of scaremongering, but we have pointed out that the money will have to come from somewhere. It will be raised by charging more to certain categories of motorists and some people will pay much more than they currently do. My hon. Friend the Member for Runnymede and Weybridge pointed out that we have to judge whether the Bill is a fair, equitable and sensible measure. Indeed, we are in favour of the Bill in principle, but the devil is in the detail. It is important that we have full scrutiny of the Bill's effect, and we must review the collection agency and its efficiency and effectiveness in collecting the charges. We must also review how the money is distributed to hospitals and health authorities.
      I was pleased by the assurances that the Minister gave during the Bill's progress that the Government did not want to hide statistics. When a new computerised system is set up, it is possible to arrange affairs so that information can be provided to Members of Parliament,

      1075
      and I am sure that the Minister will endeavour to achieve that. We have had an interesting debate and I look forward to hearing contributions from other hon. Members.
      4.4 pm
      Mr. Simon Hughes: We are coming to the end of proceedings on this short Bill and I am grateful to my hon. Friends the Members for Oxford, West and Abingdon (Dr. Harris) and for West Aberdeenshire and Kincardine (Sir R. Smith), who looked after our interests so diligently in Committee. On Second Reading, when we supported the Conservatives' reasoned amendment, we said that this measure was not the right way to raise money for the health service.

      When the Labour party came to office, it discovered a potential source of extra money for the NHS and, as the hon. Member for Runnymede and Weybridge (Mr. Hammond) said, it decided to make it produce more money—10 times more, an increase from £16 million to £160 million. However, we still do not know whether the Bill is an admission that the Government will look openly at the funding of the health service or a one-off response to an opportunity to raise more money by increasing an existing charge. The Government said nothing about such a move in their manifesto or during the general election, but it will mean that some people will make an additional contribution to the health service.
      On Second Reading, we said that we did not like the Bill but that we would see what happened to it in Committee. I was not a member of the Committee, but I understand that proceedings there followed the same pattern as today's. For example, we made the sensible proposition, in new clause 1, that we should abolish the system under which general practitioners, such as my hon. Friend the Member for Isle of Wight (Dr. Brand), may collect money directly from someone involved in a road accident. General practitioners do not like to do that and most of them do not do so. We suggested that GPs should be paid for that service in the same way that they are paid for emergency treatment. That is a sensible proposition, but we have seen no movement in our direction by the Minister.
      We also argued, with support from the Conservatives, that the legislation should not be retrospective. I am a lawyer by training and I have always sought to defend people against retrospective legislation. Whether its effect is big or small, the principle is wrong. We suggested that the date should be changed, but the Government have not conceded the point. The only concession made was on the need for clearer statistics, although the Minister was not very helpful when he was asked by my hon. Friends how many non-NHS and NHS doctors had said that they were in favour of the system. The Minister said that he had received representations, but he would not tell us how many.
      The core issue is the financing of the health service. We will vote against Third Reading of the Bill because we cannot have uncertainty about how money for the NHS will be raised. It will be the Government's fault if, in the future, different categories of people are required to make contributions to the health service because they have been injured when undertaking certain activities. There is no difference in principle between people who drive and are involved in an accident paying into the health service through their insurance companies and
      1076
      people who go on sporting holidays and are injured—like my hon. Friend the Member for Montgomeryshire (Mr. Öpik), when he went paragliding—doing so. If we extend the principle behind the Bill, there is no reason why my hon. Friend should not pay for his treatment. By the same token, people who are injured in their local park, at their place of work or climbing up a ladder at home should have to pay. There is no logic in charging only those involved in road accidents because they could have been charged in the past. People do not believe the Government's claims on that point.
      I am in favour of more funds for the health service, but I would also like to see a public debate about how to raise them and the Government have not so far responded to that. As my hon. Friend the Member for West Aberdeenshire and Kincardine said, we feel less reassured after proceedings on the Bill than we did before. We have supported from the beginning the Government's uncontroversial proposals to abolish the emergency treatment, but the Bill contains much more.
      We shall once again try, therefore, to defeat the Bill, this time on Third Reading. It is, I expect, unlikely that we shall succeed, but if we do not try, we cannot succeed. Our consolation is that, whatever the hon. Member for Bolsover (Mr. Skinner) may think, we have a two-chamber Parliament. The other House has no Labour majority, and it contains many independent people of expertise and knowledge who may amend the Bill. We hope that the Bill will be amended in the way that we have proposed. The Government have not done so, and, no matter how unsupportable their arguments have been, they have remained resolute in opening the door to charges in the health service that have never been part of rational debate. We ask the House to reject the Bill, and to reconsider health service charging in another place, at another time and in a more comprehensive way.
      Question put, That the Bill be now read the Third time:—
      The House divided: Ayes 228, Noes 24.

      Division No. 45]

      [4.10 pm

      AYES

      Abbott, Ms Diane

      Campbell, Mrs Anne (C'bridge)

      Adams, Mrs Irene (Paisley N)

      Campbell, Ronnie (Blyth V)

      Ainsworth, Robert (Cov'try NE)

      Casale, Roger

      Allen, Graham

      Caton, Martin

      Anderson, Donald (Swansea E)

      Chapman, Ben (Wirral S)

      Anderson, Janet (Rossendale)

      Chaytor, David

      Armstrong, Ms Hilary

      Chisholm, Malcolm

      Ashton, Joe

      Clapham, Michael

      Austin, John

      Clark, Dr Lynda (Edinburgh Pentlands)

      Barnes, Harry

      Clarke, Charles (Norwich S)

      Bayley, Hugh

      Clarke, Tony (Northampton S)

      Begg, Miss Anne

      Clelland, David

      Benn, Rt Hon Tony

      Coaker, Vernon

      Bennett, Andrew F

      Coffey, Ms Ann

      Benton, Joe

      Coleman, Iain

      Berry, Roger

      Colman, Tony

      Best, Harold

      Cook, Frank (Stockton N)

      Betts, Clive

      Cooper, Yvette

      Blizzard, Bob

      Corbyn, Jeremy

      Borrow, David

      Corston, Ms Jean

      Bradley, Keith (Withington)

      Cox, Tom

      Bradley, Peter (The Wrekin)

      Cranston, Ross

      Bradshaw, Ben

      Cryer, Mrs Ann (Keighley)

      Brown, Russell (Dumfries)

      Cryer, John (Hornchurch)

      Buck, Ms Karen

      Cummings, John

      Butler, Mrs Christine

      1077

      Cunningham, Jim (Coy'try S)

      Jowell, Ms Tessa

      Dalyell, Tam

      Keeble, Ms Sally

      Darling, Rt Hon Alistair

      Keen, Ann (Brentford & lsleworth)

      Darvill, Keith

      Kelly, Ms Ruth

      Davies, Rt Hon Denzil (Llanelli)

      Kennedy, Jane (Wavertree)

      Davies, Geraint (Croydon C)

      Khabra, Piara S

      Davis, Terry (B'ham Hodge H)

      Kilfoyle, Peter

      Dean, Mrs Janet

      King, Andy (Rugby & Kenilworth)

      Doran, Frank

      King, Ms Oona (Bethnal Green)

      Drew, David

      Kingham, Ms Tess

      Eagle, Angela (Wallasey)

      Ladyman, Dr Stephen

      Eagle, Maria (L'pool Garston)

      Laxton, Bob

      Efford, Clive

      Lepper, David

      Ellman, Mrs Louise

      Leslie, Christopher

      Etherington, Bill

      Lewis, Ivan (Bury S)

      Field, Rt Hon Frank

      Linton, Martin

      Fisher, Mark

      Livingstone, Ken

      Fitzpatrick, Jim

      Lloyd, Tony (Manchester C)

      Fitzsimons, Lorna

      Love, Andrew

      Flynn, Paul

      Follett, Barbara

      McAllion, John

      Foster, Michael Jabez (Hastings)

      McAvoy, Thomas

      Fyfe, Maria

      McCabe, Steve

      Galloway, George

      McDonagh, Siobhain

      Gapes, Mike

      Macdonald, Calum

      Gardiner, Barry

      McDonnell, John

      Gerrard, Neil

      McGuire, Mrs Anne

      Godman, Dr Norman A

      McIsaac, Shona

      Goggins, Paul

      Mackinlay, Andrew

      Gordon, Mrs Eileen

      McNulty, Tony

      Griffiths, Jane (Reading E)

      McWalter, Tony

      Griffiths, Nigel (Edinburgh S)

      Mahon, Mrs Alice

      Grocott, Bruce

      Mallaber, Judy

      Grogan, John

      Mandelson, Rt Hon Peter

      Hall, Mike (Weaver Vale)

      Marek, Dr John

      Hall, Patrick (Bedford)

      Marsden, Paul (Shrewsbury)

      Hanson, David

      Marshall, David (Shettleston)

      Heal, Mrs Sylvia

      Marshall—Andrews, Robert

      Healey, John

      Martlew, Eric

      Henderson, Doug (Newcastle N)

      Merron, Gillian

      Henderson, Ivan (Harwich)

      Michie, Bill (Shef'ld Heeley)

      Hill, Keith

      Miller, Andrew

      Hinchliffe, David

      Moran, Ms Margaret

      Hodge, Ms Margaret

      Morgan, Ms Julie (Cardiff N)

      Hoey, Kate

      Morley, Elliot

      Home Robertson, John

      Mullin, Chris

      Hoon, Geoffrey

      Murphy, Denis (Wansbeck)

      Hopkins, Kelvin

      Naysmith, Dr Doug

      Hurst, Alan

      Norris, Dan

      Hutton, John

      O'Brien, Bill (Normanton)

      Iddon, Dr Brian

      O'Brien, Mike (N Warks)

      Jackson, Helen (Hillsborough)

      O'Hara, Eddie

      Jenkins, Brian

      Olner, Bill

      Jones, Helen (Warrington N)

      O'Neill, Martin

      Jones, Ms Jenny (Wolverh'ton SW)

      Organ, Mrs Diana

      Jones, Marlyn (Clwyd S)

      Osborne, Ms Sandra

      Palmer, Dr Nick

      Pearson, Ian

      1078

      Perham, Ms Linda

      Smith, John (Glamorgan)

      Pickthall, Colin

      Soley, Clive

      Pike, Peter L

      Southworth, Ms Helen

      Plaskitt, James

      Spellar, John

      Pollard, Kerry

      Starkey, Dr Phyllis

      Pope, Greg

      Steinberg, Gerry

      Pound, Stephen

      Stewart, David (Inverness E)

      Powell, Sir Raymond

      Strang, Rt Hon Dr Gavin

      Prentice, Ms Bridget (Lewisham E)

      Stringer, Graham

      Prentice, Gordon (Pendle)

      Stuart, Ms Gisela

      Primarolo, Dawn

      Sutcliffe, Gerry

      Prosser, Gwyn

      Taylor, Rt Hon Mrs Ann (Dewsbury)

      Quin, Ms Joyce

      Taylor, David (NW Leics)

      Quinn, Lawrie

      Thomas, Gareth R (Harrow W)

      Rammell, Bill

      Timms, Stephen

      Rapson, Syd

      Tipping, Paddy

      Raynsford, Nick

      Todd, Mark

      Reed, Andrew (Loughborough)

      Touhig, Don

      Robertson, Rt Hon George (Hamilton S)

      Turner, Dr George (NW Norfolk)

      Robinson, Geoffrey (Cov'try NW)

      Twigg, Stephen (Enfield)

      Rooker, Jeff

      Vaz, Keith

      Ross, Ernie (Dundee W)

      Vis, Dr Rudi

      Ruane, Chris

      Wareing, Robert N

      Russell, Ms Christine (Chester)

      White, Brian

      Ryan, Ms Joan

      Whitehead, Dr Alan

      Savidge, Malcolm

      Wicks, Malcolm

      Sawford, Phil

      Williams, Rt Hon Alan (Swansea W)

      Sedgemore, Brian

      Wood, Mike

      Shaw, Jonathan

      Woolas, Phil

      Shipley, Ms Debra

      Wright, Dr Tony (Cannock)

      Simpson, Alan (Nottingham S)

      Skinner, Dennis

      Tellers for the Ayes:

      Smith, Angela (Basildon)

      Mr. Kevin Hughes and

      Smith, Miss Geraldine (Morecambe & Lunesdale)

      Mr. Jim Dowd.

      NOES

      Allan, Richard

      Kennedy, Charles (Ross Skye)

      Berth, Rt Hon A J

      Livsey, Richard

      Brake, Torn

      Moore, Michael

      Brand, Dr Peter

      Morgan, Alasdair (Galloway)

      Burnett, John

      Öpik, Lembit

      Burstow, Paul

      Rendel, David

      Campbell, Menzies (NE Fife)

      Russell, Bob (Colchester)

      Cotter, Brian

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

      Foster, Don (Bath)

      Tyler, Paul

      George, Andrew (St Ives)

      Willis, Phil

      Harris, Dr Evan

      Tellers for the Noes:

      Heath, David (Somerton & Frome)

      Mr. Colin Breed and

      Hughes, Simon (Southwark N)

      Mr. Adrian Sanders.

      Keetch, Paul

      Question accordingly agreed to.
      Bill read the Third time, and passed.

Scottish Enterprise Bill
Order for Second Reading read.
4.22 pm
The Parliamentary Under-Secretary of State for Scotland (Mr. Calum Macdonald): I beg to move, That the Bill be now read a Second time.
This Bill has a narrow and, indeed, a technical compass. It arises because section 25(2) of the Enterprise and New Towns (Scotland) Act 1990 places an aggregate financial limit on Scottish Enterprise. For it to continue its operations, that limit must be raised every few years. The purpose of this Bill is to increase the financial limit from the present £3 billion to £4 billion. In addition, it removes the provision that enables the Secretary of State to increase the limit further by statutory instrument, so clearing the way for the Scottish Parliament to introduce its own arrangements in due course.
Mr. John Home Robertson: I cannot resist commenting on the fact that, barring accidents, this should be the last Scottish Bill ever to pass through this Parliament. As my hon. Friend may recall—well, perhaps not personally—the first Scottish Bill to pass through it was the Court Exchequer (Scotland) Act 1707, which concerned taxation. Is it not entirely appropriate that the final Scottish Bill to pass through under this Government concerns enterprise?
Mr. Macdonald: My hon. Friend makes a fair and historic observation. I understand that this will be the last Scottish programme Bill to be presented to the House, so it is a matter of some note. As I said, the Scottish Parliament will arrange such matters in future.
Sir Robert Smith: Does the Minister accept that there might still be ballot Bills containing Scottish legislation?
Mr. Deputy Speaker (Sir Alan Haselhurst): Order. I am not sure whether I put the Question on the mini-debate that is taking place. Perhaps we may now move on to the main debate on Scottish Enterprise.
Mr. Macdonald: As I said, this will be the last Scottish programme Bill to be presented to the House.
To return to less controversial matters. A number of items count towards the financial limit that is placed on Scottish Enterprise: first, its and its subsidiaries' general borrowings; secondly, sums issued by the Secretary of State or the Treasury in fulfilment of guarantees; thirdly, loans guaranteed by Scottish Enterprise or its subsidiaries; and finally, the largest item comprises payment from the Secretary of State consisting of grant in aid less administrative expenses, plus voted loans payments.
The increase to £4 billion will allow Scottish Enterprise to continue to operate until approximately March 2001. Thereafter, as already noted, the Scottish Parliament will have an opportunity to consider the future funding arrangements. It is entirely right that that should be a matter for the Scottish Parliament to decide.
Dr. Norman A. Godman: On a practical, not a historical question, I hope that the
1080
legislation will encourage the officials of Scottish Enterprise to ensure that the money is invested in areas of high unemployment and in desperately needed developments. The Gourock waterfront development is one such example and it is crying out for assistance. I hope that, by way of this Bill, the Minister will encourage Scottish Enterprise to give that development some support.
Mr. Macdonald: The legislation will not do so by itself, of course, but it will enable Scottish Enterprise to keep functioning and, therefore, to follow through the Government's plans and the strategy that has been agreed with SE, which takes into account the very points made by my hon. Friend.
Expenditure for 1997–98 alone has achieved some significant successes: the creation of 30,000 jobs opportunities; 17,700 projects undertaken with Scottish businesses; 5,300 new businesses started up, generating £33 million of additional sales and employment opportunities for 13,500 people; and finally, 87 inward investment projects.
Recently, there has been much in the news about job losses, which are always of concern. Yesterday, we heard of the possible closure of the Wrangler factory in Falkirk with a loss of 500 jobs. I understand that Forth Valley Enterprise, the local authority, the Employment Service and Triaze, which is a new deal training company, are meeting to put together practical steps to help employees gain alternative employment. Falkirk is not the only area to have to cope with setbacks of that nature.
Those statistics do not tell of the real impact on individuals and families who suffer because of job losses. However, the successes in creating jobs should also be noted. Of particular relevance to Falkirk, Thomas Cook in Larbert has just launched a campaign to recruit at least another 250 staff in the next four to five months. There are other successes throughout Scotland. In recent months, such companies as Foxteq, Packard Bell NEC, Bank of Bermuda, BSkyB and Universal Scientific Industries have announced plans to create more than 6,000 new jobs in Scotland. Yes, jobs are being lost, but throughout Scotland there are positive successes in job creation.
My right hon. Friend the Secretary of State recently provided Scottish Enterprise with strategic guidance that will ensure that it is aligned to the Government's aims and objectives for the economy as a whole. That includes the point made by my hon. Friend the Member for Greenock and Inverclyde (Dr. Godman), and we debated those aims on Monday in the Scottish Grand Committee. The strategic guidance lays out ambitious plans for Scottish Enterprise: to help create 100,000 new businesses in the next ten years; to improve their survival rates; to broaden the knowledge base of the Scottish economy; to promote the clustering of companies in sectors that are most likely to benefit from a strategy of collaboration; to engage the strength of large companies in partnerships across the economy; to raise the level of investment in research and development; to sustain Scotland's attraction to inward investment; and finally, to help Scottish Trade International to create new exporters and expand new markets for Scottish goods.
That is an ambitious programme, but we consider that it is achievable within the current level of funding. It is a programme that goes beyond June 1999, when the

1081
current aggregate amount outstanding will be reached. The purpose of the Bill is simply to raise that level to enable Scottish Enterprise to continue its work to meet those objectives until the Scottish Parliament can consider afresh the funding arrangements for Scottish Enterprise. I commend the Bill to the House.
4.30 pm
Mr. Oliver Letwin: As the Minister and some of his hon. Friends have mentioned, this is the last Scottish programme Bill before the House. [HoN. MEMBERS: "Hear, hear."] That will be a matter of delight to Labour Members, but a matter of sadness to me not to have the opportunity in my guise as MacLetwin to encounter the Minister with his charm and elegant exposition. It has frequently been the case in Committee and on considering orders that the Minister has been able to make his remarks concise. I hope that I have been able to oblige by also reducing mine, in some cases to approximately 30 seconds. That would be in the tradition of the Scottish Enterprise Bill's predecessors: when previously the limit has been raised, the debate has been short. I fear, however, I cannot utterly oblige the Minister on this occasion. I hope that he will bear with me if I make a few observations about what I think is a remarkably different situation from that which first appears.
This is a short Bill—that is an understatement—and it appears to be innocuous. After all, when allowance is made for the Scottish Enterprise (Aggregate Amount Outstanding) Order 1997 having raised already the limit to £3,000 million, this Bill only raises the limit by a further £1,000 million. I hope that hon. Members will pause at the words "only raises the limit by a further £1,000 million". That is about enough to pay 50,000 nurses for a year, to buy 1,000 miles of railway, to pay 37,600 teachers, to build 340 primary and 150 secondary schools or to build 10 major district hospitals. It is a large sum. It is about the same as the gross domestic product of Fiji or Nicaragua and about twice the GDP of Chad or Belize. I hope that those measures make it plain that we are not talking about peanuts. The question is whether we are dealing with monkeys.
Mrs. Maria Fyfe: Does the hon. Gentleman recall any such substantial increase during the Tory years when cities such as Glasgow were left to get on with high levels of unemployment to the despair of many citizens? The previous Government simply ignored their needs.
Mr. Letwin: I am grateful to the hon. Lady. The last time the limit was raised under the order it was raised by £1,000 million, so I can recall, or rather read about, such things. As I proceed the hon. Lady will discover that we in the Opposition have no opposition to the idea of an increase, nor to an increase of this magnitude. We may find ourselves joined by the hon. Lady in a few moments when she realises what is happening in Scottish Enterprise.
It is true, as the Minister says, that this organisation claims to have created about 30,000 jobs, net, at a cost of about £15,000 a job, if my arithmetic serves me correctly. That is not all that it does. The level of information that
1082
the organisation provides in its report and accounts is a good deal better than sometimes applies to non-departmental public bodies. It is still fairly exiguous compared with the amount of information about most public companies—certainly most public companies spending £400 million a year or so as this does.
There is enough in the report and accounts, with which the Minister is no doubt fully familiar, to cause more than a few eyebrows to be raised on the Benches opposite. This is not a partisan point, but something on which the whole House can agree. [Interruption.] I wonder whether the hon. Member for Carlisle (Mr. Martlew), who from a sedentary position says that there is no reason for eyebrows to be raised, knows how much Scottish Enterprise spends on administration.
Mr. Eric Martlew: I am sorry to intervene. I was pointing out that there are no hon. Members behind the hon. Gentleman to raise their eyebrows.
Mr. Letwin: I do apologise to the hon. Gentleman, but I did say the Benches opposite. As a matter of fact three of my hon. Friends are here and ready to offer themselves and their wisdom to the House. In any event I hope that we can make up in quality for what we lack in quantity.
I wonder whether the hon. Gentleman knows or, indeed, whether the Minister has at the forefront of his mind just how much this organisation last year spent on management expenditure. Let us bear in mind that its total expenditure nets about £400 million. The national health service—not always cited as the prime example of management efficiency in western Europe or the world, and certainly not usually cited by the present Government as such because they accuse the previous Government of having inflated its management—spends about 0.7 per cent. of its budget on management. That is a little less than 1 per cent. and would be equivalent to Scottish Enterprise spending £4 million on its management. The Department for International Development or the Welsh Office spend a rather higher amount—about 2 per cent., which would suggest about £8 million in this case. Perhaps most relevantly, the Scottish Office spends about 5 per cent. of its budget on management, which would suggest about £20 million in this case.
It may, therefore, come as a surprise to some Labour Members—it certainly came as a profound shock to me when I got to grips with these accounts—to find that this organisation spends nearly £70 million of its £400 million budget on management. That is a genuinely astonishing achievement. I do not know quite how it is managed, but that seems to be the case.
Mr. Tam Dalyell: When the hon. Gentleman says that he got to grips with the accounts, did he talk to the Scottish Office and give it an opportunity to give an explanation?
Mr. Letwin: I took advantage of the House of Commons Library and asked for a note on the matter. So far as I can make out the expenditure is partly the consequence of the rather elaborate federal structure—perhaps of interest to the hon. Gentleman—that the organisation operates with its subsidiaries, the local enterprise companies. It is also no doubt the case—I judge this from the statements made on the internet provision,

1083
the website and other statements by Scottish Enterprise management itself—because it prides itself on offering a high level of service to what it calls its clients, or those whom it is trying to help. The fact remains that the total sum of expenditure on management and administration is extraordinarily high.
Mr. Alasdair Morgan rose—
Mr. Dalyell rose—
Mr. Letwin: Of course I will give way.
Mr. Morgan: Would the hon. Gentleman—
Mr. Dalyell: Simply once more—
Mr. Deputy Speaker: Order. The hon. Gentleman must indicate to whom he is giving way.
Mr. Letwin: I do apologise, Mr. Deputy Speaker. I did not know that two hon. Members were seeking to intervene. I give way to the hon. Member for Linlithgow (Mr. Dalyell).
Mr. Dalyell: As one who in his constituency work, like my colleagues, has a good deal to do with the organisation, I have the anecdotal and first-hand impression that it is efficient. I do not want to score points against anybody, but fair is fair. Before making this kind of criticism the hon. Gentleman should talk to those involved.
Mr. Letwin: Nevertheless there is a set of accounts and the hon. Gentleman's anecdotal impressions must be reconciled with the facts that the accounts present. The facts presented suggest that £70 million of public money is spent on management and administration. That is not all that emerges from the accounts. The body also publishes a balance sheet. We might ask ourselves just how much cash an organisation like this needs to keep in the bank at any given time. Perhaps a few million pounds would be perfectly reasonable. Is it not therefore a matter of some surprise to discover that almost £90 million are kept in cash at the bank or in hand? Does that not strike one as a rather large sum of money?
Mr. Morgan: Regardless of the validity or otherwise of the hon. Gentleman's criticisms, would he care to tell the House who put in place the structure to which he is referring?
Mr. Letwin: The structure was put in place by the previous Government. That is fully acknowledged. It is a matter of some concern to me that the previous Opposition did not point out some of these things. That is no reason for the current Opposition to fail similarly. It is the duty of this House to scrutinise without regard to political partisanship; that is precisely the job that I am trying to fulfil.
Mr. Desmond Swayne: It has been suggested that there are bound to be rational explanations
1084
for the phenomena to which my hon. Friend drew attention. We have a Minister present who will no doubt be able to explain the matter in his reply.
Mr. Letwin: I am grateful to my hon. Friend, who is right that that should be the position. No doubt my remarks will cause the Minister to make some illuminating utterances, if he chooses to make any later. My hon. Friend would be misled if he supposed that it is only the items to which I have referred that cause concern.
In the strategy guidance to which the Minister referred, there is no mention of how the organisation is administered. Much is said about what it should be doing vis-a-vis the external world but nothing, as far as I could determine, about how it acts internally. That leads me to suspect that the Minister may not quite be able to live up to the high expectations of my hon. Friend the Member for New Forest, West (Mr. Swayne) of his ability to enlighten the House on the matter.
Things are worse than might be supposed because on examining the accounts, we next discover—the Government appear to have noticed this, to judge from the statements of the Secretary of State—that Scottish Enterprise has turned itself over the years into a sizeable property company. It holds an asset base—it is not clear on what valuation—of about £200 million, on which it seems to make a normal commercial return of about 5 per cent. One might say that there was nothing wrong with that, but it would be interesting to discover why it needs to hold such a portfolio. None of the statements in the report and accounts or otherwise published by the organisation make the matter clear. I must share my view with the Secretary of State because he has asked it to redirect its efforts away from property towards other activities.
The organisation has a heavy burden of management—at least in respect of the costs associated with it—a large amount of cash in hand, and a big property portfolio. I could bore the House with an analysis of the other issues that cause concern.
Mr. Swayne: Do.
Mr. Letwin: I do not intend to do that, not least because I know that Labour Members are desperately keen to get on trains and disappear under the new dispensation for Thursdays.
It is a remarkable fact that, irrespective of the veracity of the anecdotal observation of the hon. Member for Linlithgow that the organisation is highly efficient, the matter has not, so far as I was able to determine, been investigated. Over many years, the Public Accounts Committee has not investigated whether it operates thoroughly efficiently. That brings me to the main burden of my argument.
The Minister is right that hereafter, it will not be this Parliament in which such questions can be raised. The Public Accounts Committee will no longer in any obvious sense be able to examine them; they will move to the Scottish Parliament. The Minister will remember that as a concern of Opposition Members right from the beginning of the prolonged debates on devolution. It was raised vividly in one debate by the Chairman of the PAC. I know that we are talking about efficiency rather than

1085
outright fraud or impropriety, but how will such matters be monitored in the new arrangements for the Scottish Parliament?
Sir Robert Smith: To draw conclusions from what the hon. Gentleman has said so far, the Scottish Parliament will provide an opportunity more closely to monitor such matters because it will have the time and inclination. As he said, the current set-up has not done the job and he has found nothing in print to assist him in understanding the accounts.
Mr. Letwin: That is an interesting point but I wonder whether the hon. Gentleman will hold that view when I have finished. Certainly, the Accounts Commission for Scotland has concerns. It has probably invited him, as it has me, to a reception.
Mr. Home Robertson: How much will that cost?
Mr. Letwin: Indeed, we must ask that.
Mr. Michael Moore: Why not pay your own way?
Mr. Letwin: I have no intention of paying my way into the reception.
We are told that the reception will examine a key theme: the role of public scrutiny and audit under the Scottish Parliament. At least the commission is asking the right question. There is a serious problem but I wonder whether Ministers have seriously considered it. That brings me face to face with the point made by the hon. Member for West Aberdeenshire and Kincardine (Sir R. Smith). The Scottish Parliament will not be spending its own money, apart from what the Prime Minister tells us to regard as the penny rate. Of course, no Government or Parliament has its own money; it is all taxpayers' money, but the Scottish Parliament will not even be spending money that it has raised but money from the United Kingdom that will have been voted by this Parliament. We know a good deal about how human nature reacts in such situations because we can examine the long record of local government.
We all know that local councils—whether controlled by the Conservatives, the Liberal Democrats, or even, dare I say it, Labour—have a long and enviable record of successfully arguing, whenever they find that their inefficiencies prevent them from fulfilling the needs and desires of their local communities, that the cause is lack of cash from central Government. I have not the slightest doubt that all parties in the Scottish Parliament will, if left to their own devices, first resort to the argument that any lack comes not from the inefficiency of the bodies that they administer but from an insufficiency of funds voted by this Parliament to the Scottish Parliament.
I do not say that as an accusation. Any hon. Member, including me, would be inclined in that position to make that argument. That is how democratic politics works but it raises a question that the House must address, and which I fear that Ministers may not have addressed. To what extent will it be proper for this House to consider the efficiency with which the funds that it votes to the
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Scottish Parliament, and which the Scottish Parliament administers on behalf, so to speak, of the United Kingdom, are disbursed? The case of Scottish Enterprise and the figures that I have raised concern about are a case in point. I believe that it will be proper for the House to continue to exert itself to try to find whether the moneys allocated are being efficiently spent in such cases.
Mr. Malcolm Chisholm: When we analyse the hon. Gentleman's speech afterwards, we will regard it as one of the better speeches by an Opposition Front-Bench spokesman in favour of a Scottish Parliament. He seems to be saying that the House has signally failed over all the years of Scottish Enterprise to exercise any scrutiny. Clearly, those of us who aspire to go to the Scottish Parliament will spend much more time examining the affairs of Scottish Enterprise than we ever have here. He is wrong to assume that we shall want more money on every question. The priority will be to ensure that we get maximum value from the large resources that we will have.
Mr. Letwin: I am extraordinarily grateful to the hon. Gentleman, with his distinguished record in public service, for saying that my speech is good. I doubt that it is, but I assure him that it is not a speech in favour of, or indeed against, devolution. I am reflecting on the consequences of a fait accompli. I do not doubt that conscientious Members such as he, if they become Members of the Scottish Parliament, will seek to ensure that the things for which they are responsible are efficiently run. The question is: with what level of energy will they devote themselves to that task and to the much more politically attractive task of arguing that Westminster has not given them enough money? If the hon. Gentleman claims that the former task will be given a larger amount of energy and the latter will be given a lesser amount of energy, I would be happy outside the Chamber to take a large bet on the matter. This Parliament will continue to vote large sums via the Scottish Parliament to bodies which there is a serious threat that the House of Commons will no longer scrutinise.
We come to the second point that the hon. Member for Edinburgh, North and Leith (Mr. Chisholm) made. Has the House of Commons already shown itself incapable of examining such matters? The answer, I regret to say, is that as a result of the lamentable record of the previous Opposition, in the case of Scottish Enterprise the House was not good at examining such matters. But at least it had the motive for so doing. It could not blame anyone else if the money was badly spent and it could not ask anyone else for more money other than the taxpayers, who are also its voters.
Despite the badinage, there is a serious issue for the House. How far will we retain the ability to raise matters of concern that may be allayed by further investigation? If we do not retain that ability, we will betray the trust that our electors have placed in us by sending us to this place.
Mr. John McAllion: The hon. Gentleman seems to argue that the Scots cannot be trusted to look seriously at the way in which money is spent in Scotland and that only this Parliament can be trusted to do that. Will he reflect on the fact that my right hon. Friend the Chancellor of the Exchequer is the first Scot

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to hold the position in more than 20 years, and that he, after Labour came to office, found an extra £40 billion that had been inefficiently spent by the House?
Mr. Deputy Speaker: Order. I do not want to pin the responsibility wholly on the hon. Member for Dundee, East (Mr. McAllion), but I suspect that the argument is spinning to the further reaches of what is permissible. I wish to hear more arguments specifically about Scottish Enterprise.
Mr. Letwin: I will certainly stick by that admonition, although it is gravely tempting to respond to the hon. Gentleman.
In the case of Scottish Enterprise and many other such cases, the House will have to develop mechanisms for examination. Notwithstanding the fact that this is the last programmed Bill on Scottish matters and the last Bill that we shall see on Scottish Enterprise, as and when further increases are made in the amounts of money that Scottish Enterprise can spend out of taxpayers' funds, and as similar Bills come forward in the Scottish Parliament in relation to bodies governed by it, those amounts must be scrutinised. Such mechanisms may not often be invoked, but it must be possible to invoke them so that any serious concerns can be dealt with. The Minister has not said anything about that, which is odd. I think that he genuinely has not spent any time worrying about whether there are any concerns about the accounts of Scottish Enterprise. That is sad, but it is remediable.
The purpose of this Second Reading debate and my speech has been to ensure that the Minister goes away with his very able officials and works at precisely the question that I have raised. I hope that by the time we have gone through the Committee stage and come back to the Floor of the House for Third Reading, the Minister will be able to make an eloquent exposition on exactly how this Parliament will deal with the problem. If he does not, he will convict himself and his Department of failing to wrestle with one of the serious issues that arises from devolution, with which we have come face to face today as a result of the need to examine Scottish Enterprise.
In summary, there is a specific concern about Scottish Enterprise. That concern does not lead the Opposition to object to the raising of the limit, but it makes us wish that the Scottish Office would look closely at the matter. It is a concern that perhaps ought to be reflected in an investigation by some Committee of the House. More macroscopically, it is a concern that brings us face to face with the need for the House to develop adequate mechanisms to ensure that when public money is voted by this Parliament to the Scottish Parliament and ends up in the hands of bodies administered by the Scottish Parliament, it is nevertheless subject to the proper scrutiny of the House.
Mr. Macdonald: I shall try to respond to the points that the hon. Gentleman has made, but may I clarify whether he is attacking the Bill or simply wants to question the devolution context? I take it that he agrees with the Bill.
Mr. Letwin: That is correct. This is a probing speech in a Second Reading debate. I know of no other sufficiently serious way of raising this issue. We have no objection to the Bill and will certainly not ask colleagues to vote against it in the Lobby today.
4.55 pm
Mr. David Marshall: The fact that the hon. Member for West Dorset (Mr. Letwin) has not been long in this House may explain—I am being charitable—how he conveniently ignores that for 18 of the past 20 years his party was in power and operated the Scottish Office. His party set up Scottish Enterprise in 1991 when it replaced the Scottish Development Agency.
The hon. Gentleman criticises Scottish Enterprise's management. While I would be the last to say that everything in the Scottish Enterprise garden is rosy and there is no room for improvement, it is only fair to point out what we get from that management. The summary of the results of Scottish Enterprise for 1997–98 includes
"the creation of 30,000 net additional job opportunities, a net additional £600 million added to Scotland's output; 17,700 projects undertaken with Scotland's businesses, leading to over £850 million of additional sales, of which over a third are exports; 230 companies entering new export markets; 180,000 employees benefiting from training and development; 640 companies committed to or recognised by the national standard of Investors in People; 77,000 enquiries handled by local networks of Business Shops and Enterprise Trusts; 5,300 new businesses started up generating 33 million additional sales and employment opportunities for 13,500 people; 22,000 visitors to the Personal Enterprise Shows; 87 inward investment projects attracted including high-tech research and development, such as Cadence and Clintrials, creating and safeguarding 18,000 jobs and generating £1 billion private investment; over 68 per cent. of young people received skills training as employed status and over 16,000 VQs were awarded; 4 out of 10 adults in Training for Work went on to a positive outcome; 350,000 sq m of property and 540 hectares of land developed in support for industrial and commercial businesses; 55 per cent. of contaminated and derelict land cleared and taken up for development; for every £1 spent by the Network on the physical business infrastructure in Scotland, £4.85 was contributed by others."
That impressive record may explain why Scottish Enterprise and its network are the envy of many other parts of the United Kingdom and the world.
Mr. Laurence Robertson: I do not wish to appear churlish, but the point that my hon. Friend the Member for West Dorset (Mr. Letwin) was making was that, although all that may be true, it is at an enormous cost. In spite of what the hon. Gentleman has said, in the Scottish Enterprise annual report the chief executive said:
"Scotland, however, still lags behind the rest of the UK in the number of businesses emerging."
Mr. Marshall: Some people are never satisfied. If people do not speculate, they cannot accumulate. The investment return as part of the Scottish economy far outweighs Opposition Members' carping criticisms.
The Bill must command the unanimous support of the House. I was pleased to note that the Opposition will not oppose it—they know the political consequences of such a step, although there is little hope for them in the forthcoming elections in Scotland. I warmly welcome the Bill. Any Bill that updates the overall limit that Scottish Enterprise can spend from £3 billion to £4 billion is very good news. I congratulate the Secretary of State for Scotland and the Scottish Office team.
Some may say that it is one thing to uprate the spending limit, but yet another to spend any of the additional moneys. I do not believe that the Government would have introduced the Bill if they did not intend Scottish Enterprise to use this additional spending power to deliver

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some of the Government's key economic objectives. This proposal will be a massive boost to the new Scottish Parliament, especially as it will take over the running of Scottish Enterprise. The money will be even more essential to the future well-being of Scotland in an ever-increasingly competitive world.
I shall touch briefly on two of Scottish Enterprise's activities: first, its international role, and secondly, its involvement in the city of Glasgow. The Select Committee on Scottish Affairs, which I have the privilege to Chair, is currently conducting an inquiry into inward-outward investment in Scotland and tourism in Scotland. Those matters are connected, and both are vital to Scotland's economy.
Last week, the Select Committee visited the United States of America as part of that inquiry. The visit was well worth while, because it enabled us to see how Locate in Scotland, Scotland Trade International, Scotland Virginia Partnership and the British Tourist Authority in the USA promote Scotland's interests in that country. Other members of the Committee who are present may want to give their opinion of the success of the visit.
Suffice it to say that the USA is the largest market in the world, and it is also the fiercest and most competitive. City competes against city, county against county and state against state. Their problems are not vastly different from ours, and neither are their solutions. We are competing with them: we are all competing with each other in north America and in the wider world. It is to the great credit of Scottish Enterprise and the component parts of its network that Scotland has done so well out of north America. We are the envy of many other places, few of which have done better than we have, although there is the odd exception.
The Committee also saw the operation of the consul general's office in New York and the British embassy in Washington, and met Scottish business people doing business in the USA. It also met with American companies, such as IBM, that are major investors in Scotland and in the United Kingdom as a whole.
Dr. Godman: IBM in Spango valley in Greenock employs almost 5,000 people, which makes it one of the biggest employers in the west of Scotland. I remind my hon. Friend that IBM has been in Greenock since 1951. It was brought there by the remarkable work of the late Sir Hector McNeil, who was the Labour MP for Greenock.
Mr. Marshall: As usual, my hon. Friend is correct in all that he says. IBM was the original inward investor in Scotland. IBM's importance to the Scottish economy is such that it is worth more than the Scotch whisky industry, and that says it all.
We met many American business people who are interested and involved in Scotland. Almost to a person, they were impressed by the activities of Scottish Enterprise, Locate in Scotland and Scotland Trade International. Americans do not give praise lightly, and members of the Committee were convinced that it was sincere and genuine, and a proper reflection of the activities of Scottish representatives in that country.
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In the five days we were there we visited four cities: Stamford, New York, Washington and Philadelphia. I should like to place on record our appreciation for the assistance, information and advice that we were given by everyone we met.
Mr. Swayne: The hon. Gentleman is giving eloquent testimony to the work of the Scottish Affairs Committee. I am deeply grateful to him for that—I was unable to take part in the visit, so he is providing a great service. In the light of the remarks of my hon. Friend the Member for West Dorset (Mr. Letwin), does the hon. Gentleman think it proper to consider whether the Committee, of which he is Chairman, should undertake an investigation into the management of Scottish Enterprise?
Mr. Marshall: It is a matter of great regret to the Committee that the hon. Gentleman was unable to go with us, because we genuinely value the role that he plays on the Committee. No Conservative MPs represent Scottish constituencies, and we thought that the hon. Gentleman had committed some cardinal sin when he was put on our Committee. I say with all sincerity that he has played an important part in the work of the Committee and is a good member of it. I have no hesitation in saying that, and if it embarrasses him, so be it.
Let me answer the hon. Gentleman's question. I am sure that tomorrow I shall find on my desk a letter from him making the suggestion that he has just made to us. If I do, it will be given serious consideration in the normal way.
I feel that I should praise Steven Bennett, director of Locate in Scotland in north America, David Taylor, director of Scotland Trade International and Lisa Smith, executive director of the Virginia Scotland Partnership—or the Scotland Virginia Partnership, depending on which part of the world one is in at the time. We were tremendously impressed by the presentations that were made to us and by the work done by those people.
Whether we like it or not, globalisation is happening. We can no longer take the status quo for granted. I believe that Scottish Enterprise, Locate in Scotland and Scotland Trade International are doing all that they can in the United States on behalf of Scotland's interests. I also believe, however—and this brings me to the purpose of the Bill—that they could do much more with a few additional resources, especially in terms of staff and premises and especially in Canada, where there is a great affinity with Scotland, and where there must be considerable opportunities. Locate in Scotland has only four offices in the United States, and I am not sure whether Scotland Trade International has any. It is difficult to run such a vast area as north America out of four small offices with fewer than 20 staff. I think that the return on a reasonably modest increase in resources could make such an increase well worth while. There is great interest in the United States in the Cadence project in Livingston. It could give Scotland a leading role at the cutting edge of technology in the future and bring massive benefits to our economy.
I was impressed to learn that the commonwealth of Virginia was the first state in America—as far as I know, it is still the only state—to appoint a Secretary for Technology, because it considers technology so important. It is worth noting that there are 23,000

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high-tech job vacancies in Virginia, which it is unable to fill because it cannot obtain trained staff. Perhaps the new Scottish Parliament will take on board the idea of a Secretary for Technology. Scotland has enough high technology to guarantee such a post, and I think that it would pay enormous dividends.
I counsel against going overboard on inward investment at any cost, and I hope that Scottish Enterprise will not dissipate too much of any additional moneys in that way. It appears that there are some unscrupulous companies that are interested only in obtaining whatever grants they can get, and then playing one area or country against another. They come in, take the money and run. We must not let ourselves be taken to the cleaners by such companies.
Mr. Letwin: I do not want to embarrass the hon. Gentleman unduly either, but I hope that he will accept that the Opposition thoroughly agree with what he has just said.
Mr. Marshall: I am unembarrassable, but that is by the way.
We would perhaps be better served by doing everything possible to retain existing jobs. That is another lesson that we learnt from our trip. Cities such as Philadelphia have great problems, and great similarities to Glasgow, which also has problems. They have found it more cost-effective and beneficial to concentrate on retaining jobs than to spend a fortune on trying to attract them. We should also encourage our indigenous industries to expand and prosper in their own areas. There is a feeling that we do not do enough in that regard.
It is essential that we expand our air services to Europe. At present they are totally inadequate. Perhaps Scottish Enterprise and the Scottish Office will consider what can be done.

I am delighted that at last a Labour Government are getting down to tackling Glasgow's problems after 18 years of Tory victimisation of and bias against it. I am aware that £1.5 billion of public money is being spent in the city,but the scale of the problem is so great that it is still not enough. My hon. Friend the Member for Glasgow, Maryhill (Mrs. Fyfe) raised the issue in an Adjournment debate in the Scottish Grand Committee in Edinburgh on Monday. She referred to the problems of deprivation in the city, and I congratulate her on doing so.
Just a few months ago, the Scottish Office central research unit and the department of urban studies at Glasgow university revised the Scottish area deprivation index, which ranks areas by post code sectors. Thirty-nine of the worst 45 sectors in Scotland are in Glasgow, including the worst 15. Twelve of those 45 post code areas are in my constituency, including two of the top 10. Of the 618,430 people in Glasgow, 369,313, or 60 per cent., live in the worst 10 per cent. of post code sectors.
Those statistics are horrifying and unacceptable as we approach the new millennium. They illustrate why Scottish Enterprise must give more resources to the local employment company, namely, the Glasgow development agency, if the problems that face the city are ever to be overcome.
For example, the brown-field site budget is only £3 million, yet there are approximately 2,000 acres of derelict and contaminated land; 11 per cent. of the city's
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area is derelict or contaminated. That could be the source of much future prosperity if it is brought back into use as soon as possible. The draft Glasgow Alliance strategy has a target of bringing 50 per cent. of that land back into use within five years. Let us improve on that target, either in scale or in time. Again, Scottish Enterprise could spend more money in dealing with that problem.
Perhaps I should declare an interest, being a member of the board of the East End Partnership, of the East End Regeneration Management Board and a co-opted member of the board of Glasgow Alliance. The alliance has a visionary strategy and we now have a consultative document on a joint economic strategy for Glasgow. What we need now is action and, as I have said, even more resources from Scottish Enterprise.
Glasgow is turning itself around. There is much good in the city and a lot going for it. It is, indeed, miles better than it was. It has improved leaps and bounds, particularly over the past two years, thanks to the change in Government, but it must be remembered that, almost every year for the past 20 years, Glasgow has lost the equivalent of a Ravenscraig in terms of jobs. People tend to ignore that fact. Because it is a city, it somehow misses out.
Unemployment and poverty are still endemic in the city. There are still thousands of below tolerable standard houses, many in my constituency. Therefore, there are great opportunities for new housing partnerships. Scottish Enterprise is also involved in that.
The new employment zone has been good, but has had problems. I understand that it is £500,000 short of European social funding. If we cannot get ESF for that vital initiative, perhaps Scottish Enterprise can make up the shortfall. The hopes of hundreds of unemployed young people—including 80 of my constituents who are on the programme—depend on the success of the zone.
There are concerns in Glasgow and elsewhere that, with the establishment of the Scottish Parliament in Edinburgh, there will be a jobs drift from the west of Scotland to the east. Therefore, it is essential that the M74 extension from Tollcross to Kingston be completed as soon as possible. That is arguably the number one priority for the economy of Glasgow. It would free many hundreds of acres of derelict land for investment, create thousands of jobs, reduce pollution, improve the environment, eliminate congestion in the city, improve road safety and reduce pressure on Kingston bridge.
I appeal to the Minister to ensure that Scottish Enterprise spends its resources in a well-balanced way. It is fine to have physical developments and large projects, but it is also essential to concentrate on getting more to the poorest communities, especially if we are to maximise the advantages of the new deal.
Many thousands of young people have already benefited from the new deal, but many more have still to do so. We will not be able to levy former public utilities again to continue to fund the new deal, so, if we are to be serious about social inclusion, we must take the longer-term view and invest in training, education and infrastructure.
Thankfully, unemployment has fallen substantially since the change of Government, even in Glasgow. However, in the latest research paper issued by the House of Commons Library on unemployment by constituency as at December 1998, my constituency is ranked the

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16th worst in the UK and number one in Scotland. Indeed, eight of the top nine in Scotland are all in Glasgow and there are only nine and a bit constituencies in the city.
The male rate of unemployment in my constituency is 16.5 per cent. The female rate is 5.1 per cent., giving an average of 11.8 per cent. Those are tragic figures, and all the more so when we consider that they are substantially down on what they were two years ago and on what they were for most of the 18 years of Tory Government, when they were over 20 per cent. Under the Tories, there was no hope for my constituents, but, under the new Labour Government there is a great deal of hope. Let us extend the Scottish Enterprise budget by this £1 billion and ensure that it is spent to the benefit of the people of Scotland.
5.15 pm
Mr. Michael Moore: It is a pleasure to follow the hon. Member for Glasgow, Shettleston (Mr. Marshall). As a member of the Select Committee on Scottish Affairs, I have enjoyed working with him and other colleagues, many of whom are present this afternoon. The hon. Gentleman was right to focus many of his comments about this Bill in the context of the Select Committee's visit to north America last week. We went to see, in practice, much of the work of Scottish Enterprise and its agencies, Locate in Scotland and Scottish Trade International. I concur with the hon. Gentleman's view that, as a group, we were very impressed by the work being done.
It is also a pleasure to follow the hon. Member for Shettleston because, in truth, he brought the debate back to the real issues that should be under discussion as we deal with the funding for Scottish Enterprise. I have, for my sins, over many years, pored over rather more sets of accounts than is probably safe for my sanity, but I have never inflicted an analytical review of a set of accounts on more than myself, and certainly not on a Chamber such as this. I was disappointed to hear that the main thrust of the speech from the Opposition spokesman was a comparison of balance sheets and expenditure over the past year. Although there is a legitimate scrutiny issue, time and again, the Conservatives have missed the point that, under the Scottish Parliament we will, for the first time, have an opportunity to have the accounts of enterprise agencies such as Scottish Enterprise and Highlands and Islands Enterprise, looked at thoroughly whereas perhaps, in the past, this House has not done that particularly well.
The timing of the debate is opportune. It comes at a time when Scottish Enterprise is announcing a new strategy which will take it forward into the millennium. It comes in a week when the noble Lord Macdonald of Tradeston made a statement to the Scottish Grand Committee in Edinburgh. Also, as I have said, it follows the Select Committee's visit to north America where we were looking closely at the work of many of Scottish Enterprise's agencies.
The hon. Member for Shettleston has graphically painted a picture of how much work remains to be done in different parts of Scotland if we are to ensure that enterprise and economic development are shared out
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equally and benefit all areas of the country. Anybody who is in danger of being complacent has only to look at the list of recent job losses across the country. This week there have been job losses at Wrangler in Falkirk. There have been job losses on the ferries at Stranraer in Galloway. There has been a series of job losses in Dumfries and Prestwick and in the borders, my part of the country, we have seen unprecedented job losses. While the banana war continues in all its irrelevance between the United States and Europe, we suffer the consequence of hundreds of job losses in the cashmere sector.
It is important that we do not lose sight of any of those job losses when we are looking at the budget for Scottish Enterprise and how it may spend that money. When Lord Macdonald spoke to the Scottish Grand Committee he highlighted various weaknesses in the Scottish economy. He listed a poor level of business start-up, very low investment in research and development, low skills and zero population growth. He was eloquent in pointing out how we might address most of those issues, but, strangely, how to combat zero population growth was missing from the list of initiatives.
There can be no doubt that Scottish Trade International, which is a largely forgotten body in the economic development armoury of the Scottish Office, is an organisation that will have a greater role to play over the next 20 years. The themes of the Select Committee's visit to the United States were, time and again, the increasing need to take account of the knowledge-based economy and the fact that technology is changing very rapidly. Above all else, the Committee learnt that economies will have to adjust to mobile capital and the fact that businesses can very quickly move in and out of a country. Although Locate in Scotland has for years been very successful, we have to focus increasingly on outward investment, ensuring that Scottish companies receive as much assistance as possible in promoting their products and sales overseas.
Lord Macdonald also made much of the technology ventures initiative, which is examining ways in which Scottish Enterprise and other agencies may be able to help promote the growth of high-tech industries, which are critical to our future. The Scottish Office and Locate in Scotland have so far been successful in attracting Cadence to Scotland. Project Alba is examining ways of increasing our competence in chip technology systems and of expanding that knowledge base in Scotland. The project is very exciting but will require the support of a cluster of Scottish companies to make it successful.
I am concerned that, in Scotland, we are not yet sufficiently alert to the prospects of our financial sector or attuned to its needs. When the Committee was in the United States, we met a venture capitalist in Philadelphia who talked about establishing a European fund to provide capital to new, small high-tech companies. He plans to raise great sums to invest in Scotland, where he sees great potential. However, he does not foresee any great competition from Scottish venture capitalists. Perhaps Scottish Enterprise has more of a job on its hands than it has so far acknowledged.
This week, the Scottish Office made an announcement on establishing various business pathfinder groups to consider ways of promoting the Scottish Parliament to business and of ensuring that its Members and the Parliament's debates are attuned to business's needs and demands. That welcome initiative is directly relevant to

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Scottish Enterprise. In the debate on devolution and on establishing the Parliament, the business community was initially atheistic about the Scottish Parliament. Business is now perhaps agnostic about the Parliament, but has not yet become evangelistic about it. Nevertheless, things are moving in the right direction, and anything that supports such movement is welcome.
I should be interested to hear the Minister address the issue of why, although Scottish Enterprise has identified oil, gas and electronics as key clusters in developing the Scottish economy, appropriate pathfinder groups are not being established. It is a strange omission.
There is much consensus on how the Scottish economy should be developed, although the issue will continue to be debated actively in the remaining few months until the elections in June and beyond. Nevertheless, when implementing its new strategy and using the new funds that we are considering today, Scottish Enterprise should consider the business culture in Scotland, especially the way in which we do or—more often—do not encourage entrepreneurship.
I am afraid that too many people become aware of the need for wealth creation and business creation, and of the fact that profit occasionally can be a good thing, long after they have left school and university. We cannot blame that situation on any one sector, but there is no doubt that teacher training and school and university curriculums do not address the issues of entrepreneurship and wealth creation, thereby creating a major gap in business education. We need look no further than that non-business culture to discover some of the reasons for our low start-up business rate. It is strange that successful business men and women are the exception rather than the rule when Scotland has produced so many over the generations. Over hundreds of years, Scots have proved their ability in international trade and business. We must not lose out because of a lack of far-sightedness from agencies such as Scottish Enterprise.
I agree with the hon. Member for Shettleston about the need to complete the M74 link from Tollcross to Kingston bridge. That highlights a wider issue for Scottish Enterprise and economic development throughout Scotland. It is incredible that Scottish Enterprise's remit does not include the need to establish or draw up a national infrastructure strategy. The Minister may say that different parts of the Scottish Office consider roads and rail. Some hon. Members are eagerly awaiting the announcement of those reviews in the next few weeks. From an economic development perspective, it is important in international competition for our major enterprise agencies to have a blueprint of the national infrastructure, covering rail, road, air and sea, that would best help to attract new businesses to Scotland and help indigenous companies to grow. IBM in Greenock is almost an indigenous company, but it is important when dealing with such global firms to keep Scotland competitive as a place to do business.
I referred earlier to the significant job losses that we have experienced in Scotland recently. I have argued for some time that there is a need to establish a rapid reaction unit in the Scottish Office to take account of problems as they strike a particular area. All hon. Members present today have their own experience of the Government's response to their local difficulties. I endorse and welcome all the efforts of the Borders working party. The direction
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in which the interim report is going is encouraging, as long as the funding—of which there may be some available after this debate—comes along in due course.
Crises have hit Scotland time and again. They are unpredictable. Nobody could have expected Wrangler to announce the closure of its business this week and nobody foresaw the trouble at Viasystems in the borders. We need teams that can be assembled in the Scottish Office at short notice with the remit and responsibility to draw up local action plans, bringing together transport and education requirements and industrial and economic development issues. Sadly, the Scottish Office is getting a lot of practice at that at the moment. There is a good case for making it a standing part of Scottish Office machinery, particularly at Scottish Enterprise.
I should like to refer briefly to the situation in the borders. I have already talked about the need for the Government to keep a watchful eye on the trade dispute. I acknowledge that the Scottish Office cannot sort that out on its own. I want to put on record my gratitude to Scottish Trade International and other bodies in the Scottish Office that have worked closely with my hon. Friend the Member for Roxburgh and Berwickshire (Mr. Kirkwood) and me on that. I also had a helpful meeting with the Minister for Trade this week. The potential impact of the loss of jobs in cashmere would be devastating. We have had many job losses in the borders and people are bleary at the prospect of more. We saw the problems in textiles and agriculture coming, but we are now being confronted by an issue that has nothing to do with the borders. It started as a trade war over bananas between the United States of America and the European Commission and somehow came home to roost in the borders. That is bad luck. We must be confident that the Scottish Office and Scottish Enterprise will continue to be behind the borders and will face up to the threat.
I understand that local enterprise companies in Scotland will learn of their budgetary allocations in the next few days. Indeed, it may even be as soon as tomorrow. I hope that the House will be told pretty quickly and not via a press release issued late on Friday evening. Those allocations are an important part of the debate on the Bill.
I remind the Minister of the commitment given by the Minister for Trade to support the £1 million down payment for the borders with further funding for specific projects in the local enterprise companies' budgets in the coming year. I hope that that pledge is about to be honoured.
The debate has focused on Scottish Enterprise, which is an important organisation. As hon. Members on both sides of the House have pointed out, it has a great deal of influence and potential for good around the country. We support the Bill and we hope that the new strategy for Scottish Enterprise proves to be the correct one, and that no one is carried away by talk of clusters and knowledge economies and forgets the problems that still face many people in Scotland.
5.31 pm
Ms Sandra Osborne: I am by no means desperate to catch a train, as the hon. Member for West Dorset (Mr. Letwin) suggested. Indeed, I intend to use the opportunity of supporting the Scottish Enterprise Bill to highlight a number of local issues affecting Ayrshire—a place with which the hon. Gentleman may not be familiar.

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If he listens, he may learn something about the recent problems and successes there. They emphasise the importance of the network that comprises Scottish Enterprise and the need for more resources which we hope will be made available shortly.
Scottish Enterprise has enjoyed a high profile this week. In the Scottish Grand Committee, the Minister made a statement on the new network strategy document; Sir Ian Wood gave evidence to the Scottish Affairs Committee this week; and today we are debating the Scottish Enterprise Bill.
The Scottish Affairs Committee has been inquiring into inward and outward investment, and a number of issues have been raised. In addition to the visit to America—rather than repeating any of the points that have been made, I shall simply say that I concur with the views of my colleagues on the Select Committee—there have been several visits to Scotland. We have taken evidence in the borders and in Dundee and I am pleased to say that we shall shortly visit Ayr to hear about the problems affecting inward investment and tourism in my constituency.
I believe that the Select Committee will produce an extremely helpful report. Some of the comments that have been made today are relevant, although I would not dream of pre-empting our recommendations or making them before the publication of the report. One issue raised during our inquiry concerned the potential problems associated with having a number of different agencies dealing with economic development and competing for inward investment. That can occur nationally and locally. I shall briefly describe the approach adopted in Ayrshire, which is a good example of how local players can work together to achieve a coherent strategic approach.
The Ayrshire economic forum is a partnership drawn from the three local authorities: Ayrshire chamber of commerce and industry, the Scottish Trades Union Council and Enterprise Ayrshire. For the past two years the forum has been working towards a new economic development strategy for Ayrshire. However, it has been overtaken by recent events, particularly a number of redundancies announced by significant companies such as Volvo, Digital, Prestwick Circuits, Sweater Shop, Sports Division and Butlins. Following those redundancies, the Minister addressed the forum and called for an action plan for jobs in Ayrshire. He said his involvement reflected the Government's concern and commitment to support areas facing structural economic change. I was pleased that he was involved.
It is clear that Ayrshire is an area facing such changes, and that there is a need for new businesses in Ayrshire and further diversification of the economic base. The economic forum will shortly publish an action plan for jobs, and will drive that forward with Scottish Office involvement. Again, that is a positive move on the part of the Scottish Office.
The action plan for jobs will be set in the context of the existing Enterprise Ayrshire business plan, the economic development plans of the local authorities and the Scottish Enterprise network strategy. That has been possible because the forum is a genuine partnership in which all the agencies work together.
The changes that are impacting on the Ayrshire economy are deep-seated and are affecting a wide range of sectors such as electronics, engineering, textiles and retail
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distribution. In the past, those sectors have contributed a great deal to Ayrshire's economic prosperity. We have a highly self-contained labour market, with 96 per cent. of Ayrshire jobs taken by Ayrshire residents. Tackling structural change in Ayrshire's economy therefore continues to be our overriding priority.
The pace of economic change, along with the wave of redundancies to which I referred, means that the current resources available to Enterprise Ayrshire and its local authority partners leave them running fast to stand still. The action plan for jobs must, therefore, be underpinned by the availability of additional resources. I am sure that the House will forgive me for making my bid for Ayrshire in the same way as others have made bids for their local area.
The work done by the forum does not suggest a quick-fix strategy—it is a detailed plan for the future, with concrete proposals that will create jobs. It builds on Ayrshire's considerable existing assets, which include the extension of the M77 and Glasgow Prestwick international airport—which continues to achieve substantial growth in its freight and passenger business, and does a great deal, as we heard on our trip to north America, to support the development of the Scottish electronics industry.
The presence of nationally significant development sites is also an advantage. As well as the area surrounding Prestwick airport, we have Riverside in Irvine and Rowallan in Kilmarnock. These represent future potential, and are areas on which we hope to build. We also have international research institutions in Ayrshire, such as the Hannah research institute, the Scottish agricultural college and the higher education facilities at Ayr campus of Paisley university, which are developing positively.
I am sure that everyone in the House will recognise that Ayrshire is a beautiful part of the country with a natural environment that provides an exceptional quality of life, which I recommend to all hon. Members—including the hon. Member for West Dorset. Despite those assets, however, Ayrshire's road and rail links will continue to require substantial investment if they are to meet future business needs. As my hon. Friend the Member for Glasgow, Shettleston (Mr. Marshall) has emphasised, we will need to target areas of acute disadvantage and join in the Government's existing efforts to tackle social exclusion.
The action plan will have ambitious targets to create thousands of jobs over five years, but there has been a deliberate aim that the targets should be realistic and achievable. That is very important for local credibility. People often hear of action plans, task forces and working parties being set up, but they do not always see tangible results. There is a real, determined effort to make sure that there are tangible achievements after five years.
There has been also some good news in Ayrshire recently, with a number of announcements about inward investment—for example, Universal Scientific Industries creating 700 jobs in Irvine—and there have been positive views from local companies.
I want to highlight the work of the Prestwick task force, which was set up specifically to address aviation issues involving Prestwick airport and the surrounding aerospace companies. One of the crucial elements in its success has been the involvement of the national and multinational

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companies surrounding the airport. They have participated with great enthusiasm and have co-operated to the benefit of the whole area as well as themselves.
The final report, published in December, is a testament to how a collaborative approach can produce results. Only 18 months ago, when British Aerospace announced that production at Jetstream would cease at Prestwick, the banner headlines were all about the devastation of the Ayrshire economy. Now the talk is about Prestwick as a leading aerospace cluster on the world stage and about the continuing growth of traffic, especially freight cargo, at Prestwick airport.
The task force set itself eight targets. They have all been fully achieved or are well on the way to being achieved and have been picked up by other bodies. Alternative employment has been found for the majority of Jetstream workers affected by the closure, and all 270 aerostructure jobs at British Aerospace, which were at risk, have now been secured. In addition, more than 600 jobs have been created or are planned for the Prestwick area.
Locate in Scotland undertook a marketing exercise in north America highlighting the advantages of Prestwick as a location for aerospace companies. I agree with what other hon. Members have said about Locate in Scotland's work, which we witnessed when we were in America. The work done for Prestwick has resulted so far in 15 active leads that are currently being pursued. The airport recently opened a new purpose-built airfreight facility with support from Enterprise Ayrshire.
Some outstanding issues were highlighted by the task force report and were agreed by all the partners in the Ayrshire economic forum to be crucial to the further development of the Ayrshire economy. Those issues are extremely relevant to the work of Enterprise Ayrshire.
Improvements are needed to the roads infrastructure. Like other hon. Members, I will make a bid for the upgrading of the A77 to be completed. That is crucial to future development in Ayrshire. We will also pursue assisted area status. It will come as no surprise to hon. Members when I mention the vital importance of the completion of the new Scottish air traffic control centre at Prestwick, which will provide hundreds of high-quality jobs. The current centre is already a major contributor to the local economy. We must have progress on the contract. That is not directly the responsibility of Enterprise Ayrshire or Scottish Enterprise, but I am sure that they would agree that it is absolutely crucial to the local economy.
We need progress on fifth freedom rights for Prestwick airport. I am pleased that the Government have recently shown more flexibility and have granted fifth freedom rights to Polar Air Cargo at Prestwick, uniquely without a reciprocal arrangement from the United States Department of Transportation. That is real progress and it was certainly not achieved by the previous Government. In the long term we need a final agreement on fifth freedom cargo rights, which will bring significant benefits to Prestwick and indeed the whole of Scotland. We will continue to press for that.
It is clear that only a certain amount can be achieved locally and we are very dependent on national action and support to further our aims. A wider economic framework obviously determines how effective the enterprise companies can be locally, and general economic conditions have a major impact on the prospects for any one area.
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It is ironic that, despite everything else that I have said, unemployment in the Ayr constituency has dropped by 30 per cent. since December 1996. We warmly welcome that, but there is no room for complacency, and the figures hold no consolation for those who lose their jobs through redundancy. We must stick to a long-term strategy, both locally and nationally, to create stable and lasting jobs and make available training opportunities to help people into new employment. I am pleased that, unlike the previous Government, this Government have not washed their hands of redundancies in my area and Ministers have been willing to get involved. The role of Scottish Enterprise and local enterprise companies has also been crucial, because they are a concrete way in which the Government can ensure that they do not wash their hands of difficult situations.
All hon. Members present will no doubt wish to see applied to their area a fair share of the considerable resources that will be available to Scottish Enterprise. As my hon. Friends have said, we wish to see resources concentrated in areas of greatest need. That is important for Scotland, but was not done in the past 18 years. Ayrshire's case for more resources is sound and we will make a good case when the action plans for jobs are produced shortly. I trust that Scottish Enterprise will respond positively to our requests and our bid for increased funding.
5.46 pm
Mr. Desmond Swayne: It is a great pleasure to follow the hon. Member for Ayr (Ms Osborne), who is a member of the Committee on which I have the privilege to serve and who represents the town of my school days.
Before I deal with the subject of the Bill, will you first indulge me, Mr. Deputy Speaker, by allowing me to get a point of frustration and irritation off my chest? It is not the fact that I am unable to put in a bid for Scottish Enterprise money for New Forest, West, but the fact that, as is my custom, I rose early, swam quarter of a mile in the Serpentine and cycled to the Palace of Westminster. As a consequence of the business that must necessarily take place before the Chamber sits, I went straight into a series of meetings. Since business in the Chamber began, I have been in my place. At 5.46 pm, I rise to speak, feeling faint because I have scarcely had a moment to eat a banana and a mouthful of soup. The new arrangements for Thursday are inhumane and barbaric.
Mr. Deputy Speaker (Mr. Michael J. Martin): Order. I am sorry to hear that the hon. Gentleman is feeling faint and has not had a decent meal. However, I have had a decent meal and I wish to hear what he has to say on Scottish Enterprise, not on the arrangements of the House.
Mr. Swayne: In that case, hon. Members may welcome the fact that this is the last programmed Scottish Bill before the Scottish Parliament takes over Scottish business.
If one were to be partisan and make party political points, one might draw attention to the fact that the budget for training and Scottish Enterprise was cut by some £67 million in the comprehensive spending review. Were someone to make such a point, Labour Members would no doubt respond by saying that the previous

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Secretary of State cut the budget. However, Conservative Members would say that he did so only with the agreement of the chairman of Scottish Enterprise and that, within a year, the value of the cut had been more than restored. I wish to move on from such sterile ground in this age of new politics and consensus and to question the fundamental basis of the Bill.
The hon. Member for Glasgow, Shettleston (Mr. Marshall) made some pertinent points about the balance of investment between the need to secure more indigenous investment and the acquisition of more capital investment from overseas. I wish to go further and raise questions about the fundamental assumptions underpinning the Bill.
My first point relates to the expensive pursuit of overseas capital. The balance of payments must, of necessity, balance. The number of potatoes sold at the prices charged must be equal to the number of potatoes bought at the prices paid. Any imbalance in the balance of trade in the current account must be made up for by an equal and opposite imbalance under another item in the current account, or by an equal and opposite imbalance in the overall capital account.
Both the British and the Scottish economies are familiar with that fundamental concept. For a long period during the 19th century, and during this one, the Scottish economy and that of the whole United Kingdom ran a huge surplus on current account, made up of a deficit on the balance of trade masked by a huge surplus on invisible earnings. Strangely, even at the height of the industrial revolution, when Glasgow was the workshop of the world, we ran a deficit on our balance of trade.
The statistics of the 19th century are not entirely clear, and the evidence is not always obvious. At the beginning of the 19th century, our collection of statistics was not as sophisticated as it is now. However, it is questionable whether the United Kingdom ever ran a balance of trade surplus during that century. As a result, our current account surplus was made up of a huge surplus on invisibles, largely because of the shipping industry. The balance of trade was affected by the fact that the motor of our economic development—the cotton industry—relied almost wholly on an imported raw product.
Of necessity, the huge surplus on the current account led to an equal and opposite outflow on the capital account. Britain had to export capital to make its trading partners able to afford to continue to trade with us. On the back of that fact, British capital ended up building railways throughout the rest of Europe and in north America. A lasting legacy is that we retain the lead in the world, including the United States, as the largest per capita owners of overseas capital.
If there is a persistent balance of payments deficit, it must equally be met by a capital inflow. One cannot go on buying from a shop—
Mr. Deputy Speaker: Order. The hon. Gentleman is losing me, perhaps because I am not as well-versed as he in the economics of the 19th century. We must home in on the Second Reading of the Bill, which is about
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enterprise and new towns in Scotland. The hon. Gentleman seems to be speaking more about the economy of the UK as a whole.
Mr. Swayne: One of the principal functions of Scottish Enterprise and its partnership with Locate in Scotland will be to attract inward investment. The point that I seek to make, Mr. Deputy Speaker, is that one cannot go on buying from a shop without having some source of income. I have pointed out the necessity of equal and opposite matching outward capital flows where a country runs a persistent current account surplus, or inward capital flows where a country runs a persistent balance of payments deficit. Capital inflow is an automatic consequence of the state of the current and capital accounts of the balance of payments. My question concerns the wisdom of making the expensive pursuit of foreign investment a priority. Obviously, it is a matter of balance. There is a measure of automation in the process, yet we seem to be investing a great deal to short-circuit and do the work that the logic of economic theory would ordinarily do for us.
Mr. Alasdair Morgan: Is the hon. Gentleman saying that, if Locate in Scotland did not pursue its activities, for example, all that inward investment would still come to Scotland and would not be attracted to Ireland by, say, the Irish Industrial Development Agency?
Mr. Swayne: I am making a case for having a balance. Obviously, one must have a view as to the type of investment that one wants. After all, one would not want merely to attract screwdriver plants; one must have a qualitative attitude to the sort of investment that comes in. The hon. Gentleman is right in identifying the fact that economic logic requires a certain amount of inward investment.
Mrs. Fyfe: The hon. Gentleman talks as though depressed areas can easily pick and choose where investment comes from. Industry disappeared from the area that I represent decades ago. Maryhill was at the heart of the industrial revolution and all that industry has gone. Frankly, if an investor from Mars were offering jobs in Maryhill, I would take up the offer.
Mr. Swayne: I hope that the hon. Lady will be successful in that bid for inward investment. I was talking not so much of the ability to pick and choose as of the logic of economic theory, which would require inward investment.
Another aspect of the work of Scottish Enterprise is that of the funds that it maintains to provide venture or seedcorn capital for business start-ups that would otherwise not be able to secure such funds. By its very nature, that is a risky business and it leads to a significant element of loss. Arguably, that is of necessity so. Indeed, if the figures for Scottish Enterprise did not show such losses, it could be argued that it was not doing its job properly by providing for industries that would otherwise not be able to secure such capital and so would never start up. There has to be a balance, but I am not wholly persuaded by the argument.
However, I do not want to go into that. I want to question why Scottish Enterprise finds itself in that position at all. Many years ago, there were agencies for

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providing such capital. It is all very well for us to complain that the banks do not fulfil that role, but it was never their role to provide venture capital. In the great age of Glasgow—the industrial revolution—the main source of capital for risky enterprises was from within an entrepreneur's own family. Why has that source of capital almost completely disappeared throughout the realm? One cannot blame it on new Labour even if, in this age of consensus and new politics, one were minded to do so. That situation arose not only in this century but in the past century—
Mr. Dominic Grieve: Is not the answer simple? It is due to the failure of wealth to cascade down the generations.
Mr. Swayne: My hon. Friend has a pertinent point. As the state has taken on a series of activities, it has displaced—
Mr. Deputy Speaker: Order. I am interested in what the hon. Gentleman has to say, in particular about the history of my native city, Glasgow, but he must be more specific. He must deal with the Bill, not wander through the economic problems of the United Kingdom.
Mr. Swayne: Thank you for your guidance, Mr. Deputy Speaker. You will be relieved to hear that I am drawing to my peroration. The point that I am seeking to make is that we are about to provide an agency that already spends a great deal of public money with an additional £1 billion. I am questioning the necessity of that process.
Mr. Letwin: I want to ask my hon. Friend a question that is absolutely specific to Scottish Enterprise and that I neglected to draw to the attention of the Minister earlier. Is he aware that of the approximately £3 billion that Scottish Enterprise has so far consumed, total investments—apart from those in property—amount to some £51 million, showing that some £2.95 billion has not gone into investments currently held?
Mr. Swayne: I thank my hon. Friend for that intervention, which is highly pertinent at this time.
My hon. Friend the Member for Beaconsfield (Mr. Grieve) pointed out that, as the state has taken on greater and greater activities for itself, it has displaced the activity and responsibility that would otherwise have come from individuals and their families. The state has reduced the incentive to save by funding such activities through taxing savings, income and, very importantly, inheritance—so much so that the diffusion of wealth throughout the population no longer exists to fund the activities of venture capital. That is why this Bill which requires the state to provide funding is before us today.
6.2 pm
Mr. Russell Brown: Follow that, as they say. Unlike my hon. Friend the Member for Ayr (Ms Osborne), let me tell the hon. Member for West Dorset (Mr. Letwin) that I shall be catching a train this evening and, like Cinderella, hope to be home before midnight.
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I welcome the opportunity to support the Scottish Enterprise Bill which will provide financial cover for various activities over the next two years. Thereafter, as has been said, that will become the responsibility of our Scottish Parliament. Naturally those resources filter down to local areas. For an area such as my constituency, which has seen significant job losses over recent months, any additional support that may flow from these moneys will be welcome. Hon. Members have spoken of the major role played by Scottish Enterprise and, like them, I welcome the new network strategy document that was announced earlier this week by my noble Friend Lord Macdonald of Tradeston.
Only this week 20 job losses in heavy engineering and a further 80 job losses in the polyester film manufacturing business in my constituency were announced. The ICI site that offered about 800 manufacturing jobs during the summer of 1997 will by the middle of this year offer only 350 jobs. The collapse of the Asian market and the decision of multinational companies to change their portfolios and abandon certain manufacturing sectors can have a devastating effect on rural areas. Dumfries, Galloway and the Scottish borders have felt some of these devastating consequences during the past 12 months.
Given that in recent months we have had about 600 job losses announced in my locality, it comes as a surprise to many people that unemployment figures do not show significant increases. I do not want to play down job losses because losing a job is a personal tragedy for anyone. However, far from the significant job losses being shown in an increase in unemployment, compared with this time last year, the statistics show a 3.7 per cent. reduction in people seeking employment and claiming jobseeker's allowance; compared with two years ago, the reduction is 20.4 per cent.
After the numerous job losses, my noble Friend Lord Macdonald of Tradeston visited our locality.
Mr. Moore: I know that the hon. Gentleman will develop his point, but does he agree, given our similar experiences of rural issues in the south of Scotland—the hon. Member for Galloway and Upper Nithsdale (Mr. Morgan) is also here—that when people lose their jobs, they are forced to leave the area? That artificially suppresses the unemployment rate. Does he agree that many of the worst recent job announcements have yet to kick directly into the statistics?
Mr. Brown: I agree to some extent. People in the hon. Gentleman's area may leave the locality to seek employment elsewhere, but that is not necessarily so in my constituency. He said that some job losses had yet to kick in, but my figures relate to people who have become unemployed and are a true reflection of what is happening.
The position has undoubtedly been helped by the excellent performance of Dumfries and Galloway enterprise company. Like so many such companies, its assistance is welcome in difficult times. Rural areas cannot attract inward investors who would bring 400 or 500 jobs at a stroke to one place. I therefore believe that it is even more important for the local enterprise company to spread its financial resources over as wide a variety of activities as possible.
According to its most recent annual report, my local enterprise company, which also covers the constituency of the hon. Member for Galloway and Upper Nithsdale

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(Mr. Morgan), provided information and assistance to 247 companies and helped 271 businesses to start up. The general public often miss such figures. It assisted 45 exporting companies and advised four potential inward investors. It supported 28 food, 27 forestry and 73 tourism businesses.
In such a large rural area, the importance of the ability to support 750 companies in training their staff cannot be overstated. Such training, in programmes such as skill seekers and training for work, helped some 230 long-term unemployed people attain employment. That is an excellent step forward for those who have fought so long and hard to find employment. It is also worth mentioning that 20 companies committed to the Investors in People standard during that year.
Dumfries and Galloway Enterprise is involved directly in the delivery of the new deal in my area. As a member of the strategic partnership formed to deliver the initiative, it is leading on the management and delivery of the employment option and the full-time training and education option. It sees its role in the new deal as an increasingly important part of the economic inclusion activity.
I mentioned previously that 271 new businesses had started up. That element of entrepreneurship continues to be a strong feature of the local economy in rural areas. Rural areas depend on small and medium-sized businesses. The launch of a new business start-up programme has proved invaluable to so many people who have been seeking opportunities to start a business.
The importance of tourism in rural areas can be shown by the numbers employed in that sector. Almost 10 per cent. of the area' s work force is employed in the industry and last year we saw the development of a partnership that established our area's first integrated tourism strategy, in which a comprehensive vision for the industry's development was set out.
The ability to offer market research, exhibition support and overseas promotional literature assisted the previously mentioned 45 exporting businesses in the locality. In what is clearly recognised as a difficult time for export companies, the enterprise company's intervention is expected to have led to a growth in direct sales of just less than £1 million. That activity, along with other activities that my hon. Friends and hon. Members have mentioned in the realms of property and environmental improvements, as well as assistance to a significant number of property-based initiatives, has shown just what can be done in rural areas by local enterprise companies.
The Bill offers the opportunity to support through Scottish Enterprise a significant amount of economic activity that might otherwise never happen. I hope that hon. Members on both sides of the House see fit to support it.
6.11 pm
Mr. Laurence Robertson: I am rather amazed to find myself talking at this hour about the Scottish Enterprise Bill.
Mr. David Marshall: So are we.
Mr. Robertson: With a name like Robertson, I am perhaps entitled to offer one or two words on the Bill.
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When I looked at the Bill I was even more amazed. The thing that caught my eye was the extraordinary amount of money that we are talking about—not just the extra £1 billion but the almost £3 billion that has already been spent. I welcome the removal of Ministers' ability to increase the amounts by statutory instrument, but I want to make a short speech that my hon. Friend the Member for West Dorset (Mr. Letwin) might describe as a probing speech. I wish to ask a few questions and seek clarification.
I am concerned that responsibility for Scottish Enterprise will pass to the Scottish Parliament. It is not a matter of whether the Scots, the English, the Welsh or people from Northern Ireland are competent to deal with their own affairs, but the amount of money is so enormous that it inevitably comes from the United Kingdom taxpayer. Should not the United Kingdom Parliament have some control over it? If Labour Members feel that the money is well spent and benefits the people of Scotland to such an extent, would they be happy for the people of Scotland to provide it in its entirety? If they are, I suggest that the Scottish Parliament would need to increase the tax in Scotland by more than the 3p in the pound by which it is entitled to increase tax. I wonder whether it would have been better to delay introduction of the Bill until the Scottish Parliament was up and running. The responsibilities would have been clearer.
Mrs. Fyfe: Does the hon. Gentleman realise that so far he is presenting only one half of the equation? If all the investment effort is successful, the jobless figures will fall and therefore unemployment benefit costs will fall, which will benefit the United Kingdom taxpayer.
Mr. Robertson: If that happens, that may well be the case. I have probably presented only one half of the equation because I am only a quarter of the way through my speech. Who will pay? The hon. Lady makes a good point. Will Scottish Enterprise be self-financing? What returns can we expect from the new companies that are created which otherwise would not have been created? That has to be the question. What will they contribute in terms of corporation tax, job creation and jobs retained—which is important—and in terms of inward investment attracted? In other words, is this money well spent?
I wish to put the amount into context. My hon. Friend the Member for West Dorset mentioned the number of nurses who could be employed by the extra money. The £4 billion over the period in question would run the health service for quite a few weeks. The health service employs about 1 million people. In that context, the figures quoted this afternoon are not impressive.
Mr. Alasdair Morgan: Does the hon. Gentleman accept that the Bill will not increase the sum available to the Scottish Parliament because that is clearly laid down by the Scotland Act 1998 and the Barnett formula? If the Scottish Parliament finds that money, it will be at the expense of other items of expenditure. The hon. Gentleman appears to want the House to supervise the Scottish budget in total.
Mr. Deputy Speaker (Sir Alan Haselhurst): Order. It is not in order to go down that track. We must

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concentrate on the Bill before us, not the wider issue, which has already been raised once in the debate and which I hoped I had expelled.
Mr. Robertson: Thank you, Mr. Deputy Speaker, for rescuing me from going down a complicated path.
May I put the £4 billion in another context? I was saying how many people it could help and how long it could run the health service, for example, which employs 1 million people; but given that the entire population of Scotland over the age of 16 numbers just over 4 million and the economically active population is only 2.5 million, it seems an extraordinarily large sum to spend on such a small work force. That is not to undervalue that work force; my argument is whether it is money well spent. The money might be better spent elsewhere, as the hon. Member for Galloway and Upper Nithsdale (Mr. Morgan) might have been suggesting, or perhaps left in the pocket of the taxpayer, who knows how to spend it better than Governments.
A number of differing figures have been quoted this afternoon. They also differ from the figures that I shall give. In an earlier intervention I quoted the chief executive of Scottish Enterprise. I shall do so again for the benefit of hon. Members who were not in the Chamber then. He claimed in the annual report that Scottish Enterprise has helped to attract inward investment of £1 billion, and created or retained 18,000 jobs and 36,000 training places. Yet he says:
"Scotland …still lags behind the rest of the UK in the number of businesses emerging".

The chairman of Scottish Enterprise, Sir Ian Wood, says that Scottish Enterprise has
"added £600 million to Scotland's GDP."
Those figures may sound impressive, but compared with what Scottish Enterprise has cost, they are not impressive at all. The agency has not moved Scotland on very far. Will the Minister assure us that the money will be well spent and will result in gains to Scotland that are proportionate to the cost of the schemes?
Mr. Moore: Is the hon. Gentleman suggesting that economic development is not a valid purpose for Government expenditure, or is he contending, by contrast, that Scottish Enterprise is particularly inefficient in terms of economic development? If it is the latter, what benchmark is he using to make that suggestion?
Mr. Robertson: I have used a number of benchmarks, the best of which is the fact that the chairman of Scottish Enterprise, Sir Ian Wood, says that it has added £600 million to Scotland's GDP. However, if one averages out what the agency has cost since its creation, that £600 million is not impressive. One must ask how much of it would have existed had the money not been spent in the first place.
I shall bring my remarks to a close because I am interested in hearing the Minister's response. Will he assure us that the value for money of Scottish Enterprise will be constantly monitored?
6.19 pm
Mr. Dominic Grieve: I shall try to keep my remarks brief. Whenever I have participated in Scottish debates in the past and told the House that I would be brief, I have usually succeeded in keeping to that undertaking.
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It is a great pleasure to participate in this debate and to have listened to it. During the long passage of the devolution Bill, when I spent many long hours on the Benches, I realised how much one learns about issues concerning places other than one's own constituency when one bothers to attend debates in this Chamber.
I hope that you, Mr. Deputy Speaker, will allow me to go slightly beyond the Bill, because I want to refer to the necessity for Members of Parliament to be kept informed of what goes on nationwide. I am satisfied that the Bill should commend itself to the House, and I accept that Scottish Enterprise has been beneficial in Scotland, so I have no objection to raising the limits.
However, the comments of my hon. Friend the Member for West Dorset (Mr. Letwin) about the lack of past scrutiny of the activities of Scottish Enterprise are perfectly valid. The House has previously discussed the problem of our ability to scrutinise every aspect of Government activity. I suspect that the Scottish Parliament may also have that problem, especially if every day it packs up at 5 o'clock in the afternoon—it is now a quarter past six. Bills should not be allowed to be nodded through. They require explanation, and I hope that the Minister will deal with my hon. Friend's points, if only briefly, when he winds up the debate.
Some issues go beyond the Bill, which I am told is the last we shall consider before the Scottish Parliament comes into being. Finance is at the root of what makes a unified nation state. We all have concerns about one another's finances. During the devolution debate, and even this evening, I heard enough compelling speeches, such as that of the hon. Member for Ayr (Ms Osborne) about the particular needs of her constituency, to know that there is competition nationally for the allocation of funds. If any issue is to cause problems and dissent when the Scottish Parliament is established, it will be finance.
I listen to Government Members who represent English constituencies, particularly in the north-west. It is clear that, even though this money may come from the block grant, the block grant itself will be up for consideration far more frequently once the Scottish Parliament is established. Therefore, those of us who believe in the Union—that applies across the Benches—argue that continuing, adequate information should be provided to hon. Members about how money is spent north of the border after the Scottish Parliament comes into being. If it is not provided, that will be a fertile area of misunderstanding. New mechanisms will have to be established in this Parliament so that we can be given that information.
Mr. Dalyell: What mechanisms would the hon. Gentleman like to see? This is a serious point.
Mr. Grieve: We shall have to look beyond the existing Select Committee system to provide mechanisms for frequent contact between Members of the House and Members of the Scottish Parliament in Edinburgh, for the exchange of information, if not on a statutory basis then according to growing conventions, and for relevant Ministers to explain to hon. Members whether they are satisfied with the way in which expenditure is being handled north of the border. I do not see that as unwarranted interference, because Members of the Scottish Parliament should be entitled to obtain answers on those aspects through representatives at Westminster on issues that concern England alone.

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As these new mechanisms come into being, I should like to see them work. I hope that the hon. Members present who were also present during the devolution debate are aware that I want the new system to succeed, even if I have reservations about it. I hope that the Minister will take my comments on board, because without such mechanisms an interesting debate will not happen and misunderstandings will build up. That will ultimately threaten the Union, so we must get the exchange of financial information right.
6.24 pm
Mr. Macdonald: With the leave of the House, Mr. Deputy Speaker.
Despite its technical start, the debate has been interesting. I think that the point on which the debate concluded is the point that began it, but I shall deal with that later, when I respond to what was said by the hon. Member for West Dorset (Mr. Letwin).
The hon. Member for Tewkesbury (Mr. Robertson) asked why we could not delay the whole business until the Scottish Parliament was up and running. The purpose of the Bill, however, is to enable Scottish Enterprise to continue its operations until the Parliament is up and running. If it is not presented and passed, Scottish Enterprise cannot do that. I think we all agree that it is important for Scottish Enterprise to continue its work. We have extended the limit for a minimal period, so that the Parliament can decide on future arrangements when it has been established.
The hon. Member for New Forest, West (Mr. Swayne) mentioned reductions in support for training. Under the new deal, an extra £300 million is being spent in Scotland over the lifetime of this Parliament—much more than was available to Scottish Enterprise before. Indeed, this is the biggest training programme in peacetime history.
The hon. Gentleman also made a plea for balance in terms of efforts to attract inward investment. Scottish Enterprise tries to maintain that balance. It may interest the hon. Gentleman to learn that less than 10 per cent. of Scottish Enterprise's operational expenditure is devoted to inward investment and the attraction of such investment; the rest is devoted to companies that are already operating in Scotland.
My hon. Friends the Members for Dumfries (Mr. Brown) and for Ayr (Ms Osborne) made a number of important points, especially in regard to the difficulties and challenges that exist in their constituencies. Those points will be drawn to the attention of my noble Friend the Minister for Business and Industry, who will note them with interest. As both my hon. Friends will know, my noble Friend recently met representatives from Dumfries and Galloway, and expects to meet representatives again in the next month or so. Many of the points that have been raised can be pursued then. The Scottish Office has now joined the Ayrshire economic forum. My noble Friend attended the forum's last meeting before the end of last year, and will attend the next on 25 January.
The hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) welcomed the action plan drawn up for the borders, and I welcome his positive comments.
1110
He suggested that the plan could provide a model or template for the future, and I agree that there are lessons to be drawn from the necessary speed with which Scottish Enterprise responded to the crisis in the borders. I certainly think that the way in which the action plan was put together by the working party provides a model from which we can learn lessons for the future.
The hon. Gentleman also emphasised the importance of infrastructure to economic development. Infrastructure is important for the borders, and also for my part of Scotland. It is taken into account in the current roads review, and the hon. Gentleman can be assured that officials from the Department that deals with transport, who are working on that review, try to consider the economic impact and the benefits of the various roads proposals. They are always grateful for the advice and information that they receive from Scottish Enterprise and from officials in the Department of Trade and Industry, so the communication that he was looking for is there.
The hon. Member for West Dorset raised a number of issues. Essentially, he asked questions about the value for money achieved through expenditure on Scottish Enterprise. He had particular queries and points in that respect, but he also couched the matter in a larger question about scrutiny of Scottish Enterprise post devolution.
As regards the first point, I can reassure the hon. Gentleman on the specific points that he made. Scottish Enterprise has not escaped scrutiny. In 1996, the National Audit Office published a report on Scottish Enterprise following a two-year review by the NAO that was obviously extremely thorough. It made several points to Scottish Enterprise. I think that the balance of them was positive in terms of the frame of controls that Scottish Enterprise has established to secure value for money.
The hon. Gentleman noted that the Public Accounts Committee had not conducted its own investigation of Scottish Enterprise, but the NAO conducted that thorough review, which was presented to the PAC. I do not know the practical reason why the PAC did not take that further, but one assumes that it was because it was satisfied with the outcome of the NAO report, Therefore, I hope that the hon. Gentleman can take reassurance from that and will rest his case not on any fears that Scottish Enterprise is not achieving value for money, but on the wider constitutional points that he made.
Mr. Letwin: Of course the Minister is right that my main point is a constitutional one and about the future, rather than a financial point and about the past, but does he accept that the NAO report is interesting in that it looks in painstaking detail at the way in which the moneys that were disbursed, after administrative expenses and so forth, were used, and whether value for money was achieved in terms of cost per job? It also, I should add, examined internal auditing controls; I am not and have never suggested any impropriety and the NAO found none. However, does he agree that the report does not look at all closely at whether the organisation is, as a financial enterprise, running its internal affairs efficiently? Is that not surprising?
Mr. Macdonald: That is a point that the hon. Gentleman could take up with the NAO. Certainly the tone of the report is one of general satisfaction with the operations of Scottish Enterprise. Unless we know

1111
otherwise, we would do better in this Chamber to emphasise that positive side, albeit the hon. Gentleman wants to make those wider points about scrutiny. It would only be fair if, here, we accepted that the NAO issued a generally positive report on Scottish Enterprise, and we can only assume that it found favour with the Public Accounts Committee as well.
My hon. Friend the Member for Glasgow, Shettleston (Mr. Marshall) made the point that, during the Select Committee visit to north America, it heard glowing testimony of the high regard in which Scottish Enterprise is held in north America because of the nature and quality of its work and the way in which it is perceived. I agree with what he said about Scottish Enterprise strategy and I find nothing to disagree with his points about Glasgow in general. I agree particularly with the fact that we need to address the problems of Glasgow, not just through the efforts of Scottish Enterprise, but through other measures such as the new deal, social inclusion partnerships and so on.
My hon. Friend the Member for Shettleston also mentioned the subject of brown-field sites in Glasgow which, quite rightly, he raises frequently. The treatment of such sites is important and my hon. Friend will be reassured to know that £3 million has been ring-fenced specifically for the development of brown-field sites in Glasgow.
The future oversight of Scottish Enterprise will be a matter for the Scottish Parliament. It will be one of the agencies under the Scottish Executive. The Scottish Executive and its agencies will be held to account by the Parliament. One would assume that the Parliament will have its own audit committee, which, like the Public Accounts Committee, will play an active and powerful role in the life of that Parliament. From April next year, responsibility for auditing Scottish Enterprise will transfer to the auditor-general for Scotland. That may not answer the deeper questions about devolution that were asked by the hon. Member for West Dorset, but I believe that those are just points of disagreement between both sides of the House about the merits of devolution and the need to achieve it.
Mr. Letwin: Without entering the depths of the dispute, if there is one, will the hon. Gentleman clarify a point? Is he saying that, it is the Government's view that, following devolution and in the light of the audit arrangements which he no doubt correctly says will be established by the Scottish Parliament, there should be no opportunity for oversight by this House or this Parliament of the use of funds by agencies which come under the Scottish Parliament.?
Mr. Macdonald: I am sure that the hon. Gentleman will be free to make his own speeches after devolution and to raise any points that he wishes with the Government of the day about how that Government are spending
1112
their money. It is a firm view on the Labour Benches that those responsibilities and duties should be transferred to the Scottish Parliament and, in our view, it will be the responsibility of that Parliament to fulfil them.
Mr. Letwin: I am sorry to interrupt again; this will be my last intervention. Can the Minister tell us how far he intends to press that point? Is he saying that, even if there are suggestions in this House that moneys voted by this House through the block grant to the Scottish Parliament are being ill-used, he and his colleagues do not intend to set up any specific mechanism to enable the taxpayers of the United Kingdom, as represented in this House, to investigate that?
Mr. Macdonald: I am confident that the Scottish Parliament will be able to acquit its financial duties and its responsibility for oversight of the agencies every bit as competently as the current Parliament and Government are able to do. As I have said, I am sure that the hon. Gentleman and his colleagues will be able to make their own speeches and raise their own points in their own way post-devolution. I hope that he will at least accept that, within the Parliament, there will be a powerful mechanism for ensuring proper oversight of those agencies.
I am grateful to have had the opportunity to respond to this debate. Although it is a technical Bill, it has raised some interesting issues. As I explained at the beginning of my speech, the Bill is intended simply to raise the aggregate limit for Scottish Enterprise to allow it to continue its important work, which I am grateful to note has received cross-party support. I commend the measure to the House.
Question put and agreed to.
Bill accordingly read a Second time, and committed to a Standing Committee, pursuant to Standing Order No. 63 (Committal of Bills).

SCOTTISH ENTERPRISE BILL [MONEY]
Queen's recommendation having been signified—
Motion made, and Question put forthwith, pursuant to Standing Order No. 52(1)(a),
That, for the purposes of any Act resulting from the Scottish Enterprise Bill ("the Act"), it is expedient to authorize—
(1) any payment out of the National Loans Fund, the Consolidated Fund or money provided by Parliament resulting from increasing by the Act, to an amount not exceeding £4,000 million, the aggregate amount which is permitted to be outstanding, otherwise than by way of interest, in respect of the items mentioned in paragraphs (a) to (d) of section 25(2) of the Enterprise and New Towns (Scotland) Act 1990; and
(2) any increase, resulting from such increase, in the sums payable into the National Loans Fund or the Consolidated Fund.—[Mrs. McGuire.]
Question agreed to.

PETITION

  Evercreech Primary School
  6.40 pm
  Mr. David Heath: I should like to present, and offer my support for, a petition that I was given earlier this week at Evercreech primary school. I am grateful to the school's staff, children and governors for the welcome that they gave me. The petition has been signed by 250 people resident in Evercreech and in the surrounding district of Somerset, including the area's county councillor, Mrs. Gloria Cawood.
  The petition states:
  The number of pupils attending Evercreech Primary School, and the continuing popularity of the school, is such that class sizes are unacceptably large, and that one class now has 38 children, to the detriment of the educational opportunities offered to local children.
  Wherefore your Petitioners pray that your Honourable House will take such matters as lie within their powers to urge that the Secretary of State for Education and Employment ensures that such resources are available to Somerset County Council as may be required to provide an extra permanent classroom and one extra teacher for Evercreech Primary School.
  And your Petitioners, as in duty bound will ever pray etc.
  To lie upon the Table

  Parish and Town Councils
  Motion made, and Question proposed, That this House do now adjourn.—[Mrs. McGuire.]
  6.41 pm
  Mr. David Drew: I am delighted to have the opportunity to initiate this Adjournment debate. I start from the premise of a belief that often the importance of parish and town councils—or, as I shall refer to them, local councils—is undervalued and that the advantages that they offer, not only to their own community but as the basis of representative government, is underestimated.
  I should immediately declare an interest: I am a local councillor. I have been a Stonehouse town councillor for the past 12 years, and shall remain a local councillor if those in power will select and re-elect me.
  I realise that I am not the only hon. Member who has the onerous responsibility of being a local councillor. My hon. Friend the Member for North-West Leicestershire (Mr. Taylor) is a parish councillor in his constituency, and my right hon. Friend the Member for Bishop Auckland (Mr. Foster) is president of the Durham Association of Local Councils. Recently, I became a vice-president of the National Association of Local Councils. The Minister for Local Government and Housing once filled that position with distinction. It is interesting how we hon. Members begin our careers.
  I should like to give my thanks to all those who have served with me in local government. I should certainly like to thank my own councillors on Stonehouse town council and the two clerks who have been with the council for the past 12 years. I thank also all the other town councils with which I have had contact both before and especially since I was elected to the House.
  My constituency has 48 parish and town councils, consisting of the five town councils of Stonehouse, Dursley, Nailsworth, Stroud and Berkeley; 41 parish councils, which vary in size from Cam—which my old friend, Councillor Brian Addle, always assures me is the biggest parish in Gloucestershire —to very small parishes, such as Brookthorpe-with-Whaddon, Standish, Elmore and Miserden. Finally, but not least, it has two parish meetings—which hon. Members who know about such matters will realise comprise the lowest level of representative democracy and meet only very occasionally, when the need arises—at Moreton Valence and Owlpen.
  I should like to make special mention of two people who have helped me to compile my notes for this speech: Stephen Wright, the secretary of the Gloucestershire Association of Town and Parish Councils, who doubles as the director of the Gloucestershire rural community council; and Robin Wendt, the chief executive of the National Association of Local Councils.
  Local councils tend to be seen as the lowest and least form of democracy and are sometimes parodied as something of a French farce. In "The Vicar of Dibley" they are portrayed as not as serious as they could be. It is easy to think of local councils in that way, but those who serve on them regard their role as important. Although it is not always easy to get people to serve, councils are an important part of the democratic process. When they work, they work very well.

  1115
  The councils that set out to fulfil their role and take it seriously are many and varied throughout the country. The late Professor Bryan Keith Lucas, emeritus professor of government at the University of Kent, said:
  "It would be difficult to exaggerate the diversity of parishes and how their councils provide for them."
  That comes from the foreword to the 1997 book "Parish Government 1894–1994", which he co-authored with K. P. Poole.
  Lord Faversham, currently president of the NALC, has said that local democracy is a vital element in a healthy state and that parish, town and community councillors can make local councils a relevant, valuable and necessary part of the governance of this country in the 21st century.
  We are all aware of the historical importance of parishes. When people say where they come from, they often refer to their parish rather than a large city or a town. Parishes go back way beyond the creation of parish councils. That historical link is good to see. Only in the Local Government Act 1894 were civil parishes formally created. That was reaffirmed in the Local Government Act 1972. Although both Acts were widely welcomed, they were also opposed by some in authority—the landed gentry and the Church in the first example and larger councils in the second, because they saw local councils as a threat. How things move on and sometimes come round.
  There is a tremendous range of local councils—10,000 in England and Wales, as well as Scotland's community councils. They vary in size, with the larger ones, such as Bracknell, Dunstable and Oswestry, covering sizeable populations, while the smaller ones cover only 100 or 200 people. Their variety and diversity is their strength.
  Local councils have about 50 powers and duties. There is tremendous variation in how they are exercised. Some exercise them widely, while others use them in only a limited way. It is important that however the powers are exercised, the councils are supported and regarded as important. Pleasingly, the powers of local councils were re-established in the Local Government and Rating Act 1997, when the previous Secretary of State, the right hon. Member for Suffolk, Coastal (Mr. Gummer), gave them new powers over crime, transport and traffic control.
  Local councils are an important part of the local government scene. It is easy to parody them as places where people just talk and little happens, but they can achieve a considerable amount and look after their population in many ways. Interestingly, it is the only part of local government in which it is not easy to control expenditure. I always whisper that very quietly as it could be considered to be a door that needs to be shut. I shall move on quickly as my hon. Friend the Minister is looking at me.
  Local government—unitary authorities or two tiers of local government—often forgets that there is a third tier or, in the case of unitary authorities, a valuable second tier. Nowadays much emphasis is placed on joint working between the principal authority and local councils, but there is always room for improvement. If the move towards unitary authorities continues and gathers pace, rather than threatening parish and town councils, it may encourage them and further enhance their role. The process will be hastened if, as seems likely, we dispense with some of the councillors on the larger authorities and genuinely try to bring back local decision making and get councillors in touch with the populace.
  1116
  Although the Government's approach to modernising local government is welcome, it is slightly disappointing that the White Paper "In Touch with the People" does not make much mention of local councils although it recognises that they are
  "an essential part of the structure of local democracy in our country"
  and
  "will continue to play a key role in many of our towns and villages".
  It recognises that they have
  "a vital role in helping principal councils keep in touch with the smallest communities"
  and making sure that they can work in partnership so that the best decisions are made.
  Welcome as those words are, local councillors believe that their role could be further enhanced and their value given greater emphasis. I hope that the forthcoming urban and rural White Papers will stress the role of local councils.
  Mr. Laurence Robertson: Does the hon. Gentleman agree that one way to increase the perceived importance of town councils would be to give them a greater say in the planning process? Like me, the hon. Gentleman comes from Gloucestershire, so he will be aware that people's views, expressed through the town councils, are being overridden by unelected inspectors.
  Mr. Drew: I shall not take up that challenge, but the hon. Gentleman knows my views on planning, as do many other hon. Members. I concur that there would probably be great benefit if local opinion, which is reflected in parish and town councils, were listened to more carefully, not just as part of the appeal process, but in advance of that process. Certainly when appeals are heard, it would nice for local councils to be given a proper role in the process.
  I should like some answers from my hon. Friend about some specific issues, some of which are more important than others. My starting point is what I consider to be the Government's interest and concern for uprating and improving local government structure and the new ethical framework. Local councils support the Government's desire to provide an ethical framework for local government, based on codes of conduct, standards committees and so on. However, there is a belief that the concept is being passed down to them, rather than being created in the context of how local councils can best perform. That does not fully recognise the position of local councils in their own right. The alternative suggestion from the NALC is that local councils in each county area should prepare their own code of conduct in the light of national advice. The Government should be urged to rethink and clarify how that could be taken forward.
  The second issue is best value. Again, local councils strongly support the approach of the Government in that regard. The policy intention is that the new regime will apply to all local authorities, including local councils, with budgeted expenditure above a defined threshold. The Government have indicated that that may be set at £500,000, subject to further consultation. Many local councils would allege that that is a low level, and it would be sensible for the Government to consider raising it. It is understood that the Government will consult with the NALC about the issue, and I look forward to hearing the result.

  1117
  The third issue is community leadership, and again it is proposed that there be a new duty on all manner of local authorities to promote the social and economic well-being of communities. That will apply to the lowest level of local government. It would be sensible to recognise that that can be achieved by those councils in the lowest category, and again we would hope that the remit of such councils would be properly constituted and understood. I believe that it should be the right of every area, if it so wishes, to have a local council—whether that be a parish, a town or a community council.
  It is pleasing that although every part of my area is now parished, other parts of Gloucestershire, which were traditionally not completely parished—such as the Cotswolds and the Forest of Dean—are now creating parish councils, which seem to be popular. I hope that the Government will welcome and encourage that, and not see it as a threat to other levels of local democracy.
  My fourth point concerns the European charter of local self-government. There was concern, surprise and disappointment among councils that they were not included when the Government decided to ratify the charter. Councils, along with the principal authorities, had looked forward to the signing of the charter by the new Government and to its eventual ratification. They were taken aback when it was not applied to them, and the Government ought to think about the benefits of so doing.
  I would link that with the local councils' welcome for the regionalisation of this country. They feel that they can play a part in helping that process. They would not want to have a formal role within regional development agencies, but some disappointment has been expressed at the fact that they have not always been included in the proposals or action plans for the evolution of the relevant chambers. That is not true in all areas and, in the south-west, there is a representation of local councillors through to the regional chamber. However, that is not always the case.
  There are some real concerns about funding, as well as about the auditing and accounting regimes—certainly about the way in which local councils can borrow, which has been referred to as loan sanctioning. The restriction in total to £6.7 million a year is seen to be unduly restrictive. My largest town council, Stroud, has been seeking to borrow money, quite justifiably, for a particular project, but it is like waiting for Buggins's turn to get the money. That is neither fair nor reasonable, and I hope that the Minister will comment on whether it will be possible to increase the total amount and consider whether that could be shared out fairly.
  The concern among parish and town councils about auditing and accounting is the principal reason for this Adjournment debate. They are concerned, first, about the imposition by regulation of a £5,000 a year spending threshold, above which all local council accounts are subjected to the full audit regime. Secondly, many councils are unhappy with the audit system itself because they consider it to be excessively prolonged, thus increasing fees. Complaints have also been raised at times about a lack of professionalism. Councils do not have the time to do what they want to do to meet the requirements of the Audit Commission.
  It being Seven o'clock, the motion for the Adjournment of the House lapsed, without Question put.
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. McAvoy.]
  Mr. Drew: I undertook a survey and found that many councils were concerned about how the audit system was being applied. Many said that they wanted changes. By pure chance, I was sent some information a couple of days ago by Cotswold district council showing that Adlestrop had a precept of £181 a year and an audit fee of £168; one may well ask what happened to the other £13, but it is a question of precepting for a purpose.
  Local councils have an important role to play. They are well respected in their communities. With proper training and support, the councillors and clerks can serve their populations well. I hope that my hon. Friend will consider ways in which we can further enhance the lower levels of local government and regard them not as an amusing aside but as an important part of our democratic structures.
  7.1 pm
  The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Nick Raynsford): I congratulate my hon. Friend the Member for Stroud (Mr. Drew) on his success in the ballot, and on raising the subject of the role of parish and town councils. It was apparent from what he said that he has great experience of the operation of local councils, especially in Gloucestershire. The role of town and parish councils is a matter of real concern at a time when everyone in local government is rightly considering the way in which their institutions operate and the role that local authorities, including parish councils, play in the democratic structure.
  The enactment of the Local Government and Rating Act 1997, with full support from the current Government, reflects the valid role that parishes have to play. The implementation of that Act—the first parish-focused legislation in over 25 years, which the previous Government took through Parliament with our support—has enabled communities for the first time to petition for a parish in an unparished area and has returned the power to district councils to undertake reviews of their parish arrangements.
  We have already agreed a number of new parishes and 20 will have been constituted by 1 April. I think that that provides a response to what my hon. Friend said and proves that we see a role for parishes in the democratic structure and that we are already encouraging the creation of more local councils.
  When we were elected in May 1997 we pledged to modernise the country and bring government back to the people; and to create a new Britain for the new millennium—a decent society that serves all its people and not only the few. We are now implementing the most radical improvement to our constitution this century, with devolution for Scotland and Wales; a London Assembly with an elected mayor; and development agencies for the English regions.
  Our better government initiative, along with the comprehensive spending review and our work on freedom of information, has examined how government can function more effectively and openly; but if we are to achieve change and deliver our pledges we need to mobilise all levels of government and society to work together. Local government at every level has a key role to play if people are to have the quality of life that they deserve. That must and should include parishes.

  1119
  Local government is essential to our democracy but it is not as strong as it ought to be. One does not have to look far to see the weaknesses: low turnout at local elections—only 26 per cent. last May—and 2 million absentees from the electoral register. Too few people find local government interesting enough to bother to register or vote. We want to encourage the public to become more involved in local democracy and we hope that parishes will use their role as representatives of their communities to encourage local people to take part and have their say.
  The White Paper "Modern Local Government: In Touch with the People" put in place an ambitious programme of reform for the next 10 years or more. To implement that programme requires action by central Government and local government, local communities, business and the voluntary sector. I hope that parish councils will play their part. They have an important role to play in local decision making and provide a valuable opportunity for local people to take part in managing their environment. That is especially true in rural areas where parish councils are vital in representing, and servicing at the most local level, small and often tightly knit communities.
  My hon. Friend the Member for Stroud referred to the rural White Paper. Thriving rural communities are an integral part of the Government's vision of a fair and decent society. Rural England is changing and we must respond to that change. We have therefore announced plans to produce the rural White Paper this year. It will look at the long-term future for the English countryside and at how a wide range of policies can support rural communities in the future. Work will proceed in tandem with the urban White Paper, recognising that town and country are inextricably linked. Consultation will be an important part of the process, so we will shortly issue a discussion document setting out key themes and inviting comments in advance of the publication of the White Papers. The National Association of Local Councils will of course be one of the consultees and is to help us in ensuring the consultation paper is seen by parish councils. I can assure my hon. Friend that any comments made by parishes will be carefully considered.
  As my hon. Friend the Member for Stroud made clear, there are wide variations between individual local councils, not least in size. While town and parish councils, and their representatives, play a vital representative role both locally and nationally, most parish councils have a limited role in terms of expenditure, functions and staff resources when compared with principal councils. Therefore, few of the changes we are considering for local authorities as a result of our local government White Paper will affect parish councils directly. Indeed, in many ways, because of their very local nature they are already close to their communities and, of course, as was mentioned, parish councils are unique in that every local government elector for such councils has the right to raise any matter affecting parish business at the annual parish meeting. In that respect, I agree that democracy is already more direct than in the case of other tiers of local government.
  Minsters meet the National Association of Local Councils regularly. My hon. Friend the Minister for Local Government and Housing spoke at the NALC conference last year and met with NALC representatives most recently only last month where all the issues raised today were discussed in some detail. I shall therefore cover them only briefly now.
  1120
  I note the comments by my hon. Friend the Member for Stroud on the new ethical framework, but the important thing to note is that local codes of conduct will be drawn up in consultation with local councils. As for best value, we are consulting various local government associations, including NALC, to consider the extent to which local councils should be subject to the best value regime. I am pleased to hear my hon. Friend's comments on the wish of local councils to play a positive role in the development of best value.
  As I have already said, ministerial agreement to a number of new parishes confirms our view that they have a role in community leadership where a parish is wanted by local people. As for the cost of elections, it is a matter for local discretion as to whether a district council chooses to reclaim the cost of a parish by-election from the parish council. I understand that the Home Office has no plans at present to reconsider the existing legislation.
  I do not intend to stray into the planning process, despite the temptation provided by the hon. Member for Tewkesbury (Mr. Robertson), but I note that the Rural Development Commission has provided assistance to parish councils through the production of a software package on village appraisals to aid them and others to understand their local community. That will help them to respond to the real challenges that arise from new planning proposals that affect their communities.
  I am sorry that the reasons why parish councils are not subject to the European charter of local self-government are not fully understood. Rather than rehearse those arguments, I shall write to my hon. Friend to set out more fully the reasons why the Government reached that decision. As for regional chambers, we believe that it is right that it should be for the chamber itself to decide whether parish councils should be members.
  As my hon. Friend is probably also aware, we are investigating the position on loan sanctions as the last two financial years have ended with a considerable balance of unused allocation. We need to be clear for future years about whether there is unmet demand. To that end it has been agreed that all borrowing approval applications will be submitted to my officials until the end of the financial year.
  The new audit arrangements have been in place for only two years. They must be given time to settle down. We recognise that some parish clerks will have had difficulties adjusting to the new requirements, but audits should become clearer and simpler as parish clerks become more familiar with the new regulations. No doubt the Audit Commission will welcome NALC's views on the system in practice.
  It has been said that the introduction of council tax benefit subsidy limitation would be a potential indirect cap on local council spending. That is not the case.
  Although local precepting authorities are outside the scheme, in that they will not make contributions to benefit costs where the local authority sets a council tax above guideline, changes in the local precept may affect the amount by which it exceeds the guideline and, thus, the contribution to costs. The Government believe it right that that cost is met, in part or in full, by the local taxpayer rather than nationally. We expect local precepting authorities to behave responsibly and to take that into account.

  1121
  We have received a number of representations from local authorities about the impact that parish council precepts may have on district budgets with regard to council tax benefit subsidy limitation. We will take them into account along with others before finalising the scheme.
  I am disappointed to hear that there is a reluctance to use the 1972 Act section 137 funding, as that was not our understanding. A number of larger town councils have made use of it, and, of course, the facility is there for all parish councils to use. Certainly a recent study found that the current section 137 arrangements are generally regarded as satisfactory by the vast majority of parish councils, and it is encouraging to see that local councils are increasingly using their section 137 power, and that they are doing so for a wider range of activities.
  Mr. Drew: There is some misunderstanding of exactly how section 137 operates. That is an example of where training and support, especially from principal councils, may be worth while, particularly for small parish councils or parish meetings.
  Mr. Raynsford: I hear what my hon. Friend says, and I shall write to him. I appreciate his concern for more information and training opportunities. The Government
  1122
  are not averse to helping to ensure that those who play a role in local councils are familiar with procedures and given help in understanding the available options.
  I hope that my hon. Friend is assured that the Government see parish and town councils remaining an essential part of the structure of local democracy in our country. I hope the councils will continue to play a key role in many of our towns and villages. For our part, we will continue to consult parishes, through NALC and other local government associations, on the many issues raised by our radical agenda for modernisation.
  I take this opportunity to refute accusations of not listening to parish council views. Ministers have listened to comments from NALC on a number of important recent issues and we meet them regularly to hear parish views.
  Let me assure the House that the Government recognise that, although parish councils, as an integral part of the whole local government system, do not need a separate modernisation exercise from principal local authorities, they do have a vital role. We hope that they will help principal councils to keep in touch with the smallest communities in their areas, and that they will take on board many of the initiatives that we are progressing with the higher tiers of local government.
  Question put and agreed to.
  Adjourned accordingly at thirteen minutes past Seven o ' clock.

NORTHERN IRELAND

  Higher Education
  Mr. Hume
  To ask the Secretary of State for Northern Ireland how many full-time students, normally domiciled in the Northern Ireland Western Education and Library Board area, enrolled in higher education courses for the current academic year. [65309]

  Mr. McFall
  This information is not available in the form requested. However, 2,534 full-time students domiciled in the area of the Western Education and Library Board applied for financial support to attend higher education courses in the current academic year.

  Clifton Special Care School, Bangor
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland how many students are enrolled at Clifton Special Care School, Bangor; if a nurse is available in the school; and if she will make a statement. [65960]

  Mr. McFall
  98 pupils are currently enrolled at Clifton Special School. At present there is no nurse available in Clifton School, but the Eastern Health and Social Services Board and Ulster Community and Hospitals Trust are working with the South Eastern Education and Library Board to arrange provision of the required level of nursing support.

  Retired Teachers (Returnees)
  Mr. John D. Taylor
  To ask the Secretary of State for Northern Ireland what estimate she has made of the number of retired teachers who subsequently returned to teach for limited periods in primary schools for the most recent 12 month period for which figures are available; and if she will make a statement about opportunities for recently trained teachers. [65959]

  Mr. McFall
  673 retired teachers were re-employed in primary schools on a temporary basis during the 1997–98 school year.

  Board/NHS trusts

  Linkage complete

  Linkage planned by 31 March 1999

  Argyll and Clyde Health Board

  Yes

  Argyll and Bute NHS Trust

  Yes

  Inverclyde Royal NHS Trust

  Yes

  Lomond Healthcare NHS Trust

  Yes

  Renfrewshire Healthcare NHS Trust

  Yes

  Royal Alexandra Hospital NHS Trust

  Yes

  518
  The Department of Education has advised employing authorities and schools that, wherever possible, preference should be given to newly qualified teachers or experienced teachers seeking to return to employment, when filling vacancies, including those of a temporary nature.

  In the year after qualification, the vast majority of around 650 teachers who qualify each year should obtain teaching posts. For example, a total of only 11 primary and secondary school teachers of age 24 years or under were registered as unemployed for more than 6 months at the end of the 1997–98 school year.

  Ulster Society for the Prevention of Cruelty to Animals
  Mr. White
  To ask the Secretary of State for Northern Ireland how she intends to fund the costs incurred by the Ulster Society for the Prevention of Cruelty to Animals in caring for the dangerous wild animals that were taken into their care on behalf of public agencies, from Seskinore, Co. Tyrone, on 8 November 1997. [67440]

  Marjorie Mowlam
  Costs incurred by the USPCA in caring for these animals until ownership formally passed to the Society on 26 October 1998 amount to £54,329. It is proposed to share these costs on an equal three way basis across the budgets for the Police Authority for Northern Ireland and the Departments of Agriculture and Environment for Northern Ireland. Parliament's approval to meet these costs in the current year will be sought in a Supplementary estimate for Department of the Environment Vote 4 (Environment and other Services). Pending that approval, payment will be made from repayable advances from the Northern Ireland Consolidated Fund.

SCOTLAND

  NHSnet
  Mrs. Ewing
  To ask the Secretary of State for Scotland which NHS trusts and health boards are currently connected to the NHSnet; when he expects every NHS trust and health board to have a link to the NHSnet; what future resources will be required to(a) complete and (b) support this service; and what resources have been allocated to this project (i) this year and (ii) in each of the next three financial years. [65762]

  Mr. Galbraith
  All Health Boards and NHS Trusts will be linked to NHSnet by 31 March 1999. The current position of Health Boards and NHS Trusts is set out in the table. Resources allocated to this project in this year are £6 million. The ongoing costs of supporting these links will be met by the Health Boards and Trusts.
  519

  Board/NHS trusts

  Linkage complete

  Linkage planned by 31 March 1999

  Ayrshire and Arran Health Board

  Yes

  Ayrshire and Arran Community Healthcare NHS Trust

  Yes

  North Ayrshire and Arran NHS Trust

  Yes

  South Ayrshire and Arran NHS Trust

  Yes

  Borders Health Board

  Yes

  Borders Community Health Services NHS Trust

  Yes

  Borders General Hospital NHS Trust

  Yes

  Dumfries and Galloway Health Board

  Yes

  Dumfries and Galloway Acute and Maternity Hospitals NHS Trust

  Yes

  Dumfries and Galloway Community Health Services NHS Trust

  Yes

  Fife Health Board

  Yes

  Fife Healthcare NHS Trust

  Yes

  Kirkcaldy Acute Hospitals NHS Trust

  Yes

  Queen Margaret Hospital NHS Trust

  Yes

  Forth Valley Health Board

  Yes

  Central Scotland Healthcare NHS Trust

  Yes

  Falkirk and District Royal Infirmary NHS Trust

  Yes

  Stirling Royal Infirmary NHS Trust

  Yes

  Grampian Health Board

  Yes

  Aberdeen Royal Hospitals NHS Trust

  Yes

  Grampian Healthcare NHS Trust

  Yes

  Moray Health Services NHS Trust

  Yes

  Greater Glasgow Health Board

  Yes

  Glasgow Dental Hospital and School NHS Trust

  Yes

  Glasgow Royal Infirmary University NHS Trust

  Yes

  Greater Glasgow Community and Mental Health NHS Trust

  Yes

  Southern General Hospital NHS Trust

  Yes

  Stobhill NHS Trust

  Yes

  Victoria Infirmary NHS Trust

  Yes

  West Glasgow Hospitals University NHS Trust

  Yes

  The Yorkhill NHS Trust

  Yes

  Highland Health Board

  Yes

  Caithness and Sutherland NHS Trust

  Yes

  Highland Communities NHS Trust

  Yes

  Raigmore Hospital NHS Trust

  Yes

  Lanarkshire Health Board

  Yes

  Hairmyres and Stonehouse Hospitals NHS Trust

  Yes

  Lanarkshire Healthcare NHS Trust

  Yes

  Law Hospital NHS Trust

  Yes

  Monklands and Bellshill Hospitals NHS Trust

  Yes

  Lothian Health

  Yes

  East and Midlothian NHS Trust

  Yes

  Edinburgh Healthcare NHS Trust

  Yes

  Edinburgh Sick Children's NHS Trust

  Yes

  Royal Infirmary of Edinburgh NHS Trust

  Yes

  West Lothian NHS Trust

  Yes

  Western General Hospitals NHS Trust

  Yes

  Orkney Health Board

  Yes

  Orkney Health Unit

  Yes

  Shetland Health Board

  Yes

  Shetland Hospitals and Community Services Unit

  Yes

  Tayside Health Board

  Yes

  Angus NHS Trust

  Yes

  Dundee Healthcare NHS Trust

  Yes

  Dundee Teaching Hospitals NHS Trust

  Yes

  Perth and Kinross Healthcare NHS Trust

  Yes

  Western Isles Health Board

  Yes

  520 521
  Mrs. Ewing
  To ask the Secretary of State for Scotland if full use of the NHSnet requires(a) GP practices and (b) NHS trusts connected to the NHSnet to have compatible software and hardware; and which companies have supplied the hardware and software for the project. [65763]

  Mr. Galbraith
  NHSnet provides a UK-wide secure private telecommunications network for NHS Organisations across the UK under contracts with BT, BT Syntegra and Cable and Wireless. Connection to NHSnet is achieved by connecting to a Service Access Point on the NHSnet. NHS organisations can either connect directly to an NHSnet Service Access Point or indirectly if they are already linked to a network, e.g. a private Health Board wide network, with a gateway connection to NHSnet. All networks (whether single GP Practices or Board level private networks) connecting to NHSnet must conform to the NHSnet Code of Connection which maintains the security and integrity of NHSnet.

  Full use of NHSnet requires each GP Practice and NHS Trust (or the local network to which they belong) to meet published standards for NHSnet which comply with the Internet suite protocols (IP). GP Practices and NHS Trusts must therefore have systems which are compatible with NHSnet (but not necessarily the same as each other). A variety of suppliers will have supplied parts of the overall network; details of these are not held centrally.

  Mrs. Ewing
  To ask the Secretary of State for Scotland when he expects all GP practices in Scotland to have a link to the NHSnet; what resources have been allocated to this project(a) this year and (b) in each of the next three financial years; what resources will be required to (i) complete and (ii) support this service; and what is the estimated cost saving over the next five years. [65760]

  Mr. Galbraith
  97 per cent. of GP practices are already connected and the remaining practices which asked to participate will be linked by March 1999. The total cost of this project was £7 million of which £0.415 million was spent in 1998–99. Resources required for ongoing support of the installed systems and NHSnet connections will be met through the usual arrangements between Health Boards and GPs for reimbursement of expenses.

  It is difficult at this stage to estimate the cost saving when the system is fully utilised. The main objective is to improve patient care through ensuring that clinicians have access to the information they need to care for patients wherever they are in the NHSiS. The benefits expected when the full infrastructure is put into place also include savings in costs and reductions in the bureaucracy of sending an estimated 10 million paper forms around the system each year, saving in staff time, and improved convenience for patients.

  Mrs. Ewing
  To ask the Secretary of State for Scotland how many and what percentage of GP practices are currently connected to the NHSnet. [65761]

  Mr. Galbraith
  My most recent information is that 1,040 GP Practices are now connected to the NHSnet. This represents 97 per cent. of all practices in Scotland. Of the remaining 34 practices, 4 practices did not ask to participate and the remainder will be linked by March.

  Psychiatrists (Young People)
  Mrs. Ray Michie
  To ask the Secretary of State for Scotland how many child psychiatrists are currently employed in the NHS in Scotland. [65879]

  Mr. Galbraith
  The number of consultant child and adolescent psychiatrists employed in the NHS in Scotland at 30 September 1998 was as follows:

  Whole time equivalent: 41.3

  Headcount: 48

  Notes:

  1. Data available do not distinguish between staff working in child psychiatry and adolescent psychiatry.

  2. Information on junior staff not yet available for 1998.

  3. Consultant data for 30 September 1998 are the latest available and are provisional.

  Source:

  Information and Statistics Division Scotland.

  Mrs. Ray Michie
  To ask the Secretary of State for Scotland if he will make a statement about the availability of psychiatric services for young people, with particular reference to rural areas. [65878]

  Mr. Galbraith
  Within the context of their mental health strategies, all Health Boards in Scotland are determining and putting in place the appropriate levels of in-patient and community-based provision they require to meet assessed needs for child and adolescent psychiatric care.

  The growth of community-based psychiatric services should help promote better access for young people in rural areas. But, inevitably, in-patient facilities will tend to be close to population centres. Health Boards covering rural areas should take account of this in developing their plans.

  Quigley Committee
  Mr. Dalyell
  To ask the Secretary of State for Scotland (1) if he will state the terms of reference of the Quigley Committee on higher education; and when he expects it to report; [65476]

  (2) if he will make a statement on the interim findings of the Quigley Committee on student applications. [65475]

  Mrs. Liddell
  I refer my hon. Friend to the answer given by my right hon. Friend the Secretary of State for Education and Employment on 1 December 1998,Official Report, column 138.

  The Quigley Committee has not made any statement of interim findings.

EDUCATION AND EMPLOYMENT

  New Deal
  Mr. Keetch
  To ask the Secretary of State for Education and Employment if he will list those areas for which(a) the New Deal Gateway and (b) one or more New Deal options are delivered entirely by private sector providers; and if he will list monthly expenditure and client outcomes for each of these private sector providers up to the latest date for which the figures are available. [63275]
  523
  Mr. Andrew Smith
  [holding answer 14 December 1998]: There are no areas where the New Deal Gateway is delivered entirely by private sector providers although in ten Units of Delivery the New Deal is private sector led. These are: Leicester, Colchester, West Lancashire, Exeter and East Devon, South Humber, North Tyneside, Forth Valley, Hackney and City, Solihull and Bridgend. Client outcomes for these are shown in the table. These figures are GSS from January to October 1998 and provisional Management Information for November 1998.

  Unsubsidised placings

  Number joining the Employment Option

  Leicester

  413

  27

  Colchester

  376

  19

  West Lancashire

  84

  12

  Exeter and Devon

  234

  32

  South Humber

  539

  4

  North Tyneside

  130

  42

  Forth Valley

  226

  66

  Hackney and City

  460

  35

  Solihull

  93

  19

  Bridgend

  317

  151

  Whilst I am unable, for reasons of commercial confidentiality, to provide details of payments to individual contractors, we will be reporting later this year on the overall financial performance of all Units of Delivery, including these ten private sector led areas as part of our continuous improvement agenda. This will include as a core performance measure the unit cost of placing a New Deal client into a job in each of the Units of Delivery.

  Mr. Hancock
  To ask the Secretary of State for Education and Employment how many people have entered the New Deal Gateway in the Unit of Delivery covering Havant Borough Council area since its inception; and how many took up each New Deal option. [66367]

  Mr. Andrew Smith
  The latest Government Statistical Service figures for the Portsmouth and South East Hampshire Unit of Delivery, which covers Havant, show that to the end of October 1998(a) 1,229 young people had entered the Gateway and 217 had secured unsubsidised employment (b) 307 had joined one of the four options: 49 on the Employment option; 35 on the Voluntary Sector option; 10 on the Environment Task Force; and 213 on the Full-Time Education and Training option. 506 young people were still at the initial stage of New Deal support through Gateway, 32 had left New Deal to claim other benefits, 33 had gone to other known destinations and 134 had gone to unknown destinations.

  Mr. Hancock
  To ask the Secretary of State for Education and Employment how many people have entered the New Deal Gateway in the Unit of Delivery covering the New Forest District Council area since its inception; and how many took up each New Deal option. [66368]

  Mr. Andrew Smith
  The latest Government Statistical Service figures for the Southampton and South West Hampshire Unit of Delivery, which covers the New Forest, show that to the end of October 1998(a) 820 young people had entered the Gateway and 162 had secured unsubsidised employment (b) 178 had joined one of the four options:
  524
  37 on the Employment option; 25 on the Voluntary Sector option; 18 on the Environment Task Force; and 98 on the Full-Time Education and Training option. 316 young people were still at the initial stage of New Deal support through Gateway, 27 had left New Deal to claim other benefits, 32 had gone to other known destinations and 105 had gone to unknown destinations.

  Ms Rosie Winterton
  To ask the Secretary of State for Education and Employment how many young unemployed people aged 18 to 25 years in Doncaster, Central have to date gained new skills from their participation in the New Deal programme. [66562]

  Mr. Andrew Smith
  Statistics from the New Deal are not available for individual constituencies.

  The latest Government Statistical figures to the end of October 1998, including the provisional Management Information to the end of November 1998, show that for the Wakefield and Doncaster Unit of Delivery, which covers the Doncaster Central area, 3,015 young people aged between 18–24 have already entered the New Deal Gateway. 961 young people have joined one of the four options and each participant on a New Deal option will work towards an NVQ or equivalent qualification which will assist them in gaining a new skill and increasing their prospects for sustainable employment.

  Outdoor Education
  Mr. Pike
  To ask the Secretary of State for Education and Employment what representations he has received on the subject of outdoor education; what changes he proposes to make in the provision and funding of such education; and if he will make a statement. [66485]

  Ms Estelle Morris
  Under the new maintained school funding system which takes effect from April 1999, local education authorities will be able to retain funding centrally to support outdoor education centres, as they have been able to do under present arrangements for Local Management of Schools. This reflects representations from Local Education Authorities and others following the publication last year of the consultation paper "Fair Funding".

  The Government is also committed to increasing the range of opportunities that young people have to take part in learning activities outside school hours. To this end, we are making £180 million of Lottery money available across the UK through the New Opportunities Fund to support such activities. The draft application guidance produced by the New Opportunities Fund includes adventurous outdoor activities among those which may be eligible for funding. The New Opportunities Fund will be formally inviting applications later in the Spring.

  School Performance
  Mr. Chaytor
  To ask the Secretary of State for Education and Employment what conclusions he has drawn from his Department's internal investigations of the relationship between socio-economic factors and school performance; and if he will place a copy of results of these investigations in the Library. [66602]
  525
  Ms Estelle Morris
  [holding answer 20 January 1999]: Historically, there has been a strong statistical relationship between socio-economic factors and school performance. This does not mean, however, that poverty can be used to excuse poor results.

  The Autumn Package of performance data, which was distributed in November last year, contains detailed information on national results and the performance of schools within similar bands of Free School Meals. The Package shows what is possible: many schools in the highest Free School Meals band can be seen to perform better than some of the schools in the lowest band.

  The Government are committed to raising standards in all schools. For example, we are ensuring that successful schools better share good practice. The beacon school initiative and the new Standards Site on the Internet encourage and enable schools to learn about "what works", regardless of the socio-economic context in which individual schools are located.

  We have placed a copy of the Autumn Package in the Library. It is also available via the Internet. The address is: http://www.standards.dfee.gov.uk/library/publications.

  Ethnic Monitoring
  Mr. Chaytor
  To ask the Secretary of State for Education and Employment (1) what plans he has to introduce quality assurance procedures within Section 11-funded adult education; [66608]

  (2) what guidance he has issued to local education authorities relating to the means by which existing Section 11-funded adult education will be protected following the introduction of ethnic minority achievement grants; [66610]

  (3) if he will ensure that, within the new administrative arrangements for ethnic minority achievement grants, the level of existing funding of adult education within each participating local education authority is ring-fenced before the retained and devolved proportions of the authority's allocations are set. [66609]

  Mr. Charles Clarke
  The Department's letter of 12 November 1998 to Chief Education Officers set out details of the new Standards Fund Ethnic Minority Achievement Grant. Subject to the receipt of good action plans, local education authorities will receive broadly the same allocations for the support of ethnic minority education in 1999–2000 as the Home Office provided under section 11 in 1998–99, including that element for adult education.

  The Department's letter also set out the arrangements whereby up to 15 per cent. of allocations, or £150,000 whichever was the greater, might be held back to provide central services including adult education. This should be satisfactory for the vast majority of Authorities. However, my right hon. Friend the Secretary of State will consider carefully, and on their merits, any cases which an Authority might make reflecting historically heavy investment in adult education.

  LEAs are required to ensure that all Standards Fund grants are spent for the purpose for which they are paid and to monitor the quality of provision. In addition, the Department monitors and evaluates all Standards Fund expenditure.
  526

  Teachers (Unfair Discrimination)
  Mr. Dalyell
  To ask the Secretary of State for Education and Employment, pursuant to the letter of 27 August (EM CC/614/2044) to the hon. Member for Linlithgow, what interim results he has received in respect of the non-statutory code of practice on unfair discrimination on grounds of age in the teaching profession. [65404]

  Mr. Charles Clarke
  The draft Code of Practice we have been developing with key external partners was published for wider consultation, including amongst those with responsibilities for the employment of teachers, in November 1998. We were very pleased with the wide interest the Code prompted, with over 9,000 copies being distributed. The consultation ended on 8 January 1999 and we are currently analysing the responses. The analysis will be published in due course and the final version of the Code will be launched in the Spring.

SOCIAL SECURITY

  Pensions
  Mr. Cousins
  To ask the Secretary of State for Social Security if, pursuant to the answer given to the right hon. Member for Birkenhead (Mr. Field) on 12 January 1999,Official Report, column 152, he will state (a) the assumptions about the growth of the minimum income guarantee relative to prices and earnings and (b) the number and proportion of state second pensioners who will be receiving the pensioners' minimum income guarantee in the years up to 2050. [66469]

  Mr. Timms
  Information is not available in the form requested. Such information as is available is as follows.

  It is assumed that, from the announced rates for April 1999, the Minimum Income Guarantee is uprated in line with the growth in average earnings (assumed to be 1.5 per cent. per year more than the growth in prices).

  Estimates are not available of the number of pensioners who would be receiving payments of state second pension in future years. Overall, estimates taken from the PENSIM model suggest that under the new insurance contract for pensions approximately 1 in 4 pensioner units (2.5 million) would receive income from the Minimum Income Guarantee in 2050, and a lower proportion in years after 2050.

  Projections forward to the year 2050 are subject to a high degree of uncertainty, given the number of assumptions in making them. Some of those who will be pensioners in 2050 have yet to begin work, and most are today in their 20s and 30s.

  Estimates made by extrapolating projections from the PENSIM model can give only a broad indication of the likely order of magnitude of figures so far into the future.

  Mr. Cousins
  To ask the Secretary of State for Social Security if he will estimate the savings in income support or minimum pensioner income guarantee payments each year after 1 April 1999 till 1 April 2007 arising from the introduction of pensions splitting. [66462]
  527
  Mr. Timms
  The information is not available in the form requested. Such information as is available is as follows.

  Legislation to enable pensions to be shared at the time of divorce will be included in the forthcoming Welfare Reform Bill.

  The financial implications of pension sharing are uncertain, and will depend on the number of spouses who obtain a pension share and the percentage of pension which is transferred. Current estimates are based on the assumption that there could be from 35,000 to 65,000 cases per year, with a central assumption of 50,000. All estimates made are also dependent on a large number of other assumptions and should be considered illustrative.

  It is expected that any impact on the minimum income guarantee will initially be small, as income support entitlement will not be altered until a pension share comes into payment. As most divorces take place before the age of 40, it is likely that, in most cases, there will be a significant time lapse between a pension share being made and income being received from the pension. Broad estimates of the impact 20 years after implementation suggest that, using the central assumption of 50,000 pension shares per year, pension sharing on divorce could lead to a saving on all income related benefits of around £10 million (within a range of £0—£30 million using alternative assumptions).

  Social Fund
  Mr. Wigley
  To ask the Secretary of State for Social Security if he will extend Direction 25 of the Social Fund to include 16 to 18-year-olds who are on a youth training placement. [66156]

  Angela Eagle
  It is not appropriate to extend Direction 25 to include 16–18 year olds on youth training placements. Payments from the Discretionary Social Fund are made from a cash limited budget and available resources must be targeted on those most in need of help. Eligibility for Social Fund Community Care Grants is therefore restricted by Direction 25 to those entitled to Income Support or income based Jobseeker's Allowance.

  Provision already exists to allow vulnerable 16–17 year olds to receive Income Support and income-based Jobseeker's Allowance and, in turn, access to Community Care Grants.

  Disabled People
  Mr. Oaten
  To ask the Secretary of State for Social Security if he will place in the Library a copy of the responses his Department has received following the consultation process for the paper, "A New Contract for Welfare: Support for Disabled People". [66828]

  Mr. Bayley
  I refer the hon. Member to the Written Answer I gave to my hon. Friend the Member for Salford (Ms Blears) on 19 January 1999,Official Report, column 402.

DEFENCE

  Portsmouth Naval Base
  Mr. Hancock
  To ask the Secretary of State for Defence what evaluation he has made of the use of space and the state of the equipment in COB2 building at the Portsmouth Naval Base. [66178]

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

  Letter from J. A. Trewby to Mr. Michael Hancock, dated 21 January 1999:
  The Secretary of State for Defence has asked me to reply to your Question on what evaluation he has made of the use of space and the state of the equipment in Central Office Block 2 (COB2) building at HM Naval Base Portsmouth, as this falls within my areas of responsibility.
  COB2 is an office administration building. A study was completed in 1997 which showed that the building's usage conformed with Departmental Standards for space utilisation. The equipment in the building compromises of normal office equipment, ie. computers, telephones, and service equipment such as lifts and lights. These are regularly maintained and updated as requirements demand.

  Submarines
  Mr. Hancock
  To ask the Secretary of State for Defence what is the displacement of the Vanguard class of submarines. [66172]

  Mr. Spellar
  The displacement of Vanguard class submarines, when submerged, is about 16,000 tons.

  Mr. Hancock
  To ask the Secretary of State for Defence what is the anticipated hull life of the Trafalgar class of submarines. [66667]

  Mr. Doug Henderson
  The initial design life of Trafalgar class submarine hulls was 25 years, although there is sufficient margin to extend the life of the submarines as necessary, subject to monitoring to ensure the continuing safety of the submarines.

  Project Horizon Ships
  Mr. Hancock
  To ask the Secretary of State for Defence what is the expected average time between major refits for Project Horizon ships. [66665]

  Mr. Spellar
  The maintenance philosophy for CNGF is based on a continuous process of repair and update. It is expected that the length of upkeep periods will be reduced, scheduled maintenance will be minimised, and the docking period will be extended to five years. There will be no major refits, but there will be four docking periods, of six months each, at five year intervals during the planned 25 year life of the ship.

  Commercial Lobbyists
  Mr. Flynn
  To ask the Secretary of State for Defence what rules or guidance his Department has to govern the(a) formal and (b) informal interaction between his civil servants and commercial lobbyists. [66204]
  529
  Mr. Spellar
  I refer my hon. Friend to the answer given by my right hon. Friend the Prime Minister on 27 July 1998,Official Report, column 4, to my hon. Friend the Member for Pendle (Mr. Prentice).

  Uranium
  Ms Drown
  To ask the Secretary of State for Defence what representations his Department has received requesting the use of its uranium stocks for cancer research, with particular reference to the detection and treatment of cancer; what response his Department gave; and what factors underlay this response. [66487]

  Mr. Doug Henderson
  [holding answer 19 January 1999]: The Department of Trade and Industry asked my Department last year if we could provide highly enriched uranium, HEU, from defence stocks for use by the United Kingdom Atomic Energy Authority (UKAEA) to produce medical radioisotopes.

  UK defence requirements for HEU were considered in detail in the Strategic Defence Review, which concluded that any material not required for nuclear weapons purposes would be needed for the nuclear propulsion programme. Therefore, as we stated in the Strategic Defence Review (SDR) White Paper, the MOD holds no surplus stocks of HEU. We were, as a result unable to accede to the Department of Trade and Industry's request. We were, however, able to provide advice on a possible alternative source of HEU.

  Codes of Conduct
  Mr. Keith Simpson
  To ask the Secretary of State for Defence (1) when he intends to publish a revised code of conduct on ethics and discipline for the Royal Air Force; [66746]

  (2) when he intends to publish a revised code of conduct on ethics and discipline for the Army; [66747]

  (3) when he intends to publish a revised code of conduct on ethics and discipline for the Royal Navy. [66748]

  Mr. Doug Henderson
  As I explained in my previous answer on 14 January 1999,Official Report, column 269, each of the Services has its own procedure for providing information and guidance on matters relating to conduct and discipline within its individual Service environment. The Army and the Royal Air Force are currently revising and updating their current codes of conduct. When this work is complete, I will write the hon. Member and a copy of my letter will be placed in the Library of the House.

  There are no immediate plans to publish a revised code of conduct for the Royal Navy.

  Outstanding Compensation Cases
  Mr. Keith Simpson
  To ask the Secretary of State for Defence how many outstanding legal cases are pending against his Department on grounds of(a) equal opportunities, (b) racial discrimination, (c) homosexuality and lesbianism, (d) post-traumatic stress syndrome and (e) physical injury. [66743]
  530
  Mr. Spellar
  The available information requested relating to the number of outstanding compensation cases being pursued against my Department, whether in litigation or not, by employees, former employees and members of the public as at 20 January 1999 is set out:

  Number

  (a) Sex discrimination, sexual harassment and equal pay claims submitted by Service and former Service personnel to Employment Tribunals

  138

  (b) Racial discrimination and harassment claims submitted by Service and former Service personnel to Employment Tribunals

  116

  (c) Homosexuality and lesbianism cases submitted by Service and former Service personnel to Employment Tribunals

  172

  (d) Post-traumatic stress disorder

  155

  (e) Physical injury

  23,716

  1 These figures exclude claims from MOD civilian and former civilian staff as the information is not held centrally.

  2 This figure excludes personal injury claims from members of the public being handled by MOD claims officers overseas as the information is not held centrally. Medical negligence claims and third party personal injury claims relating to road traffic accidents have also been excluded. Claims in respect of disease (e.g. asbestosis, mesothelioma) have been included but claims relating to psychiatric illness have been excluded.

  HMS Invincible
  Mr. Hancock
  To ask the Secretary of State for Defence what has been the interval between major refits for HMS Invincible. [66666]

  Mr. Doug Henderson
  HMS Invincible has undergone one refit. It took place some six years after she entered service with the Royal Navy.

  RAF Manston, Kent
  Mr. Mackinlay
  To ask the Secretary of State for Defence on what occasions RAF Manston, Kent, has been used by private freight aircraft in(a) 1997 and (b) 1998; what cargo they carried; and if he will make a statement. [66629]

  Mr. Doug Henderson
  [holding answer 20 January 1999]: My Department does not record the information requested. Kent International Airport (KIA), a private company, operates from an enclave of leased land within the airfield site of RAF Manston and is responsible for all flight planning, acceptance of aircraft movements, handling and refuelling, loading and unloading.

  Chief of Defence Personnel
  Mr. Keith Simpson
  To ask the Secretary of State for Defence what plans he has to establish the post of Chief of Defence Personnel. [66744]

  Mr. George Robertson
  I have no current plans to establish a post of Chief of Defence Personnel.

  Territorial Army
  Mr. Hoyle
  To ask the Secretary of State for Defence what is the net effect of the review of the Territorial Army on the number of(a) TA centres and (b) TA units in North Wales. [65017]
  531
  Mr. Doug Henderson
  Prior to the Strategic Defence Review there were seven Territorial Army Centres and five Territorial Army company-sized units in North Wales, plus a battalion Headquarters. As a result of the re-structuring there will be five Territorial Army Centres and four Territorial Army company-sized Units, plus a battalion Headquarters.

  Mr. Hoyle
  To ask the Secretary of State for Defence what proportion of the strength of the TA prior to the Strategic Defence Review will remain after implementation of the Strategic Defence Review in(a) the North West of England and (b) North Wales. [65023]

  Mr. Doug Henderson
  75 per cent. of TA strength will remain in the North West after the implementation of the findings of the Strategic Defence Review. 72 per cent. will remain in North Wales.

  Atomic Test Veterans
  Mr. Llew Smith
  To ask the Secretary of State for Defence if he will commission a re-assessment of the work of Dr Sue Rabbitt Roff, at the centre for medical education at Dundee University, on the causation of cancers in British atomic test veterans. [66431]

  Mr. Spellar
  No. My Department has made clear on a number of occasions its reservations about the work of Ms Rabbitt Roff and the conclusions reached. Nevertheless, consideration is being given to researching further the incidence of multiple myeloma among our nuclear test veterans and we have asked Ms Rabbitt Roff for access to her data. Any such research will be carried out by the National Radiological Protection Board but the results, which would be subject to external peer review, would be unlikely to be available until the latter half of next year.

  101 Battalion REME (Chorley)
  Mr. Hoyle
  To ask the Secretary of State for Defence what consultations his Department had with North West and Isle of Man TAVRA on the move of HQ 101 Battalion REME from Chorley to Queensferry. [65012]

  Mr. Doug Henderson
  North West and Isle of Man TAVRA were consulted on the move of Headquarters 101 Battalion REME from Chorley to Queensferry during the consultation process which took place at Headquarters Land Command in October.

  Mr. Hoyle
  To ask the Secretary of State for Defence, pursuant to his answer of 7 December 1998,Official Report, column 54, concerning the cost of transferring 101 REME Battalion HQ, if he will define significant financial costs. [65016]

  Mr. Doug Henderson
  These are costs of an order likely to influence the decision to relocate the unit.

CULTURE, MEDIA AND SPORT

  Dome (Sponsorship)
  Mr. Syms
  To ask the Secretary of State for Culture, Media and Sport if he will make a statement on the total amount of sponsorship which he forecasts will be available for the Dome. [65228]
  532
  Janet Anderson
  The New Millennium Experience Company's target is to raise £150 million of sponsorship support. The Company announced, last November, confirmed sponsorship of £120 millio—or 80 per cent. of that total. The NMEC are in detailed negotiations for a further £15 million.

  Festival Fund
  Mr. Ben Chapman
  To ask the Secretary of State for Culture, Media and Sport if he will ensure that there is sufficient help and advice from the millennium festival on funding applications for regional and local events and activities to the Millennium Festival fund. [65229]

  Janet Anderson
  The Millennium Festival is a partnership initiative between the Lottery Distribution bodies in England, Scotland, Wales and Northern Ireland and the New Millennium Experience Company. It aims to give as many people as possible financial and other support for events and activities within their communities during 2000. Promotional and administrative support for the Festival is provided by NMEC's twelve country-wide offices. Staff in those offices are available to advise anyone who is interested in the Millennium Festival and I have today placed contact details in the Libraries of the House.

  The funding round for larger awards—over £5,000—which opened on 5 May 1998 has now closed. Decisions on the Awards will be announced in February 1999. The funding round for smaller community schemes—seeking between £250 and £5,000—will open in the spring of 1999.

  Ferry Passengers
  Mr. Robathan
  To ask the Secretary of State for Culture, Media and Sport what estimate he has made of the number of people who will travel to the Millennium Dome by ferry. [65230]

  Janet Anderson
  The New Millennium Experience Company estimates that about 1 million out of the estimated 12 million visitors to the Dome will arrive by boat from central London and by the shuttle service from historic Greenwich.

  Visitors
  Mr. Pike
  To ask the Secretary of State for Culture, Media and Sport what estimate he has made of the maximum number of visitors which the millennium site could handle on any one day. [65232]

  Janet Anderson
  Actual daily numbers will depend on the New Millennium Experience Company's policy regarding the number of tickets on sale for each day, on visitor safety and comfort, and on necessary approvals from the relevant authorities. The present estimate is for a maximum of 35,000 on those occasions when the Millennium Experience opens during daytime; on those occasions where the Millennium Experience is open during the daytime and the evening, the number of visitors is estimated at 55,000.

  Mr. Luff
  To ask the Secretary of State for Culture, Media and Sport what is his most recent estimate of the number of daily visitors to the dome and the proportion of the visitors who will arrive by underground train service. [65234]
  533
  Janet Anderson
  I refer the hon. Member to the answer I gave to my hon. Friend the Member for Burnley (Mr. Pike) on 21 January 1999,Official Report, column 532. The number of visitors estimated to arrive at the Dome site by underground train is about 55 per cent.

  National Lottery
  Mr. Canavan
  To ask the Secretary of State for Culture, Media and Sport what proportion of the total public and national lottery expenditure on the millennium celebrations will be spent on the dome at Greenwich. [65233]

  Janet Anderson
  The Millennium Commission has awarded a grant of £449 million (gross) to the Millennium Experience project, which incorporates the Dome at Greenwich and a linked comprehensive programme of events and activities around the country. This represents 20 per cent. of the Millennium Commission's total funds. The remaining 80 per cent. has been distributed to a wide range of projects around the UK. The New Millennium Experience Company has received, and will receive, no public funds from the Exchequer for the project.

  Sponsorship
  Mr. Amess
  To ask the Secretary of State for Culture, Media and Sport what recent representations he has received on sponsorship of the Millennium Experience. [65231]

  Janet Anderson
  As shareholder of the New Millennium Experience Company, my right hon. Friend the Member for Hartlepool (Mr. Mandelson), the former Secretary of State for Trade and Industry, received many representations from members of the public and from Members of this House about all aspects of the Millennium Experience project, including sponsorship.

  Millennium Landmark Projects
  Mr. Hancock
  To ask the Secretary of State for Culture, Media and Sport how much money has been paid out to date for each of the Millennium Landmark projects. [66672]

  Mr. Chris Smith
  This is a matter for the Millennium Commission. I shall write to the hon. Member in my capacity as Chairman of the Commission and place copies of my reply in the Libraries of the House.

  Commercial Lobbyists
  Mr. Flynn
  To ask the Secretary of State for Culture, Media and Sport what rules or guidance his Department has to govern the(a) formal and (b) informal interaction between his civil servants and commercial lobbyists. [66208]

  Mr. Chris Smith
  I refer my hon. Friend to the reply given by my right hon. Friend the Prime Minister on 27 July 1998,Official Report, column 4, to my hon. Friend the Member for Pendle (Mr. Prentice).

  Hotels (Rating System)
  Mr. Hoyle
  To ask the Secretary of State for Culture, Media and Sport what account is given of value for money in the accreditation of crowns on a quality rating system for hotels. [66896]
  534
  Janet Anderson
  Rating assessments under both the English Tourist Board's current crown scheme and the new harmonised accommodation rating scheme are made on the range of facilities and level of services appropriate to each type of accommodation and not specifically on their value for money. Under the new harmonised scheme for serviced accommodation in England, hotels are given a rating of 1 to 5 stars covering the whole visitor experience (e.g. quality, level of services and range of facilities) and guest accommodation is rated entirely on quality, using 1 to 5 diamonds. The ETB, the AA and the RAC are currently carrying out inspections against the new harmonised scheme, which will be launched to customers later this year.

  Tourism (North West)
  Mr. Hoyle
  To ask the Secretary of State for Culture, Media and Sport if he will estimate the annual revenue of the tourism industry in the North West for the last five years. [66898]

  Janet Anderson
  Estimated figures for annual expenditure in the North West Tourist Board region from 1993 to 1997 by tourists from the UK staying at least one night and by tourists from overseas are shown in the table. Figures for spending by UK residents on tourism day visits to the North West Tourist Board region are available only for 1996 and show an estimated £2,800 million for that year (Source: the UK Day Visits Survey).

  £ million

  1993

  1994

  1995

  1996

  1997

  Domestic tourism

  860

  995

  1,060

  1,020

  1,000

  Tourism from overseas

  287

  371

  331

  381

  455

  Total (rounded)

  1,147

  1,366

  1,391

  1,401

  1,455

  Sources:

  UK Tourism Survey (domestic tourism), International Passenger Survey (tourism from overseas).

  North West Tourist Board
  Mr. Hoyle
  To ask the Secretary of State for Culture, Media and Sport what assessment he has made of the value of the North West Tourist Board. [65988]

  Janet Anderson
  [holding answer 18 January 1999]: My Department has made no specific assessment of the North West Tourist Board, which, like the other regional tourist boards, is an independent commercial organisation. However, I fully recognise the important work that the Board does to promote, develop and raise the profile of tourism in its region. I am pleased to say that I am opening the Great Days Out Fair in Bolton on 20 February.

  Football Task Force
  Mr. Love
  To ask the Secretary of State for Culture, Media and Sport if he will extend the terms of reference of the Football Task Force to allow it to investigate the administration of professional football. [65061]

  Mr. Banks
  I expect the governing bodies to address issues relating to the administration of professional football and I urge them to take an early opportunity to review current structures and procedures. The Football Task Force has provided valuable advice in a number of
  535
  reports and I will give careful consideration to any arrangements that may follow the conclusion of its original remit.

TREASURY

  Transport Companies (Millennium Insurance)
  Miss McIntosh
  To ask the Chancellor of the Exchequer what representations he has received on the ability of transport companies to obtain insurance cover to operate services on 1 January 2000; and if he will make a statement. [65217]

  Ms Hewitt
  None.

  Paymaster General
  Mr. Gibb
  To ask the Chancellor of the Exchequer if he will list the changes made to the responsibilities of the Paymaster General since publication of the list of Ministerial Responsibilities in October 1998. [64490]

  Mr. Gordon Brown
  The Paymaster General, my hon. Friend the Member for Bristol, South (Dawn Primarolo) has a portfolio with responsibilities which include the Inland Revenue, Customs and Excise, tax and the Finance Bill.

FOREIGN AND COMMONWEALTH AFFAIRS

  United Kingdom Overseas Territories
  Mr. Colvin
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he expects to publish his White Paper on the United Kingdom overseas territories; and if he will make a statement. [66625]

  Mr. John M. Taylor
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he intends to publish the White Paper on British Overseas Territories. [66697]

  Mr. Tony Lloyd
  We expect that the White Paper will be published soon.

  Yemen
  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) when a representative of the British Embassy in Yemen first met with a member of the Yemeni Government to discuss the five detained British citizens; [66686]

  (2) what representations were made to the Yemeni Government between the kidnapping of the hostages on 28 December and their death on 29 December; and what response was received from the Yemeni Government. [66688]

  Mr. Fatchett
  I refer my hon. Friend to the statement given to the House by my right hon. Friend the Foreign Secretary on 11 January 1999,Official Report, columns 21–34.

  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs when(a) he and (b) a Foreign and Commonwealth Office minister first spoke to a member of the Yemeni Government to discuss the situation in Yemen. [66687]
  536
  Mr. Fatchett
  (a) My right hon. Friend the Foreign Secretary first discussed events in Yemen by phone with the Yemeni Prime Minister, Dr. Iriyani, on 9 January. (b) The Minister of State for Foreign and Commonwealth Affairs, my right hon. Friend the Member for Gateshead, East and Washington, West (Ms Quin), called on the Yemeni Ambassador on 1 January.

  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of Yemen's application to join the Commonwealth. [66689]

  Mr. Tony Lloyd
  At their meeting in Edinburgh in October 1997, Commonwealth Heads of Government decided to keep Yemen's application to join the Commonwealth under review.

  Mr. Vaz
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans his Department's ministers have to visit Yemen. [66690]

  Mr. Fatchett
  We have no current plans to visit Yemen.

  Gibraltar (Spanish Fishing Boats)
  Dr. Marek
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to send a fisheries protection vessel to Gibraltar to reinforce the protection of British waters from unlawful incursions by Spanish fishing boats. [66246]

  Ms Quin
  [holding answer 19 January 1999]: This situation remains under review. The deployment of a fisheries protection vessel, to aid in calming the situation in British waters around Gibraltar, remains one of a number of options we are considering.

  Chechnya
  Mrs. Browning
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) when the British Embassy in Moscow learnt of the Interfax report of 6 December 1998 that a rescue attempt was to be made to release the hostages in Chechnya, employed by Granger Telecom; [66958]

  (2) when his Department in London learned of the BBC World Service report from the Caversham Monitoring Service that Interfax had reported that a rescue attempt was to be made to release the hostages in Chechnya employed by Granger Telecom. [66959]

  Mr. Tony Lloyd
  On 7 December 1998, HM Embassy Moscow saw the Interfax news agency dispatch reporting Chechen assertions that the men were being held outside Chechnya and that Russian law-enforcement agencies might try to rescue the hostages.

  Mrs. Browning
  To ask the Secretary of State for Foreign and Commonwealth Affairs if the advice he has placed in the Library in respect of people travelling to Chechnya was issued to individual visa applicants employed by Granger Telecom or was issued to the company that employed them. [66960]

  Mr. Tony Lloyd
  The FCO travel advice for Russia, now in the Library, was shown to Granger Telecom management at a meeting with FCO officials on 21 August 1998. Granger Telecom have confirmed to FCO officials that, as a result of that meeting and the
  537
  advice given, Granger management re-consulted their staff about their willingness to work in Chechnya. The FCO was not made aware of individual visa applications to the Russian Embassy.

  Mrs. Browning
  To ask the Secretary of State for Foreign and Commonwealth Affairs if the advice given to travellers visiting Chechnya is the same as that given to people intending to work there. [66961]

  Mr. Tony Lloyd
  Since 7 December 1994, we have advised British nationals not to travel to Chechnya. The travel advice is the same for visiting travellers and for British people intending to work there.

  Iran
  Mr. Dalyell
  To ask the Secretary of State for Foreign and Commonwealth Affairs what requests he has received from the Government of Iran for compensation for a stray missile which landed in or near the Iranian city of Khorramshahr [65400]

  Mr. Fatchett
  We have received a request for compensation from the Government of the Islamic Republic of Iran in respect of a stray missile that landed in or near the town of Khorramshahr.

  No missiles were fired by UK forces in the course of Operation Desert Fox. Questions relating to the circumstances of individual missile attacks and any subsequent claims for compensation are therefore a question for the US authorities.

  European Communities Working Groups
  Mr. Maclean
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many reports were submitted by European Communities working groups during the United Kingdom presidency; and if he will list them. [66374]

  Ms Quin
  During the UK Presidency approximately 6,700 documents with official document numbers were submitted by working groups. As agreed during our Presidency, from 1 January 1999, details of all documents will be listed on the Council's website, at http://ue.eu.int.

  Mr. Maclean
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many working groups have been established at European Community level; what is the average number of meetings held each year; if he will list the 20 groups which met most frequently over 1998; and if he will indicate the level of United Kingdom participation at each of them. [66364]

  Ms Quin
  In 1998, 262 working groups met in Brussels, and a total of 2,138 meetings were held. The level of UK participation at each working group varied according to the subject discussed. According to the Council Secretariat, the twenty working groups which met most frequently were:Enlargement, Orient and Central Asia, Central Europe, Mashrak/Maghreb, Development, Oceania, Latin America, Balkans, CFSP Counsellors, Friends of the Presidency, Budgetary, Structural Actions, Financial Questions, Jurist Linguists, Environment, Social Questions, Telecoms, Research, Agriculture, Vetinary.

  European Commission
  Mr. Maclean
  To ask the Secretary of State for Foreign and Commonwealth Affairs what was the age of the target audience for the European Commission booklet, "The Raspberry Ice Cream War"; what was the aim of the booklet; how many copies have been distributed in the EU; and if he will make a statement. [66393]

  Ms Quin
  The European Commission booklet "The Raspberry Ice-Cream War" was written for young people. The aim of the booklet was to explain the advantages of European co-operation in the form of an adventure story. Information on how many copies have been distributed in the EU is not available.

  Franco-German Summit
  Mr. Maclean
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the implications for the United Kingdom of the resolution at the Franco-German meeting at Potsdam to establish a binational working group on national sovereignty. [66344]

  Ms Quin
  We are not aware of any such resolution at the Franco-German Summit in Potsdam. The joint declaration issued at the end made no reference to it.

ATTORNEY-GENERAL

  Crown Prosecutors
  Sir Nicholas Lyell
  To ask the Attorney-General what are the salary bands for the Chief Crown Prosecutor for London and for each of the CPS areas. [66573]

  The Attorney-General
  The salary bands for the 42 Chief Crown Prosecutor posts are linked to the likely job dimension. Relevant factors include anticipated caseload, budget responsibility and numbers of staff. The table sets out in relation to each of the 42 Areas the relevant pay band, together with the estimated bracket for caseload, budget and staff numbers.

  Chief Crown Prosecutors: Job dimensions

  Area

  Salary range

  Likely job dimensions

  Band 5

  London

  £54,230–90,400

  Budget: £50m+

  Staff numbers: 800+

  Total caseload: 200,000+

  Band 4

  Greater Manchester

  £49,130–80,400

  Budget: £10–15m

  West Midlands

  Staff numbers: 200–300

  West Yorkshire

  Total caseload: 65,000–100,000

  Band 3

  Merseyside

  £44,560–71,470

  Budget: £6–10m

  Lancashire

  Staff numbers: 140–200

  Northumbria

  Total caseload: 40,000–65,000

  South Wales

  Hampshire

  Band 2

  Thames Valley

  £40,430–63,490

  Budget: £2.5–7m

  South Yorkshire

  Staff numbers: 65–140

  Devon & Cornwall

  Total caseload: 20,000–50,000

  Kent

  Nottinghamshire

  Avon & Somerset

  Essex

  Cheshire

  539

  Chief Crown Prosecutors: Job dimensions

  Area

  Salary range

  Likely job dimensions

  Staffordshire

  Leicestershire

  West Mercia

  Sussex

  Humberside

  Derbyshire

  Cleveland

  Band 1

  North Yorkshire

  £33,456–54,323

  Budget: £l–3.5m

  Hertfordshire

  Staff numbers: 30–65

  North Wales

  Total caseload: 9,000–20,000

  Norfolk

  Gwent

  Dyfed-Powys

  Northamptonshire

  Surrey

  Cambridgeshire

  Dorset

  Durham

  Cumbria

  Bedfordshire

  Suffolk

  Gloucestershire

  Lincolnshire

  Wiltshire

  Warwickshire

  Sir Nicholas Lyell
  To ask the Attorney-General if he will list the Chief Crown Prosecutors for London and the 42 police areas who are currently in post; and if he will list those areas where appointments have not yet been made. [66574]

  The Attorney-General
  An open competition is at present in progress to select a Chief Crown Prosecutor for each of the proposed 42 CPS areas. Following advertisement in the national and legal press in the week commencing 16 November 1998, a selection board is at present interviewing those candidates selected for interview. Appointments will be offered to the successful candidates at the conclusion of this process and they will be invited to take up their posts in April 1999.

HOUSE OF COMMONS

  Overseas Telephone Calls
  Dr. Lynne Jones
  To ask the Chairman of the Information Committee if he will list the(a) average annual expenditure on overseas telephone calls per hon. Member and (b) greatest amount spent by an hon. Member in each of the last three years for which information is available; and what the annual administrative cost is of collecting payment for these calls. [66567]

  Mr. Allan
  The average annual expenditure for hon. Members for overseas calls for 1998 was £29.31. The greatest amount spent by an hon. Member in the preceding three years is £127.31 (1996), £403.51 (1997) and £1,289.90 (1998). The annual administrative cost of collecting payment for these calls is estimated to be £13,000 (excluding any administrative costs incurred by the Member).

PRIME MINISTER

  Cross-party Co-operation
  Mr. Gordon Prentice
  To ask the Prime Minister what assessment he has made of the advantages and disadvantages of involving hon. Members from the Liberal Democrat Party in the development of Government policy on matters relating to access to the countryside. [66404]

  The Prime Minister
  [holding answer 18 January 1999]: I refer my hon. Friend to the answer I gave him on 20 January 1999, Official Report, columns 483–84.

  Iraq
  Mr. Dalyell
  To ask the Prime Minister, pursuant to his letter of 13 January to the hon. Member for Linlithgow, what was the outcome of discussions with(a) EU partners and (b) Security Council colleagues about making more effective arrangements for alleviating the suffering of the Iraqi people. [66491]

  The Prime Minister
  [holding answer 19 January 1999]: Discussions are still continuing with EU partners on all aspects of Iraq policy, including ways to alleviate the suffering of the Iraqi people, on which we have made a number of proposals to the Presidency. The General Affairs Council will consider these matters further on 25 January. Following discussions in the Security Council on 14 January, the President of the Council reported that members had discussed the need to improve the humanitarian programme and looked forward to a full report from the UN Secretary General on how this might be achieved.

  However, it is important that these issues are put into context. Saddam Hussein has proven time and again that he is not prepared to provide adequately for his people's welfare. He has refused shipments of humanitarian aid, prevaricated over distribution plans for the "oil for food" programme, smuggled oil illegally out of Iraq for his own benefit and tried to sell wheat and barley to other countries at low prices, while complaining that his people are starving. The UN Special Rapporteur holds Baghdad responsible for the precarious food and health situation in Iraq. We are determined to do what we can to ease the suffering of the Iraqi people in the face of such neglect by their leader.

  Government Agencies
  Mr. Peter Bottomley
  To ask the Prime Minister if he will make it his policy that Government agencies which choose not to pay costs ordered by a court at the end of a case must report the detailed circumstances and the reasons for any refusal to his office. [66872]

  The Prime Minister
  Government agencies are bound by Orders of the Court in the same way as any other litigant and have the same remedies available to them. Where they are aggrieved by an Order or are advised that the Order was incorrectly made, their remedy is to appeal against the Order or to apply to the Court to have the Order set aside. Otherwise, they must obey the Order.

TRADE AND INDUSTRY

  Package Holidays
  Ann Keen
  To ask the Secretary of State for Trade and Industry what progress has been made in improving protection for consumers buying package holidays. [65195]

  Dr. Howells
  Overall, the Package Travel Regulations 1992 are serving consumers well. Around 30 million holiday and travel packages are sold in this country each year, and produce relatively few problems. However, I am keeping the effectiveness of the Regulations under review and will not hesitate to act if necessary.

  The Foreign Package Holidays (Tour Operators and Travel Agents) Order which came into force on 16 November 1998 will help consumers to shop around to get the best deals.

  Parental Leave
  Judy Mallaber
  To ask the Secretary of State for Trade and Industry what measures he is proposing to provide rights for employees to take parental leave. [65202]

  Mr. Ian McCartney
  We expect to introduce a Bill shortly which will create the framework for a package of measures implementing our family-friendly employment proposals. All of these measures will help employees to balance work and family life and bring about a culture in the workplace which will support employees wanting to take parental leave. The measures in the Bill will be supported by regulations setting out the detailed provisions.

  The package will introduce three months parental leave, enabling fathers, as well as mothers, to play an active role in raising their children and helping to encourage a workplace culture where it is acceptable for them to do so. And the Bill will recognise for the first time, the need for adoptive parents and their children to spend vital time together adjusting to their new circumstances.

  Parental leave builds on the maternity leave rights. Women, and their families, will benefit from the extension of basic maternity leave to 18 weeks, and from the reduction in the qualifying period for the longer period of maternity absence.

  The new right to time off to deal with family emergencies will allow people to take short-term time off to deal with emergencies without jeopardising their job security. It will apply to all employees and is a significant step which recognises that caring responsibilities may affect people at all stages of their working life.

  Libya
  Mr. Dalyell
  To ask the Secretary of State for Trade and Industry if he will make a statement on trade with Libya. [65203]

  Mr. Wilson
  Until we see actual progress in our political relations with Libya, my Department's position remains unchanged. We neither encourage nor discourage trade.

  Engineering Industry
  Mr. Bill O'Brien
  To ask the Secretary of State for Trade and Industry what steps he is taking to safeguard jobs in the engineering industry; and if he will make a statement. [65204]

  Mr. Byers
  The slowdown in the world economy will lead to slower growth in the United Kingdom.

  We believe that the best way of safeguarding jobs in the long term in the engineering industry is to create a stable and strong monetary and fiscal regime.

  Post Office
  Mr. Stringer
  To ask the Secretary of State for Trade and Industry if he will make a statement on his policies for making the Post Office internationally competitive. [65205]

  Mr. Ian McCartney
  The elements of the Post Office reform package—a combination of market disciplines and commercial freedoms—aimed at transforming the performance of the Post Office and its ability to carry out business both nationally and internationally—are set out in the Statement made by my right hon. Friend the then Secretary of State for Trade and Industry on 7 December 1998,Official Report, columns 21–24.

  The first fruit of our new policy has been Government approval for the Post Office's first major foreign strategic acquisition. The acquisition of German Parcel will significantly enhance the international parcels capability of the Post Office. [65220]

  Mr. Nigel Griffiths
  To ask the Secretary of State for Trade and Industry what recent representations he has received on the future of the Post Office. [65220]

  Mr. Ian McCartney
  The statement of this House on the future of the Post Office on 7 December 1998 by my right hon. Friend, the then Secretary of State for Trade and Industry followed representations from and consultations with interested parties. These included the Post Office, Post Office Unions, the Post Office Users National Council, the National Federation of Sub-Postmasters, representatives of business users and potential and existing competitors.

  We also took full account of the Trade and Industry Select Committee's 1998 Report on the Post Office (HC 380).

  Single European Currency
  Mr. Laurence Robertson
  To ask the Secretary of State for Trade and Industry if he will make a statement on literature advising companies on the single European currency issued by his Department. [65206]

  Mr. Wilson
  The Government have produced a number of publications and specialist information relating to the introduction of the single European currency. The Euro Preparations Unit in HM Treasury has published a series of factsheets to help small and medium businesses prepare for the euro. To supplement this work, DTI has produced leaflets aimed specifically at exporters. My noble Friend, the Minister for Trade and Competitiveness in Europe wrote to 1.6 million small and medium companies last year to alert them to the need to prepare for the euro and to the information available from the Government.

  Consumer Protection
  Ms Rosie Winterton
  To ask the Secretary of State for Trade and Industry if he will make a statement on his work in protecting the consumers of goods and services in the UK. [65207]

  Dr. Howells
  We are taking forward a large number of measures aimed at improving the lot of consumers including work on clearer sale of goods rights, giving consumer bodies the right to seek injunctions against the use of unfair contract terms, increased transparency in pricing information by extending unit pricing, giving consumers clear rights when buying by mail order and other distance selling methods and strengthening consumer protection on doorstep selling.

  At the same time we are working on a broader consumer strategy aimed at giving consumers a fair deal. It will concentrate on three key areas: ensuring that consumers know their rights and have the information they need to make informed choices and demand their rights; taking rogue traders out of the market; and taking measures to give consumers confidence when shopping on the internet.

  South America
  Mr. Luff
  To ask the Secretary of State for Trade and Industry what steps his Department is taking to maintain and increase exports to South America. [65208]

  Mr. Wilson
  My Department offers a full range of services to British companies seeking business in South America, including support for trade missions and trade fairs. Opportunities in the markets are extensively promoted throughout the United Kingdom, supported by Ministers, other Government Departments, Export Promoters seconded from the private sector and various private sector multiplier organisations. This is underpinned by visits to the region by various Government Ministers and by visits to this country by both Heads of Government and Ministers from Latin America.

  Science (Women)
  Mrs. Butler
  To ask the Secretary of State for Trade and Industry if he will make a statement on the involvement of women in science. [65209]

  Mr. Byers
  Women are significantly under-represented in the physical sciences and engineering. Unless we can improve this situation, our industrial and research base will continue to be deprived of access to some of the best potential talent. We are encouraging young women to continue with science through A-levels into higher education, and are seeking to ensure that women can have satisfactory science and engineering-based careers, by encouraging family-friendly practices in both the public and private sectors.

  Personal Pensions
  Ms Stuart
  To ask the Secretary of State for Trade and Industry what progress he has made in his discussions with the Social Security Department in relation to S226 personal pensions being available to trustees in bankruptcy. [65210]
  544
  Dr. Howells
  Following those discussions the Government issued a Green Paper, "A new contract for welfare: Partnership in Pensions", which proposes that all tax-approved private pension rights should be treated equally on bankruptcy. A subsequent Consultation Paper, "Strengthening the Pensions Framework", set out that proposal in more detail.

  We propose that in the future all tax-approved private pension rights should remain with bankrupts and not be available to the trustee in bankruptcy for the benefit of creditors. This will include tax-approved Section 226 Personal Pensions. But as a safeguard against abuse the trustee in bankruptcy will be able to apply for a court to recover any excessive contributions made to the pension scheme.

  Regional Competitiveness
  Mr. Illisley
  To ask the Secretary of State for Trade and Industry what proposals he has to improve regional competitiveness. [65211]

  Mr. Byers
  The White Paper, "Our Competitive Future: Building the Knowledge Driven Economy", which was published in December 1998, sets out new proposals to improve regional competitiveness. These include a refocused Regional Selective Assistance, new measures to support the growth of smaller businesses in selected areas, new regional venture capital funds and extra funds for the new Regional Development Agencies in England to address their regional competitiveness needs.

  Mrs. Ellman
  To ask the Secretary of State for Trade and Industry how he will ensure that his proposals for innovative start-ups from the public sector science and engineering base will enhance competitiveness in regional economies. [65213]

  Mr. Byers
  The Government are currently setting up new Regional Development Agencies (RDAs) to enhance the competitiveness of the English regions. These will play an important role in encouraging innovation and the exploitation of our knowledge base. The help for innovative start-ups announced in the Competitiveness White Paper will be available through Business Links partnerships which will work closely with national and local partners to ensure the support they deliver meets regional needs.

  Venture Capital
  Mr. Miller
  To ask the Secretary of State for Trade and Industry what steps he will take to encourage the growth of venture capital in the regions. [65212]

  Mr. Byers
  I recognise the vital role that venture capital can play in support of growth businesses and the value that the formal venture capital industry adds in making larger investments. I am committed to ensuring that there is also adequate supply of venture capital, in smaller amounts, to meet demand across the regions.

  Scientific Discoveries
  Dr. Iddon
  To ask the Secretary of State for Trade and Industry what plans he has to encourage commercial development of scientific discoveries. [65214]
  545
  Mr. Byers
  The commercial exploitation of scientific research is fundamental to a prosperous knowledge-driven economy. The Competitiveness White Paper set out a number of important measures including:A new "Reach-out" fund to encourage universities to work more effectively with business;
  A £25 million Science Enterprise Challenge to create up to eight enterprise centres at UK universities;
  Expansion of activities to promote collaborative partnerships and the transfer of knowledge between the science and engineering base and businesses.
  A look at how to make the most of the outputs of Public Sector Research Establishments.

  The White Paper announcements build on other activities such as the University Challenge launched last year to help universities turn good research into good business.

  Minimum Wage
  Mr. Plaskitt
  To ask the Secretary of State for Trade and Industry what recent representations he has received on the national minimum wage. [65215]

  Mr. Ian McCartney
  The Government have received a number of recent representations on the national minimum wage, both in response to its consultation on draft national minimum wage regulations and through general correspondence.

  Mr. Syms
  To ask the Secretary of State for Trade and Industry if he will list those groups which he plans to exempt from the provisions relating to the minimum wage. [65219]

  Mr. Ian McCartney
  We have always made it clear that the national minimum wage should have the maximum possible application. The draft minimum wage regulations, upon which we consulted in autumn 1998, provided for the exemption of 16 and 17-year-olds, apprentices under the age of 26 in the first year of their apprenticeship and apprentices aged 18 in any year of their apprenticeship. We have given careful consideration to the responses we received during the consultation exercise and revised regulations will shortly be laid before Parliament.

  Sub-post Offices
  Mrs. Organ
  To ask the Secretary of State for Trade and Industry if he will make a statement on the future of the sub-post office network. [65216]

  Mr. Ian McCartney
  The Government remain firmly committed to a network of post offices throughout the country in which sub-post offices will continue to be the key element alongside a core of Post Office owned and managed Crown offices.

  Competitiveness White Paper
  Ms Southworth
  To ask the Secretary of State for Trade and Industry what representations he has received on the Competitiveness White Paper. [65221]

  Mr. Byers
  My Department has received numerous representations from business and private individuals welcoming the wide-ranging programme to promote business competitiveness set out in the Competitiveness White Paper.

  Ministerial Visits
  Mr. Robathan
  To ask the Secretary of State for Trade and Industry what plans he has to make an official visit to(a) Brazil and (b) the USA in the next year. [65222]

  Mr. Wilson
  Proposals for overseas visits by the new Secretary of State, including Brazil, are still under discussion. There are provisional plans for the Secretary of State to visit the US in the Spring of 1999. The visit would be part of a continuing programme, building on the good working relationship we have with many American companies for the strategic alliances and joint ventures.

  High-tech Industry
  Mr. Flynn
  To ask the Secretary of State for Trade and Industry what proposals he has to improve the competitiveness of British high-tech industry. [65223]

  Mr. Byers
  The Government set out their agenda for helping to improve the competitiveness of the whole of British industry in the recently published White Paper "Our Competitive Future: Building the Knowledge Driven Economy". In the White Paper, we also recognised the need to look to the future, to those high-tech industries that have strong growth potential. This is why for example, as part of the Enterprise Fund announced in the White Paper, we are working with major financial institutions to set out a national venture capital fund to support very early-stage, high technology businesses. It is also why the Government in partnership with the Wellcome Trust will spend an additional £1.4 billion to modernise the science and engineering base and help fund leading edge research projects.

  Interest Rates
  Mr. Fisher
  To ask the Secretary of State for Trade and Industry what representations he has received from business leaders in the last month on the level of UK interest rates. [65224]

  Mr. Byers
  Ministers regularly receive representations from business leaders on many aspects of economic performance, including the level of interest rates. Frequently we are told that one of the most important things the Government can do for business is to deliver economic stability. The Government have taken tough and decisive action to secure that much needed stability, including giving independence to the Monetary Policy Committee of the Bank of England over interest rates. We shall support the Monetary Policy Committee in the difficult decisions they have to make.

  Postal Service
  Ms Blears
  To ask the Secretary of State for Trade and Industry what action he will take to ensure that postal service users pay an affordable, uniform price for services wherever they use the service in the UK. [65196]

  Mr. Ian McCartney
  As my right hon. Friend the then Secretary of State for Trade and Industry made clear in his Statement to this House on 7 December 1998 on the future of the Post Office, the Government remain committed to the Post Office being subject to a universal
  547
  service obligation. A uniform public tariff across the UK, regardless of delivery distance, will be maintained for those activities that fall within this obligation.

  Nuclear Reprocessing Contracts
  Mr. Boswell
  To ask the Secretary of State for Trade and Industry if he will specify the procedures for recovery of losses incurred by BNFL on nuclear reprocessing contracts in the UK in the process of cancellation by German interests(a) under contract and (b) under inter-governmental agreements; if he will specify the amount of such losses; and if he will make a statement. [66836]

  Mr. Byers
  My hon. Friend the Minister for Energy and Industry and I met the German Environment Minister, Juergen Trittin, on 20 January to discuss BNFL's reprocessing contracts with Germany.

  We made clear to Mr. Trittin that the decision to phase out nuclear power was a matter for Germany herself to decide.

  But we also stressed that the costs of that decision should not be borne by BNFL which had entered into legally binding contracts in good faith. It would be wrong for the company to suffer financially from a change in German policy over which they had no control. We also emphasised the point that the contracts would be determined under English law. BNFL are firmly of the view that the German utilities are under a clear contractual obligation.

  We also made it clear that, if the 650 tonnes of German spent fuel in store at Sellafield were not to be reprocessed, then it would have to be returned to Germany. The UK will not act as a permanent storage depot for nuclear material. We were pleased to announce that Mr. Trittin agreed that a joint working group of UK and German officials be established to work out the practical details of returning the German material should this prove to be necessary.

  Researchers
  Mr. Dalyell
  To ask the Secretary of State for Trade and Industry, pursuant to the letter of 7 October 1998 from the Minister for Science to the hon. Member for Linlithgow, what response he has had from OST to his request about taking forward specific projects recommended by Sir Gareth Roberts's report on researchers. [65408]

  Mr. Battle
  The Office of Science and Technology has been principally involved in work to restructure the membership of the Research Careers Initiative, as recommended in the report. It has also had informal discussions with a number of organisations, in particular to take forward the report's recommendations relating to provision of career guidance and training for researchers. I understand that a new RCI steering group will be meeting in the next few weeks to consider more specific actions.

  Refrigerants
  Mr. Dalyell
  To ask the Secretary of State for Trade and Industry, pursuant to the letter of 11 November (td-235-11) from the Minister for Energy and Industry to the hon. Member for Linlithgow, what progress he has 548
  made in considering air products refrigeration systems using air as the coolant as an alternative to CFCs and other ozone-depleting refrigerants. [65407]

  Mr. Battle
  My officials have contacted Air Products Europe Inc. to obtain further information about the Closed Cycle Air Refrigeration (CCAR) system. Their response suggests that the current technology is not yet an economic proposition for domestic refrigeration, but has potential for specialised industrial and buildings applications such as large food storage facilities. The promotion of air cycle refrigeration is being addressed by 2 special interest groups set up with MAFF assistance at the Food Refrigeration and Process Engineering Research Centre at Bristol University, which has received UK and EU funding. Air Products have been in contact with the Centre and have given a presentation on the CCAR system.

  Domestic Gas Appliances
  Mr. Kirkwood
  To ask the Secretary of State for Trade and Industry what plans he has to review the regulations covering safety standards for domestic gas appliances. [65331]

  Mr. Battle
  The safety of new domestic gas appliances is controlled by the Gas Appliances (Safety) Regulations 1995, ("the Regulations") which implement into UK law the European Council's Gas Appliances Directive.

  The Regulations contain "essential requirements" which manufacturers of gas appliances are required to meet. To ensure that gas appliances comply with these safety provisions, manufacturers are required to submit their product to a third-party Notified Body for type approval before it may be placed on the market. Manufacturers must also appoint a Notified Body to undertake periodic surveillance of the production process in order to ensure that the product continues to conform to the type that was originally approved.

  Millennium Trade Round
  Mr. Stunell
  To ask the Secretary of State for Trade and Industry if he will list Her Majesty's Government's objectives in the proposed Millennium Round of trade negotiations. [65979]

  Mr. Wilson
  The UK Government are strongly in favour of a broad-based new Round of trade negotiations in the World Trade Organisation, and has backed the European Commission's calls for a comprehensive approach. Decisions are to be taken on the scope and timing of these negotiations at the third WTO Ministerial Conference, which will be held in the United States in November this year.

  Our objectives at this stage include further tariff reductions; reducing the burden on business and barriers to trade represented by industrial standards and technical regulations; opening up Government procurement markets in third countries; simplifying import and export procedures; ensuring proper enforcement of intellectual property rights around the world; seeking substantial progressive reduction in support and protection for agriculture and developing better regimes to cover issues such as food safety; deepening and broadening the liberalisation of trade in services; establishing a liberal, rules-based framework for international investment;

  549
  clarifying the interaction between environmental and trade policies to meet concerns that liberalisation should be pursued in a manner compatible with sustainable development; and clarifying the interaction between trade and competition issues. Throughout the Round we shall want to ensure that the interests of developing countries are taken into account and that every opportunity is taken to promote further engagement of the least developed countries.

  Mr. Stunell
  To ask the Secretary of State for Trade and Industry what plans he has to ensure full consultation with Parliament, relevant non-Governmental organisations and the public over developments in the proposed Millennium Round of trade negotiations. [65982]

  Mr. Wilson
  The Government have always consulted fully on major trade policy developments. The proposed Millennium Round of trade negotiations will not get underway until after the third WTO Ministerial Conference in November 1999. In preparation for and during these negotiations, the Government will consult with interested parties as we have in the past. The timetable for these consultations has not yet been finalised.

WALES

  National Assembly
  Mr. Wigley
  To ask the Secretary of State for Wales when he expects to publish the consultation paper on the disqualification of persons from membership of the National Assembly for Wales under section 12 of the Government of Wales Act 1998.[66163]

  Mr. Michael
  The consultation referred to ran from 13 August to 2 October 1998. Views were invited on proposed offices and employment whose holders would be disqualified from also being members of the National Assembly by means of an Order-in-Council under section 12 of the 1998 Act.

  I expect to put a draft of the Order before Parliament. It will be subject to affirmative resolution procedure in both Houses.

  Wales European Centre
  Mr. Rhodri Morgan
  To ask the Secretary of State for Wales if he will place a copy in the Library of the letter from the Head of European Division concerning the recent appointment of the Chief Executive of the Wales European Centre. [66878]

  Mr. Michael
  No. The head of the European Division is not a member of the Board of the Wales European Centre but attends as an observer. He was unable to attend the meeting of the Board at which the appointment of a new director was under consideration. He therefore sent a letter on a personal and confidential basis to the Secretary of the Board of the Wales European Centre. It was made quite clear that it did not present a view on behalf of my Department. The letter did not express a view on the proposed appointment but(a) conveyed points that had been raised with us by certain members of the wider partnership and (b) set out a number of questions which he suggested should be considered by the Board in deciding
  550
  whether they should accept the recommendations of the appointments panel. I understand that each of these questions were fully considered by the Board in reaching a conclusion.

  I am sure that my hon. Friend would be the first to criticise any official who failed to pass on pertinent views in this way or who failed to suggest questions to which such a Board should seek answers. That he did so strengthens the appointment procedure and public confidence that the Board sought to appoint the best person for the job, in the best interests of Wales.

  The Wales European Centre is an independent body, headed by a Board which includes representatives of the partners who fund and support its work.

  Neither I nor my officials will interfere with its work but I strongly support the Centre as a partner in promoting the people of Wales in Europe and for that reason I visited the Centre two weeks ago to discuss how best to cooperate and complement each other's work. I hope my hon. Friend and all Welsh members will join in this endeavour.

HEALTH

  Psychotic Conditions
  Mr. Hesford
  To ask the Secretary of State for Health what steps his Department is taking to ensure that assessments of a patient's mental health, with particular reference to possible psychotic conditions, have excluded known genetic diseases which share the same symptoms. [R] [66148]

  Mr. Hutton
  The assessment of those presenting with mental health problems includes inquiries into family history of psychiatric and medical disorders.

  Deafness (Early Diagnosis)
  Mr. Wigley
  To ask the Secretary of State for Health what assessment he has made of the benefits of early diagnosis of deafness to language acquisition. [66192]

  Mr. Hutton
  We are aware that early identification and intervention is vital for normal language development, and age at identification and consequent age at which a hearing aid is fitted have become important indicators of screening and service performance.

  Most health authorities screen children who are at risk of permanent hearing impairment soon after birth. We are currently considering ways in which the screening system for children with hearing impairment can be improved and extended so that more children can be identified and treated earlier in life.

  Mr. Wigley
  To ask the Secretary of State for Health what steps he is taking to promote the early diagnosis of deafness among children. [66191]

  Mr. Hutton
  A 1997 review commissioned by the health technology assessment programme suggested considering a system of universal neo-natal screening followed at seven months by a targeted screening using an infant distraction test. The National Screening Committee, through its sub-committee on child health screening, is now considering these suggestions for implementation across the National Health Service. Any proposed changes
  551
  to screening arrangements need to be considered very carefully to see whether they would be feasible and clinically cost effective. We do not expect the Committee to make a rushed decision on this important issue.

  Mr. Wigley
  To ask the Secretary of State for Health if he will implement a deafness screening programme for all children at birth. [66328]

  Mr. Hutton
  The National Screening Committee advises United Kingdom Health Ministers on all aspects of the introduction, modification or withdrawal of screening programmes. The Committee is currently considering the case for replacing the present infant distraction test with universal neonatal screening. We expect to receive advice later this year.

  House Dust Mites
  Mr. Dalyell
  To ask the Secretary of State for Health, pursuant to the letter of 9 October 1998 (POH(6)5437/63) from the Parliamentary Under-Secretary of State to the hon. Member for Linlithgow, what assessment his Department has made of fabrics containing fungicide which kills house dust mites in new bedding materials. [65402]

  Mr. Hutton
  We have no plans to make such an assessment.

  Organ Preservation
  Mr. Dalyell
  To ask the Secretary of State for Health, pursuant to the letter of 1 December 1998 (POH(6)5437/66) to the hon. Member for Linlithgow, what assessment he has made of Japanese research on organ preservation. [65409]

  Mr. Hutton
  The Japanese research is at too early a stage for making any meaningful assessments of its applicability to human transplantation. We are maintaining a close watching brief on its progress.

  Mid Essex Hospital Services NHS Trust
  Mr. Burns
  To ask the Secretary of State for Health, pursuant to his replies of 8 December 1998,Official Report, column 185, if he will (a) list the latest figures for people waiting 12 months or more for hospital treatment in the Mid Essex Hospital Trust area and (b) the latest figures for people waiting (i) 13 to 25 weeks and (ii) 26 weeks or more to see a consultant in the Mid Essex Hospital Trust area. [66130]

  Mr. Denham
  1,194 people were waiting 12 months or more for hospital treatment at the Mid Essex Hospital National Health Service Trust at the end of November 1998. The number of people waiting 13 to 25 weeks to see a consultant was 1,596 at the end of September 1998; the number of people waiting over 26 weeks was 341 at the end of September 1998.

HOME DEPARTMENT

  Asylum Seekers
  Dr. Cable
  To ask the Secretary of State for the Home Department what plans he has to improve the inspection 552
  procedure for accommodation for asylum seekers (a) before the introduction of and (b) under the asylum seekers support scheme. [66714]

  Mr. Mike O'Brien
  The Home Office currently has no responsibility for the accommodation of asylum seekers (other than those held in detention). Asylum seekers who are currently in need of accommodation support receive such support from local authorities.

  The new asylum seekers support scheme described in the White Paper, "Fairer, Faster and Firmer—a modern approach to immigration and asylum" (Cm 4018) is in the planning stage. It is too soon to indicate what plans we have for inspection of asylum seeker accommodation.

  Adult Education (Section 11 Funding)
  Mr. Chaytor
  To ask the Secretary of State for the Home Department (1) what proportion of section 11 funding in each of the participating local education authorities is currently used to support adult education; [66611]

  (2) if he will list each local education authority currently using section 11 funding to support adult education; [66613]

  (3) what proportion of section 11 funding is currently used to support adult education; [66612]

  (4) what is the total amount of section 11 grant for the financial year 1998–99. [66614]

  Mr. Mike O'Brien
  Section 11 grant funds projects in education and in other service areas including social services and housing. Total provision in the current financial year is £82.68 million. Projects with 118 local education authorities, as well as grant-maintained schools and colleges in the further education sector, cover a range of educational activity. Some local education authority projects principally concerned with other activities (eg English language support for school pupils whose first language is not English) include elements of adult education (eg family literacy work delivered through schools). Precise disaggregation of costs in such cases is difficult. The table lists local education authorities which have specific adult education projects; and shows, in relation to the 1998–99 financial year, the potential grant cost of these projects as a percentage of the total potential grant cost of the local education authority's section 11 projects. The potential grant cost of specific adult education projects in relation to the 1998–99 financial year represents 1.03 per cent. of the total potential grant cost of local education authorities' projects, and 0.95 per cent. of the total potential grant cost across the section 11 programme as a whole.

  Local education authorities with specific adult education projects, showing the potential grant cost of these projects in relation to 1998–99 as a proportion of the total potential grant cost of the authority's projects

  LEA

  Percentage

  Barking & Dagenham

  4.17

  Bolton

  13.21

  Brent

  13.86

  Bristol

  1.79

  Bromley

  43.75

  Croydon

  6.51

  Hillingdon

  12.56

  Kent

  8.72

  553

  Local education authorities with specific adult education projects, showing the potential grant cost of these projects in relation to 1998–99 as a proportion of the total potential grant cost of the authority's projects

  LEA

  Percentage

  Leeds

  3.04

  Leicester

  1.19

  Manchester

  9.35

  Norfolk

  13.78

  Peterborough1

  4.26

  Redbridge

  4.34

  Suffolk

  5.44

  1Most section 11-funded provision in Peterborough is covered by a project managed by Cambridgeshire, which pre-dated local government reorganisation. The table reflects the estimated potential grant cost of posts in Peterborough under that project.

  Note:

  In addition, some funding for adult education is currently paid under projects with further education colleges. In Birmingham, such funding would amount to 4.49 per cent. of the local education authority's funding if paid direct.

  Common Market Referendum
  Sir Richard Body
  To ask the Secretary of State for the Home Department if he will place in the Library the material held by the Security Services relating to the 1975 referendum on United Kingdom membership of the Common Market. [66396]

  Mr. Straw
  It is for the Director General to decide which Security Service files should be released for public scrutiny, and to determine when they should be released. In reaching these decisions, he is bound by the relevant provisions of the Public Records Acts of 1958 and 1967, including the 30-year rule. In common with records belonging to other public bodies, Security Service records are released to the Public Record Office.

  Life Sentences
  Sir Richard Body
  To ask the Secretary of State for the Home Department how many prisoners are currently serving life sentences(a) in total and (b) by category of offence for which sentenced. [66334]

  Mr. George Howarth
  The latest available information is for 30 November 1998. On that date, there were 4,011 life sentence prisoners (3,872 males and 139 females) in prisons in England and Wales. A breakdown by offence is given in the table.

  Population of life sentence prisoners in prisons in England and Wales on 30 November 1998, by offence1

  Offence

  Number

  Murder

  3,241

  Manslaughter

  135

  Other homicide and attempted homicide

  87

  Other violence against the person

  82

  Rape

  250

  Other sexual offences

  28

  Robbery

  45

  Arson

  92

  Other offences

  51

  Total

  4,011

  1Provisional figures

  Feltham Young Offenders Unit
  Dr. Cable
  To ask the Secretary of State for the Home Department how many(a) juveniles and (b) young offenders had been on remand at Feltham Young Offenders Unit for (i) two to four weeks, (ii) four to six weeks, and (iii) eight weeks or more, (1) currently and (2) between October 1997 and October 1998. [66397]

  Mr. George Howarth
  The information requested is given in the table. The latest available data are for November 1998.

  Population of young offenders at HMP Feltham by length of time since first reception

  Length of time since first remand into prison

  Juveniles1

  Young offenders2

  30 November 19983

  Up to 2 weeks

  28

  52

  2 weeks up to 4 weeks

  20

  40

  4 weeks up to 6 weeks

  24

  23

  6 weeks up to 8 weeks

  14

  36

  8 weeks or more

  65

  138

  31 October 19983

  Up to 2 weeks

  37

  45

  2 weeks up to 4 weeks

  23

  58

  4 weeks up to 6 weeks

  18

  25

  6 weeks up to 8 weeks

  10

  22

  8 weeks or more

  60

  150

  31 October 1997

  Up to 2 weeks

  23

  40

  2 weeks up to 4 weeks

  24

  42

  4 weeks up to 6 weeks

  9

  26

  6 weeks up to 8 weeks

  4

  23

  8 weeks or more

  55

  155

  1Persons aged 15–17 years

  2 Persons aged 18–20 years

  3Provisional figures

  Dr. Cable
  To ask the Secretary of State for the Home Department what is the current staffing level at Feltham Young Offenders Unit; and if it is at full strength to cover all regimes. [66444]

  Mr. George Howarth
  The prison officer staffing complement at Feltham Young Offender Institution is 243. There were 242 prison officers in post as at 15 January 1999. Of these, 230 are operational, nine are undergoing prison officer initial training and three are suspended. There are six members of staff on long-term sick leave.

  The health care department at Feltham is currently running seven health care officers/nurses short of complement; the gymnasium is two officers short of complement; and the industries and works departments are three instructors short of complement. In each case the regime has been affected. Steps are being taken to improve this situation; two officers are receiving training to become physical education officers and one additional instructor has been identified for works and industries.

  The governor is conducting a recruitment exercise for officers and is implementing measures to reduce the number of staff on long-term sick leave.

  Dr. Cable
  To ask the Secretary of State for the Home Department what plans he has to reduce the length of time(a) young offenders and (b) juveniles spend on remand at Feltham Young Offenders Unit. [66391]
  555
  Mr. George Howarth
  One of the Government's top priorities is faster and more efficient youth justice proceedings. One of our key manifesto commitments is to halve the time it takes to deal with persistent young offenders from arrest to sentence. In 1996, the average time taken was 142 days—the objective is to reduce this to 71 days. In the Public Service Agreements for the Home Office and the Criminal Justice System, the Government are committed to achieving a national average of 71 days by March 2002.

  A range of measures have been introduced aimed at reducing delay in the youth justice system. The Home Office has prepared comprehensive best practice guidance on a range of issues—particularly the establishment of fast-tracking schemes in local areas. The Crime and Disorder Act 1998 includes a whole range of measures to tackle delays—strengthening the ability of the courts to manage cases, and making procedural changes to ensure that unnecessary delays are avoided—we have just implemented some of these measures; others are being piloted.

  More specifically, the Government's plans for ensuring that appropriate arrangements are in place for remanded juveniles are being taken forward in the context of the wider programme of work arising from its review of all forms of secure accommodation for young offenders and young people held on remand or under sentence. The Government's aim is to implement provisions in the Crime and Disorder Act 1998 as soon as practicable, and by June 1999 at the latest, to allow the courts to remand directly to local authority secure accommodation 12–14 year olds, 15 and 16 year old girls and, where a place has been identified in advance, vulnerable 15 and 16 year old boys. The existing arrangements for remanding other 15 and 16 year old boys to Prison Service accommodation will continue for the time being, though the Government wish to move to a position where the practice of prison remands is no longer necessary.

  In the meantime, work is being taken forward, with the Youth Justice Board, to improve the standard of care and quality of regimes for remanded and sentenced juveniles held in Prison Service accommodation to ensure that these are appropriate to the needs of young people. The Government are also making available funds, which will be administered by the Youth Justice Board, to develop local bail support provision to help ensure that custodial remands are used appropriately for the most serious and persistent cases.

  Dr. Cable
  To ask the Secretary of State for the Home Department what plans he has to increase the percentage of uniformed officers from ethnic minority communities at Feltham Young Offenders Unit. [66401]

  Mr. George Howarth
  There are currently 15 uniformed officers, 6 per cent. of the total, from ethnic minority communities employed at Feltham Young Offender Institution.

  A local recruitment exercise is under-way and advertisements have been worded specifically to encourage applications from individuals from ethnic minority communities. Selection is always on merit.
  556
  The Prison Service has recently been reviewing levels of representation from the ethnic minorities and the opportunities it provides for its own ethnic minority staff. As at 1 January 1999, the Prison Service employed 1,246 members of staff, 3 per cent. of the total from the ethnic minorities. Proposals for action are being developed which will include the launch of a new national recruitment outreach strategy.

  Prison Accommodation (Elderly Inmates)
  Dr. Cable
  To ask the Secretary of State for the Home Department (1) what provisions he has made for the conversion of prison accommodation to suit an elderly prison population; [66441]

  (2) what plans he has to authorise conversion of prisons or prison wings to cater for the needs of elderly inmates. [66434]

  Mr. George Howarth
  The Prison Service meets the demands of elderly prisoners in the light of their particular circumstances and the facilities already available at the particular establishment where they are housed. At present, inmates over the age of 50 are held within the general prison population according to their legal status, security requirement and geographical location. This enables inmates to receive regular visits from professional advisers and maintain ties with their families. It also helps the Probation Service in their work to resettle offenders back into the community.

  Kingston prison, Portsmouth, has a unit for elderly life sentenced prisoners, which was created in recognition of the increasing number of these prisoners. The Prison Service is keeping the position under consideration.

  Prison Service (Recruitment)
  Dr. Cable
  To ask the Secretary of State for the Home Department what representations he has received about the Job Simulation Assessment Centre system of recruitment for the Prison Service. [66435]

  Mr. George Howarth
  In its recent annual report, the Board of Visitors of Feltham Young Offenders Institution asked the Home Secretary to look closely at the arrangements for the recruitment of prison officers, which they feel exacerbate local staffing problems.

  Job simulation assessment centres form part of the new approach to the recruitment of prison officers. They have been developed to provide fairer, more objective and more reliable assessments of candidates than the recruitment process which they replaced.

  The Prison Service is aware, however, of the difficulties being experienced at Feltham and elsewhere in recruiting suitable prison officers and other grades of staff. It is therefore carrying out a short review in order to identify ways in which the situation can be improved.

  Commercial Lobbyists
  Mr. Flynn
  To ask the Secretary of State for the Home Department what rules or guidance his Department has to govern the(a) formal and (b) informal interaction between his civil servants and commercial lobbyists. [66211]
  557
  Mr. Straw
  I refer my hon. Friend to the reply my right hon. Friend the Prime Minister gave to my hon. Friend the Member for Pendle (Mr. Prentice) on 27 July 1998,Official Report, column 4.

  Immigration and Nationality Directorate (Correspondence)
  Mr. Green
  To ask the Secretary of State for the Home Department what target he has set the Immigration and Nationality Directorate for replying to correspondence. [66233]

  Mr. Mike O'Brien
  The Immigration and Nationality Directorate (IND) has a target of 15 working days for replying to letters from hon. Members. This includes correspondence addressed to Ministers and addressed to the Secretary of the IND Board, to which IND officials reply. In addition, the Whitehall Service Standards operated across Government under the auspices of the Service First Initiative means IND has a target of 20 working days for replying to correspondence from members of the public which does not specifically relate to individual applications.

  Date

  Minister

  Local authority or association

  Video link/in person

  Date request received from the local authority or association

  16 December

  Hilary Armstrong

  Lincolnshire

  In person

  8 December

  21 December

  Hilary Armstrong

  Brighton & Hove

  In person

  10 December

  21 December

  Hilary Armstrong

  Broxtowe

  In person

  14 December

  21 December

  Hilary Armstrong

  Gedling

  In person

  7 December

  21 December

  Hilary Armstrong

  Harrow

  In person

  8 December

  21 December

  Hilary Armstrong

  Leicester City

  In person

  9 December

  21 December

  Hilary Armstrong

  North Lincolnshire

  In person

  9 December

  21 December

  Alan Meale

  Rutland

  Video link

  15 December

  21 December

  Hilary Armstrong

  Worcestershire

  In person

  8 December

  22 December

  Hilary Armstrong

  Birmingham

  Video link

  17 December

  22 December

  Hilary Armstrong

  Bradford

  In person

  9 December

  22 December

  Hilary Armstrong

  Brent

  In person

  8 December

  22 December

  Hilary Armstrong

  Cambridgeshire

  In person

  9 December

  22 December

  Hilary Armstrong

  Haringey

  In person

  17 December

  22 December

  Alan Meale

  Havant

  In person

  10 December

  22 December

  Hilary Armstrong

  Havering

  In person

  8 December

  22 December

  Alan Meale

  Herefordshire

  In person

  14 December

  22 December

  Hilary Armstrong

  Tyne & Wear FCD

  Video link

  8 December

  22 December

  Hilary Armstrong

  West Sussex

  Video link

  7 December

  22 December

  Alan Meale

  Wokingham

  In person

  8 December

  4 January

  Nick Raynsford

  Castle Point

  In person

  16 December

  4 January

  Glenda Jackson

  Derbyshire

  Video link

  30 December

  4 January

  Nick Raynsford

  Northamptonshire

  In person

  21 December

  4 January

  Nick Raynsford

  Nottinghamshire

  In person

  23 December

  4 January

  Glenda Jackson

  Oldham

  Video link

  23 December

  4 January

  Nick Raynsford

  Wansbeck

  In person

  18 December

  5 January

  Alan Meale

  Buckinghamshire

  In person

  18 December

  5 January

  Nick Raynsford

  County Councils Network

  In person

  17 December

  5 January

  Alan Meale

  Devon

  Video link

  21 December

  5 January

  Nick Raynsford

  East Riding of Yorkshire

  In person

  22 December

  5 January

  Alan Meale

  Hertfordshire

  Video link

  21 December

  5 January

  Nick Raynsford

  Lancashire

  In person

  11 December

  5 January

  Glenda Jackson

  Mansfield

  In person

  16 December

  5 January

  Alan Meale

  North East Lincolnshire

  In person

  21 December

  5 January

  Glenda Jackson

  Northampton

  In person

  24 December

  5 January

  Glenda Jackson

  Northumberland

  In person

  22 December

  5 January

  Alan Meale

  Nuneaton & Bedworth

  In person

  21 December

  5 January

  Alan Meale

  Plymouth

  Video link

  22 December

  5 January

  Nick Raynsford

  Poole

  In person

  22 December

  5 January

  Alan Meale

  Stroud

  Video link

  17 December

  5 January

  Alan Meale

  Torbay

  Video link

  21 December

  5 January

  Nick Raynsford

  Wandsworth

  In person

  24 December

  5 January

  Glenda Jackson

  Windsor & Maidenhead

  In person

  23 December

  558
  The hon. Member will be aware of recent notice given to Members of Parliament that moving offices and changing procedures in IND will cause delays in responding to correspondence for a few months. This is a temporary disruption, which should enable more efficient delivery against targets in the future.

ENVIRONMENT, TRANSPORT AND THE REGIONS

  Local Government Finance
  Mr. Sanders
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list(a) the dates and (b) the Minister in attendance, indicating whether (i) in person or (ii) by video link, for meetings requested by local authorities to discuss the local government grant settlement; and if he will list in each case the date his Department received the request for such a meeting from the local authority. [65432]

  Ms Armstrong
  The information requested is as follows:
  559

  Date

  Minister

  Local authority or association

  Video link/in person

  Date request received from the local authority or association

  6 January

  Nick Raynsford

  Chesterfield

  In person

  24 December

  6 January

  Nick Raynsford

  Kent

  In person

  17 December

  6 January

  Nick Raynsford

  London FCD

  In person

  24 December

  6 January

  Nick Raynsford

  North Kesteven

  In person

  18 December

  6 January

  Glenda Jackson

  Norwich City

  Phone

  21 December

  6 January

  Glenda Jackson

  Shropshire

  In person

  23 December

  6 January

  Nick Raynsford

  Town and Country Finance Issues Group

  In person

  18 December

  6 January

  Glenda Jackson

  Wigan

  Video link

  21 December

  7 January

  Alan Meale

  Burnley

  Video link

  17 December

  7 January

  Alan Meale

  Coventry

  In person

  3 December

  7 January

  Nick Raynsford

  Cumbria

  Video link

  23 December

  7 January

  Nick Raynsford

  Hackney

  In person

  23 December

  7 January

  Glenda Jackson

  North East Derbyshire

  In person

  22 December

  7 January

  Nick Raynsford

  Reigate & Banstead

  In person

  30 December

  7 January

  Nick Raynsford

  Special Interest Group of Municipal Authorities

  In person

  21 December

  7 January

  Alan Meale

  South Gloucestershire

  Video link

  17 December

  7 January

  Alan Meale

  Suffolk

  Video link

  11 December

  7 January

  Alan Meale

  West Berkshire

  In person

  15 December

  7 January

  Nick Raynsford

  West Midlands FCD

  Video link

  21 December

  8 January

  Glenda Jackson

  Swindon

  In person

  5 January

  11 January

  Nick Raynsford

  Bury

  Video link

  5 January

  11 January

  Nick Raynsford

  Copeland

  In person

  23 December

  11 January

  Glenda Jackson

  Derwentside

  In person

  22 December

  11 January

  Glenda Jackson

  E8 Group

  In person

  29 December

  11 January

  Nick Raynsford

  Harborough

  In person

  17 December

  11 January

  Glenda Jackson

  Kingston upon Thames

  Video link

  5 January

  11 January

  Hilary Armstrong

  Kirklees

  In person

  8 December

  11 January

  Alan Meale

  Milton Keynes

  In person

  22 December

  11 January

  Nick Raynsford

  North Somerset

  In person

  17 December

  11 January

  Lord Whitty

  Stockport

  Video link

  5 January

  12 January

  Hilary Armstrong

  North Yorkshire

  In person

  4 December

  12 January

  Hilary Armstrong

  Oxfordshire

  In person

  16 December

  12 January

  Nick Raynsford

  West Yorkshire FCD

  In person

  5 January

  13 January

  Hilary Armstrong

  Association of London Government (ALG)

  In person

  n/a1

  13 January

  Hilary Armstrong

  Local Government Association (LGA)

  In person

  n/a1

  1Meetings with the LGA and the ALG followed a precedent set in the previous year and no separate request was required.

  Rainham Marsh, Havering
  Mr. Brake
  To ask the Secretary of State for the Environment, Transport and the Regions (1) if English Partnerships has made any determination in respect of the suitability of land at Rainham Marsh in Havering for(a) development and (b) regeneration; and if he will place copies in the Library; [65900]

  (2) if English Partnerships supports the amended planning application made by Havering Borough Council for development on a site of special scientific interest at Rainham Marsh in Havering; and if he will make a statement. [65903]

  Mr. Meale
  No determination has been made by English Par44tnerships as to their possible involvement in the generation or development of the Havering Riverside site (known as Rainham Marsh). The Havering Riverside site is entirely in the ownership of the London Borough of Havering and, being included within the Unitary Development Plan prepared in 1993 has been considered to be of strategic importance to employment generation within the Thames Gateway area. Any development must meet the requirements for nature conservation also set out in the UDP. English Partnerships is one of the partner organisations examining options for its possible development. English Partnerships supports the strategic
  560
  commercial development of this site as far as it is in line with recommendations in the approved Unitary Development Plan.

  Mr. Brake
  To ask the Secretary of State for the Environment, Transport and the Regions for what reasons English Partnerships has made an application for planning permission on a site of special scientific interest at Rainham Marsh in Havering in identical terms to an application previously made by Havering Borough Council; and subsequently withdrew it. [65902]

  Mr. Meale
  Following LB Havering's initial outline planning application for development in January 1997, English Partnerships submitted a further identical application in November 1997 in an attempt to deal with the issue of securing benefits for the developing through a Section 106 Agreement. Clearly the Borough cannot submit such an application to itself; to assist the local authority, English Partnership, although in no way committed to this project, therefore became the applicant. That application has now been withdrawn in response to improvements embodied in the London Borough of Havering's amended scheme. The Council is in consultation with both English Nature, English Heritage and other environmental groups, on the environmental implications of the application proposals. All parties are
  561
  now collaborating to prepare a full environment impact assessment in an attempt to reconcile the competing interests on the site.

  Mr. Brake
  To ask the Secretary of State for the Environment, Transport and the Regions (1) what powers English Partnerships possesses to(a) make and (b) support planning applications on land in respect of which he has not given directions or consent as to its suitability for (a) regeneration and (b) development; [65904]

  (2) what (a) directions and (b) consents have been given to English Partnerships relating to the possible (i) regeneration and (ii) development of Rainham Marsh; and if he will place copies in the Library. [65899]

  Mr. Meale
  The powers of English Partnerships, contained in the Leasehold Reform, Housing and Urban Development Act 1993 are directed at its main statutory objective of securing the regeneration of land, across England, which is contaminated, derelict, vacant, unused or likely to become so. In pursuit of this objective the Agency can acquire, hold, manage, reclaim, improve and dispose of land, plant machinery, equipment and other property; give financial assistance to other persons (including for use on environmental improvements); and generally do anything necessary or expedient for the purposes of its objects or for purposes incidental to those purposes. Section 167 of the Act provides for the Secretary of State to issue guidance or directions. Guidance was issued to English Partnerships in April 1994 on which land is suitable for regeneration or development or how it is to exercise its functions. No guidance or directions have been issued since that time, and no guidance, directions or consents have been issued with respect to Rainham Marshes. English Partnerships is free to make planning applications on the same basis as any other applicant.

  Countryside (Public Access)
  Mr. Paul Marsden
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer of 16 December 1998,Official Report, columns 539–40, if he will make a statement on the way in which the Government will take into account future financial settlements with regards to the increased costs to local authorities of increased public access to the countryside. [66057]

  Ms Armstrong
  We shall be consulting further with the Local Government Association on the financial implications for local authorities of our proposals for increasing public access to the countryside. The need for revenue expenditure by local authorities will be taken into account, along with other spending pressures and the scope for efficiencies, in a future local government finance settlement.

  Jubilee Line Extension
  Dr. Cable
  To ask the Secretary of State for the Environment, Transport and the Regions what is his Department's current estimate for the(a) completion and (b) commissioning of the Jubilee Line Extension. [66639]

  Dr. Reid
  London Transport plan to open the Jubilee Line Extension in three phases (firstly Stratford to North Greenwich, then on to Waterloo and finally to Green Park and connection with the existing Jubilee Line).562
  Commissioning will thus overlap with the final completion of the construction and fitting out work. Commissioning work is already in hand. London Transport aims to have all three phases commissioned and in operation by the autumn.

  Barrage Schemes
  Mr. Hancock
  To ask the Secretary of State for the Environment, Transport and the Regions how many of the country's estuaries(a) have been and (b) are currently being investigated for barrage schemes. [66371]

  Mr. Raynsford
  This information is not kept centrally.

  A large number of estuaries have been investigated to varying levels of detail in connection with flood protection, tidal power generation and for amenity purposes. However, many of these have not been and are unlikely to be taken forward. Some examples are indicated in the following table but this is by no means comprehensive.

  Location

  Barrage type

  Status

  Hull

  Flood surge

  Built

  Breydon Water (Norfolk)

  Flood surge

  Under investigation

  River Colne (Essex)

  Flood surge

  Built

  Thames

  Flood surge

  Built

  River Truro (Cornwall)

  Flood surge

  Built

  River Hayle (Cornwall)

  Flood surge/amenity

  Built

  Swansea

  Amenity

  Built

  Cardiff Bay

  Amenity

  Under construction

  River Usk (Newport)

  Amenity

  Proposed

  Tees

  Amenity

  Built

  River Adur (West Sussex)

  Amenity

  Proposed

  Severn

  Tidal power

  Proposed

  Mersey

  Tidal power

  Proposed

  Duddon (Cumbria)

  Road barrage

  Proposed

  The Wash

  Water supply

  Proposed

  Morecambe Bay

  Water supply

  Proposed

  Contaminated Metals
  Mr. Llew Smith
  To ask the Secretary of State for the Environment, Transport and the Regions what information he has received since May 1997 from(a) the Environment Agency and (b) Her Majesty's Customs and Excise, concerning interception of illegally imported radioactively contaminated metals; and what arrangements are in place to stop the recycling of imported contaminated metals. [66430]

  Mr. Meale
  Reports of such incidents are received from the Radioactive Substances Sub-Group of the UK Interpol Environment Crime Group. Since April 1997 we have received information about 5 incidents involving the interception of illegally imported radioactive contaminated metals.

  Imports of radioactively contaminated materials into the UK are regulated by the Environment Agency (EA) in England and Wales and the Scottish Environment Protection Agency (SEPA) in Scotland, under the Transfrontier Shipment of Radioactive Waste Regulations 1993 and Council Regulation 1493/93 on shipments of radioactive substances between Member States. The reuse or recycling of such materials is regulated by EA and SEPA under the Radioactive Substances Act 1993.

  Wind Farms
  Mr. Stunell
  To ask the Secretary of State for the Environment, Transport and the Regions if he will take steps to ensure that the benefits of wind power in terms of pollution are given greater weight by planning inspectors when considering planning applications for wind-farms. [66329]

  Mr. Raynsford
  Inspectors must give appropriate weight to all material planning considerations when considering wind-farm proposals on a case by case basis.

  Mr. Stunell
  To ask the Secretary of State for the Environment, Transport and the Regions (1) how many wind-farm projects have been refused planning permission in each of the last five years; [66226]

  (2) how many wind energy projects have been built in the last three years. [66227]

  Mr. Raynsford
  This information is not held by the Department and could be obtained only at disproportionate cost. Most planning applications are dealt with by local planning authorities.

  Water and Sewerage Companies
  Ms Walley
  To ask the Secretary of State for the Environment, Transport and the Regions if he will meet the Chartered Institute of Environmental Health to discuss its proposal that the Water Industry Act 1991 be amended to place a duty on water companies and OFWAT to operate in such a way as to protect public health and the environment. [66556]

  Mr. Meale
  The Government are deeply committed to protecting both the environment and public health. However, the Water Industry Act 1991 already places the Director General under a duty to consider the environment when formulating or considering any proposal relating to water companies' functions. In the context of the current review of utility regulation, we intend to strengthen this so that the Director General will be under a statutory duty to have regard to statutory guidance on social and environmental objectives in the exercise of his statutory functions.

  The 1991 Act also places a number of duties on the water and sewerage undertakers, and the protection of public health is at the core of these duties. The Water Industry Bill will further protect public health by removing water companies' ability to disconnect people's homes in the event of non-bill payment. There are therefore already clear duties on both the Director General and the water companies to take account of public health and the environment. Apart from strengthening the duties on the Director General through the utility regulation review, I do not see a need for further duties.

  Ms Walley
  To ask the Secretary of State for the Environment, Transport and the Regions what method is used by OFWAT to determine the adequacy of investment in the sewerage network by the water and sewerage companies; and if he will make a statement. [66558]

  Mr. Meale
  Ofwat's approach to assessing the adequacy of capital maintenance expenditure on the sewerage network is to consider trends in the serviceability of assets 564
  to customers and to the environment and, if appropriate, allow for the expenditure levels to be adjusted at the next price review.

  In "Raising the Quality" (September 1998) we published guidance to the Director General of Water Services which suggested that sewerage companies should take a strategic approach to the maintenance of their sewerage assets by, for example, developing an assessment system similar to the one already used for water supply.

  Ms Walley
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list those water and sewerage companies which have met their targets on flooding from sewers and collapses(a) between 1990 and 1995 and (b) since 1995. [66559]

  Mr. Meale
  I refer my hon. Friend to the answer I gave on 19 January 1999,Official Report, columns 441–42, in response to a Question from the hon. Member for Carshalton and Wallington (Mr. Brake).

  Marine Pollution
  Ms Walley
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer of 12 January 1998,Official Report, column 187, if his reference to historic levels relates to pre-1998 levels; and if it is his intention to reduce concentrations under paragraph 15 of the Sintra statement to pre-1998 levels by 2020. [66560]

  Mr. Meale
  The UK is working with the other OSPAR Contracting Parties to establish a common understanding of "historic levels" and how these levels will relate to Member States' obligations under the Radioactive Substances Strategy agreed at Sintra. The UK will fully meet its international obligations agreed at Sintra and elsewhere.

  Docklands Light Railway
  Mr. Fitzpatrick
  To ask the Secretary of State for the Environment, Transport and the Regions if he will provide a report on the progress of Docklands Light Railway Limited. [67025]

  Mr. Caborn
  I have today placed in the Library of the House the Docklands Light Railway Limited' s (DLR Ltd) Annual Report and Accounts for 1997–98.

  The railway continues to make excellent progress. Passenger numbers increased from 17 million to 23 million during the year and continue to grow. Excellent progress is being made on the extension of the railway to Lewisham and it is expected to be operational in time for the Millennium. DLR Ltd., now directly owned by the Secretary of State for Environment, Transport and the Regions, assumed its new role as a holding company, with effect from 6 April 1997 and successfully franchised the railway's operation and maintenance to the private sector.

  Atmospheric Tests (Crosby)
  Mrs. Curtis-Thomas
  To ask the Secretary of State for the Environment, Transport and the Regions if he will give details of(a) the atmospheric-tests which have been

  565
  carried out by his Department in Crosby, (b) the test results and (c) the action which is being considered as a result; and if he will make a statement. [66709)

  Mr. Meale
  There are four Nitrogent Dioxide (NO2) Diffusion Tube Network sites in or near Crosby.

  Grid reference

  Site name

  Site address

  East

  West

  Crosby 1N

  39 Crosby Road North, Waterloo

  3322

  3985

  Crosby 2N

  Sycamore Road, Waterloo

  3322

  3986

  Crosby 3N

  39 Elton Avenue, Waterloo

  3314

  3999

  Bootle 2N

  23 Norman Road, Bootle

  3345

  3971

  A summary of the monthly NO2 concentrations for these sites, for calendar year 1997, is as follows. Concentrations are given in parts per billion by volume (PPb).

  Monthy summary of nitrogen dioxide concentrations 1997 Number of exceedences and maximum for each month

  Site name

  Crosby 1N Location K

  Crosby 2N Location I

  Crosby 3N Location B

  Crosby 2N Location B

  January

  43

  36

  —

  34

  February

  24

  14

  15

  22

  March

  35

  18

  15

  23

  April

  33

  22

  19

  20

  May

  32

  21

  14

  16

  June

  36

  17

  13

  15

  July

  27

  12

  7

  13

  August

  29

  20

  11

  14

  September

  26

  20

  14

  20

  October

  35

  25

  19

  26

  November

  44

  32

  28

  36

  December

  34

  23

  —

  26

  UK Smoke and SO2 Network

  Suspended particulate matter (as black smoke) and sulphur dioxide (as total acidity) are measured at one site in Crosby, CROSBY 3 situated at Merchant Taylor's School, Liverpool Road. The site is part of the UK Smoke and SO2 Monitoring network and has been in operation since 1979. It is in a predominantly residential (suburban) area. Mean concentrations of SO2 and smoke at this site for the year April 1997–March 1998 were 8Tgm-3 for smoke (British Standard calibration) and 18Tgm-3 for SO2. These values are below the UK means for the same period, which were 9Tgm -3 and 21Tgm -3 for smoke and SO2 respectively, based on the whole network. A summary of the statistics for this period is as presented.

  Code

  85503

  Site name

  Crosby 3

  Region

  North-West

  Authority

  Sefton

  Grid reference

  East

  3321

  North

  3990

  Summary of smoke data 1997–98

  Valid days

  49

  Max. gap

  15

  Arith. Mean

  8

  Median

  5

  98th percentile

  35

  Max. day

  84

  566

  Code

  85503

  Site name

  Crosby 3

  Region

  North-West

  Authority

  Sefton

  Grid reference

  East

  3321

  North

  3990

  Summary of SO2 data 1997–98

  Valid days

  349

  Max. gap

  15

  Arith. Mean

  18

  Median

  20

  98th percentile

  40

  Max. day

  68

  Abbreviations:

  "Valid Days" denotes the number of valid days data obtained for the year.

  "Max. Gap" is the maximum number of consecutive days for which no valid value was obtained.

  "Arith.mean" is the arithmetic mean of all daily values.

  "Median

  "98th percentile" is the 98th percentile for all daily values.

  "Max. Day" is the maximum daily value measured during the year. Further information and daily data up to September 1998, can be obtained via the World Wide Web, at DETR's Air Quality Archive at http://www.environment.detr.gov.uk/airy/aqinfo.htm.

  The Government's policies with respect to improving air quality in the UK were published on 13 January, in the "Report of the Review of the National Air Quality Strategy". Copies of the report have been placed in the Library of the House.

  Birmingham Northern Relief Road
  Mr. Jenkins
  To ask the Secretary of State for the Environment, Transport and the Regions what are the(a) costs to date and (b) projected costs to the public purse of work associated with the Birmingham Northern Relief Road, including (i) land purchase, (ii) legal costs and (iii) policing costs; and what contribution to these costs will be made by Midland Expressway Ltd. [66414]

  Ms Glenda Jackson
  [holding answer 20 January 1999]: Under the Concession Agreement with Midland Expressway Limited (MEL) the costs and risks of constructing the Birmingham Northern Relief Road (BNRR) and its link roads fall to MEL, though certain non-works costs involved in promoting a private finance scheme fall to the Government.

  The total cost to date of selecting the private sector promoter, negotiating the Concession Agreement and contributing to the statutory Order-making process is estimated at £9.8 million, of which £1 million is attributable to legal advice. Land acquisition and management costs are recoverable from the concessionaire. Policing costs are a matter for the Police Authority and the Home Office.

  Projected costs to the public purse associated with the BNRR include a contribution towards the reconstruction of the existing M42 near Water Orton to enable its use by BNRR traffic. Under the concession agreement the major part of the cost of this work is to be met by MEL, but the Department is to contribute a share currently estimated at £20 million. This takes into account that much of the traffic on that section will not use the BNRR.

  Further costs to the public purse could result from any changes imposed by the Department to the requirements of the concession agreement, for example, changes

  567
  reflecting revised engineering standards. Any imposed changes which involve extra costs to the Concessionaire have to be paid for by the Secretary of State. The present estimate of the agreed changes is a maximum of £1.5 million.

  In addition to these costs, about £11.4 million in the period until June 1991 was spent on the earlier proposals for a publicly financed Birmingham Northern Relief Road.

  National Air Traffic Services
  Mr. Levitt
  To ask the Secretary of State for the Environment, Transport and the Regions if he will have the power to insist on minimum staffing levels for the reorganised National Air Traffic Services. [66863]

  Dr. Reid
  My right hon. Friend has no plans to take powers to set either minimum or maximum staffing levels for NATS. Except where safety regulations prescribe minimum staffing levels, it will—as now—be for NATS' management to determine the staffing levels the company needs to discharge its obligations.

  Fair Rents
  Mr. Swayne
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to limit increases in registered fair rents; and if he will make a statement. [66937]

  Mr. Raynsford
  I refer the hon. Member to the answer I gave on 13 January 1999,Official Report, columns 216–17.

  Housing
  Mr. Boswell
  To ask the Secretary of State for the Environment, Transport and the Regions if he will publish the current tabulation of the distribution of the SAP rating of the housing stock. [66885]

  Mr. Raynsford
  Details of the distribution of SAP ratings in the housing stock will be included in an energy report of the 1996 English House Condition Survey due for publication this spring.

  Ms Moran
  To ask the Secretary of State for the Environment, Transport and the Regions when he expects to consult on a best value framework for housing as announced in his statement on Housing and Regeneration Policy on 22 July 1998. [67438]

  Ms Armstrong
  We are today publishing a consultation paper, "Best Value in Housing Framework", allowing until 16 April 1999 for comments. Best value is a central part of the Government's agenda for modernising local government. Its application to housing, as one of the key functions undertaken by local authorities, is therefore of prime importance. Under the provisions in Part I of the Local Government Bill, currently before Parliament, local authorities will have to set, in consultation with tenants and others, tough targets for their investment programmes and for the quality of their service delivery. They will be judged by their performance. As my right hon. Friend the Chancellor of the Exchequer announced on 11 June 1998 a new Housing Inspectorate, under the auspices of the Audit Commission, will be established which will monitor their performance.
  568
  The consultation paper explains the framework within which local housing authorities will need to operate in obtaining best value in housing. It takes account of key housing issues such as the relationship between best value and the housing investment programme process; the role of tenants and residents; the read across to registered social landlords; and principles around the operation and establishment of the Housing Inspectorate. I have placed copies of the consultation paper in the Libraries of both Houses.

  Private Rental Deposits
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer of 18 January 1999,Official Report, column 306, concerning rental deposits, if a date has been set for the meeting with Ministers; and how its conclusions will be reported to hon. Members. [66883]

  Mr. Raynsford
  My officials have had constructive initial meetings with the organisations representing landlords, agents and tenants. In the light of these discussions, some of the organisations have asked to consult their members further. A date for the meeting with Ministers will be fixed very shortly, when these further discussions have taken place. I cannot say at this stage how or when I will report conclusions back to hon. Members.

  Contaminated Land
  Mr. Dalyell
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to letters of 15 December 1997 (EE/P50/17203/97) and of 9 June (EE/P50/9738/98) to the hon. Member for Linlithgow, what action has been taken as a result of the Environment Agency's report on its research using earthworms as indicator organisms of contaminated land. [65403]

  Mr. Meale
  Results from the study highlighted the need for further chemical analysis of the soils and earthworms to enable the biological and chemical data to be fully understood. The analytical work was completed in mid-December and is currently being evaluated and interpreted. A final report is expected in March 1999.

  Transport Planners
  Mr. Dalyell
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to the letter of 17 July 1998 (R/J/P50/8480/98/98) to the hon. Member for Linlithgow, what progress has been made in developing a gender audit to assist transport planners. [65405]

  Ms Glenda Jackson
  The Transport Studies Unit at the University of East London has been commissioned to produce the gender audit to assist transport planners and operators. The audit is due to be finalised in the summer of this year. As part of the development of the audit, there will be a number of focus groups with professionals, users and transport providers, and the Unit is creating a website to aid the exchange of ideas and information on what women's public transport needs are and how they can be met. A Steering Group will shortly be convening to discuss progress of the audit.

  Air Transport Users Council
  Mr. Oaten
  To ask the Secretary of State for the Environment, Transport and the Regions what funding is provided to the Air Transport Users Council from public bodies; and if he will list those bodies. [66827]

  Ms Glenda Jackson
  The Air Transport Users Council is entirely funded by the Civil Aviation Authority which operates on a commercial basis receiving its income from airlines' fees and services provided to other bodies including the Government. The Council does not receive any public funds.

  Air Travel
  Mr. Oaten
  To ask the Secretary of State for the Environment, Transport and the Regions which Department has responsibility for monitoring the Warsaw Convention as it relates to air travel. [66826]

  Ms Glenda Jackson
  Responsibility for the monitoring of the Warsaw Convention rests with the International Civil Aviation Organisation. My Department has responsibility for policy matters relating to the Convention and the implementation of it in United Kingdom legislation. The Foreign and Commonwealth Office is responsible for the signature and ratification of new instruments and, when new instruments enter into force, is the recipient of formal communications from the Government of Poland.

  Traffic Congestion
  Mr. Paice
  To ask the Secretary of State for the Environment, Transport and the Regions what estimate he has made of the cost to British industry of traffic congestion. [65218]

  Ms Glenda Jackson
  Last year's White Paper on the Future of Transport explained, as background to the new policy framework set out in that White Paper, that traffic congestion is costing the economy billions of pounds every year, and that traffic forecasts based on pre-White Paper policies pointed to more congestion and increasing costs. As mentioned in para. 1.7 of the White Paper, published estimates of the costs include the CBI's of £15 billion per annum, and National Economic Research Associates' of £7 billion per annum.

  Biotechnology
  Mr. Stinchcombe
  To ask the Secretary of State for the Environment, Transport and the Regions what research his Department has(a) conducted and (b) commissioned into the possibility of biotechnology causing irreversible contamination of the ecosystem. [66679]

  Mr. Meacher
  The Department for the Environment, Transport and the Regions has an ongoing research programme to assess the risk and potential impact of genetically modified (GM) organisms on the environment:(a) Research conducted and reports published by the DETR

  i. GM Crops and their Wild Relatives—a UK Perspective

  ii. Genetic Modification of Fish—a UK Perspective

  iii. Dispersal of GM Microorganisms by Abiotic Factors and Soil Invertebrates

  570

  iv. Risk Assessment and the Release of GM Microorganisms into the Pylloplane

  v. Risk Assessment and the Release of GM Microorganisms into the Rhizosphere

  vi. Risk Assessment and the Release of GM Microorganisms into the Environment

  vii. Gene Flow in Natural Populations of Brassica and Beta

  viii. Selectable Marker Genes in GM Organisms

  Research conducted and awaiting publication by the DETR

  i. Environmental Impact of GM Crops

  ii. Safety of Plant Viral Inserts

  iii. Investigation of Feral Oilseed Rape Populations

  iv. Review of GM Bioinsecticides

  v. Review of Parasitic Nematodes for Biological Control of Invertebrates

  (b) Research commissioned by the DETR and ongoing

  i. Environmental Impact of Insect Resistance in GM Plants

  ii. Impact of Multiple Tolerance in GM Plants

  iii. Environmental Impact of Disease Resistance in GM Plants

  iv. Assessment of the Biocontainment of GM Microorganisms in a Model Ecosystem

  v. Monitoring Large Scale Releases of GM Plants.

  Mr. Stinchcombe
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the potential for biotechnology to produce herbicide resistant weeds. [66683]

  Mr. Meacher
  All applications for the release of plants genetically modified for herbicide tolerance are accompanied by a risk assessment that considers the potential for the herbicide tolerant crop to become a persistent weed or for it to cross-pollinate wild relatives and produce herbicide tolerant hybrids. The Advisory Committee on Releases to the Environment (ACRE) considers these applications on a case by case basis and advises the Government on the likelihood that herbicide tolerant weeks will result from the release of the genetically modified plant.

  My Department also funds research into the potential of biotechnology to create herbicide tolerant weeds. Completed and current projects are as listed:

  (i) GM Crops and their Wild Relatives—a UK Perspective

  (ii) Gene Flow in Natural Populations of Brassica and Beta

  (iii) Environmental Impact of GM Crops

  (iv) Investigation of Feral Oilseed Rape Populations

  (v) Impact of Multiple Tolerance in GM Plants

  (vi) Monitoring Large Scale Releases of GM Plants.

  Car Travel
  Mr. Stunell
  To ask the Secretary of State for the Environment, Transport and the Regions what estimates he has received of the average number of miles driven by a non-company car driver in each of the last five years(a) in the course of work, (b) for travel from home to work and (c) for other reasons. [66912]
  571
  Ms Glenda Jackson
  The average number of miles driven in a non-company car in each of the last five years is:

  Average annual vehicle mileage of non-company cars by year and by journey purpose: 1993–97

  Miles

  Year

  In the course of work

  Travel from home to work

  Other mileage

  Total mileage

  1993

  924

  2,468

  5,065

  8,475

  1994

  903

  2,459

  5,260

  8,623

  1995

  874

  2,428

  5,094

  8,396

  1996

  861

  2,446

  5,071

  8,378

  1997

  760

  2,468

  4,989

  8,217

  1995–97

  832

  2,447

  5,052

  8,331

  Source:

  National Travel Survey

  Mr. Stunell
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the average number of miles driven by a company car driver each year(a) in the course of work and (b) not in the course of work. [66910]

  Ms Glenda Jackson
  The average number of miles driven in a company car each year during the period 1995–97(a) in the course of work is 11,380 miles, and (b) not in the course of work is 11,230 miles.

  Source:

  National Travel Survey.

  Mr. Stunell
  To ask the Secretary of State for the Environment, Transport and the Regions what proposals he has(a) to reduce the number of discretionary journeys made in company cars not in the course of work and (b) to reform the system of allowances for business-related journeys. [66911]

  Ms Glenda Jackson
  The White Paper, "A New Deal for Transport", contains a wide range of proposals to encourage more sustainable car use, many of which should help to reduce private mileage in company cars. More specifically, the Government are committed to increasing the taxation on free fuel provided by companies for private motoring annually by 20 per cent. above usual pump price increases over the next five years, to discourage its provision. The Inland Revenue is also continuing to review how the company car taxation regime, covering both business and private mileage, might be structured to send better environmental signals.

  Gosport Marina
  Mr. Viggers
  To ask the Secretary of State for the Environment, Transport and the Regions what factors underlie the timescale for issuing a section 34 consent under the Coastal Protection Act 1949 to The Gosport Marina Limited in respect of its proposed redevelopment and construction of a 400 m section of the Millennium Promenade at Gosport. [66882]

  Ms Glenda Jackson
  Before granting his consent under the Coastal Protection Act 1949 my right hon. Friend has to consider any objections to the proposed works made on the ground of whether obstruction or danger to navigation is likely to result. In addition, Regulation 48 of the Conservation (Natural Habitats, etc.) Regulations 1994 requires him to determine whether the 572
  plan or project is likely to have a significant effect on a European site for nature conservation. In respect of the proposals submitted by The Gosport Marina Limited we are currently considering the submissions made by objectors and advice in respect of the likely impact on the Portsmouth Harbour Special Protection Area.

  Local Government and Public Policy
  Dr. Starkey
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement about the research his Department has commissioned on cross-cutting issues relating to local government and public policy. [67439]

  Ms Armstrong
  Today, I am publishing two reports looking at how effective joint working, at both central and local levels, is at tackling a number of serious issues facing society today. These issues, like social exclusion, community safety, disaffected youth and sustainable development, cut across Government Departments.

  We need to know how we can improve the design and delivery of policies aimed at tackling these issues and we need to shift the emphasis from attempting to solve problems to preventing them. The two reports contain lessons from the experience of joint working and advice about future co-operation in working towards agreed outcomes.

  The research encourages everybody to look beyond short term, single issue approaches using a number of separate agencies to a more coherent, unified approach setting these issues in the widest possible context.

  This joined-up approach is not only more desirable, but has already proved to be more effective in emerging policies like Health Action Zones and the Best Value pilots in my own specific area of responsibility, local government.

  Darwin Advisory Committee
  Mr. Burgon
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the forthcoming financial management and policy review of the Darwin Advisory Committee. [67552]

  Mr. Meacher
  As part of the Government's programme of regular five-yearly financial, management and policy reviews of non-departmental public bodies my Department will conduct a thorough review of the Darwin Advisory Committee. The first stage of the review will take the form of a "prior options" study. This will assess the extent to which the Darwin Advisory Committee functions are necessary for the achievement of the Government's policies, and whether there is scope for contracting out or transferring all or part of its functions to another body.

  The progress made by the Darwin Advisory Committee since it was set up will be examined and the results of that examination and of the prior options study will inform a detailed review of the Darwin Advisory Committee's policy and financial management systems.

  I expect the reviews to last about 6–8 weeks. In carrying out the study my Department will consult widely with those who have an interest in the Committee's work.

  Tenant Participation Compacts
  Lorna Fitzsimons
  To ask the Secretary of State for the Environment, Transport and the Regions when he intends to publish the consultation paper on local authority tenant participation compacts. [67597]

  Ms Armstrong
  The Government's proposals for increasing tenant involvement in the management of local authority housing will be published in the consultation paper, "Tenant Participation Compacts" on 25 January 1999. The proposals link with the proposals contained in the consultation paper "Best Value in Housing Framework", which are being published today and on which I have made a separate announcement.

  The consultation period will end on 31 March 1999 and a further announcement on the proposals will be made in May. I am arranging for copies of the consultation paper to be placed in the Libraries of both Houses.

AGRICULTURE, FISHERIES AND FOOD

  Special Advisers
  Mr. Robert Jackson
  To ask the Minister of Agriculture, Fisheries and Food if he will list the special advisers in his Department and the issues on which they specialise; and to what level they have been security cleared. [62845]

  Mr. Nick Brown
  The two Special Advisers in my Department are: Mr. Kieran Simpson and Mr. Tom Greatrex. I am advised by the Department that they both have the level of security clearance appropriate to the matters with which they deal. The areas of MAFF responsibilities with which they respectively deal are set out below:Mr. Simpson

  Agricultural Policy and the CAP

  Countryside and Rural Policy Issues

  Agricultural and Horticultural Commodities Production

  Forestry

  Pesticide Safety, Veterinary Medicines, Plant Health

  Research and Science

  Animal Welfare

  Departmental Administration and Establishment Issues

  Mr. Greatrex

  Fisheries

  External Trade

  Food and Drinks Industry Competition Issues

  Export Promotion

  Food Safety and Standards; Meat Hygiene

  Animal Health (including BSE)

  Flood Defence.

  Fishing Industry Initiatives
  Mr. Gill
  To ask the Minister of Agriculture, Fisheries and Food which of the changes referred to in his New Year message to fishermen were initiatives from the industry itself. [66407]
  574
  Mr. Morley
  Changes in a number of areas were prompted by concerns put forward from within the fishing industry. These included the introduction of fixed quota allocations, action to link the registration and licensing of fishing vessels to the declaration of maximum continuous or permanently derated engine power, restrictive licensing for scallop dredging and measures to assist the replacement or introduction of pelagic freezer trawlers. Additionally, changes were made to EU rules to increase the selectivity of fishing gear, to increase the minimum leading sizes of shellfish and to extend the quota system to additional species of fish in the North Sea.

  BSE
  Mr. Martyn Jones
  To ask the Minister of Agriculture, Fisheries and Food what plans he has to test randomly the brains of slaughtered dairy cows for BSE. [66503]

  Mr. Rooker
  A study of brain tissue from cattle slaughtered in the Over Thirty Months Scheme was started on 4 January 1999. The aim is to collect, by the end of March, samples from 4,000 animals. The brain samples will be tested for the presence of abnormal prion protein (PrPSc) by two or more of the recently developed diagnostic tests, and also studied by histopathology for evidence of vacuolation. In compliance with a recommendation from SEAC, the study is being confined, in so far as is possible, to animals 5 years of age or over. 5 years is the average incubation period of BSE and PrPSc has been detected in brain tissue only quite late in the BSE incubation period.

  Mr. Martyn Jones
  To ask the Minister of Agriculture, Fisheries and Food what methods are available to confirm the diagnosis of transmissible spongiform encephalopathy using brain materials from slaughtered animals. [66499]

  Mr. Rooker
  At the moment, all diagnostic tests for BSE using brain tissue rely upon the infectious agent having reached the central nervous system. Current evidence indicates that this event occurs late in the incubation period, shortly before clinical onset. Any diagnostic test applied earlier in the incubation period is therefore likely to produce a negative result, even if the animal is infected. Once infectivity has reached the central nervous system, several diagnostic options are theoretically possible although none will be absolute. In other words, there may be some false negative results and interpretation of positive results is still open to question, given that some of the available tests have not been fully validated. The options available include mouse inoculation, which could take up to three years to give a result; histopathological examination of the brain stem; extraction of "scrapie-associated fibrils"; or one of a range of immunologically based tests for the detection of abnormal prion protein. None of the latter have been fully validated as yet.

  Mr. Martyn Jones
  To ask the Minister of Agriculture, Fisheries and Food if he will list the percentage of suspected BSE cases that have been subsequently confirmed in each year from 1988 to 1998. [66504]
  575
  Mr. Rooker
  Of the cases placed under restriction in each calendar year and subsequently slaughtered, the following percentages were confirmed:

  Percentage

  Year of restriction

  Confirmation rate for Suspected BSE cases

  1988

  91.92

  1989

  88.54

  1990

  85.22

  1991

  86.24

  1992

  85.00

  1993

  83.66

  1994

  83.40

  1995

  83.36

  1996

  78.95

  1997

  81.30

  1998

  177.16

  1The 1998 figure is provisional; some results are still pending. It is unlikely that the full figures for 1998 will be available before the end of May 1999.

  Note:

  Data as at 8 January 1999

  Consultation (Farmers)
  Mr. Charles Kennedy
  To ask the Minister of Agriculture, Fisheries and Food if he will place in the Library full copies of the responses received to the Government's current consultation process with farmers, with the analysis carried out of the responses by his Department; and if he will make a statement. [66365]

  Mr. Nick Brown
  Farmers in England are being asked for their views on the implementation of proposals to reform the Common Agricultural Policy. Over 175,000 questionnaires have been sent out to farmers in England, asking them to indicate, by placing a tick in the appropriate box, whether they agree or disagree with options. Equivalent consultation exercises are being undertaken in Scotland, Wales and Northern Ireland. Although it would not be meaningful to place copies of all individual returned questionnaires in the Library, summaries and analyses of the returned questionnaires will be deposited in the Library at intervals.

  Pesticides
  Mr. Yeo
  To ask the Minister of Agriculture, Fisheries and Food what funding will be available for the Integrated Farming Initiative to limit the use of pesticides. [66590]

  Mr. Nick Brown
  [holding answer 19 January 1999]: The Department is committed to the encouragement of integrated farming and has spent over £1 million on research in this area in recent1 years, much of it through the LINK programme. The findings of this research were featured in a conference sponsored by MAFF in October 1998. Careful management of pesticide use is only one element of integrated farming and it would not be appropriate to single this out for dedicated funding.

  Mr. Yeo
  To ask the Minister of Agriculture, Fisheries and Food what consultations have taken place with the Department of the Environment, Transport and the Regions concerning the implementation of a pesticide tax. [66591]
  576
  Mr. Nick Brown
  [holding answer 19 January 1999]: Extensive study of the issues surrounding the introduction of a possible pesticide tax has been carried out by ECOTEC Research & Consulting on behalf of the Department of the Environment, Transport and the Regions. An interdepartmental group of officials, including those from my own Department, oversaw the conduct of this research. Ministers have not so far discussed the consultant's conclusions.

  Agriculture Council
  Mr. Hood
  To ask the Minister of Agriculture, Fisheries and Food what was the outcome of the Agriculture Council held in Brussels on 18 to 19 January; and if he will make a statement. [67011]

  Mr. Nick Brown
  I represented the United Kingdom at a meeting of the EU Agriculture Council in Brussels on 18 and 19 January 1999.

  The German Presidency informed the Agriculture Council of the work programme for the coming six months, of which the principal focus would be completion of the negotiation for reform of the Common Agricultural Policy (CAP) in the framework of Agenda 2000. In addition, the Presidency made it clear that the Council would discuss proposals on the annual CAP price fixing, animal welfare, consumer protection and organic livestock standards.

  The Council resumed its discussions of the Agenda 2000 CAP reform proposals by conducting an in-depth debate on reform of the beef and milk sectors. On behalf of the UK, I supported the Commission's proposal to reduce prices and abolish intervention buying in the beef sector, though with appropriate arrangements to safeguard the systems of extensively-reared beef production which is characteristic of the UK. On reform of the milk sector, I pressed the case for a more thorough-going reform than that proposed by the Commission, referring specifically to the proposal made by the United Kingdom, Denmark, Italy and Sweden for reform in this sector which would lead to the eventual abolition of milk quotas.

  The German Presidency outlined a programme of work on the CAP aspects of Agenda 2000, leading up to the meeting of the Agriculture Council beginning on 22 February. They indicated their intention to try to draw the negotiation to a conclusion at that Council in view of the timetable laid down by Heads of Government in Cardiff and in Vienna for completion of the whole package of measures by the end of March 1999. I welcomed their commitment to reaching early agreement on these proposals.

CABINET OFFICE

  Departmental Expenditure
  Mr. Don Foster
  To ask the Minister for the Cabinet Office what has been the total expenditure and the
  577
  breakdown of expenditure in the Cabinet Office since May 1997 on (a) public opinion research, (b) television, radio and newspaper advertising, (c) direct mail and (d) publicity. [64186]

  Mr. Kilfoyle
  [pursuant to his reply, 11 January 1999, c. 93]: I regret that a previous reply was incomplete in respect of amounts spent by the Cabinet Office since May 1997 on public opinion research. The amount showed £481,200 when it should have read £750,108 the expenditure on television, radio and newspaper advertising, £220,164; on direct mail, £794,319; and on publicity, £1,158,469 remain unchanged. All figures are net of recoverable VAT.

LORD CHANCELLOR'S DEPARTMENT

  Jury Deliberations
  Dr. Tony Wright
  To ask the Minister of State, Lord Chancellor's Department what plans he has to permit licensed jury deliberation research. [66693]

  Mr. Hoon
  The Government have no plans to amend section 8 of the Contempt of Court Act 1981, which effectively bars research into how a jury has conducted its deliberations. It is possible to conduct research into certain other aspects of the jury system without contravening the Contempt of Court Act. Any proposals received by the Government for such research are considered individually.

Preamble
The House met at three of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Chichester.

Road Building: Implications of Cutback
Lord Islwyn Lord Islwyn asked Her Majesty's Government:
Whether any assessment has been made of the implications of the cutback in new road building on traffic congestion throughout the United Kingdom.
The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty): My Lords, the Government take seriously the implications for traffic congestion. As we have explained in our White Paper, A New Deal for Transport—Better For Everyone, the way forward is not simply through building more roads but through an integrated transport policy. In pursuit of that, in December we issued Breaking the Logjam, our consultation paper on fighting traffic congestion and pollution through road user and workplace parking charges.
Lord Islwyn: My Lords, does the Minister accept the Highways Agency's definition of congestion on a motorway as when the average speed of traffic falls to below 30 miles per hour? Will he consider performance measures for the road network so that users can judge whether performance is rising or falling? Finally, does the Minister believe that the inter-urban road network provides the reliability and quality of service that the economy requires?
Lord Whitty: My Lords, there are clearly serious problems on parts of the inter-urban network which we are addressing in the targeted programme of improvements which we announced in July and by looking at movement in a multi-modal sense in many of the more seriously congested and other problem areas of the network.
As far as the speed is concerned, that is a Highways Agency rule of thumb. Although it is possible to assess the speed in terms of particular parts of motorways, the overall picture is not easy to assess with the present technology. Technology coming on stream will allow a better measure of performance. It will also allow us to control the traffic flow more effectively and give information down the line to drivers.
Baroness Ludford: My Lords, will the Government give a guarantee that the mayor of London will have available the proceeds of all congestion charging in London in order to invest in improving public transport in London?
Lord Whitty: My Lords, as I believe my right honourable friend the Deputy Prime Minister has
692
forcefully made clear on a number of occasions, the money from road user charges and workplace parking in London will, for the first 10 years, accrue to the mayor to develop further public transport and other infrastructure.
Lord Brabazon of Tara: My Lords, does the Minister recognise that, however successful the integrated transport policy is, whether or not the amount of traffic falls from 95 per cent. to 85 per cent., or whatever the figure, the vast majority of traffic will still be on the roads and therefore some road building, particularly of bypasses, will be necessary if our economy is still to thrive?
Lord Whitty: My Lords, the first statement that I made in this capacity, following on the work of my noble friend Lady Hayman, on the roads review in July indicated a substantial, well-funded and clearly timetabled programme of road improvements. However, we also wish to shift some of the commercial traffic and, more particularly, individual cars off the roads. We wish to develop more options. In the medium term, we want to see a substantial shift in mode of transport in this country.
Lord Mowbray and Stourton: My Lords, is not the noble Lord aware that the industrial traffic travelling on the roads cannot be put on the railways? I was in the DoE long enough to learn that many clever brains have been devoted to this worthy object. Does he really believe that it is possible to make a significant cut in the amount of traffic on the motorways and going off the motorways? Is it reasonable to expect that that could be achieved?
Lord Whitty: My Lords, I do believe that it is possible over time to achieve a significant shift. Nevertheless, there are limits to that, as the noble Lord indicates. Even if we doubled the amount of commercial traffic going by rail freight, as is the aim of the rail freight companies, 70 per cent. of our commercial traffic would still be on the roads.
Lord Marlesford: My Lords, while there may be limits to how much traffic can be moved off the roads, a huge opportunity exists here. Britain's largest container port, Felixstowe, still has no proper rail link with the rest of Britain's rail system. That is why so many containers use the A.14 and clutter up the roads in the Midlands. If the Government would ensure that there was a good network of railway links between Felixstowe and the rest of England, as I have frequently asked them to do, that would be a big step in the right direction.
Lord Whitty: My Lords, I take the general point that more capacity for freight traffic is needed on our railway system. We discussed this matter briefly yesterday. The Government intend to ensure that that is provided. Unfortunately, the powers left to government by the

693
previous regime are not sufficient to enable Railtrack or the operators to make a major change. We are intending to introduce legislation to that end.
Lord Berkeley: My Lords, road user charges are intended to limit and control the use of the motorways and perhaps bring a bit of discipline to those who expect to pay a large fee at the beginning of the year and then pay no more for their motoring. In other words, there would be payment at the point of use, as there is on the railways. Is that not part of the integrated transport approach?
Lord Whitty: My Lords, it is precisely the aim, on the one hand, to discourage some use of the road network and, on the other, to provide resources to develop alternatives. To precisely which roads those aims will apply depends on subsequent decisions by both central and local government.
Baroness Hamwee: My Lords, does the Minister agree that, perhaps conversely to the implication of the Question, there is no evidence to cause a reassessment of the view that road building increases congestion and road movements in the corridor of a new road? Does the Minister accept on behalf of these Benches and the many victims of a number of rail companies who have been delayed unconscionably in their journeys that they very much look forward to a strategic rail authority which means that they can comfortably and with reliability use the railways and not be subject to road congestion?
Lord Whitty: My Lords, I very much welcome the support of the noble Baroness in her latter point. As to road building, the Government contend that although some road improvement and road building are required, simply to build more roads is not the solution to congestion; rather the reverse.
Baroness Knight of Collingtree: My Lords, can the Minister inform the House when the Government intend to start building the bypasses and making the changes that have been promised but so far have not transpired?
Lord Whitty: My Lords, a programme of works was announced in July, and in December I gave the start date of the majority of the schemes. A number are still subject to public consultation and possibly public inquiry. However, the start date for the majority is now available and I shall write to the noble Baroness.

Heathrow Airport: Fifth Terminal
3.15 p.m.
The Earl of Kinnoull The Earl of Kinnoull asked Her Majesty's Government:
Whether a planning inquiry procedure that has so far taken four years is a satisfactory way of examining in public the Terminal 5 project at Heathrow Airport.
Lord Whitty: My Lords, the inquiry into the proposed Fifth Terminal at Heathrow, which is
694
considering 37 planning applications and orders, is one of several inquiries held into major infrastructure proposals in the past decade or so. I appreciate the frustration felt by many at the length of such inquiries. The Modernising Planning policy statement made in July 1998 reiterated the Governments's manifesto commitment to simplify and speed up the planning process for major infrastructure projects of vital national interest. We are considering a variety of options and will publish our proposals in a consultation paper in the near future.
The Earl of Kinnoull: My Lords, while thanking the Minister for that reply, I am sure he agrees that four years for any public inquiry and a further two years for the inspector to write his report is an exceptional period of time. It will be six years before the Minister has even an opportunity to decide what to do. Does he agree that since airport inquiries are very contentious it would be of tremendous value if the Government introduced a national airports policy for guidance? Can he say what the inquiry has cost the public purse, both central government and local government, to date?
Lord Whitty: My Lords, on the last point the cost to central government is approximately £9 million to date. I understand that a more or less equivalent amount has been expended by local government. I agree with the noble Earl that this inquiry has taken an incredibly long time. That is why we are looking at streamlining and simplifying the procedures. As to a general airports policy, we need to take into account the outcome of this inquiry but then intend to develop an overall airports policy for public discussion. Noble Lords will have an opportunity to debate aspects of that policy in about 10 days' time.
Lord Annan: My Lords, is it not necessary for the Government to review planning procedures, which are very time-consuming? Does the noble Lord recall the Roskill Commission set up in the 1960s? That commission proposed that the third London airport should be sited at Stansted. Having reported a year-and-a-half after the inquiry began, at an expenditure of £1¾ million, the Roskill Commission suggested that the airport should be sited at Cublington. That proposal was turned down by the then Conservative government. Next, it was suggested that the airport should be sited at the end of the Thames estuary and that the road connecting it to London should run through the East End and terminate in the City. That was turned down. In the end Stansted was chosen. Does the Minister consider that that is a reasonable way in which to proceed?
Lord Whitty: My Lords, as described by the noble Lord I find it very difficult to regard that as a reasonable way to proceed. I recall some of the saga. I visited Foulness in the expectation that one day that site might be an airport. We are all concerned that this procedure

695
is too long and needs to be streamlined and simplified, but that at the same time the public must have an opportunity to express their view.
Lord Clinton-Davis: My Lords, is my noble friend aware that the statements he made, today and earlier, will be generally welcomed? There need not be any dereliction of duty towards environmental matters. But is it not plain common sense that the procedures currently undertaken are too lengthy and inhibit our economic effort? Will my noble friend contrast the actions that his department has already taken—we shall have an opportunity to debate them soon—with the inertia which, over 18 years, overcame the former administration in this and other respects?
Lord Whitty: My Lords, as always I am happy to endorse my noble friend's views. We need a more strategic approach.
On planning procedures, my colleague, Dick Caborn, is considering the whole range of planning procedures. However, noble Lords need to be aware that the vast majority of public inquiries last a week. It is the big inquiries which pose a serious problem.
Baroness Hamwee: My Lords, I have to declare an interest as a resident of west London under the flight path to Heathrow.
On a more general point, does the Minister agree that the adversarial nature of planning inquiries does no good to our society? In this case, it appears to have cost the applicants around £60 million. The Minister gave a figure of £9 million as regards the opponents, including cash-strapped local authorities; my figure is £4 million. Either way, there is a great imbalance in the resources available to the parties.
Lord Whitty: My Lords, I suspect that some of the imbalance is inevitable, and far too many resources on all sides are expended. The adversarial aspect is bound to be present in some of the controversial issues, but the procedures should minimise it and the facts should, as far as possible, be agreed.
Lord Brabazon of Tara: My Lords, will the Minister accept that on this side of the House we welcome the possibility of a change in the planning procedures for major projects? Will the Minister remind his noble friend Lord Clinton-Davis that the former government got through the planning procedures some major projects including, for example, the Channel Tunnel which links this country to Europe, of which the noble Lord is so fond?
Lord Whitty: My Lords, I, and no doubt my noble friend Lord Clinton-Davis, greatly welcome the Channel Tunnel. From some of their comments, I am not sure whether all noble Lords opposite do the same.
Lord Ampthill: My Lords, the noble Lord on the Opposition Front Bench seems to forget that before the transport and works legislation the procedure went before both Houses of Parliament. We could have dealt
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with Terminal 5 in another place and this House in 18 months without the slightest difficulty. Will the Government consider repealing the transport and works legislation?
Lord Whitty: My Lords, the noble Lord rightly reminds us that the parliamentary procedure is an alternative. It is one of the options in the paper.

Mental Health Services
3.22 p.m.
Lord Laming Lord Laming asked Her Majesty's Government:
Whether they will refer the research paper Homicides by people with Mental Illness—myth and reality (Taylor and Gunn—British Journal of Psychiatry) to the review of the mental health services.
The Parliamentary Under-Secretary of State, Department of Health (Baroness Hayman): My Lords, yes. This paper has already been brought to the attention of the External Reference Group advising the Department of Health on the development of the National Service Framework for Mental Health, and of the expert group undertaking a scoping study as the first phase of the review of the Mental Health Act 1983.
Lord Laming: My Lords, I am grateful to the Minister for that helpful reply. Does the noble Baroness agree that this research indicates that, contrary to popular belief, of the number of murders committed in this country during any one year those committed by people with mental illness has declined steadily? Will she ask the review team to consider requiring each mental health authority to put in place a multidisciplinary outreach team dedicated to maintaining close contact with those mentally ill people who have a tendency to drift in order that we can ensure that they take their medication and do not drift out of sight?
Baroness Hayman: My Lords, my noble friend is right to draw attention to the article, which takes a balanced and considered view of the issues relating to homicides committed by mentally ill people. In urging that balanced view, we should not stigmatise the mentally ill because of rare occurrences. Neither should we divert ourselves from the need to improve services to reduce those incidences.
Assertive outreach is important to deal with those who suffer from mental illness who, as the noble Lord rightly pinpoints, are particularly difficult to reach by conventional systems. The National Service Framework for Mental Health, which we hope to publish in the spring, will give advice on alternative ways of providing such a service.
Lord Clement-Jones: My Lords, in the light of the Minister's reply, will the noble Baroness agree that the paper should also be referred to the review by Professor Richardson of the Mental Health Act? If or

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when Professor Richardson's review group makes a proposal for a community care order, will she confirm that there will be full consultation on the principle, and practical application, of any such community care order?
Baroness Hayman: My Lords, yes, I believe that Professor Richardson's group has received a copy of the document. She was asked to consider how community treatment orders might be implemented when the review group scoping study was set up last July. I understand that she has consulted fairly widely already but that before she puts proposals on the subject to Ministers she will consult again.
Earl Howe: My Lords, does the Minister agree with me that dangerous mental disorders, in particular schizophrenia, are often triggered by drug abuse; and that there is a close connection between these two types of disorder? Is it not therefore as important to educate young people on the many dangers of drug abuse as it is to ensure that schizophrenia is effectively treated?
Baroness Hayman: My Lords, the noble Earl is correct to point out that some sufferers from mental illness who are most difficult to reach, and some whom the article identifies as the most likely to be in that small minority who commit offences, are those who have drug or alcohol abuse problems. He is right to point out that we need to consider those issues as well as the issue, for example, of schizophrenia, if we are to be effective.
Lord McNair: My Lords, will the Minister please insist that research is carried out into the violence-producing side effects of modern psychiatric drugs, in particular that of Akathesia, which makes it difficult for many who work in the mental health services to handle the people in their charge?
Baroness Hayman: My Lords, it is important to recognise that we must look at many new treatments in the round. We have to consider the side effects as well as the primary effects. For example, we need to give clear advice on treatment protocols. The national institute for clinical excellence will have a key role in developing and disseminating guidance on drugs in the future.
Earl Russell: My Lords, I am sure this is not the first time the Minister has heard a good proposal for putting an additional obligation on a local authority. Will the noble Baroness agree that the tendency to put additional obligations on local authorities without ensuring adequate funding to meet them has increased, is increasing, and should be diminished?
Baroness Hayman: My Lords, I do not think that the hypothesis to which the noble Earl refers applies in this circumstance. We did indeed put extra obligations on local authorities, not least the obligation to work with health authorities on services for the mentally ill because their needs go across the organisational boundaries of
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the health service and local authorities. But I am glad to say that with that exhortation we provided extra funding for both social services departments in local authorities, and health authorities, so that they could take action on that.
Baroness Gardner of Parkes: My Lords, the Minister states how successful outreach teams are. I have experience of them and agree with that. Is the noble Baroness aware that, no matter how good the outreach team is, there are people who will deliberately make it impossible for that team to contact them? In that circumstance, the outreach team cannot fulfil the task it sets out to do. Will the Mental Health Act review cover such an eventuality?
Baroness Hayman: My Lords, the Mental Health Act review must look at several problem areas. Some people who can safely live within the community can do so only if they are complying with treatment. We must have back-up to ensure that the treatment is complied with or that there are alternatives if it is not. We must provide safety for patients and public alike. Whether through 24 hour nurse-beds, secure provision, additional treatment for those with severe personality disorder or outreach teams in the community, we wish to have a range of provisions to meet all the needs within the spectrum of mental health.

BBC World Service
3.30 p.m.
Baroness David Baroness David asked Her Majesty's Government:
Whether they can prevent cuts being carried out in Russian, Hungarian and Arabic World Service programmes.
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, the BBC World Service is drawing up its strategic plan for the next three years. The BBC is considering its priorities in the light of political, technological and commercial developments given the increase in World Service funding of on average 3.8 per cent. in each year over the 1998–99 level. We expect detailed proposals soon to be submitted to my right honourable friend the Foreign Secretary.
Baroness David: My Lords, I thank the Minister for her Answer and welcome the news of the increased grant which will help to improve the service. Will she assure the House that changing to FM and the Internet, which is not available to millions of people in Russia, Eastern Europe and developing countries, will not take place at the expense of short wave services which are available in those countries? Will she ensure that those services will continue and that the staff who work for them will not be made redundant?
Baroness Symons of Vernham Dean: My Lords, I draw my noble friend's attention to the article by the

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BBC Chief Executive in today's Independent which emphasises the BBC's commitment to the World Service as a global mission. It is difficult for me to give specific assurances about the plan without leaking the plan itself. It has not been finalised. It must be finalised to go to the BBC governors and then it will be submitted to my right honourable friend.
Perhaps I may suggest to my noble friend that once the plan has been finalised we arrange for the BBC Chief Executive to make a presentation to those of your Lordships who I know are extremely interested in the future of the World Service. That will give your Lordships the opportunity to look at the facts and not at some of the newspaper reports we have seen in the past few days and to be able to ask questions of the person who has drawn up the plan.
Baroness Williams of Crosby: My Lords, the House will be aware that throughout the world there is huge respect for the objectivity and quality of the World Service and that it is one of the great British institutions. Will the Minister therefore assure us that there will be no cuts in the Arabic and Russian services at this crucial juncture in world events, albeit that there may be some change in the proportion of news and entertainment? Secondly, will she assure us that the consultation to which she has referred will take place before final decisions are made on the three-year plan, give or take immediate short-term decisions?
Baroness Symons of Vernham Dean: My Lords, I cannot give that assurance. I was trying to be helpful to the House by indicating that once the plan is finalised, having gone to the governors and to my right honourable friend, we would endeavour to explain what it entails. I hoped that that was a forthcoming offer from the Government because I know that your Lordships are most concerned about the situation.
I note the noble Baroness's comments about accuracy, impartiality and objectivity of the BBC World Service. It is a market leader and has almost twice the audience of Voice of America. However, we must wait to see what comes out of the three-year strategic plan. I understand the anxieties about specific language services. Those priorities change from time to time and at the moment I am not in a position to give such undertakings to the noble Baroness.
Lord Hussey of North Bradley: My Lords, I was concerned with the BBC for 10 tranquil years and therefore must declare an interest as I am in receipt of a modest pension from it. During those years I was able to discover and fully confirm in my mind what has been said about the great regard in which the World Service is held around the world. It is of great value to this country and to those countries which receive it.
May I suggest to the Minister that the two most important areas for the World Service are the Middle East and Eastern Europe? In those areas independent news services, either in the press or over the airwaves, are hard to find, which makes the World Service that
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much more valuable. Will the Minister therefore make certain that she has an opportunity to see the plan before it is finally agreed?
Baroness Symons of Vernham Dean: My Lords, I hope that I have made clear that my right honourable friend will see the plan before it is finally agreed. I agree with the noble Lord about the great regard with which the BBC World Service is held throughout the world. The Government have great pride in the BBC World Service. I do not believe that there is any difference on either side of the House as to the regard in which the BBC World Service is held.
The noble Lord made specific points about the Middle East and Eastern Europe. Those issues are bound to be considered both by the BBC World Service itself in drawing up its plan, by the governors in considering that plan and by my right honourable friend. I point out to the noble Lord that the Macedonian service, for example, was opened up in 1996 and that we have seen further openings in Albania and in the Croat and Serbia services. I hope that the noble Lord is reassured about the efforts going into that part of the world.
Baroness Rawlings: My Lords, I am sure that the whole House agrees that the BBC World Service is acknowledged as the finest service in the world. What provisions are there for the World Service to be able to continue broadcasting effectively to crisis areas of the world, in particular the Middle East?
Baroness Symons of Vernham Dean: My Lords, the BBC World Service has increased its language services to some parts of the world which might be said to be in crisis at particular times. Under the CSR, which was published last year, the BBC is also going ahead with the new, much-needed transmitter in Oman. I hope that that will improve transmissions around that part of the world which could be said at times to be in crisis.

Pollution Prevention and Control Bill [H.L.]
3.37 p.m.
The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That it be an instruction to the Committee of the Whole House to whom the Pollution Prevention and Control Bill [H.L.] has been committed that they consider the Bill in the following order:

Clause 1,

Schedule 1,

Clauses 2 and 3,

Schedules 2 and 3,

Clause 4.—(Lord Whitty.)

On Question, Motion agreed to.

Access to Justice Bill [H.L.]
3.38 p.m.
The Lord Chancellor (Lord Irvine of Lairg): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(The Lord Chancellor.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clause 7 [Services which may be funded]:
The Chairman of Committees (Lord Boston of Faversham): I remind the Committee that if Amendment No. 90 is agreed to, I cannot call Amendment No. 91.
Lord Simon of Glaisdale Lord Simon of Glaisdale moved Amendment No. 90:
Page 5, line 12, leave out subsection (7).
The noble and learned Lord said: Amendment No. 90 seeks to leave out subsection (7) of Clause 7. The scheme of this part of the Bill is to set up a body called the legal services commission which will operate through two subordinate bodies, of which the relevant one is the community legal service. The community legal service funds various legal services apart from criminal proceedings. However, by subsection (5) of the clause, the commission may not fund any of the services specified in Schedule 2; and subsection (6) says that,
"Regulations may amend that Schedule".
That is plainly a Henry VIII clause providing for legislation by decree and it is therefore subject properly to affirmative resolution at the very minimum. Subsection (7) however, with which the Committee is concerned, says,
"The Lord Chancellor may give directions … requiring or authorising",
the funding of services in Schedule 2. That equally is a Henry VIII clause but, as I read the Bill, this time it is subject only to negative resolution.
My first question to my noble and learned friend the Lord Chancellor is: why is that subject only to negative resolution? My noble and learned friend has indicated that he will bring forward at Report stage provisions to rectify what some of us regard as constitutional enormities in this Bill. It may be that he intends to make that subsection subject to affirmative resolution.
The other question is probing. It would be helpful to know why my noble and learned friend requires that power. I hope it is not merely that it may come in useful at some time or another in circumstances which cannot now be foreseen. That is not the sort of power that we ought to give. I hope that my noble and learned friend will not use the words "flexible" or "flexibility" which are synonyms for the arrogation of executive powers.
Why does my noble and learned friend, apart from flexibility and a liking to have odd powers in his pocket, want that power? What provisions does he feel may be made subject to the funding potentiality; in other words, taken out of the negative Schedule 2? I beg to move.
The Lord Chancellor The Lord Chancellor: Clause 7(7) provides that:
"The Lord Chancellor may give directions under section 4 requiring or authorising the Commission to fund the provision of any of the services specified in Schedule 2 in circumstances specified by the directions".
I suggest with respect to the noble and learned Lord that he should not be over-prescriptive in relation to these matters. Let me tell him why I cannot and do not think it would be wise to accept his amendment. It is important that the Lord Chancellor should be able to make limited provision for cases otherwise outside the scope of the community legal service where that would be appropriate to alleviate hardship. That seems an entirely sensible provision. What I desire to emphasise to the noble and learned Lord is that the provision confers on the Lord Chancellor a power only to give and not to take away, and the need could be urgent.
I can see that the noble and learned Lord, who is a purist in these matters, takes the view that Schedule 2 should be amended under the affirmative procedure. But there are arguments as powerful the other way. I indicated in my opening speech to the Committee that I thought it right that substantial change to the schedule should be made by the affirmative procedure, in particular if it was taking away. However, I believe it right that there should be powers for the Lord Chancellor to give and to be able to move swiftly to deal with specific problems that may arise. Those are my reasons for inviting the noble and learned Lord to withdraw his amendment.
3.45 p.m.
Lord Simon of Glaisdale: I am grateful to my noble and learned friend for his explanation; I hope he will not be offended if I add the words, "such as it was". Of course, he did not answer the question as to why he needs this power, except to say that it might come in useful at some time. That is simply not good enough.
As to the question of affirmative or negative resolution, we shall have to wait until Report stage when we see my noble and learned friend's better constitutional thoughts. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 91:
Page 5, line 14, after ("2") insert ("or (Community Legal Service)").
The noble Lord said: In moving Amendment No. 91 I shall speak also to Amendments Nos. 99 and 107 which stand in my name and that of the noble Lord, Lord Kingsland. The purpose of the amendments—the first two are paving amendments—is to ensure that some personal injury cases remain within the scope of legal aid. I stress that this is simply a probing amendment. I have tried to list some of the cases which are likely to give rise to difficulty in practical terms.
Conditional fee agreements are unlikely to be offered by lawyers for the foreseeable future on the scale that needs to be contemplated. There will be a serious reduction of access to justice for personal injury victims if no legal aid is available. It is worth noting in passing that a number of successful cases fall within the sort of categories listed in the schedule. I mention only some. For example, there was the liability in the Ben Smolden case. He was a rugby referee who suffered a paraplegic injury. There was also the issue of human growth hormone litigation. The difficult case, which is still pending in terms of assessment of damages at least, relates to chronic bronchitis and emphysema suffered by miners.
I add, in parenthesis, that when I was on the Front Bench dealing with that issue, I made it clear in answer to a question that the Government would not apply the sort of standards applied by insurers when dealing with such matters and would be not just sympathetic, but practically sympathetic.
There is also the question, not totally unrelated to that—in principle, at least—of chronic vibration white finger. I refer to the Myodil case. There are several others. The Hancock case dealt with long-term exposure to asbestos. There are other asbestosis cases. That illustrates the sort of cases that have been successful in the recent past. I feel that it may be necessary to revisit some of the arguments already touched on, and I do so because I have been able to reflect on what my noble and learned friend said about the availability of conditional fee agreements. The assertion was that those will become widely available and that insurance will provide a satisfactory alternative.
With respect to my noble and learned friend, I think that we need further and better particulars of the availability of insurance. He cited some cases. I tried to investigate this with practitioners and I am assured that frequently there are real difficulties in this regard.
Another point arises in relation to this. My noble and learned friend said that the better managerial arrangement of solicitors' offices should overcome any difficulties that may arise in that respect. He prayed in aid a press release from Thompsons. Thompsons is a large firm with a continuing cash flow. It is an extremely competent firm and I have the highest regard for it. However, it is very different from the high street practitioner who does not have the same sort of cash flow.
Premiums in the range of £70 to £100 may be required for a case and if there are a substantial number of cases, that will represent a real burden to ordinary practitioners who practise in the high streets up and down the country, and particularly to those in the poorer areas.
The question was also put to my noble and learned friend by the noble Lord, Lord Goodhart, and my noble and learned friend Lord Archer of Sandwell: what if his prediction is proved to be wrong? My noble and learned friend quite properly referred to his previous statement that he has power to intervene in certain cases of hardship. Again, I feel that we should request from my noble and learned friend a greater idea of what he has
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in mind. In this regard there is uncertainty and apprehension on the part of many practitioners. Those apprehensions—perhaps misapprehensions—should be put to rest. The deep concerns felt by those providing services at present ought to be met.
I said before that premiums ranged from £70 to £100. On reflection, I believe that the figure of £90 to £170 was quoted by my noble and learned friend, which adds to the burden that I have already sought to argue.
I hope that my noble and learned friend will feel that some of the cases that I have listed in the schedule give rise to particular problems. I do not propose to argue them one by one. I have touched on one or two. However, I hope that my noble and learned friend, while recognising that this is simply a probing amendment, will try to give as many satisfactory assurances as he possibly can to those very worried practitioners who are working, as far as they can, in the best interests of their clients. I beg to move.
Lord Goodhart: I rise to support the amendment. A long series of examples of cases is set out in which it is likely that CFAs will in practice be unobtainable and yet in which there may be a strong case for supporting a plaintiff who wishes to take action to claim damages. The list is extensive; there are 15 different examples. Each of them falls clearly within this category. The number of cases in the list is an example of the fact that it is wholly indefensible to exclude from public funding cases of personal injury. There are many types of personal injury case where CFAs will not be appropriate or available. The amendment illustrates the importance of returning to the principle of saying that public funding will remain available for personal injury cases, but will be excluded in cases which it is reasonable to expect to be funded through a CFA; and only in those cases will it be excluded.
Lord Campbell of Alloway: I wish to support the amendment for the reasons put so clearly by the noble Lord, Lord Goodhart, which are real, practical and wholly cogent.
Before I sit down I should like to take up the point that the noble Lord, Lord Clinton-Davis, made that sometimes it is forgotten and wholly unrealistic to compare the position of a firm of the ilk of Thompsons with that of a high street solicitor working in a poor area. The noble Lord speaks from his own experience and I think that we should defer to his opinion.
Lord Kingsland: I too rise to support the amendment tabled by the noble Lord, Lord Clinton-Davis. There seem to be two categories of personal injury cases covered in the proposed schedule. The first concerns vulnerable victims and the second concerns cases that will require a great deal of research and expenditure before the risk involved can be accurately assessed. That is why I think that the list is worthy of the noble and learned Lord's attention.
We had a long debate on the principles that lie behind CFAs and personal injury cases on Tuesday and it is certainly not my intention to repeat the arguments today. However, it should be borne in mind that when the legal

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services commission exercises its discretion in relation to a request for funding, one of its options is to suggest an alternative solution.
I want to ask the noble and learned Lord—perhaps he will say to me that it is obvious on the face of the Bill; nevertheless, it is not obvious to me so I shall ask him—in circumstances where such a list were to be incorporated, would it still be open to the legal services commission to say that in a particular case contained in that list a CFA would nevertheless be appropriate?
Lord Phillips of Sudbury: I should like to support the amendment and to add two points to the debate. First, if Clause 28 is passed as it stands, it could have a significant impact on the risk to which members of the public may be put, who, under present circumstances, may be able to obtain legal aid in the normal way.
The second point that I would add is that I was a non-executive director of one of these legal costs insurance companies for eight years. I had discussions with that and another such company only recently. I fear that the hopes of the Government in relation to the availability of suitable costs insurance may well not be realised. I believe that the premium rates to which the noble Lord, Lord Clinton-Davis, referred may already be out of date. Indeed, there is serious concern within the small group of companies which provide such insurance that there is some selection against them. Moreover, I also fear that the after-the-event insurance, which is what we are principally concerned with here, may not be effectively available in terms of cost. Therefore, I strongly support the amendment.
4 p.m.
Lord Ackner: I, too, should like to express my support for the amendment. However, I think it would probably be helpful to get on record what the noble and learned Lord the Lord Chief Justice said at the Barnett Lecture which he gave on Thursday 11th June 1998. Towards the end of that lecture he said:
"In relation to the main thrust of the Government's proposals for the reform of civil legal aid, the argument is a complex and closely reasoned one. One cannot read the well-argued responses to the Government's proposals submitted, for instance, by the Bar, the Personal Injuries Bar Association and Justice without appreciating the difficulties and the potentially fateful consequences of any radical change to the current arrangements. Those of us who have had no contact with insurance interests cannot be other than unsure whether insurance cover will be available in the much wider range of civil proceedings which are suggested as suitable for conditional fee agreements".
The Lord Chancellor: Conditional fee agreements are good for the public. They will bring into access to justice the millions who are not eligible for legal aid and cannot afford to litigate because they cannot run the risk of losing and having to pay the other side's legal costs. Conditional fee agreements will also be good for the business of lawyers. When lawyers recover from the shock of the new, I believe that they will come to recognise that the extension of conditional fee agreements is a major boost to legal business for litigators. Lawyers in a changing world are not free from
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the need to adapt. They must recognise that they can no longer live in the world of traditional legal aid where lawyers are paid—win, lose or draw.
The proposed amendments would have the effect of introducing a schedule of entitlements in respect of personal injury cases into the Bill. I cannot accept them for two main reasons. First, the community legal service fund will operate within a controlled budget, and resources will be allocated according to priorities, in the areas of greatest need. There is no place in such a scheme for a set of entitlements such as those proposed by my noble friend and the noble Lord, Lord Kingsland.
Secondly, the exclusion of personal injury cases from the scope of public funding is not only important in releasing funds for priority cases, but it is also based on the fact—and I do not propose to go over the detail that I gave earlier in Committee in this respect—that there is a viable alternative method of funding; namely, conditional fee agreements. I give way to the noble and learned Lord.
Lord Simon of Glaisdale: Is there not, in addition, a further alternative? I refer to the one that will shortly be proposed by the noble Lord, Lord Goodhart; namely, the contingency legal aid fund. It is not just one alternative to which my noble and learned friend is so attached.
The Lord Chancellor: We shall debate the possibility of a contingency legal aid fund in due course and in its proper place in our proceedings. However, we are of the clear view that a contingency legal aid fund would attract only the weak cases because the strong cases would proceed by conditional fee agreements carried forward by the profession. We believe that a contingency legal aid fund would be doomed to failure. However, lest we are wrong about that, we are taking reserve powers which would enable us, if need be, to establish such a fund. In the meantime, we are proceeding in the way that I have indicated.
Nevertheless, I desire to say this to lawyers, be they barristers or solicitors. Every other business incurs costs and runs risks in order to earn profits. Litigation will be very profitable for the lawyer under a conditional fee agreement when he wins. I do not begin to accept that lawyers, among all businesses, should be excluded from running risks and incurring costs in order to earn profits. Lawyers must come to terms with the real world and not that of conventional legal aid where lawyers are paid whether they win, lose or draw. I give way to the noble Lord.
Lord Goodhart: Is the noble and learned Lord the Lord Chancellor suggesting, for example, that doctors should be paid on a no cure, no payment basis?
The Lord Chancellor: Certainly not. We are proposing a means of funding litigation which is an alternative to the public purse and which will expand access to justice, thereby releasing moneys to follow other desirable purposes. However, I will have the

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flexibility through my direction-making powers in Clause 4 and Clause 7(7) to allow the funding of personal injury cases in some circumstances.
I shall not repeat the detail of what has already been said, but it is clear that, if need be, I shall be in a position to achieve some of the objectives set out in the amendments. By keeping the cases specified by the noble Lord and my noble friend off the face of the Bill, I will have greater flexibility to respond to changing needs and circumstances in the future. I shall certainly take their suggestions into account as I develop policy and, if any need is demonstrated, I shall consider whether to restore particular categories of case to legal aid. I predict that the prophets of doom are wrong and that conditional fee agreements will prove to be a triumphant success. I therefore invite my noble friend and the noble Lord to withdraw their amendment.
However, although it was not germane to the specific argument on these amendments, perhaps I should respond to the point made by the noble Lord, Lord Kingsland. On the footing that the amendment were accepted, he asked whether the commission could still refuse to provide legal aid. In response, I invite the noble Lord to consider Clause 9(2)(d) of the Bill.
Lord Clinton-Davis: I thank my noble and learned friend for at least some of the arguments that he has adduced and, in particular, for drawing attention once again to the power that he will have to utilise directions in certain specific instances. However, the position remains very vague and, notwithstanding my noble and learned friend's usual powerful advocacy, my doubts are not put wholly at rest.
My noble and learned friend said on the first day of the Committee stage that he was satisfied that the kind of concerns that we have mentioned again today were unfounded. He said,
"It is my view that the majority of personal injury cases do not warrant public funding in the future because there is a viable alternative in the private sector; namely, conditional fee agreements".—[Official Report, 19/1/99; col. 568.]
But what constitutes a majority? A majority is 51 per cent. I assume that my noble and learned friend asserts that he is talking about a substantial majority, but I do not know upon what basis this has been properly assessed. It remains imprecise. If there is a real risk that a substantial minority of cases will be prejudiced as a result of this situation, it remains a cause for great anxiety.
I do not agree with the totality of the argument that my noble and learned friend adduces when he acquaints lawyers' practices with the general run of businesses. Lawyers' practices, certainly in the City and the West End, are run as businesses—there can be no doubt about that at all—but they are vastly different in character and in the work that they undertake from the kind of practices to which I have alluded. There are no vast profits being made by the overwhelming majority of that category of firm. I believe that they are doing a superb job in protecting the interests of the public and making access to justice a reality. Of course there are many things that go wrong, but I believe that the public have confused the high-blown cases that one reads about—mostly criminal cases involving substantial fraud—with
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the ordinary day-to-day routine business that is undertaken in a solicitor's practice of the kind I have mentioned.
I am most grateful to those who have spoken in this debate. It is important that my noble and learned friend should respond to the point made by the noble and learned Lord, Lord Ackner, in citing a speech he made some time in June 1998—I did not catch the exact date—which does not altogether sit satisfactorily alongside the remarks that my noble and learned friend has made.
Lord Ackner: I intervene, first, to correct what the noble Lord has said and, secondly, to strengthen it. I was not quoting from a speech I made, I was quoting from a speech made by my noble and learned friend the Lord Chief Justice.
Lord Clinton-Davis: I apologise if I expressed myself inelegantly or in an inappropriate manner. I was referring to the intervention made when the noble and learned Lord cited the speech made by my noble and learned friend. That does not altogether sit easily with the remarks that he has made during the course of these debates.
I understand that my noble and learned friend will adopt a measure of flexibility. However, while he is reluctant to be more specific about the kind of instances where that would apply—I understand that—the matter remains imprecise. That makes things difficult for people who practise in these areas. I do not know whether any Member of the Committee wishes to speak again before I seek to withdraw the amendment, as I propose to do. I see no vigorous nodding of heads. I ask my noble and learned friend to respond to the points I have just made.
4.15 p.m.
The Lord Chancellor: I do not propose to respond as I did so in the previous arguments that I put to the Committee.
Lord Clinton-Davis: Perhaps my noble and learned friend will at least indicate what he meant by a majority of personal injury cases, and the extent of that majority.
The Lord Chancellor: I shall read Hansard to see precisely what I said but I have total confidence that the overwhelming majority of personal injury cases will be funded successfully through conditional fee agreements. For many years trade union solicitors have carried forward bulk personal injury litigation successfully for those whom they represent on terms specifically of not expecting fees from their substantive clients—the trade unions—when they lose because the fees they get when they win enable them to run a profitable business. In

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fact probably the best evidence that conditional fee agreements are completely viable in this area is precisely what I have now said.
Lord Phillips of Sudbury: I rise to—
The Lord Chancellor: The noble Lord, Lord Phillips of Sudbury, wishes me to give way before I have completed my reply to my noble friend Lord Clinton-Davis. However, I yield to his enthusiasm.
Lord Phillips of Sudbury: I am grateful to the noble and learned Lord the Lord Chancellor for so doing. He has twice now mentioned firms which represent trade unions and the manner in which they conduct business. My own firm represents one of the large unions and has for a long time had an arrangement with that union as to the payment of costs. However, I must assure the Committee that that situation is not comparable with the situation we are talking about which concerns a case by case arrangement for individual solicitors dealing with clients as they come through the door. A relationship with a trade union involves swings and roundabouts. The arrangement is capable of being adjusted from month to month and year to year to ensure that the firm concerned gets a fair return overall for the cases. There is no such averaging out in the case of an individual solicitor who is dealing with an individual client.
The Lord Chancellor: The noble Lord, by that intervention, gives away his position. What we are doing is addressing whether individuals will have access to justice through conditional fee agreements. I say they will because we can see that the volume providers of services, the trade union lawyers, make a satisfactory profit in providing that volume service. However, the noble Lord says that one cannot equate that with the position of the small lawyer. That shows that the noble Lord is seeking to defend the interests of a particular group of lawyers. The question I am addressing is whether the public will have access to conditional fee agreements in the overwhelming majority of cases. I say that they will.
There is a further point I desire to make in reply to my noble friend Lord Clinton-Davis. The only cases where I have a measure of concern is where there are high investigative costs. We are taking powers under the Bill partially to fund cases going forward under conditional fee agreements so that sums are advanced to cover these high investigative costs. These are the reasons why I have confidence in the situation and why I repeat my invitation to my noble friend to withdraw the amendment.
Lord Clinton-Davis: My noble and learned friend is right to underline again the particular category of case where it is virtually impossible to proceed because of high investigative costs. That point was mentioned by the noble Lord, Lord Kingsland. My noble and learned friend has given an assurance to the Committee that he is giving serious consideration to this kind of issue. I must say that I am no more enlightened about his view
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of the majority, to which he had referred earlier—and to which he has referred twice more in his remarks—than I was before. I am tempted to submit a request for further and better particulars as regards a majority. However, I shall not hold up the deliberations of the Committee to extract a reply at this stage. I cannot promise that I shall not return to this matter at further stages of our consideration of this Bill. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 92 and 93 not moved.]
Lord Kingsland Lord Kingsland moved Amendment No. 94:
Page 5, line 14, at end insert—
("( ) Where services are funded in accordance with subsection (3)(b), payment shall be made in accordance with regulations made by the Lord Chancellor after consultation with the Law Society and the General Council of the Bar, and in making such regulations the Lord Chancellor shall have regard to the principle of providing fair and reasonable remuneration.").
The noble Lord said: Amendment No. 94 concerns the regulations which will be made by the noble and learned Lord the Lord Chancellor to determine the conditions under which payments are made by subsection (3)(b) of Clause 7. There are two issues to which I wish to draw the noble and learned Lord's attention. First, it is desirable that the noble and learned Lord should consult both the Bar Council and the Law Society before making those regulations. Secondly, the basis upon which payment should be made under Clause 7(3)(b) should be as transparent as possible. This is to prevent the undermining of quality services. In making these proposals, I am reflecting the terms of the Legal Aid Act 1974 with respect to transparency and the Legal Aid Act 1988 with respect to consultation. I beg to move.
The Lord Chancellor: The purpose of these amendments is to provide a framework in which remuneration of lawyers will be determined. Amendments Nos. 94 and 182 would restore the concept of fair and reasonable remuneration to the face of the legislation. Amendment No. 184 would require me, in relation to services procured through the criminal defence service, to respect the principle that such services are to be remunerated by payment of a reasonable amount in all the circumstances of the case.
I do not accept the terms of the present amendment. The terms "fair" and "reasonable" are far too wide and imprecise. Nor do these amendments contain any reference to what might be affordable or what value for money might be achieved through the remuneration scheme. At the risk of becoming tedious, I have to say that public money is limited; the priorities for that public money are many, and they compete with each other. It cannot be right that a duty should be placed on the Lord Chancellor to make regulations relating to the remuneration of lawyers which take no account of the availability of those public funds. To suggest otherwise is not to live in the real world.
I am not attracted simply to carrying into this Bill provisions about remuneration that have previously failed. It seems to me that the Lord Chancellor should

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have a discretion to set rates, as now, but that in doing so he should have regard to the extent to which the rates ensure the availability of a sufficient number of competent practitioners, the cost to public funds and the value for money achieved for the taxpayer, and the beneficiaries of the help received from the money spent.
I propose to put down an amendment along those lines, setting out the factors that the Lord Chancellor should consider in fixing remuneration rates. I will also address the level of any consultation that might be appropriate in the circumstances. On that basis I invite the noble Lords who tabled these amendments not to press them.
Lord Kingsland: When the noble and learned Lord the Lord Chancellor began to speak I felt a sensation of intense and acute depression, but I had somewhat recovered by the end of his speech. I thank him for what I take to be a move in some direction towards the terms of these amendments. I look forward to seeing what he has to say about the matter and debating it again at Report stage. I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
Clause 7 agreed to.
[Amendment No. 95 not moved.]
Schedule 2 [Community Legal Service: excluded services]:
Lord Goodhart Lord Goodhart moved Amendment No. 96:
Page 53, leave out lines 33 and 34.
The noble Lord said: Paragraph 2 of Schedule 2 excludes from any possibility of funding out of the CLS,
"Services consisting of the provision of help in bringing or defending any proceedings in the course of carrying on a business".
The Legal Aid Act 1988 and its predecessors excluded any form of legal aid to corporate bodies. I think that is an entirely correct position, which is continued by the present Bill. Under the Legal Aid Act, aid can be granted to business proceedings if the business is carried on by an individual on his own or by individuals in partnership. This paragraph of Schedule 2 would exclude that possibility. I believe that position is wrong.
In a small business carried on by an individual, a business action may well destroy that person's livelihood. Let us consider the example of a corner shop. The lease of that shop comes to an end and there is an application for a new tenancy under the Landlord and Tenant Act. The landlord puts in a wholly unjustifiable claim for a much higher rent before the new tenancy is granted. If that claim takes effect, the shop may be forced out of business and the shopkeeper may well suffer personal bankruptcy. A challenge to that claim in the court is very likely to require help from a lawyer and, indeed, from a surveyor. Very many small shopkeepers would not be able to afford that help. Should it not be possible for such shopkeepers to be at least considered, in due course of priority, for help from the community legal service fund?
In a case of that kind it is very hard to see how a CFA could possibly be suitable. It is not a risk of the kind covered by a normal insurance policy. I accept that if the owner of the business has chosen to get the benefit of limited liability by incorporating the business, he should not get publicly funded
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help for the benefit of that company. Nor would I expect the community legal service to fund the costs of large firms, solicitors and accountants.
Cases where it is appropriate to fund business proceedings out of the community legal service fund will certainly be rare, but I believe that small businesses should not be excluded altogether from the possibility of applying. I accept that if a CFA is available, the case should not be funded by the taxpayer. But that is not always the case and it is not appropriate to exclude that type of case on the assumption that a CFA will always provide an acceptable alternative to public funding. On the relatively rare occasion where a business is conducted by an individual and a case represents a real threat to his livelihood there should be a possibility of funding out of the community legal service. I beg to move.
4.30 p.m.
The Lord Chancellor: I do not accept this amendment. One of the key objectives of these reforms is to ensure that publicly funded help under a controlled budget is directed to areas where the need of people is greatest, such as social welfare cases and public interest cases; for example, those involving the interests of children. Politics is the language of priorities and there are hugely competitive demands on the public purse. I have to live within a controlled budget. Proceedings carried on in the course of a business do not, in my judgment, have sufficient priority to warrant any public funding other than for the provision of basic information and advice on the law.
I agree with the noble Lord that under the current legal aid scheme legal aid is not available to companies but a sole trader can currently receive legal aid to pursue a business dispute. Businessmen who are running profitable businesses have the option of insuring against the possibility of having to take or defend legal proceedings. I do not follow how the noble Lord is able to assert that insurance is necessarily not available for the kind of case which he supposed. It is a question of judgment and priorities. I do not believe that the taxpayer should have to meet the legal costs of sole traders who do not take out adequate insurance.
Lord Goodhart: I find myself naturally somewhat disappointed with that answer. The test of priorities is one that has to be applied in deciding which types of case should have priority, but there should also be sufficient flexibility to enable cases of particular hardship within types of case which in general have a lower priority to be promoted up the scale. While I accept that this is a type of case where it would be relatively rare for the CLS to fund proceedings, I still think that it would be best to keep that type of case in so that, where appropriate, it could be funded. Having said that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 97 to 99 not moved.]
Lord Goodhart Lord Goodhart moved Amendment No. 100:
Page 54, line 28, at end insert—
("( ) proceedings before industrial tribunals,
( ) proceedings before appeal tribunals constituted under the Social Security Act 1998,").
The noble Lord said: In moving this amendment, I wish to speak also to Amendments Nos. 101, 102 and 104. They propose to include in Schedule 2 a number of additional tribunals for which public funding would be possible. The effect of paragraph 5 of the schedule is that services consisting of the provision of representation are excluded except those specified in sub-paragraph (2). Sub-paragraph (2) broadly maintains the present courts and tribunals in which representation is possible.
One of the main drawbacks to the present system of legal aid has been that it has never extended to tribunals which decide many cases of great importance to people who cannot afford legal help out of their own pockets. The Bill retains the possibility of public funding for two tribunals where it is now available—the Employment Appeal Tribunal and the Mental Health Review Tribunal. However, it excludes public funding where legal aid is now available for hearings before the Lands Tribunal or the Commons Commissioners. I accept those exclusions. It also appears to exclude the existing right of representation before the Discretionary Lifer Panels, which consider applications for release on licence from prisoners who have been given life sentences for offences for which a life sentence is not the sole mandatory sentence. Those proceedings are not covered by paragraph 5(2) of Schedule 2, but, equally, do not appear to be criminal proceedings. Aid is now provided by way of the ABWOR scheme for representation. Aid should be provided in such cases and I hope that it has been omitted by way of an oversight.
Paragraph 5(2) does not extend rights of representation to any tribunals which do not have them now. There is no representation for tribunals dealing with employment matters. I must apologise for having used in my amendment the old description of them as "industrial tribunals" rather than the current one of "employment tribunals". It does not provide any representation before the tribunals under the Social Security Act 1998, or before the Social Security Commissioners, or before immigration and asylum tribunals. The rejection of a case before any of those tribunals may be devastating to the claimant. It may lead to a loss of livelihood, it may lead to extreme personal hardship, and in an asylum case it may lead to an applicant being returned to a country where he or she will suffer a grave risk to their life. Representation is extremely valuable. It is clear that claimants who are represented before employment tribunals through, for example, their trade union, or social security claimants who are represented through advice agencies, have a much better chance of success.
I believe that it is the Government's intention that, as and when the costs of existing services are brought under tighter control, it will be possible to modify Schedule 2 to allow an extension of services to these tribunals. But I do not think that that mere statement of intention is good enough. I believe that the Bill should
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allow representation before suitable tribunals now. I accept that representation would have to be phased in very slowly for these purposes. An immediate grant of tribunal representation to all who need it without a large increase in funds would mean an unacceptable restriction of services provided under the existing law. But necessity for phasing in does not mean that tribunals should be excluded.
It is true that the commission is supposed, under Clause 5, to inform itself of the need for services and to plan how to meet that demand. Obviously, it cannot investigate the need for services which by law it cannot provide. It is only if representation before tribunals is not excluded that the commission can inform itself of the need for representation and plan how those needs can be satisfied. The commission should start on that right away. Representation before tribunals on employment, social security and immigration matters at present form the greatest pool of unmet need for legal services. They should not be excluded by Schedule 2 so that phasing in can begin now for how those services are to be incorporated into the scheme of the community legal service fund. I beg to move.
Lord Archer of Sandwell: Amendment No. 103, in this group, bears my name. It proposes that a further item should be added to the list of proceedings which may be funded as part of the community legal service for the purpose of representation; namely, proceedings before immigration adjudicators and the Immigration Appeals Tribunal. The noble Lord, Lord Goodhart, got there first. So I am content to support his amendment and not to move my own.
The reasons that it would be unfair and unjust to exclude those proceedings from the benefits of the scheme were touched upon by the noble Lord. Perhaps I may briefly elaborate. As the noble Lord said, those who are concerned in these proceedings have very serious matters at stake, sometimes their lives. They are frequently unfamiliar with the English language. It is possible to give evidence with the assistance of an interpreter, but it is very difficult to conduct one's own case using an interpreter. Often, such people are unfamiliar with tribunal proceedings, or indeed any proceedings at all, certainly in the United Kingdom. They are unlikely to know the intricacies of the legal provisions that are at the very core of the issues to be decided.
I take this opportunity to pay tribute to the adjudicators and the chairmen and members of the Immigration Appeals Tribunal, most of whom are totally dedicated and grapple with the difficulties to produce a just result. But unskilled representation in those conditions is no substitute for justice.
Sometimes of course such people are represented at the expense of their families; and sometimes by advocates from outside the legal profession. That representation may be very competent. It is within my knowledge that the Immigration Advisory Service and the Refugee Legal Centre make a commendable contribution to the process, as do law centres. However, some appellants, unfamiliar with the procedure, fall into the hands of charlatans without qualifications,

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knowledge or skill and who are simply out to make a fast buck. I am aware that the Home Office, the Bar Council and the Law Society are considering how the problem may best be addressed. But at present it is very much in evidence. In terms of a contribution to justice, the addition of these proceedings to the list of those for which representation may be provided would be a sound investment.
However, I confess that, like the noble Lord, Lord Goodhart, I had an ulterior motive in tabling this amendment. We may all make suggestions as to meritorious additions to the list. I was anxious to make a more general point—one which I believe will find some sympathy with my noble and learned friend the Lord Chancellor, even if he cannot respond positively to all the specific suggestions in this group. I am grateful to the noble Lord, Lord Goodhart, for ventilating the subject in general.
I must declare an interest. I am privileged to be chairman of the Council on Tribunals—a matter that is known to my noble and learned friend as, together with my noble and learned friend the Lord Advocate, he appointed me.
When I first came to the Bar, tribunals were the poor relations. The questions with which they dealt were perceived as marginal. It was said in their favour that they were less formal than the traditional courts. So indeed they were. But that very virtue was conceived as ensuring that they administered second-rate justice. I must confess that the period of which I am speaking falls not within history but archaeology! It was before the Franks Report in 1957.
One important consequence was that, almost if not totally without exception, proceedings in tribunals were not considered worthy of legal aid. Now, in terms of numbers, they deal with the major part of our justice system. At the last count, the number of tribunal systems that fell within the supervision of the Council on Tribunals was 78, bearing in mind that some of those jurisdictions embrace a variety of situations and issues. The citizen is six times more likely to encounter our system of civil justice in a tribunal than in the more traditional courts. Some deal with very large sums of money. Many deal with matters of vital importance to those who come before them. The law that they dispense is often exceedingly complicated and requires a high degree of expertise. The president or regional chairman is often of a status at least equivalent to that of a senior circuit judge; in fact, sometimes it is a senior circuit judge.
I hope that in the foreseeable future there will be a new acronym in the language—SCROCG—which stands for the Standing Conference on the Resolution of Citizens' Grievances. It arises out of an international conference which took place in 1997 at the University of Bristol, and, happily, was sponsored by my noble and learned friend's department. Much of the credit for it goes to Professor Martin Partington. The purpose of establishing it is to review the many decisions that are now taken in our system of administrative law where the citizen may need to know in which direction he should go for redress.
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My noble and learned friend has recognised some of these points already in the schedule, which includes mental health review tribunals. I shall not make a false point about the Employment Appeal Tribunal because that is in a special position. The noble Lord, Lord Goodhart, has suggested other candidates for the list, and I support those candidates.
I hope that the culture in which tribunals were often seen as the harijans of the system will not find its way into the legal services commission, and that even if my noble and learned friend does not feel able to respond positively to all these amendments, the seed will germinate and—who knows?—possibly bear fruit in the future.
4.45 p.m.
Lord Meston: I support the amendment and strongly support the remarks of the noble and learned Lord, Lord Archer. There seem to me to be four main reasons for advocating representation supported by the state in some form or other before tribunals.
Before tribunals, the imbalance between the represented employer and the unrepresented employee, or former employee, is usually most pronounced. If ever there were a case for equality of arms, it is in tribunals. Secondly, over the years the law that was intended to be straightforward and simple, particularly before industrial tribunals, as they were then called, has become increasingly complex. That is partly the fault of Parliament in enacting employment Bills of one kind or another year after year. However, it is not merely a question of legislation coming from Parliament but of that coming directly from Europe. Thirdly, as both my noble friend and the noble and learned Lord said, the issues and their outcome can be of great importance to the individual concerned. Fourthly, the unrepresented applicant who has no recourse to a union, and who will therefore be tempted to represent himself, may fall prey to the so-called experts in representation who hold themselves up as representing applicants to tribunals and who are in some cases, as the noble and learned Lord accurately described, charlatans. They often have their own agenda; they often do more harm than good to the individual concerned; and they are not accountable to any professional body for their conduct. In areas involving particular expertise such as race and sex discrimination cases, and nowadays disability discrimination, expertise is most important for the effective presentation and defence of a claim. For those reasons I strongly support the amendment.
Lord Renton: May I say that I have no objection in principle to Amendments Nos. 100, 102 and 104, although I would have thought it better to leave those to the discretion of the noble and learned Lord the Lord Chancellor when exercising his power, if he ever does so, to add to paragraph 5 of the second schedule. But I must make absolutely plain that for reasons I shall give I am strongly opposed to Amendments Nos. 101 and 103. I say that with deep respect to the noble and learned Lord, Lord Archer of Sandwell, for whom I have had a high regard for many years, having known him well in both Houses of Parliament as well as a member of the Bar.

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The trouble really is this. We have to acknowledge that our country, probably more than any other country in the world, is subject to pressure from immigration. We have bogus asylum seekers; we have people who come here not as asylum seekers but in a speculative way, hoping that they will be allowed eventually to stay.
Lord Goodhart: I am most grateful to the noble Lord, Lord Renton, for giving way. When he says that the pressure on this country is greater than on any other country in the world, does he seriously suggest that the pressure is greater than that on Germany and Austria which face very large incursions of refugees from eastern Europe and the former Yugoslavia?
Lord Renton: I agree that pressure has been very great in the past, but it is not within my knowledge that it continues to be so, whereas year after year we have vast numbers of people wishing to come here and settle in overcrowded parts of England; not so much in Scotland or Wales. I shall not give way again, although I may later. I think I should be allowed to develop my argument. If noble Lords are afraid of hearing my argument, so much the worse for them.
To grant the kind of aid which is being proposed in respect of appearances before the immigration appeal authorities and the immigration appeal tribunals would produce, I am sure, many more bogus asylum seekers coming here speculatively and hoping to get leave to remain. I do not consider that a wise use of public funds, especially when the noble and learned Lord the Lord Chancellor, faced with tremendous public expenditure on legal aid, is doing his very best under the Bill to try to change the system and make it more rational. I do not consider it would be wise for your Lordships to accept Amendments Nos. 101 and 103. I now give way.
Lord Archer of Sandwell: The noble Lord is typically generous and I am most grateful to him for giving way. He uses the words "bogus asylum seekers". How is it to be known whether an asylum seeker is bogus until his case has been competently deployed and competently considered?
Lord Renton: If I may say so, I think that a somewhat tendentious argument. We know that many people come here speculatively and we would only increase the numbers doing so if they were given public funds to help establish themselves here. I must confess that I do not think that is in the public interest.
Lord Clinton-Davis: I support, certainly in principle, the amendments we are addressing. I record a prior interest. I was at one time chairman of the Refugee Council, a body which undertakes invaluable work on behalf of people who are extremely vulnerable, many of them inarticulate and most of them incapable of coping with the sort of problems we are talking about.
I want to address briefly some of the remarks made by the noble Lord, Lord Renton, for whom I have a high regard, as he knows. We are good friends. However,
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I reject most of what he had to say. It is simply not true that this country, in the past or currently, bears a burden of immigration comparable to that of many countries in Europe, certainly proportionately. The noble Lord is simply mistaken. I did not know that he would raise the point; otherwise I would have armed myself with the statistics to buttress what I am saying. I invite the noble Lord to examine the statistics which are available.
The burdens borne by European countries do not compare with those in impoverished countries of Africa which have immigration problems of an unparalleled size. I think it is fair to say that in the light of the noble Lord's remarks.
As to the amendment, I adopt the argument adduced by my noble and learned friend Lord Archer. The issues being dealt with here can, even if they concern only a minority of cases, be matters of life or death. They have the most profound significance for many of the people who appear before the tribunals. I would also add—it goes without saying—that by no means all asylum seekers should be declared "bogus" before their cases have even been investigated properly.
I understand the arguments about priorities which I am sure my noble and learned friend will seek to adduce. I remind him that those arguments were present before in connection with the Society of Labour Lawyers, of which he is a distinguished co-president along with my noble and learned friend Lord Archer. I too have the privilege of being a co-president. I think the society is on record as having made a statement defending legal aid before the sorts of tribunals we are addressing. So there is something of an inconsistency about the current situation as it is being argued under the Bill. The Society of Labour Lawyers is very clearly on record over a long period of time as being in support of the very proposition now being discussed.
Lord Renton: Before the noble Lord sits down, does he agree that even if we are not getting more people seeking immigration here, relatively speaking, than other countries, the number is higher than is acceptable in the interests of the people of this country?
Lord Clinton-Davis: I am not going to enter into an argument because the matter cannot be dealt with properly in this way. I do not accept the argument that the noble Lord has adduced; nor do I accept that bogus immigrants are pouring into the country and that they are likely to get legal aid to appear before these tribunals. That is a rather speculative possibility and in fact one which is very unlikely to happen.
Lord Mackay of Clashfern: In relation to Amendments Nos. 101 and 103, it occurs to me to inquire whether, once the legal aid system is altered in accordance with this Bill, it might not be quite a good idea to invite the noble and learned Lord the Lord Chancellor and his colleague the Home Secretary to pass over the budget for support of representation in these tribunals so that it might be brought into the community legal service as part of the planned integration and

719
perhaps therefore made use of under criteria which are more general than those which apply to the Home Office budget in this respect at the present time.
5 p.m.
The Lord Chancellor: The proposition is that Schedule 2 should be amended to allow legal aid to be available for representation in proceedings before employment tribunals—the old industrial tribunals—and social security tribunals. I speak from personal experience, and I believe that my experience would be confirmed by practitioners today. I have always made my views crystal clear, and my noble friend Lord Clinton-Davis has called attention to that.
I accept that employment tribunals follow procedures similar to those of the courts. That is because their function, like that of the courts, is to determine what are often complex factual and legal issues between private parties. Legal complexity can in some cases exceed anything which appears in the county courts. There can, I agree, be professional cross-examination of witnesses, and lawyers frequently appear in these tribunals. Applicants can be unrepresented in difficult cases, while employers are represented, and that is unequal representation. I accept that there are certainly some cases in which legal representation is desirable.
I recognise that representation is already provided for in proceedings before employment tribunals from a number of sources, including trades unions and statutory bodies such as the Commission for Racial Equality and the Equal Opportunities Commission. Nevertheless, it is clear to me that many people are unable to obtain representation when they need it, and it would be unworthy of me to seek to deny that.
I have already extended the availability of conditional fee agreements to all civil courts and tribunals, and under the Bill I propose changes to make these agreements more attractive. As I have already said, it is my belief that where the private sector can provide an effective service, such as conditional fee agreements, public money should not be spent. Conditional fee agreements are available for people to use in relation to employment disputes in employment tribunals. However, under the employment tribunals' costs rules, costs do not follow the event as in almost all other litigation where significant sums of money are recovered. A successful applicant in the employment tribunal under a conditional fee agreement would therefore have to pay his lawyer's success fee and the insurance premium from the damages awarded because he could not recover these from the respondent.
At the Home Affairs Select Committee on 13th October 1997 I was asked whether I planned to expand legal aid to cover representation at tribunals. The answer I gave on that day was that it would not be possible until I had control over expenditure. The reformed scheme which I propose to introduce under the Bill should, over time, give me that control and the flexibility required to target resources on deserving cases. I am willing to consider whether legal aid could be made available, in certain limited circumstances, for representation in proceedings before employment tribunals.
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However, there are two points I wish to make. First, it would be premature to reach any decisions about extending publicly-funded representation in tribunal proceedings before the Government have completed a review, on which they are now embarked, of the extent to which current procedures and other arrangements, including representation, comply with our ECHR and EU obligations and until we have identified the options for ensuring compliance in the future; and, secondly, in any event, within my controlled budget I could not here and now realistically consider the availability of legal aid in employment tribunals beyond a very limited category of case, for to admit it even to that extent would be at the expense of other priority parts of the budget.
Legal aid could not conceivably be granted in present circumstances in every employment case. My general approach is clear. Public funding should not support weak cases. It should not displace other forms of support. Cases need to be tested for priority of claim under a controlled budget. Factors to be considered would include the complexity of the case, factually or legally, the public importance of the issues at stake and the availability to the applicant of other sources of representation. I can assure the Committee that I have these issues under active consideration.
Different considerations apply to tribunals dealing with social security appeals, whether the appeal tribunals or the proceedings before the social security commissioners, although I cannot claim any direct personal experience of these. Welfare tribunals investigate all questions relating to the appeal through an informal and inquisitorial hearing and are in sharp contrast to employment tribunals, which are adversarial. Oral evidence in these tribunals does not carry the same significance that it has in employment tribunals. Since 1996 appellants have had the opportunity in these tribunals to opt for either an oral or a paper hearing. The Department of Social Security's officials act as amici curiae, informing the tribunal of the relevant evidence, whether it assists the appellant or the department. Presenting officers receive training and guidance which stresses that they must not assume a defensive role or think in terms of winning cases. For these reasons, I see far less prospect that these cases could have a sufficient claim on a controlled budget.
On that basis, and bearing in mind what I have felt able to say about employment tribunals, which I believe is of an encouraging nature, I invite noble Lords not to press their amendments.
I turn now to Amendment No. 102. The noble Lord, Lord Goodhart, called specific attention to discretionary lifer panels. He proposes an amendment to Schedule 2 to allow funding to be available under the community legal service for representation in proceedings before discretionary lifer panels.
I welcome the opportunity to assure the Committee that representation will continue to be made available under the new scheme. However, I cannot accept the amendment because I intend to make provision under the criminal defence service rather than under the community legal service.

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Although these hearings are not strictly criminal proceedings, the expertise necessary to provide this type of representation is most likely to be found in those practitioners who will provide services as part of the criminal defence service. However, I can give an assurance to the noble Lord, Lord Goodhart, that, although there is no provision for representation at these proceedings on the face of the Bill, I intend to make regulations under Clause 12(3)(f) to enable prisoners to be represented before parole board panels dealing with "discretionary lifers" and offenders detained at Her Majesty's pleasure. Clause 14(2)(b) requires the legal services commission to fund representation in the circumstances there prescribed. On that basis, I invite the noble Lord not to press that amendment.
I turn to Amendments Nos. 101 and 103, which address immigration tribunals. I am grateful to my predecessor the noble and learned Lord, Lord Mackay of Clashfern, for fuelling my assumed irredentist ambitions and seeking to gain control over part of the Home Office budget. I shall certainly convey what the noble and learned Lord said to my right honourable friend the Home Secretary. I do not believe that the amendments are necessary in the area of immigration tribunals. The Home Secretary already makes grants under Section 23 of the Immigration Act 1971 to the Immigration Advisory Centre and the Refugee Legal Centre. They are two voluntary organisations who provide free advice, assistance and representation at these appeals.
The whole system of immigration and asylum appeals is a matter that is receiving the current attention of the Government. I have been working closely with my right honourable friend the Home Secretary on proposals to rationalise the whole system of immigration appeals. I have also asked the Legal Aid Board to report to me with proposals for contracting legally-aided immigration work. All of this means that currently we are addressing the effectiveness of the system from the standpoint of having good quality advice, assistance and representation where needed. On that basis I invite the noble Lord to withdraw the amendment.
Lord Harris of Greenwich: Speaking as a former chairman of the Parole Board, I very much welcome the observations of the noble and learned Lord about discretionary life panels. When I was chairman of the board the Home Secretary alone took the final decision. As a result of the judgment these decisions are made by panels of the Parole Board. That being so, it is highly desirable that there should be legal assistance in cases of this kind, and I very much welcome what the noble and learned Lord said.
5.15 p.m.
Lord Windlesham: I also was chairman of the Parole Board and had an opportunity to observe discretionary life sentence prisoner hearings. I was under the impression that applicants were already legally aided.
Lord Meston: Before the noble and learned Lord responds further—if he intends to do so—perhaps he
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can add to the list of those whom he acknowledges provide good representation for those who appear before employment tribunals, in particular the Free Representation Unit. Further, when considering whether conditional fee agreements are appropriate before such tribunals, will he bear in mind that they would be inappropriate in many cases where the primary remedy sought was reinstatement rather than financial compensation, and also that they might be inappropriate before tribunals where inter partes orders for costs are not the norm?
The Lord Chancellor: That is the problem, is it not? It is very difficult to make conditional fee agreements wholly effective where costs do not follow the event. That was the point that I was at pains to make. Conditional fee agreements can work in a regime where costs do not follow the event, but they have the disadvantage that the fees of the claimant's lawyers and the uplift must come out of the compensation and so reduce the amount to which ex hypothesi the claimant is entitled. Conditional fee agreements therefore work much more effectively in a regime where costs follow the event.
It is not however obvious why costs should not follow the event in tribunals when that is the norm in every other class of litigation. But conditional fee agreements in employment tribunals can, without the benefit of a general presumption that costs follow the event, still improve upon the current state of affairs. I can assure the noble Lord that I am ready to add my voice to that of others in praise of the Free Representation Unit.
Lord Donaldson of Lymington: Do I understand the noble and learned Lord the Lord Chancellor to say that it is not obvious to him—or I assume to anyone else—why costs should not follow the event in employment tribunal cases? I believe that it is very obvious. Usually they are cases in which individuals are suing their employers. The employer has considerable assets and can incur enormous sums in costs. If the employee loses, under a revised regime he will be liable for the employer's costs. In many cases that would strongly deter the employee from seeking to assert his rights. The very threat would achieve the employer's result. It is not a case where one would expect the employee to insure against that liability. Not all employees—perhaps not even the majority—have trade unions behind them to act as substitute insurers. I would be very alarmed at any move to make costs follow the event in employment tribunals except to the extent that it already exists; for example, if there were a major abuse of process by the claimant.
The Lord Chancellor: This is a matter that we can debate to a substantial degree. A rule that costs follow the event must be a reciprocal one. The applicant would have to be liable for costs if he lost. That is the position in all civil litigation. One asks what is so special about employment tribunals that entails that the rule that applies in all other civil litigation should not apply in employment tribunals. Throughout the country employers are sued for damages in the county courts

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and the High Court by employees where the rule applies that costs follow the event. What reason in principle is there for making a difference in employment tribunals? The noble and learned Lord suggests one reason may be that the applicant will be deterred from bringing his case before the employment tribunal by the risk of a liability in cost. It can be argued, however, that one should discourage weak cases. Very often applicants bring weak cases before employment tribunals inspired by animus against their employers arising out of their dismissal. If the effect of changing the cost rule were to deter weak claims and prevent employers being vexed by them there is a highly respectable argument in favour of that change. There is a lot to argue about in this area, but perhaps now is not the time.
Lord Simon of Glaisdale: This most valuable debate has brought out a number of interesting points. I draw attention to one spin-off. We now have a clear demonstration that conditional fee agreements are not a universal panacea. They do not give access to the legal system in all circumstances but much less to justice. I hope that the proponents of the contingency legal aid fund—the noble Lord, Lord Goodheart, and my noble and learned friend Lord Brightman who made such a striking speech on the White Paper—will note that. I understand that it is not proposed that the contingency legal aid system should be in addition to conditional fees. My noble and learned friend is right when he said that if that were so, the conditional fee agreement would cream off all the cases likely to succeed leaving only the more speculative cases. That is not what I understand is proposed. On the contrary, the contingency legal aid fund system covers the same ground as the conditional fee agreement area, but without any of the disadvantages of the latter. However, it has been a valuable debate. We now have clearly demonstrated one of those disadvantages.
Lord Goodhart: I am grateful to those who have spoken in the debate; and I am grateful to the noble and learned Lord the Lord Chancellor for the answers he has given to the amendments in the group.
In descending order of gratitude, perhaps I may touch on the replies to the amendments. First, on Amendment No. 102 relating to the proceedings before the discretionary "lifer" panels I am entirely satisfied by the response of the noble and learned Lord the Lord Chancellor. It clarifies a point which was not clear on the face of the Bill and was a matter of considerable concern to Justice.
As regards immigration proceedings, there is a considerable, unmet, need for assistance. However, in view of the extensive review of immigration proceedings now under way, this may not be the moment to press that issue further. It is a matter that I wish to take away. I shall be interested to hear the view of the noble and learned Lord, Lord Archer of Sandwell, on this aspect.
I shall wish to read what the noble and learned Lord the Lord Chancellor said on social security proceedings,
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and to consult with bodies which are actively involved in that area before deciding whether the issue should be brought back. However, in the case of appeals before the social security commissioners—they are appeals from the first level of appeal tribunal under the 1998 Act—there is inevitably a strong case at that level for providing publicly funded assistance. By the time the matter is before the social security commissioners it necessarily involves a point of law. It involves necessarily technical arguments, and it is surely appropriate that assistance should be provided there.
Finally, on employment tribunals the noble and learned Lord accepted that it was desirable in principle that in a number of cases, and subject to a case satisfying the applicable merits test, there should be publicly funded assistance. But that was dependent on getting the budget in order. I am somewhat disappointed. If that is the objective, the provision should go into the Bill now, even though at present it is necessary to give it a low priority. It is desirable that a clear aim of the Government should not at the very first stage be wholly excluded, but should be included on the understanding that it inevitably receives a low priority.
Having said that, I beg leave to withdraw Amendment No. 100 at this stage.
Amendment, by leave, withdrawn.
[Amendments Nos. 101 to 104 not moved.]
Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 105:
Page 54, line 32, at end insert—
("(I) proceedings in coroners' inquests into death, and
(j) public and judicial inquiries").
The noble Lord said: It does not follow that all coroners' inquests, and public and judicial inquiries, would fall within these categories; but in the light of the exclusion of clinical negligence from the general negative approach towards legal aid, I believe that these amendments could be associated with that provision. I presume the reason for excluding clinical negligence from the general rule that personal injury negligence should not come within legal aid is because of its complexity, the expense involved and the difficulties of carrying out investigations. I submit that enabling representation to take place where these difficult considerations are likely to apply could well obviate costs.
I have appeared at inquests and have found that material which had not been willingly given—perhaps suppressed is too hard a word—was available at the inquest. I cannot remember a case where I charged to appear at an inquest; it has not been eligible for legal aid in the past. But in my experience, and I am sure that of other practitioners present, in particular in clinical negligence cases, it would have been extremely difficult to obtain the information and evidence to enable that to happen. I believe that there is an argument for this to be considered by my noble and learned friend in relation to the approach that he has indicated about other matters.
The same argument applies as regards public and judicial inquiries. I do not press that so hard and I should be happy to abandon that part of the amendment. The issue is more important in relation to coroners' inquests.
I hope that my noble and learned friend will recognise the point I made at the outset. It is a way of obviating costs which could be expensive if the provision is not allowed. It occurs at present; and I believe that it should not. My noble and learned friend will always have discretion in relation to these matters. I commend the idea to him. I beg to move.
The Minister of State, Cabinet Office (Lord Falconer of Thoroton): The effect of my noble friend's amendment would be to make public funds available to provide representation at coroners' inquests and at public and judicial inquiries. I do not think that we can accept the amendment. An inquest is an inquiry concerned with the facts surrounding a death rather than issues such as civil or criminal liability. The proceedings are intended to be inquisitorial and informal; and legal representation is generally considered unnecessary. Full civil legal aid is not therefore available to someone appearing at an inquest. For similar reasons, it is not available for making representations for public or judicial inquiry. This does not mean that someone who is required to attend an inquest will receive no assistance from the legal aid scheme. Legal advice and assistance from a solicitor is available under the green form scheme to those who are financially eligible. The proposed new scheme replicates this position.
I accept that there may be truly exceptional circumstances in which it is fair for public funds to be spent on representation at inquests and inquiries. I am thinking of circumstances similar to those concerning the inquest into the "Marchioness" disaster where a second inquiry was necessary because of failures in running the first. On that occasion, legal aid was provided in the form of a specific grant covering only that instance. As the failures of the inquest were in no way the responsibility of the families, it was only fair that they should not have to pay to be represented a second time around. The noble and learned Lord the Lord Chancellor therefore exercised his power to permit the legal aid board to pay for representation at the second inquiry, despite that being outside the normal scope of legal aid. No similar grants have been made since. I believe that the new scheme should contain a similar provision and the noble and learned Lord the Lord Chancellor will be considering how best this can be achieved. I hope that in the light of that somewhat encouraging speech the noble Lord will withdraw his amendment.
Lord Clinton-Davis: I welcome what has been said by my noble and learned friend. He has been more forthcoming than I expected and I accept with relish what he has offered. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.30 p.m.
Lord Archer of Sandwell Lord Archer of Sandwell moved Amendment No. 106:
Page 55, line 5, at end insert (", and
( ) proceedings on a complaint under the Environmental Protection Act 1990.").
The noble and learned Lord said: This is a narrow point. The amendment seeks to add an item to the list of proceedings in a magistrates' court for which funding may be made available for representation. The proposal, for which I am indebted to the Law Centres Federation, is designed not primarily to assist people in defending proceedings but to enable someone to bring proceedings. The proceedings in question arise where a tenant is living in a house which by reason of disrepair is alleged to create a health hazard, or an unfitness for habitation, or a public nuisance. The complaint may be against a private landlord or against a local authority.
Most constituency MPs have experience written on their hearts of where a problem which despite repeated complaints is always relegated to next year and the danger to health is overlooked. Sometimes a summons is the only way to concentrate minds. I cannot believe that this would represent a serious drain on resources. However, the existence of the possibility of a sanction represented by the inclusion of these proceedings in the list may itself lead to the redress of a genuine grievance.
The provision is a useful statutory provision, but tenants may well hesitate to avail themselves of it without access in an appropriate case to representation. I hope that in such a case, where generosity is not likely to be exhaustive, my noble and learned friend will feel able to respond. I beg to move.
Lord Falconer of Thoroton: My noble friend's amendment to paragraph 5 of Schedule 2 would have the effect of making public funds available for representation for complaints under the Environmental Protection Act 1990. These are summary criminal proceedings which allow for any person to issue a complaint to a magistrates' court where aggrieved by the existence of a statutory nuisance, or the defacement by litter or refuse of any public land or other land within a litter-control area of a local authority, as specified in Parts III and IV of that Act.
I am afraid that we cannot accept the amendment. In the cases described, the court has to order a defendant to pay the reasonable expenses incurred by the complainant where there were reasonable grounds for bringing the complaint. In the majority of complaints, the defendant will be a public body or company and there is not the risk of costs not being paid. One of the key objectives of the reforms of the legal aid system is to ensure that publicly-funded help under a controlled budget is directed to areas where the need of people is greatest; for example, social welfare cases, public interest cases and those involving the interests of children. In the judgment of the noble and learned Lord the Lord Chancellor, these proceedings do not have sufficient priority to warrant any public funding other

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than for the provision of basic information and advice on the law. Therefore, I invite my noble and learned friend to withdraw his amendment.
Lord Archer of Sandwell: My noble and learned friend and I are agreed on the premise—something has slipped—but we are not agreed on the conclusion. I agree that the purpose of the legislation should be to direct legal aid to where the need is greatest. If he had seen some of the cases with which I had to deal as a constituency MP he might have believed that there was a need. However, we live in a real world, even in this Chamber. I am disappointed but scarcely surprised by his response and not being surprised I am resigned. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 2 agreed to.
[Amendment No. 107 not moved.]
Clause 8 [Individuals for whom services may be funded]:
Lord Archer of Sandwell Lord Archer of Sandwell moved Amendment No. 108:
Page 5, line 15, at beginning insert ("Subject to subsection (4),").
The noble and learned Lord said: It may be to the Committee's convenience if with this amendment we discuss Amendment No. 112, for which Amendment No. 108 is a paving amendment. I tabled the two amendments in the hope of allaying anxiety, including my own. If I am told that they are unnecessary I shall be delighted and happily seek leave to withdraw them.
Clause 8 is about financial limits on applicants for community legal service funding. Subsection (2) recognises that there may be situations in which justice may require funding without an investigation of financial resources, possibly because there is an emergency and no time to carry out an investigation or because for some reason the applicant is unable to provide information about his resources.
There is some anxiety because no specific mention is made of what is now called the green form scheme. I believe that a few moments ago my noble and learned friend Lord Falconer went some distance to make the point which I am now raising, but the fact that he did not go the whole distance was because it did not arise in respect of the amendment moved by my noble friend Lord Clinton-Davis.
As I ventured to suggest during our debate on Tuesday, problems do not always come packaged in neat categories to facilitate administration. Someone may have a variety of problems. Some he may not recognise as legal problems at all. Some he may not appreciate as being susceptible to a remedy. Frequently he may not know what his remedy is and where to find it. A short interview with someone well informed and practised in analysis may be essential to sort out whether he can bring proceedings at all and if so for what. There can be no application for public funding and therefore no financial assessment until he is clear for what purpose he is making the application. A short interview may be not only the source of a solution to his problems, but it may represent a saving in court or tribunal time
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and certainly in administrative time. If my noble and learned friend can assure me that such an interview can be funded under the proposed scheme without my amendment I shall proceed no further and simply enjoy the feeling of pleasure which he has engendered. If he cannot give me that assurance, and if the amendment is necessary, I hope he will agree that it should be made. I beg to move.
Lord Goodhart: I rise briefly to express my complete support for what the noble and learned Lord, Lord Archer of Sandwell, said. The free diagnostic interview seems an absolutely essential element in any scheme if it is to work, and I too therefore hope that the noble and learned Lord the Lord Chancellor will be able to satisfy the concerns of the noble and learned Lord, Lord Archer, and myself.
Lord Clinton-Davis: I wish to ask my noble and learned friend Lord Archer a question. I have not been involved with the green form for many years but I think it does attract a fee which is assessed by the solicitor when dealing with the green form application. He or she is required, on the basis of means as he or she feels appropriate, to insert in the form a fee—it is a very small one—from the client. I think that the wording of the amendment is therefore defective because it refers to an initial free interview. If my noble and learned friend was referring to the inclusion of the green form requirements and conditions, that is fine, but the proposal may be defective for that reason.
Lord Archer of Sandwell: If the question had occurred to me I would have consulted my noble friend Lord Clinton-Davis because I would have assumed that he knew more about the green form scheme than I do. However that may be, I am grateful to him for having raised the question. I do not seek to improve on the existing green form scheme, and if the wording of my amendment is defective as he suggests, I would be very happy to withdraw it if we can be assured either that it is unnecessary or that an appropriate amendment will be forthcoming at a later stage.
Lord Falconer of Thoroton: I can very well understand the intention behind this amendment. For technical reasons it will not achieve its desired effect, but I am happy to say that I think it is unnecessary. As I understand the amendment and the speech in support of it by the noble and learned Lord, Lord Archer of Sandwell, it is meant to ensure that it will always be possible for people to get an hour's free basic advice regardless of what other conditions may be imposed on eligibility by regulations made under Clause 8.
The amendment says that those regulations cannot preclude the provision of the hour's advice. However, regulations made under this clause cannot provide for charges to be applied or disapplied. They can only impose conditions on eligibility in terms of applicants' financial resources. Regulations about payment for services would be made under Clause 10. In strict terms, therefore, it is already the case that the regulations in Clause 8 cannot preclude the provision of free advice.

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I hope that in that rather convoluted way I have dealt with the point. The regulations in Clause 8 cannot preclude the provision of free advice. That is the important point. Perhaps the noble and learned Lord's amendment is intended to go further and ensure that an hour's advice will be available to anyone, regardless of their means. I am not sure that the amendment as drafted will achieve that. If that were the effect, I would have to urge your Lordships to reject it. Clause 8(2) allows the Lord Chancellor to prescribe circumstances in which services can be given regardless of means. I envisage that this will usually mean only the most basic of services such as information about the availability of help. I would be reluctant to make an hour's advice available to absolutely anyone because of the cost implications. Even diagnostic advice would take time that would need to be paid for, and giving that to anyone who asked would take money away from people who needed it more.
The Government intend to make services available free of charge to people who absolutely cannot afford to pay for them and will bring forward regulations in due course under Clause 10. But we believe people should pay something towards their help where they can afford to. This amendment carries the risk that some services might not be provided on that basis. I hope therefore, with those encouraging words, that the noble and learned Lord will withdraw his amendment.
Lord Archer of Sandwell: I am grateful to my noble and learned friend for that exposition. I did invite him to tell me that my amendment was unnecessary. I did not expect him to tell me that it was unnecessary because I had put it down in the wrong place. As I said a moment ago, I do not seek to improve on the existing scheme. I probably moved the amendment from a reservoir of ignorance which ought to be dispelled before I seek to proceed further. I shall consult further with those who know about these matters to decide whether there is some other way in which I can ensure that what I originally intended will take place or whether what my noble and learned friend has promised will be sufficient to achieve that. That will require a little reflection and, for the moment at least, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.45 p.m.
[Amendments Nos. 109 to 112 not moved.]
Clause 8 agreed to.
Clause 9 [Code about provision of funded services]:
Lord Kingsland Lord Kingsland moved Amendment No. 113:
Page 5, line 23, after ("code") insert ("following consultation with interested parties as appropriate").
The noble Lord said: The intention of this amendment is to introduce into Clause 9(1) an obligation on the commission to consult with interested parties before its funding code is settled. I understand that recently the Legal Aid Board has published a draft funding code. I wonder whether the noble and learned Lord the Lord Chancellor will confirm that he intends to take
730
account of the views expressed by interested individuals and organisations before approving the code in final form.
The Lord Chancellor: Never in the history of this Chamber can advocacy so brief have met with success. I am happy to consider these amendments. Our practice, as the noble Lord indicated, is always to consult on major innovations like the funding code. As the noble Lord said, the Legal Aid Board only last week published a first draft of the code for consultation. That shows that we are already abiding by the duty envisaged in the first amendment, and I have no objection at all to the Bill containing such a duty.
The second amendment imposes the same duty on the commission when it is considering any revisions to the code. Again, I would expect consultation to be undertaken as a matter of course. I imagine that in many cases revisions to the code will come about as a result of the commission consulting practitioners and others about the way the code is working in practice. I think that consultation will drive the revisions rather than the other way about. I am happy, however, to take both these amendments away for positive consideration.
Lord Kingsland: If my brevity has that effect I shall continue in the same vein. I am most grateful to the noble and learned Lord for his reply and in those circumstances I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (The Viscount of Oxfuird): I must advise the Committee that should Amendment No. 114 be agreed to, I am unable to call Amendments Nos. 115 to 118 inclusive due to pre-emption.
Lord Simon of Glaisdale Lord Simon of Glaisdale moved Amendment No. 114:
Page 5, line 27, leave out subsection (2).
The noble and learned Lord said: This amendment seeks to leave out subsection (2) and is grouped with amendments to leave out subsections (4) and (6). My noble and learned friend the Lord Chancellor was, or seemed, rather cavalier on Tuesday about the desirability of economical drafting. Under our arrangements there is no one to give directions to the draftsmen generally that they should draft in accordance with the recommendations of the Renton Committee on preparation of legislation or the later report of the Hansard Society on the legislative process. It is therefore left to each departmental Minister in charge of the Bill to ensure and satisfy himself as to the drafting. That does not mean only the accuracy of the drafting; it also means its economy.
Perhaps I may remind the Committee that it was prolonged dissatisfaction as to the contents of the statute book which led to the setting up of the Renton Committee in 1975. It remarked, among other things, on the evil of prolixity in the statute book and over-elaboration. At that time the statute book consisted of three medium-sized, though fairly stout, volumes of

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public and general Acts. Ten years later, far from there being economy in pursuance of what the Renton Committee recommended, it had swelled to five volumes—not only five volumes but, comparably, there were fewer statutes in those five volumes than there had been in the preceding three volumes.
The format of the statute book was enlarged rather than the drafting being made less prolix. That was expensive to those who had bookcases made for the smaller format, but was a minor consideration when it succeeded once again in reducing the number of volumes from five to three. However, in spite of the larger format, within a few years it was again up to five volumes. I shall be very surprised if this year it is not six or more.
Therefore I make no apology—I hope I do not need to make one—for begging for there to be economy in the drafting of the statute books. There is another disadvantage. It is extremely expensive to have unnecessary provisions; for example, subsection (2), which is around one third of a page, will be printed over and over again; secretaries, draftsmen, printers and bookbinders will all be concerned and the people who pay for it in the end are, first, the taxpayers who fund the public purse and, secondly, the users of the statute book. That is not the only reason.
The other reason, as I am sure my noble and learned friend the Lord Chancellor will bear out, is that unnecessary provisions in a statute add to the complication and difficulty of interpretation, which quite often leads to a misinterpretation. Therefore, if we can get down to the essentials, we are performing our duty as a legislative chamber.
Subsection (2) might be described under the rubric of legislation to teach grandmothers to suck eggs. Clause 9 says that the commission must draw up a code as to the criteria which will govern the principles of funding. That is splendid; so it should. But then the clause goes on to say precisely how that should be done. One must remember that the commission is not drawn from the local mental deficiency colony; it consists of men of acumen and experience chosen for their special gifts by my noble and learned friend himself. Let us consider what they have to be told. They have to consider the likely cost and how much money they have to meet those cost, the importance of the matters, the prospect of success and the conduct of the applicant.
Do they really need to be told that? But that is not the end. They have to be told also that they must consider the public interest. Is it really conceivable that, in carrying out the duties imposed on them by subsection (1), they would not consider those matters? So much for subsection (2), which is a grandmother/egg subsection.
Subsection (4) falls under the same rubric. It says,
"Where more than one description of service is available, the service funded is that which (in all the circumstances) is the most appropriate having regard to the criteria set out in the code".
Do they need to be told that too? Subsection (6) is not grandmother-led, it is computer-led. It is something that
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pops up in almost every statute in one form or another. It says,
"The code may make different provision for different purposes".
Is it conceivable that it should not do so; that the same provision must be made however different the purposes and the different circumstances?
As I say, we are under a duty to see that this measure, which is extensive and one of whose objects is economy generally—with which I wholly concur—ensures that the cost of the legal aid service is contained. But in doing that, we should act consonant with it. All those provisions merely either tell people what they would do in any event without the necessity of writing it into the statute, or are completely absurd, telling them that the code must not make different provisions for different purposes.
6 P.m.
Lord Hacking: I have had a great affection for the noble and learned Lord for over 30 years. He was generous to me when, as a young and nervous barrister, I appeared before him when he was President of the Probate, Divorce and Admiralty Division. Alas, I must profoundly disagree with what he has just said. I do not believe that the drafting of Clause 9, and the code that will be published consequent to Clause 9, is a licence to print reams of legislation and subsidiary legislation; nor do I consider that subsection (2) falls under the rubric of trying to teach one's grandmother to suck eggs.
The correct approach is to look at what the Government are seeking to achieve. First, it is plain that the Government are seeking to achieve greater flexibility in the application of legal funding than is currently available under the legal aid merits test. Secondly, they are deliberately introducing a range of considerations identified in subsection (2)(a) in terms of comparing the likely cost of funding and the benefit to the individual. That seems an entirely sound test.
I turn to subsection (2)(c) on,
"the importance of the matters in relation to which the services would be provided to the individual".
Again, that seems an entirely sound test.
Paragraph (f) deals with the conduct of the individual. We shall discuss that later and I shall reserve my position on it. I refer finally to paragraph (g) which deals with the public interest. Those are all examples of the helpfulness of the Explanatory Notes which have been prepared under the auspices of my noble and learned friend the Lord Chancellor.
I refer to paragraph 82 where we see another good example of why the new proposed criteria are a definite step forward from the criteria used for the grant of legal aid. It states:
"For example, prospects of success will not be a relevant factor in cases about whether a child should be taken into local authority care".
Again, that is an example of how I believe that the clause achieves its objective. As a result, I believe that it will result in a much better regime for the funding of legal aid than currently exists.

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The fact is that, economic with the legislation or not, the amendment drives a coach and horses through the setting up of the new criteria. On that basis, I hope that my noble and learned friend will resist the amendment. If he does, he will have my full support.
Lord Falconer of Thoroton: I am encouraged by that support to resist, with diffidence, the amendment proposed by the noble and learned Lord, Lord Simon of Glaisdale. Of course, I concede immediately that unnecessarily long legislation is to be deprecated. Therefore, the position that I have to defend is why the three subsections that the noble and learned Lord seeks to remove should be retained.
The first, Amendment No. 114, would remove Clause 9(2) in its entirety. This would be an act of quite astonishing statutory vandalism. This is the clause that sets out the factors which are to be considered in framing criteria for the funding code. The removal of the criteria would render the funding code either ineffective or unclear. They are its essence in terms of enabling the commission, in drawing up and operating the code, to reflect priorities and ensure that only the most deserving cases receive funding. The removal of the criteria would also make the system of giving help to individual cases far less accountable. I cannot understand why anyone would want to remove that subsection.
Lord Simon of Glaisdale: I cannot have made myself clear. The subsection is quite unnecessary; it goes without saying.
Lord Falconer of Thoroton: The noble and learned Lord says, "It goes without saying" as to which are the particular considerations for the commission to take into account. It may "go without saying" to a reasonable man, such as the noble and learned Lord, but I would not for one moment think that it would "go without saying" to lawyers considering the means of challenging the ways in which the commission has prepared its code. A reasonable fellow, such as a predecessor of the noble and learned Lord the Lord Chancellor, was himself challenged in court by both the Bar Council and the Law Society some years ago in relation to provisions that he made in relation to regulations. No doubt it would have been said in those proceedings that what is required "goes without saying". In my submission, it is perfectly sensible in such a Bill to specify with precision the considerations that the commission has to take into account. If they are obvious, that makes things clearer.
The second amendment, Amendment No. 120, would remove Clause 9(4). This clause allows the commission to ensure that the most appropriate type of service is used in individual cases. The amendment is unacceptable because it would remove the commission's discretion to assess whether the most appropriate service was being considered by the applicant; for example, was the case suitable for mediation rather than full-blown
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litigation? The noble and learned Lord's point on that, that "It is so obvious; they could do that anyway; you do not need to include that"—
Lord Simon of Glaisdale: Not only that; it says elsewhere in the statute that it cannot be done.
Lord Falconer of Thoroton: In my respectful submission, subsection (4) is the only place where it is made clear that the code shall seek to ensure that. That is why it is there.
The final amendment, Amendment No. 123, would remove Clause 9(6). The clause allows the commission to vary the funding code criteria according to the category of case or the type of service; for example, if a case has a wider public interest, the commission could apply less stringent criteria for the prospects of success. The removal of the clause would remove an important part of the commission's ability to allocate funds according to priorities and need.
Lord Simon of Glaisdale: I apologise for interrupting the noble and learned Lord again. I say again that I have not made myself clear. Certainly, it should have power—obviously, it should have power—to make different provisions for different cases. The noble and learned Lord has just given an example. The point is that it does not need to be told that it can do that. Common sense and reasonableness say that it may do that. We cannot go on legislating for every aberration, for every ridiculous argument that some ingenious advocate might place before a court.
Lord Falconer of Thoroton: I am grateful to the noble and learned Lord for making his argument clear. I had understood it. The argument boils down to assertion and counter-assertion. The noble and learned Lord says that common sense leads to the conclusion so clearly that there is no need for such provisions to be set out in the Bill. Parliamentary draftsmen take the view—having, with the greatest of respect to the noble and learned Lord, heard him making that point in respect of a number of parallel clauses in previous legislation—that that is not right. It is a matter of judgment and balance. It is sensible to set out this sort of power in order to avoid any disputes that may be brought by lawyers.
A judgment must be made as to whether or not it is necessary—and thereby avoid disputes in the future—or whether one can rely on the common sense not only of the judges, which I am sure one can, but also of the claimants who might think that because there is a gap there is a chance for making a claim and clogging up the time of the court. So, a judgment has to be made and the line must be drawn somewhere. It does not seem to me to be inappropriate to draw the line in the way outlined by the parliamentary draftsmen. It will avoid disputes, especially in an area where lawyers might be motivated to bring judicial review or similar proceedings. Speaking for myself, I think that it is quite a sensible course that the parliamentary draftsmen have taken. Although the noble and learned Lord might disagree, and although I have obviously failed to

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persuade him, I trust that he will rest assured that I did understand his argument. In the light of those comments, I invite the noble and learned Lord to withdraw his amendment.
Lord Simon of Glaisdale: My first very pleasant duty is to thank the noble Lord, Lord Hacking, for what he said in his introductory remarks. All too often these days I have to say, "Yes, I knew his father". Occasionally, as with the noble Lord, Lord Strathclyde, it is, "Yes, I was a fellow Member with his grandfather in both Houses". The father of the noble Lord, Lord Hacking, was a very old friend of mine. It is a great joy to see his son intervening in debates, even if the points he made today were not perhaps the best that could be made. Neither he nor the noble and learned Lord, Lord Falconer, really faced the fact that, although they may be desirable, these criteria are the sort which the kind of people that my noble and learned friend is going to appoint are bound to consider.
The noble and learned Lord said that any reasonable body would take these criteria into account. But he then went on to say that that would not preclude some enthusiastic lawyer putting forward to a tribunal a point that is ex hypothesi unreasonable. If we are really going to legislate in that way, there will be no end to the statute book. It will not be merely six volumes; indeed, it will be seven, eight or nine in a few years' time. What is more, it will establish a precedent.
I recall a certain Bill, but I am not sure whether it was one for which the noble and learned Lord the Lord Advocate was responsible. However, I remember one of the Ministers involved. I shall name him because there is no shame attached. I have in mind the noble Lord, Lord Williams of Mostyn. When I pointed out to the latter during the proceedings on that Bill that a provision was unnecessary, he said: "There is precedent". Members of the Committee will remember the well-known provision in paragraph 10 to the seventh schedule of the Local Government (Scotland) Bill. That is the way in which the provision will be used. I am sure that we shall have many precedents.
I am afraid that the noble and learned Lord did not make the point that the test is: what is the meaning to a reasonable man? That is the test in every court. We simply cannot go against the reasonable man, the very basis of Anglo-American jurisdiction, and take as our criterion the most ingenious and wrong-headed advocate seeking to find a hole. That is not the way—and I say this with all the force at my command—to frame a statute. If we try to do so, as I said, there will be no end to the mischief.
The noble and learned Lord concluded his speech—given, as usual, so delightfully—by saying that, in view of what he had said, he hoped I would withdraw the amendment. I shall withdraw the amendment, but I trust that the noble and learned Lord will not take offence if I say that it is not in view of what he said. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.15 p.m.
Lord Kingsland Lord Kingsland moved Amendment No. 115:
Page 5, leave out lines 31 to 34.
The noble Lord said: This amendment seeks to remove the provision which enables the legal services commission to deny legal aid in cases in which an individual would otherwise have qualified but does not do so because of lack of resources. In seeking to illuminate the point, I shall quote briefly from the keynote address to the Bar Annual Conference in 1996 made by the noble and learned Lord the Lord Chancellor. Lest he should think that this is a hostile act on my part, I should say that I accept that the words he uttered cut both ways, politically. The opening part of the noble and learned Lord's speech referred to a White Paper produced by the previous government. He said:
"The main feature of the White Paper is to cap legal aid for the first time and to impose heavier liabilities on assisted persons both to pay greater contributions and their opponent's costs if they lose. Of course, I do not exclude cost capping, if the cost of a demand-led system makes that unavoidable. Cost capping, however, is unattractive in principle because legal aid would cease to be a benefit to which a qualifying individual is entitled. It would, in practice, become a discretionary benefit, available at bureaucratic disposal—a benefit which would have to be disallowed when the money run out, or when another category of case was given preference. Legal aid would cease to be a service available on an equal basis nationally because cases would go forward in one region where identical cases in others of equal merit would not. I am not persuaded by the arguments of the White Paper that that would not happen".
I accept, first, that the policy of capping legal aid was the policy of the previous government; and I am a member of the party of that government. Secondly, I also accept that the noble and learned Lord the Lord Chancellor qualified, quite heavily, what he said on that occasion by saying that he did not exclude cost capping,
"if the cost of a demand-led system makes it unavoidable".
Nevertheless, it seems to me that the principle which flows from what the noble and learned Lord said is that, all things being equal, a system of entitlements is preferable to a system of bureaucratic discretion.
At present, we face a legal aid budget which is not out of control. The budget has been underspent over the past five years and, indeed, it forms only just 0.5 per cent. of the total annual budget of this nation. Moreover, the measures that the noble and learned Lord is proposing in the Bill will further discipline expenditure. I am thinking in particular of the block contracting system to solicitors. I am thinking also of the intention to widen the use of graduated fees, which currently apply in criminal cases up to a length of 10 days, to other cases.
If those facts are put together, it is my submission that, far from being out of control, the legal aid budget is well under control. In those circumstances, the threat to which the noble and learned Lord the Lord Chancellor alluded in his speech is not on the horizon. I wonder whether the noble and learned Lord will reconsider that part of the Bill which imposes financial

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cut offs in circumstances where otherwise individuals would be perfectly entitled to be legally aided. I beg to move.
Baroness Crawley: I cannot agree with Amendment No. 115 in the name of the noble Lord, Lord Kingsland. For the commission to operate effectively it is essential that it is able to assess the availability of resources and use those resources within the terms of the community legal service fund. After all, as we are constantly reminded by my noble and learned friend the Lord Chancellor, this is a properly controlled budget which must be administered in the context of the priorities set by my noble and learned friend. My noble and learned friend quite rightly reminds us that there is no longer a bottomless pit of resources within the terms of this Bill.
Lord Phillips of Sudbury: We on these Benches wish to associate ourselves with the amendment moved by the noble Lord, Lord Kingsland. Access to justice—as this Bill is entitled—will not prevail once the capped budget has been reached. Access to justice and equality before the law is one of the most basic and fundamental rights to which citizens of this country are entitled, and which they have claimed since the time of Magna Carta.
Like the noble Lord, Lord Kingsland, we too believe that the budget is not out of control. Last year and this year the legal aid system operated within budget. The number of cases covered rose by 3 per cent. Most important of all under this Bill the Government will take vast new powers, discretions and controls to ensure that what has prevailed without those extra powers over the past two years will prevail in future. Therefore the difference between us in terms of this amendment may be less than the previous speaker and the noble and learned Lord the Lord Chancellor have indicated.
As I said, with the new regime there is a degree of flexibility which the Government can control to some extent by means of the merits test and the means test. That is desirable from any point of view and most of all in terms of obtaining access to justice. The legal aid budget has never before been capped in this way. It is difficult to see the justification for doing so at a time when the legal complexities of life for the ordinary citizen and the importance of obtaining access to justice, have never been so great. That need will continue to increase. In our view it is not possible to justify this aspect of the Bill.
Baroness Thornton: I am puzzled about this matter. The figures appear to indicate that expenditure on legal aid has risen dramatically over the past few years and that it continues to rise at a rate well above inflation. That means that we have to set priorities in regard to this area of our public expenditure. Politics is about setting priorities. I do not see why this area of our public expenditure should not be subjected to the same conditions as other areas of our public expenditure. No one has said anything so far to convince me otherwise.
This legislation seeks to establish systems to ensure we obtain the best value from the resources which are available. The Bill seeks to build a modern legal edifice
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which will achieve several key objectives; namely, high quality legal services which are accessible to people when they need them most. The Bill seeks to achieve the most effective use of public funds to meet those objectives. A cornerstone of the Bill is the concept of the availability of resources and likely demand. The effect of the amendment would be to make the new structure lopsided, even if it did not make it fall over, as it were. Therefore I believe the amendment must be resisted.
The Lord Chancellor: The Prime Minister said again and again during the election campaign that schools and hospitals were our number one priority. He did not say that legal aid was our number one priority. I agree with the realism of the noble Baroness, Lady Crawley. With regard to all the competing claims on scarce resources, the Government are entitled to take a view as to how much they will spend on legal aid, and on what kinds of services they will expend those moneys. The average cost of cases has continued to outstrip inflation. In 1997–98 the average cost of a civil case was 12 per cent. higher than the previous year.
It is essential that under a controlled budget the funding code should reflect the availability of resources. Therefore I cannot accept the noble Lord's amendment. The main way that resources will affect the code will be through the priorities that I set for the deployment of resources. That will obviously be influenced by the amount of money that I can provide to the community legal service fund. I must repeat a simple truth that no noble Lord would or could gainsay in our discussions; namely, that what is available for civil legal aid is what is left over from the budget after the prior claims of criminal legal aid have been met. We can no longer operate in a world where the budget for funding civil legal aid is entirely open-ended and controlled by the lawyers and simply regulated by demand. That is simply not an appropriate way of spending taxpayers' money when there are so many other important calls on public expenditure.
Resources will not usually be taken directly into account in individual funding assessments as regards the merits of cases that should go forward. But they will be a factor in determining the toughness of the criteria at any particular time. For very expensive cases, which will be funded through a centrally held budget, resources will always be a factor, and they may be a factor in borderline cases, particularly if the commission is faced with unforeseen demand and needs to ensure that it can continue to meet the demand for funds that are judged to be required in priority areas. In fact unforeseen demand is not something that I expect to be a major problem. The combination of effective planning and the flexible allocation of resources to service providers through contracting should, with the ability to vary the criteria in the funding code, mean that we have an effective system for matching the available resources to the need for publicly funded legal services.
However, it is important here to stress this flexibility in the funding code. It has been designed to be able to take a variety of factors into account, with criteria varying with the priority accorded to the category of

739
case. In some cases resources will be a major consideration, such as the high cost cases to which I have just referred. In others, such as cases about whether a child should be taken into care, they will not be considered at all.
I know that some people fear that the funding code will somehow or other be used covertly to achieve cuts in services and to lead to differing availability of services in different parts of the country. I shall take those two points in turn. First, there is nothing covert about the funding code. Quite the opposite is the case. For a start, a consultation document—to which I have already referred—outlining the code has just been published by the Legal Aid Board. People have until the end of April to make their views about it known. The code is very much more detailed and open about what is intended than before. For example, there is an entire chapter about resources issues. I have already indicated that I am prepared to consider making the important changes to the code in future subject to affirmative resolution by Parliament. Openness and accountability are central characteristics of the new code.
Secondly, the code is a national one. There is nothing in it which will discriminate between different areas or communities across the country. I refer your Lordships to paragraph 2.27 of the code. It is simply wrong to suggest that that kind of discrimination is possible. Of course the differing needs of areas and communities will be assessed by the commission under its duties in Clause 5(4) so as to assess the needs for particular kinds of services that specific areas most require. The allocation of contracts will take account of geographical variations in the need for services of particular kinds.
I understand the concerns that noble Lords may have about the consideration of resources in the funding code. I do not believe their concerns are well founded and I invite the noble Lord to withdraw his amendment.
6.30 p.m.
Lord Simon of Glaisdale: As I have intervened every time, until now, on matters on which I considered this Bill was open to criticism, it is only in justice to my noble and learned friend that I should say that I entirely agree with the way in which he has just put the case. We really cannot afford any open-ended financial commitment—not even for education, which I would certainly put first, or health. Our resources are not unlimited. If any fund is to be limited it has to have priorities within it, just as there must be priorities for the other major demands.
Still less are we entitled to regard any fund as open-ended if we are in a state where we are borrowing—not only borrowing at a particular moment but incurring debt over the whole economic cycle. What we would then be doing is asking those who come after us to pay for our satisfactions. To my mind, that is legitimate in education, which will inure to their benefit; it is extremely doubtful as to health and access to justice. Access to justice is not the same as access to the legal system.
It seems to me, even though we are disappointed in our particular predilection—even those of us who have chosen a life in the law because we believe it to be a
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life serving justice—that we have to accept that there, too, the funds are not unlimited and that therefore there must be priorities. As I said, I entirely agree with the way in which it was put by my noble and learned friend.
Lord Kingsland: In rising to respond I feel more than usually battle scarred as a result of the intervention of the noble and learned Lord, Lord Simon of Glaisdale. If there were clear evidence that the legal aid budget was out of control, of course I would accept the arguments of the noble and learned Lord the Lord Chancellor, and his position would be entirely consistent with what he said in his speech to the Bar Council in the autumn of 1996. But, in my submission, there is no evidence that the legal aid budget is out of control. It must therefore follow in that context that the decision to switch from an entitlement system to a system of bureaucratic discretion is unjustified.
However, I have been in your Lordships' House long enough to know when a Minister means what he says. The look in the eye of the noble and learned Lord the Lord Chancellor left me in no doubt that he meant what he said. In those circumstances, it would be prudent of me to seek leave to withdraw my amendment.
Amendment, by leave, withdrawn.
Lord Phillips of Sudbury Lord Phillips of Sudbury moved Amendment No. 116:
Page 5, leave out line 42.
The noble Lord said: I am moving Amendment No. 116 in the name of the noble Lord, Lord Kingsland, and myself. Clause 9 of the Bill is very important. It requires the commission to prepare a code setting out the criteria according to which it will decide whether or not to fund. The paragraph that we are dealing with here refers to "the conduct of the individual" as being one of those matters in respect of which the commission's criteria must speak.
The problem is that if, as has been said previously, phrases such as "fair and reasonable" are too flexible and uncertain of interpretation, what on earth is one to make of the phrase "the conduct of the individual"? For example, does this mean that the criteria will address the degree to which the public supports or condemns the conduct of the individual applying for legal aid? Would that conduct be in relation to the matter for which legal aid was applied for, or for some previous matter? If the person was very unpopular and had convictions for dire offences against children, would that be a matter that the commission, through its criteria, would have regard to? I suspect not, but the degree of flexibility which this particular paragraph allows the commission seems to be excessive and to encourage indiscretion on its part in drawing up the criteria. It is on those bases that we would prefer to see this part of Clause 9 removed from the Bill. I beg to move.
Lord Hacking: As the noble Lord, Lord Phillips of Sudbury, has so succinctly described, he seeks to remove the criteria of the party's conduct in the provisions under the new funding arrangements. Conduct has always been a factor in considering

741
whether to grant a legal aid certificate and, more significantly, whether to withdraw it. For example, persistent failure to attend appointments with the individual's lawyers, persistent failure to give proper instructions to the lawyer, failure to co-operate, and behaving in an abusive way have always been grounds for withdrawing legal aid.
It has never been ground for refusing or withdrawing legal aid that a client's cause is unpopular or that he has behaved in a way which gives offence. For example, the conduct of those disrupting the Easter Sermon of the Archbishop of Canterbury in Canterbury Cathedral last March or April was extremely offensive to some people. I am sure that the noble and learned Lord the Lord Chancellor is not directing attention to the conduct which has caused the individual to be involved in the litigation, be it criminal or civil. After all, murder is pretty awful conduct.
Having said that, I wonder whether the word "conduct" as drafted in the Bill is quite the appropriate word. I wonder whether, in the circumstances, my noble and learned friend would consider a different drafting so that we focus not on the conduct that has caused the individual to be involved in the litigation but the conduct in the course of that litigation.
Lord Phillips of Sudbury: I am obliged to the noble Lord for that suggestion. Amendments along those lines would indeed meet the point I have been trying to make.
Lord Meston: I had assumed that the reference to "conduct" was to deal with those individuals who were perceived to be vexatious and possibly also, in the modern climate, with those individuals who refused to submit themselves to mediation when mediation was available.
I should like to deal with one further point. The Explanatory Notes say, and the noble and learned Lord the Lord Chancellor has repeated, that the prospects of success referred to in the preceding paragraph will not be a relevant factor in cases concerning whether a child should be taken into local authority care. That must be quite right. There are few cases in which one can think of representation being needed more than when a local authority is preparing to take the drastic step of removing a child into care, possibly irrevocably if adoption is considered. There may well be cases where the prospects of success for the individual parent in resisting care proceedings will be relatively slight. Although the Explanatory Notes indicate that the code will not allow that to be a factor in care proceedings, I cannot help wondering whether the conduct of the individual will allow the parent to be denied representation if the conduct of the parent is perceived not to be deserving of representation irrespective of the prospects of success. In other words, those cases in which the prospects of success are not to be taken into consideration will be undermined by the paragraph referring to the conduct of the individual.
Lord Renton: There have been rare cases in which the legally aided person has behaved in a most
742
extraordinary way, sometimes starting off by dismissing the solicitor and barrister who were appearing for him and then becoming a litigant in person who wastes the time of the court by extraordinary behaviour. That necessarily would add to the ultimate costs of the case. I think that a person who behaves like that should not be treated in the way that he would normally be treated if as a legally aided person he had behaved properly throughout. I think that the word "conduct" is fairly broad. If noble Lords think that the word "behaviour" is slightly different and would meet the point of the noble Lord, Lord Hacking, we could add "behaviour". But I do not think it is really necessary.
Baroness Crawley: Perhaps I may add one or two points to those already made. I understand the concern of the noble Lord, Lord Phillips of Sudbury, about the word "conduct", but in that concern I think that if he continues with his amendment he will close down the opportunity of being able to cut off the facility of public funding from people who, as the noble Lord, Lord Renton, has said, may behave extraordinarily badly and be impossible as applicants to deal with. The noble Lord must have met one or two of my constituents over the years.
6.45 p.m.
The Lord Chancellor: The noble Lord, Lord Phillips of Sudbury, conjured up the spectre that the politically or socially unpopular might be denied legal aid because of who they are by contrast with the merits of the case that they desired to bring forward. That is no part of the Government's intention. It is only the applicant's case—the quality of his case—and his financial eligibility that matter as to whether he should receive help. His character and who he is do not count.
However, as the noble Lord, Lord Hacking, made perfectly plain, there are circumstances where the applicant's conduct can matter, if not when applying for help then certainly once it has been given. The noble Lord, Lord Hacking, gave good examples. The board can remove someone's certificate for reasons of conduct—for failing to attend interviews or failing to provide material information about the case. It is always open to a solicitor to decline instructions, to refuse to continue to act, if the solicitor believes that the solicitor-client relationship has broken down because the client is being persistently abusive or, for example, is wilfully declining to give proper instructions so as to put the solicitor in an impossible position.
Clause 9(2)(f) simply preserves for the legal services commission powers that are already there. I can assure the Committee that these powers would be used very sparingly. But it is important to retain a power to take people's help away from them if their conduct warrants it, as the board can now do. For example, I am sure the Committee would agree that people who have been demonstrably untruthful to the commission about material facts—I see the noble Lord, Lord Renton, nodding his assent—should not be able to take up funds that other more honest people could better use. But I can assure the Committee that the commission will monitor refusals and removals of legal aid as part of the contract monitoring process.

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Having said that, I appreciate, as the noble Lord, Lord Hacking, indicated, that the word "conduct", particularly perhaps in relation to the grant of legal aid, is somewhat stark and conjures up the image of people being refused help for reasons quite unconnected with their applications, although I can assure the Committee that that is no part of our intention. I undertake to consider our deliberations and take this amendment away and consider how best to ensure that the commission has the powers that I have described and how best to obviate any risk, although I do not think it is a very real risk, of these powers being carried beyond their proper sphere. On that basis, I invite the noble Lord to withdraw his amendment.
Lord Phillips of Sudbury: On that basis, the noble and learned Lord the Lord Chancellor has entirely satisfied the movers of the amendment. I beg leave to withdraw it.
Amendment, by leave, withdrawn.
[Amendments Nos. 117 and 118 not moved.]
Lord Kingsland Lord Kingsland moved Amendment No. 119:
Page 6, line 5, at end insert (", provided that assistance for representation shall not be refused on the grounds that mediation is more appropriate unless the circumstances are such that a privately paying individual would be likely to opt for mediation.").
The noble Lord said: This amendment is based on the principle that those who cannot afford the full cost of legal services should have the same access to the system of justice as those who pay privately. If we apply that principle to Clause 9, at line 5 on page 6 of the Bill, we should reach the conclusion that it would only be appropriate to require mediation from public funds, rather than defray the costs of negotiations through solicitors, if a private party were likely to take the same approach. In other words, we do not wish to see mediation introduced as a poor relation to a procedure that would have been used were the parties to the action or the dispute both private parties. That is the purpose of the amendment. I beg to move.
Lord Hacking: I am sure that it is not the intention of my noble and learned friend to treat mediation as a poor relation in the resolution of disputes. The starting-point is the guidance. As I have said several times, the guidance notes are very helpful. Paragraph 83 states the principles which it is intended that the code should follow. Perhaps I may read the paragraph as I believe it is important. It states:
"The Code is required to reflect the principle that in many family disputes mediation is more appropriate than court proceedings. This is intended to reinforce the development, under the Family Law Act 1996, of mediation as a means of resolving private law family disputes in a way that promotes as good a continuing relationship between the parties concerned as is possible in the circumstances. The Government believes that mediation is more constructive than adversarial court proceedings, and that litigation in these cases usually serves only to reinforce already entrenched positions and further damage the relationship between the parties. In addition, the cost of court proceedings is higher than that of mediation and additional costs have to be borne by the property of the family, reducing the amount available to the parties and their children in future".
744
Those are important principles. Neither the Bill nor the guidance note indicates that mediation is mandatory; nor do they indicate that there should be some obligatory appropriateness test. Indeed, if the code did so, it would be going beyond the powers given to it by Parliament under the Bill.
Secondly, I am not sure that the test proposed by the noble Lord who moved the amendment is entirely satisfactory. It is the test of what private litigators would do. Unfortunately, experience shows that some private litigators who have the funds can be pretty bloody-minded in matrimonial and other civil cases and go for court proceedings for reasons of vindictiveness. To attempt to apply this test to what a private vindictive person would do is surely not sensible in any degree. For those reasons I oppose the amendment.
Baroness Crawley: I, too, oppose the amendment. I do so simply because it would cut across the proposition that, in order to increase access to justice for more people while keeping an eye on best value for money for the taxpayer, it would be better for people to try mediation first, before becoming eligible for other services. Such a course of action would seem eminently sensible, certainly from the point of view of the distinct advantages of mediation in conflict resolution.
Lord Simon of Glaisdale: Perhaps I may speak briefly from the point of view of family law. My remarks are made in the knowledge that the noble Lords, Lord Meston and Lord Hacking, and the noble Baroness, Lady Scotland, have more recent experience than I.
As regards family disputes, we are concerned only with the financial and property repercussions, where mediation is of particular value because passions are frequently more virulent in such disputes. Indeed, they may poison whole relationships, particularly those of the parties as regards their children. One should not regard mediation as a poor relation, or even as a first step to litigation. On the contrary, in family disputes mediation will frequently be in the interests of the parties.
The Lord Chancellor: The noble Lord, Lord Kingsland, was more economical in his recommendation of this amendment to the Committee than even the noble and learned Lord, Lord Simon of Glaisdale, would wish the statute book to be.
The noble Lord, Lord Hacking, put the matter in context. Clause 9 as a whole provides for a code that reflects priorities and under which the commission seeks to ensure that the most appropriate types of service for an individual case are funded. It is a discretionary framework, as it must be under a controlled budget.
The amendment to Clause 9(3) cuts across that discretionary framework. The clause provides that,
"The criteria set out in the code shall reflect the principle that in many family disputes mediation will be more appropriate than court proceedings".
The amendment would add,
"provided that assistance for representation shall not be refused on the grounds that mediation is more appropriate unless the circumstances are such that a privately paying individual would be likely to opt for mediation".

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So the amendment cuts across the discretionary approach by laying down an iron rule that assistance for representation shall not be refused on the grounds that mediation is more appropriate unless the circumstances are such that a privately paying individual would be likely to opt for mediation in the circumstances.
I do not accept that this is a test that the commission should have to apply in addressing the allocation of scarce public resources for the benefit of people who do not have the resources to be privately paying clients.
The noble Lord, Lord Hacking, made sound points. It may be that the acrimony in a particular marriage relationship between well-off partners who can afford to litigate would mean that they would be likely to insist on a set-piece confrontation in the courts instead of mediation. The result would be costly litigation from which their lawyers would benefit. That would do nothing but harm their long-term relationship. It would be likely to be damaging to the interests of the children, with whom they must both continue a relationship after the marriage and property disputes have been resolved.
It would be entirely reasonable for the commission in its discretion to take the view that people should try mediation in these property disputes first, and become eligible for representation only if that failed. The fact that well-off people who could afford to litigate might be likely to prefer an Olympian confrontation in the courts should not deter the commission from promoting a more sensible course. So I am afraid that the Government cannot accept this amendment, because it cuts across a discretionary system based on clear criteria which the Government believe does command popular assent to achieve access to justice for the many while maintaining best value for taxpayers' money. Traditional litigation in this area does not, because of lawyers' costs, make a persuasive appeal to claims on scarce public resources. On that basis I invite the noble Lord, Lord Kingsland, to withdraw his amendment.
7 p.m.
Lord Kingsland: I should like to thank the noble and learned Lord for his response and, although I am not happy with it, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 120 not moved.]
The Deputy Chairman of Committees (Lord Brougham and Vaux): Amendment No. 121 has already been debated.
[Amendment No. 121 not moved.]
Lord Kingsland Lord Kingsland moved Amendment No. 122:
Page 6, line 16, at end insert ("and procedures for informing the individual applying for funding about the decision, the reasons for that decision, and where funding has been refused what help should be given to that individual to find alternative ways of resolving the dispute.").
The noble Lord said: This amendment requires the code to contain procedures for informing applicants of the reasons for decisions and provisions concerning what help should be given to applicants who are refused
746
funding to find alternative ways of resolving their disputes. As your Lordships are aware, the Bill replaces the merits test with a funding assessment which takes into account a large number of considerations. There are the Government's priorities; the availability of finance; the strength of the case; the importance of the case to the client; public interest in bringing the case; whether there is another way of funding the case; and whether there is another way of resolving it.
Depending upon the particular priority given to the area of law which is the subject of the decision, different weights will be given to each of these factors. So the task of balancing all these weights against each other is an extremely complex one in each individual case. There are likely to be very many dissimilar instances. In those circumstances, if the application is refused it is my submission that very clear reasons should be given so that, first of all, the applicant knows exactly where he stands. Secondly, if that funding is refused the applicant is given a very full opportunity to consider all the other options that may or may not be at his disposal.
The noble and learned Lord the Lord Chancellor has spoken on several occasions during the course of this Committee stage about the importance of open government and of an open approach to decision-making. In my submission, that principle is more important in relation to Clause 9 than in relation to any other clause. I beg to move.
Baroness Wilcox: I rise to support my noble friend Lord Kingsland, because this amendment involves consumer protection and accountability to consumers for decision-making. The amendment deals with the vital information that will be given to people when a decision is made as to whether or not their case will be funded.
The new decision-making process considers a number of factors which will be given different weights depending on the priority and resources for that type of case. This process will be much more discretionary than in the past, and much more complicated. Unless the Act places a duty on the decision-maker to give clear reasons to the applicant when funding is refused, the applicant will be in great danger of not knowing what to do next.
Where the applicant is refused because there are better ways of funding or of resolving the dispute, the applicant may need help to find alternatives. During my time serving on the review of the civil Court of Appeal set up by my noble and learned friend Lord Mackay of Clashfern when Lord Chancellor, I came into contact with people driven to appeal, often as lay litigants in person, because they did not understand the reasons for the decisions affecting their cases.
Although this is a different aspect of decision-making, I suggest that it makes the point that a lot of wasted time, and unnecessary heartache, in the civil justice system could be avoided if people were entitled

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to and were actually given—in plain English, of course—clear reasons for the key decisions in their cases.
Lord Donaldson of Lymington: I should like strongly to support this amendment on the basis partly of trying to remove a sense of injustice on the part of the person refused funding, but much more on the basis of causing those who are deciding the matter to think through why they are refusing funding. That view is consistent with the view that is being taken by the courts—it was being taken by the courts even when I was in office—which was in all circumstances to try to encourage not the High Court but the tribunals and lower courts, and in many cases judicial review, to give reasons. I was responsible, with others of course, for giving leave to apply for judicial review, largely on the basis that while the authority concerned might well have been right we just did not know, because of the failure to give reasons. So, both from the point of view of deciding whether anybody ought to object to the refusal, but much more in terms of improving the decision-making process, I think that something on these lines ought to be included.
The Lord Chancellor: Clause 9(5) already lays down that the code must include procedures for appealing against decisions, and I agree with the noble and learned Lord, Lord Donaldson of Lymington, that an integral part of such a procedure must be to give the applicant reasons for the decision. Not to do so would breach basic principles of natural justice and, I am sure, would lead us very quickly to judicial review of the commission.
My officials are working on the details of the information that unsuccessful applicants will be given. I expect them to be set out in the code when it is finalised. A draft appeals procedure is already contained in the version published last week, but it does not go as far as the points we are currently discussing.
I take a similar view of information about alternatives. One of the criteria on which funding can be refused will be the existence of an alternative. Providers will have to advise applicants whether there are alternatives so that they can give them a good idea of whether their applications are likely to succeed. In fact, where an alternative exists I expect that many will not even put in an application. But there will be situations where someone has been turned down for some reason or another and will want to know about alternatives. Given that one of the tasks of the commission will be to give basic advice about the availability of services, doing this should become second nature. I am sure that there will be no harm but much good in making it an obligation at this stage of the process as well.
That leaves the most obvious case, simple refusals, for which the amendment would require reasons, which we should in any event give before the appeal to which I have referred could be meaningful. So, if I may, in the light of this debate, I will take this amendment away
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and give it positive consideration. On that basis, I invite the noble Lord to withdraw his amendment in its present form.
Lord Kingsland: I am most grateful to the noble and learned Lord the Lord Chancellor for his reply. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 123 to 129 not moved.]
Clause 9 agreed to.
Clause 10 [Terms of provision of funded services]:
Lord Archer of Sandwell Lord Archer of Sandwell moved Amendment No. 130:
Page 6, line 33, after ("individual") insert (", other than a person who is in receipt of any means-tested benefit,").
The noble and learned Lord said: While my noble and learned friend's ear is so obviously open, this may be a propitious moment at which to introduce the debate on my amendment. Clause 10 deals with the contributions which a recipient of services from the community legal service shall be required to pay. At present we do not know what the rules will be because the Bill provides that they will appear in regulations. It may be that my noble and learned friend will take advantage of this debate to give us some indication of what the regulations may contain. They are not regulations which, according to Clause 23, are to be subject to the affirmative procedure. That may make it all the more important that we should have some indication of what they may say.
My amendment is designed to ensure that one matter is not left uncertain: that no one, as a condition of access to justice, shall be required to pay a contribution which is beyond his means. One criterion of that seems to me to be where some other authority has investigated the applicant's means and found that they are not sufficient for his needs.
I note that the noble Lord, Lord Goodhart, together with the noble Lords, Lord Phillips and Lord Kingsland, have set their names to Amendment No. 133, which seeks to impose a similar constraint with respect to capital resources. Subject to anything which may emerge in this debate, I support their amendment, which is wholly consistent with mine. I beg to move.
Lord Goodhart: I rise briefly to say that I sympathise with the view that it seems unnecessary to have rules about recovering contributions from someone who clearly is not in a position to pay them.
Lord Falconer of Thoroton: I hope that the noble and learned Lord, Lord Archer of Sandwell, will forgive me if I do not take up his gentle invitation to give details of what may be in the regulations. It may be that we shall do that later, but I am not in a position to do it at the moment.
The noble and learned Lord's amendment goes to the important issue of the relationship between eligibility for social security benefits and for help from the community service fund. The effect of the amendment

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would be to prevent the Lord Chancellor from making regulations requiring contributions or fees from any person who was receiving any means-tested benefit.
The noble and learned Lord's argument is that, if someone's means have already been assessed for social security purposes, they should also qualify for help from the fund. In other words, he says that, if a person's means are low enough to warrant help from the state with living expenses, help for legal services should be automatic. If that were the position, his argument would be very attractive. Unfortunately, it is not as simple as that.
Currently, recipients of income support and income-based jobseeker's allowance are indeed automatically qualified for legal aid without contribution. In the jargon, they are "passported" through the means test. But there are other means-tested social security benefits that do not automatically qualify the recipient for legal aid—with good reason. Income support and jobseeker's allowance are benefits designed to guarantee a minimum level of income, and the eligibility limit for legal aid without contribution is aligned with that minimum level of income. Other means-tested benefits, however—for example family credit—are available in certain circumstances to people with significantly higher income. It would not be fair to allow family credit recipients free legal aid when people on the same income would be required to pay a substantial contribution. The powers under the Bill should be wide enough to allow us to replicate the position that currently exists under legal aid, which seems fair. This amendment would prevent that. In those circumstances, I ask the noble and learned Lord to withdraw the amendment.
7.15 p.m.
Lord Archer of Sandwell: My noble and learned friend correctly paraphrased my argument. He equally correctly pointed out where it breaks down. I understand that his heart is in the right place, even though his ear is not as open as was that of my noble and learned friend the Lord Chancellor at an earlier stage. Perhaps we should both reflect further on the problem. Clearly we both want to achieve a just result. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Simon of Glaisdale Lord Simon of Glaisdale moved Amendment No. 131:
Page 6, line 36, leave out (", or conduct is,").
The noble and learned Lord said: This probing amendment is grouped with a number of other amendments which, apart from the last one, are also probing amendments. The amendment refers to Clause 10(2)(b):
"if his financial resources are, or conduct is, such as to make him liable … under the regulations".
We may have covered that point in discussing a previous amendment. I am not certain whether my noble and learned friend wishes to add anything. I am not clear
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what is the conduct in question and whether it is the kind of matter which we discussed in relation to an earlier amendment.
Amendment No. 134 relates to Clause 10(6):
"The regulations may …
(b) make provision for the determination of the cost of services for the purposes of the regulations".
I am not sure what kind of machinery my noble and learned friend has in mind for that.
Amendment No. 135 is to leave out of Clause 10(7) the words,
"Except so far as regulations otherwise provide".
What is the force of that?
Amendment No. 136 relates to Clause 10(7)(b):
"other sums payable by the individual by virtue of regulations under this section".
What is that meant to catch?
Finally, Amendment No. 137 relates to Clause 10(8):
"For the purposes of subsection (7)"—
which I believe is an old provision, going back to the original Legal Aid Act, relating to a first charge on any property recovered or preserved—
"it is immaterial what the nature of the property is and where it is situated; and the property within the charge includes—(a) any to which the individual is entitled under any compromise or settlement of the dispute".
At the moment I do not see why that is not subsumed in subsection (7) which gives a first charge in respect of any property that is recovered or preserved. Does that not include property recovered or preserved under a compromise? I beg to move.
Lord Falconer of Thoroton: The amendments in this group are Amendments Nos. 131, 132 and 134 to 137. The noble and learned Lord has dealt with some, but not all of them. Amendment No. 132 in the name of the noble Lord, Lord Kingsland, has not been moved and I shall not deal with it unless the noble Lord moves it later. I deal first with Amendment No. 131.
Lord Simon of Glaisdale: To clear my mind, is it right that the odd man out is Amendment No. 132? I do not believe that I spoke to that amendment.
Lord Falconer of Thoroton: The noble and learned Lord did not speak to that amendment but it is in the grouping. The noble and learned Lord is right not to speak to it because that amendment is in the name of the noble Lord, Lord Kingsland, who has lost heart as to that, quite understandably.
Lord Kingsland: I have not lost heart. I simply reserve my position for a later stage.
Lord Falconer of Thoroton: The noble Lord lies in wait for me with Amendment No. 132. I am on tenterhooks as my noble friend Lord Clinton-Davis says. The effect of Amendment No. 131 is to remove conduct as a consideration in deciding whether or not a person should pay something towards the costs of his case. The noble and learned Lord asks whether the Government

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wanted to elaborate on the meaning of "conduct". All I can say is that this will allow the commission to recover its costs or retain contributions where a person has misbehaved; for example by fabricating evidence. It is already possible to do this under the present scheme. A person's certificate can be revoked if his conduct is bad enough and revocation means that he is liable to repay everything that has been spent so far on his case. We need to be able to do the same under the new scheme to cater for similar extreme cases. That gives some indication of the conduct considered.
Under Amendment No. 134 the noble and learned Lord seeks to remove Clause 10(6)(b). That subsection allows regulations to provide for how the cost of a service is to be calculated. This will be essential in future if the contract price paid to the lawyer is a fixed unit price per case. Around this fixed price costs for work done in an individual case may vary considerably.
Lord Simon of Glaisdale: Before the noble and learned Lord moves on I am not clear about the machinery of recovery.
Lord Falconer of Thoroton: Is the noble and learned Lord referring to the machinery under Amendment No. 131 or Amendment No. 134? I have not finished my response to Amendment No. 134. Perhaps I may complete my response and return to that question. The power under Clause 10(6)(b) could be used to set a notional cost at the beginning of a case to avoid assisted people having to pay unexpectedly large or small amounts. This power also allows us to develop more detailed systems for relating repayment more closely to the stages cases reach. These features are important to make the scheme fair and predictable. That is the aim of Clause 10(6)(b). The precise machinery set up to achieve that has not yet been fixed. At this stage I can do no more than set out precisely what it is aiming at rather than the form of the machinery.
The noble and learned Lord's next three amendments are about the statutory charge. Clause 10(7) provides for a first charge that the commission (like the board now) will have over any property recovered or preserved in proceedings in respect of the costs of the case. The first of these amendments, Amendment No. 135, would remove the power by regulations under Clause 10(7) to modify or disapply the charge in respect of some cases. That lack of flexibility can risk serious unfairness and harshness and that is why it is there. Amendment No. 136 would remove Clause 10(7)(b). That provides for the statutory charge to include sums over and above the actual cost of the case. This would be necessary if a conditional legal aid fund (CLAF) were set up where the person would be liable to pay a success fee into the fund. To remove the power would undermine the operation of a CLAF if one were set up.
The noble and learned Lord's last amendment, Amendment No. 137, would remove Clause 10(8)(a) which applies the statutory charge to property recovered or preserved as a result of settling a case. It would be very odd not to have that power. At present the Legal Aid Act does the same. I am not sure why the noble and learned Lord wants to take a backward step. In this
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respect there is no reason why we should make a distinction between cases that go to trial and those that settle.
Lord Simon of Glaisdale: I apologise to the noble and learned Lord for not making myself clear. My question is this: why is the power in subsection (8)(a) not contained in the last limb of subsection (7)? In other words, why is recovery under a compromise or settlement not property recovered or preserved in a dispute?
Lord Falconer of Thoroton: It is dealt with in this way because it is wide enough to cover a situation where no proceedings have been issued. I believe that that answers all of the questions raised by the noble and learned Lord. In the light of that I ask him to withdraw his amendment.
Lord Simon of Glaisdale: As usual, the noble and learned Lord has replied very pleasantly, although I fear that he as well as his noble and learned friend the Lord Chancellor have now used the word "flexibility". I understand that the question that I asked about machinery was answered on the basis that the Government had not yet made up their mind. I am quite content to accept that. Otherwise, I believe that the noble and learned Lord answered satisfactorily all of my other queries except for the last which I shall consider and perhaps return to on Report. Perhaps the noble and learned Lord will himself consider the matter again. I was not entirely convinced in so far as I took it in. In the meantime, I ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 132 not moved.]
Lord Hunt of Kings Heath: My Lords, I beg to move that the House do resume. In moving this Motion I suggest that the Committee stage begin again not before 8.29 p.m.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Road Traffic (NHS Charges) Bill
Brought from the Commons; read a first time and to be printed.

Social Security Benefits Up-rating Order 1999
7.30 p.m.
The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham)The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham) rose to move, That the draft order laid before the House on 13th January be approved [5th Report from the Joint Committee].
The noble Baroness said: My Lords, as your Lordships are aware, this annual order and the others standing in my name on the Order Paper are an important part of the routine business of the DSS. The uprating order will increase most rates of social security benefits from this April. Most national insurance and non-contributory benefits will increase by an RPI of 3.2 per cent. Most income-related benefits will increase by the Rossi index of 2.1 per cent. As is usual, the increases are based on the change to the retail prices index from September to September, with the increase for the income-related benefits adjusted to remove the element of housing costs. As your Lordships know, housing costs for those on the income-related benefits are met separately through housing benefit, council tax benefit and income support mortgage interest and the Rossi index reflects more appropriately the spending of those claiming income-related benefits.
I must first ask for the indulgence of the House. I draw your Lordships' attention to the fact that we discovered only late this afternoon that during the drafting of the uprating order a transcription error meant that on page 17 of the uprating statement, item 11, the amount of benefit for widowers' pensions in industrial injuries benefits is shown as £66.25 whereas the actual uprated amount equals £66.75. The error will be remedied as quickly as possible and will not affect the benefit paid to claimants. None the less I wish to apologise to the House.
Lord Higgins: My Lords, the noble Baroness was good enough to alert me a short time ago to the fact that a mistake had been made. Clearly, it is better that it is discovered now rather than later when pensioners would either have been paid 50p less than they should have been or the right amount without appropriate parliamentary authority. It is right that that should be corrected as soon as possible. Had the mistake been the other way round and the Government were paying more, I should have been in a more difficult position. Perhaps the Minister will indicate how she proposes to correct that. I believe that the order comes before the Commons next week.
Baroness Hollis of Heigham: My Lords, unless I am misinformed—I shall write to the noble Lord—I understand that there will be a correction when the matter comes to the Commons. We have made the matter clear now. When the Statement is before the Commons it will have the correct figure. Does that answer the noble Lord's question?
Lord Higgins: My Lords, I doubt it. I presume the matter needs to be corrected in this House too. The noble Baroness clearly cannot amend the order at this moment. I presume the noble Baroness will either lay a new order—I understand that that is not what she intends; we should have to debate the whole matter again—or she will simply carry this order, and a second order will correct the figure.
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I may be wrong but I do not believe she can simply correct the order in another place and not in this House.
Baroness Hollis of Heigham: My Lords, apparently it is not unprecedented. Section 152 of the Administration Act explicitly allows for the laying of subsequent affirmative regulations to put right mistakes. The error has now been referred to. We shall be remedying it. No claimants will be affected. A similar reference will be required for the Commons debate. Subject to agreement with the business managers, it is proposed that an amended order be laid and debated in March as part of a package of affirmative orders and regulations.
Lord Higgins: My Lords, I am anxious to facilitate the matter for the reasons I mentioned. I was surprised that the Minister seemed to indicate that the matter would be corrected in the Commons and not in this House.
Baroness Hollis of Heigham: My Lords, no. The situation will become clear because of the correction in the Commons. The matter will obviously have to come back to us. I apologise to the House.
The Guaranteed Minimum Pensions Increase Order is a consequence of Section 109 of the Pensions Schemes Act 1993 which requires that salary-related schemes contracted out of SERPS increase that part of the GMP earned since April 1988 by RPI or 3 per cent., whichever is less. So this year the increase will be 3 per cent. with the balance of inflation proofing provided through SERPS. This arrangement means that the burden of inflation proofing the post-1988 GMPs in payment is spread between the state and occupational pension schemes.
The national insurance re-rating order will increase the rates of class 2 national insurance contributions paid by self-employed people and of class 3 voluntary contributions broadly in line with the increase in the basic state retirement pension. Class 2 contributions will go up by 20 pence from £6.35 a week currently to £6.55 a week from April 1999. Class 3 contributions also go up by 20 pence a week from £6.25 to £6.45.
The order increases the small earnings exemption limit for class 2 contributions from £3,590 a year currently to £3,770 a year from April 1999. Self-employed people who expect to have annual profits or gains below that limit can apply to be excepted from payment of class 2 contributions. The order also increases the lower and upper profits limits for class 4 contributions paid by self-employed people on their annual profits and gains which are chargeable to income tax under Schedule D. The lower profits limit will go up from £7,310 a year to £7,530 a year. The upper profits limit will increase from £25,220 a year to £26,000 a year.
There will be no increase in the rate of class 4 contributions. This remains at 6 per cent. of annual profits and gains between the lower and upper profits limits. Nor will there be any increase in the rate of class 1 contributions paid by employees on the portion of their earnings that exceed lower earnings limit but do

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not exceed the upper earnings limit. This rate remains at 10 per cent. The rate of employers' class 1 contributions was set at 12.2 per cent. by the Social Security Act 1998 as part of the radical simplification of employers' and employees' contributions which comes into effect from April 1999. This simplification replaces the present multiplicity of employers' contribution rates with the single 12.2 per cent. rate in respect of non-contracted out employees, raises the point at which employers start to pay contributions to a new earnings threshold and abolishes the 2 per cent. "entry fee" contributions currently paid by employees on the portion of their earnings below the lower earnings limit.
Regulations will be laid next month to increase the lower earnings limit for employees' contributions from £64 a week currently to £66 a week from April 1999, to increase the upper earnings limit for employees' contributions from £485 a week currently to £500 a week from April 1999 and to set the earnings threshold for employers' contributions at £83 a week from April 1999.
These orders are laid with a report from the Government Actuary's Office on the National Insurance Fund. The Deputy Government Actuary estimates that the fund will not require a treasury grant in 1999–2000 in order to meet its estimated expenditure commitments and achieve an end of year balance of at least the minimum level recommended by the Government Actuary. However, in order to safeguard management of the fund's finances in the event that contributions revenues are lower than expected or benefit expenditure is higher than currently forecast, the contributions re-rating order provides that the maximum amount of Treasury grant which could be made available to the fund in 1999–2000—subject to parliamentary approval of a supplementary estimate—is set at 2 per cent. of annual benefit expenditure from the fund, some £930 million.
I turn to the costs of the uprating. The total additional cost of the uprating for the year 1999–2000 is estimated to be £3.7 billion. This will mean that the total estimate of DSS benefit expenditure for that year will be over £95 billion. Around half of this expenditure will go to pensioners, a quarter to sick and disabled people, with around 20 per cent spent on families. Over the period 1998–1999 to 2001–20, the period covering the settlement of the comprehensive spending review, cumulative DSS expenditure in cash terms will increase by £24 billion. The main beneficiaries of this significant increase will be pensioners who will gain some £12 billion, disabled people and carers some £7 billion, and £3 billion on child benefit. This last increase partly reflects the increase in child benefit for the eldest child by a record amount of £2.95 a week.
I must reassure your Lordships that this increased provision, most of which is targeted on the most vulnerable in our society, is within our spending capacity. We expect that the average real growth in DSS benefit spending, including the working families tax credit, is forecast to be under 2 per cent. a year over this Parliament. This compares to to 4 per cent. a year during the last Parliament, and an average of 3.4 per cent. a year for the period 1978–79 to 1996–97. I must also
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reassure your Lordships that our expenditure plans are affordable. This Government have consistently taken a responsible approach to the public finances and the plans include cautious forecasts of growth in the economy and include margins to cover uncertainties. The result is that social security spending is now growing more slowly than the long-term trend for the economy as a whole.
It is important to focus on spending patterns and projections in a debate which calls for an increase in public spending of £3.7 million. It is also important, as these orders are debated in both Houses, to demonstrate that this total of social security expenditure, over 10 per cent. of GDP, provides the taxpayer with value for money. These are difficult equations. A business case which provides for cash transfers from one group to another and which involve issues like decency, security and the nature of a civic society, are difficult to construct. But while it is difficult ever to know that you have got it just right, it is plainly obvious when you have got it wrong. Between 1979 and 1997, the amount spent on social security increased in real terms by £43 billion. But during that period poverty, inequality, dependency and social exclusion increased dramatically. That was plainly and badly wrong.
How did it go so wrong? At the root of it was a failure to understand the extent to which society had changed. Just as fundamentally, it was a failure to use the great machinery of welfare which had developed in Britain since Beveridge to encourage and enable people to live to their full potential and make the best of their lives. Our task as we tackle the issue of welfare reform is to get it right, to ensure that the vast sums of money which are the essence of the orders today are used as an investment.
We have set about the task with some urgency. Our first priority was to help people of working age back into work, changing the culture of social security, no longer a bank of last resort but an active partner in providing people with greater employment opportunities. Thus our New Deals are already making a real difference to the lives of thousands of people, providing them with training, new skills and the springboard for participation in the labour market. We wanted to raise our horizons. Rightly, in the first wave, we focused on the young unemployed and those who had lived with the misery of long-term unemployment. But we also recognise that those who need additional help to participate, or those who want to participate but can only do so to a limited degree, by reasons of health or domestic responsibility, require different services and support. The New Deals for lone parents and for disabled people are providing that support by matching service to needs.
But no matter how big the hand-up, we can only change people's perception of work, especially those who are entrenched in social exclusion, if we ensure that work pays, if it is truly a pathway out of poverty. The national minimum wage to be introduced in April will make a significant contribution. As important are our plans for helping families and the disable to stay in employment. The working families tax credit will guarantee an income of at least £180 a week for every

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working family in full-time work. Families with earnings of less than half average, £220 per week, will not pay income tax. The childcare tax credit will also provide significant support to single and two-parent families. This credit will provide help of 70 per cent. of eligible childcare costs up to a weekly limit of £100 for families with one child and up to £150 for families with two or more children. Underpinning the childcare tax credit will be a coherent childcare strategy with an aim of encouraging good quality, affordable and flexible childcare to be widely available.
We will also make work pay for those disabled people who want more out of life than being set-aside to depend entirely on out-of-work benefits. They tell us that they want to work. We are seeking to help them to work through our New Deals. The disabled persons' tax credit will increase the rewards of working for those people who have only limited earnings capacity.
This is just the first stage of getting it right on social policy, and I look forward to developing our reform agenda over the coming months. But social security expenditure is not just about covering the costs of benefit rates. We need to ensure that we achieve maximum value for money in terms of service delivery. Our objectives are a system for delivering welfare that is flexible, efficient and accessible. But welfare is more than just delivering benefits. We are working to change the environment and culture of claiming benefit. Crucial to this is active management of individuals by trained personal advisers geared to help and encourage people of working age to develop their potential. When people have been out of the labour market for some time or have special needs such as caring responsibilities or want to better themselves by maximising their employability, they need ongoing help, a proper skills analysis, help in overcoming skills deficiencies and practical advice on overcoming barriers to work. In short, we believe that obtaining value for money in service delivery terms is by recognising the needs and aspirations of our clients.
I mentioned earlier the difficulties of building business cases where social policy is involved. But clearly our approach of using the social security budget as an investment in people, as an instrument of change, is based on our principle of work for those who can. Security for those who cannot is the other side of that coin and an essential element of a decent society.
While our approach to work for those who can has been to reject the past, our approach to security for those who cannot work is to take direct government action. For instance, an extra £1.25 billion a year will help all families with children. Similarly, the substantial increase in benefit for the poorest pensioners included in this uprating order is part of a £2.5 billion package of measures to give help among the most vulnerable in our society. Our approach is about delivering more help to those who need it most.
Our reform of the severe disablement allowance will target extra help on people who become disabled early in life and do not have the opportunity to work. Parents of severely disabled children will be able to plan for the future in the knowledge that their child will have a
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secure non-means tested income. People who become disable early in life and claim benefit before the age of 20 will have access to incapacity benefit. After a year on benefit, they will receive the long-term rate of incapacity benefit—as much as £25 a week extra for some claimants, a significantly higher level of guaranteed support without means testing. The vast majority will be floated off income support.
The disability income guarantee will provide a new enhanced premium in the income-related benefits for severely disabled people aged under 60 with the highest care needs. A similar new premium is provided for families with severely disabled children with the highest care needs. It means an extra £5.75 a week for a single person or a child, £8.30 for a couple, at April 1998 rates. To meet a longstanding gap in the system of support for severely disabled young children, the DLA higher rate mobility component worth £35.83 a week, will be extended to children aged three and four, something that I know your Lordships welcome.
At the heart of our approach to getting it right is making effective change by taking practical measures. We are not burdened by dogma. This is reflected in our attitude to means tested, contributory and universal benefits. In my mind there is no one right method. Since the election we have heavily endorsed the universal benefits by increasing child benefit to its highest ever amount. We will extend contributory widow's benefit to bereaved men. We are extending needs-based disability benefits for people disabled early in life and severely disabled young children. Other changes, such as working families tax credit, will increase means testing but will help to make sure that work pays for up to 1.5 million families who will be better off as a result. We want to promote fairness and opportunity, and partnerships between public and private provision. We will face these challenges with all the tools at our disposal, including a full range of benefit structures.
I look forward to the debate with interest. Precedent allows for a wide-ranging debate on social security. While I believe that under this Administration we can, for the first time in many years, give an assurance that social security spending is increasingly providing added value out of total government spending, I always welcome your Lordships' informed views on the matter. This Government set a very clear agenda for welfare reform. For most people of working age the promotion of social inclusion is the promotion of employability and the promotion of personal responsibility. The responsibility for the security for those who cannot work falls to society. The instruments before us are part of that process. For example, the changes to national insurance are just a component of substantial changes to national insurance for April which will help ensure that work pays. The uprating order, by providing price protection, ensures continuing security and for some groups such as parents and the poorest pensioners ensures more security. I therefore commend the order to the House.
Moved, That the draft order laid before the House on 13th January be approved [5th Report from the Joint Committ].—(Baroness Hollis of Heigham.)
7.52 p.m.
Lord Higgins: My Lords, though I have been here for little more than a year, I still have a slight sense of culture shock. I had not fully anticipated the extent to which this debate would be wide ranging. If the Minister's speech is repeated in the other place, I suspect that there may be some trouble with the Speaker.
Be that as it may, when we debated this issue last year, it was preceded by a Statement on the uprating order which I had understood would be one of the few fixed points in the annual financial timetable. I believe I am right in saying that that has not happened this year and I am not at all clear why that is so. Perhaps the Minister will enlighten us.
As the noble Baroness rightly points out, the total of social security spending is around 10 per cent. of GNP—an enormous amount. She raised a large number of issues which we have debated on former occasions and is aware that there are great disputes between us; for example, with regard to the working family tax credit there is a clear division between the two sides of the House. There is also a difference in the view we take with regard to means testing, the contributory principle and so forth. It is not my intention to rehearse those arguments this evening, but there are a number of specific points which it may be helpful to make.
As I understand it, we are debating all three orders together. In that context there is scope for a certain amount of confusion between the minimum pension guarantee and the guaranteed minimum pension. One order deals with one and another with the other. The distinction is substantial. One relates to the national insurance pension and the other to corporate pensions.
I turn immediately to some of the arithmetic, though I do not propose to concentrate too much on this. Given what the Minister said about the total social security and welfare expenditure, I am a little puzzled as to why—if I understand it correctly—the uprating orders this year will cost £3.7 billion for 1999–2000 whereas last year it was only £2.45 billion. Perhaps the Minister will indicate exactly what is the situation with regard to those figures.
Having said that, I turn to the question of the minimum income guarantee. As the Minister will well know from our previous exchanges, we are concerned about this in as much as it contributes to the undermining of the contributory principle—one of a number of measures which have that effect. As we understand it, some people will receive benefits to which they have not contributed, even though that specific benefit was previously regarded as one which could be obtained only if one had satisfied the contributory conditions.
In that regard a specific point arises. We understood that one of the main reasons the Government felt that there was a case for a minimum income guarantee was the fact that there is a lower takeup of income-related means-tested benefits than one would wish. The impression was created that in future there would be a minimum income guarantee and that the arrangements which were going to be made would ensure that the take-up was greater at the bottom end of the scale. I was
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therefore surprised to note what I had not previously understood from a representation made by the citizens advice bureau; that is, that the expression "minimum income guarantee" which was being used by Ministers when introducing the increased benefits, though it was reassuring, did not make clear that it related to means-tested benefits. It will not automatically be paid into a retirement pension; it will have to be claimed separately as income support. It would seem therefore that this change, which has the disadvantage I mentioned a moment or two ago, would not have the advantage we had previously understood was one of the main reasons, if not the main reason, why the Government believed it right to introduce it. It seems to undermine to some extent the whole exercise.
I turn now to a question which arose at the Committee stage of the social security contributions Bill last week and is likely to arise again on the Bill's Report stage next week; namely, the situation which has arisen with regard to the breakdown (if that is the right word) of the national insurance computer. I indicated to Ministers that I felt that it would be helpful to pursue that when we come to Report stage next week. It is also relevant to these orders since there is no point in increasing the extent of the pensions and so forth if they are not going to be paid. I thought therefore it would be helpful for me to pose some questions to the Minister. I imagine that, with her great expertise, she will be able to answer some right away, but I shall fully understand if she cannot answer them all. I give her notice that I hope to raise them next Monday at Report stage but, as I say, they are entirely relevant to these orders.
I am nowhere near as expert as the noble Baroness and my first question relates to whether it is just one computer which is the problem or whether there are several related computers, including the ones run by the Inland Revenue, which will be affected if the transfer of the Contributions Agency from the Department of Social Security to the Inland Revenue takes place. Secondly, is it the case that the computer went down last June? If so, when is it expected to become fully operational again? It is said to be next April. Is that too pessimistic or too optimistic an estimate? It is clearly a disastrous situation if it has been down from June to April.
Clearly a significant number of pensioners are affected by the breakdown. My understanding is that a number of them have received no communication whatever from the department telling them what the situation is. One would have thought at the very least that that might have been done, though I understand from one person who inquired why he had not been told, that the answer came back, "Because it has all been computerised and we would have to do it manually".
It is all very well to laugh now, but it is not very funny if one receives the answer another person had; that is, "I have now to write a considerable amount of correspondence on this matter as to what people should do if they were expecting to receive their pension and did not. The answer is that they should go on income support". Whether the computer is capable of coping with that, I am not sure. Perhaps the Minister can tell us whether the computer deals with both income support

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and pensions. She indicates that it does not. At least if people are not receiving their pension, they can claim income support. I do not find that very comforting, but it could be worse.
I am not clear also about the exact scope of the orders. As I say, I do not expect the Minister to answer all my questions tonight but if she can at least answer some of them, it will help to clarify what is obviously a serious situation.
I am not clear whether the provisions refer only to a limited number of people, particularly those who have deferred claiming their pension in order to obtain the higher amount. If you defer claiming your national insurance pension, you get a certain amount—not necessarily uprated—but with a notional rate of interest added to it. In that context, if people have not yet been paid their pension, having now claimed it, but not having claimed it previously, will they receive this uprating? Let me put it more clearly. If such people were expecting to receive their pension last June but now find that they will not receive it until after April, will they receive both the uprating and the increased allowance normally made by way of an interest calculation?
Perhaps the Minister will tell us how many people are affected by that change and something about the situation as regards tax? The Government, in their wisdom, have introduced a system of self-assessment which involves very heavy penalties. Some 20 years ago, I opposed that. How are those people to complete their self-assessment forms? If they do not do so by the end of this month, they will incur heavy interest penalties.
One could go on longer, but perhaps I may add one more point. I understand that it is proposed that, because of the delay, the Government will pay a degree of compensation. I understand that something like 0.5 per cent. a month will be paid. Will that be taxable? How does that compare with the interest charged to people who do not pay their tax on time? One would think that there should be a correlation between the two. We can pursue this further on Monday. However, it would be helpful to have a ground-clearing exercise at this stage.
The Minister has made great play of the overall effect of the Government's policy and seeks to present it in a favourable light. Perhaps I may quote her. She said that the Government want to give help,
"to those who need it most".
On previous occasions we have spent a lot of time debating the effect on pension funds generally of the Chancellor's first Budget and the fact that something like £5 billion a year was extracted from that. I do not want to pursue that point further this evening.
What received much less attention at that time, although it was included in the same Budget, was the fact that there would be a withdrawal of dividend tax credits for individual non-taxpayers, clearly the poorest in society. Such people pay no tax whatever although they may top up their meagre income with income from savings invested one way or another. Clearly, those
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amounts are not very large. Nonetheless, the effect of withdrawing the dividend tax credit from them is that the lowest paid—those who do not even pay tax—find that their incomes have been reduced as a result of the Government's Budget. How is that compatible with the clear statement made by the Minister this evening that the Government want to give help,
"to those who need it most"?
I understand that the Government reviewed the situation. Hopes were raised that they might see sense on the issue. However, I understand that, having reviewed it, they still concluded that that group of people should be penalised in the way that I have described. Why are the Government maintaining their attitude, which is clearly inconsistent with the position that the Minister set out this evening?
Two other orders are on the Order Paper, both fairly technical. One relates to the guaranteed minimum pension which, of course, is a piece of jargon used to relate it to individual company pensions. As on former occasions, I must declare an interest as chairman of a company pension fund—although one not, I suspect, affected by the provisions. That may or may not be so; I think not; but I should declare it. I am unclear as to why the figure in that order is 3 per cent. It seems to relate to the retail prices index. I am not clear why it is not related to earnings. Perhaps the Minister will clarify that point.
My final point relates to the second order regarding national insurance contributions and the Treasury subvention. The other day we discussed the fact that the payments into what I have described as a "tank" rather than a "pipe"—I refer to the National Insurance Fund—have to be at least one-sixth of the expected annual expenditure for the following year. Therefore, as the Government Actuary has decided that no further contributions are necessary—instead of being only 16 per cent. or so, it is more than 20 per cent.—I am unclear why the Government have taken the precaution of saying that there might be a further payment during the year of 2 per cent. of the estimated benefits, which is a substantial sum. Is it really the case that the margin of error in the Government's forecast is that great?
As I have said, the orders raise several points, but I do not want to go into the wide issues which the Minister raised. However, I hope that I can receive some clarification and that we can pursue some of the matters further when we meet next Monday.
8.6 p.m.
Earl Russell: My Lords, I want to express sympathy with the Minister for her misfortune with the printers. It reminded me of John Locke's remarks when he saw the proofs of his Second Treatise of Civil Government that printers have ways all their own, not united by the general fairness which cements mankind. However, the Minister may be comforted to reflect that when the courts construe legislation, they construe the intention of Parliament, and, as far as I can understand, she has made the intention of Parliament crystal clear. There are precedents for that and I think that they are being observed.

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I listened with interest to the Minister's speech. I was particularly glad to hear that there is no one right method between means-based, needs-based and universal benefits. That is a good basis for discussion and I am in entire agreement with it.
The Minister is now well played into office. She has many distinguished achievements behind her, mostly in the field of disability, including the unravelling of the problem of the benefits integrity programme. I am glad to hear that saga can finally be laid to rest.
In a sense, this is the wrong moment for a review of social security because the Bill on welfare reform is not yet on the field of play. I feel a little like Geoff Boycott poking at the pitch before there are any players on it. It is not a part in which I am particularly expert.
One can look with some satisfaction at the report of the Government Actuary. The noble Lord, Lord Higgins, expressed some surprise at the Government's forecast being so far out. Instead of a deficit of £425 million we have instead the very welcome development of a surplus of £2.6 billion. That is largely due to an increase in the number of national insurance payouts. It seems to be one of the lessons of recent economic cycles that the variation in tax receipts on the up and down stages of the cycle is much greater than one used to think. That confirms what I once said, that when I consider the interests of taxpayers what I want most is for there to be more of us.
That brings me to my main general criticism of the Government's approach to the issue of welfare reform, which is, as I am sure the Minister knows, that I believe that they have started from a wrong diagnosis. They are blaming the social security system for the failure to alleviate poverty. Last October, Angela Eagle, commenting on the statistics on households with below average incomes, said:
"The figures show that the ever increasing social security bill has had little impact on reducing inequality. This confirms our approach that welfare reform is required".
I believe that she was putting the blame in the wrong place. The job of the social security system is to keep people going through periods of poverty; it is the job of the wider economy to prevent poverty. In fact, the Minister illustrated that theme in her speech. When referring to the increase in social security spending under the previous government she asked: "How did it go wrong?" What she should have been asking was: "Where did it go wrong?"
Without meaning to endorse the social security policy of the previous government the noble Baroness might consider the view that a great deal of it went wrong in areas that were not within the responsibility of the Department of Social Security: in the overall level of employment in the economy; in the fact, to which the Acheson Report drew attention very usefully, that the decrease in mortality has not been accompanied by any corresponding decrease in morbidity—something which those considering NHS priorities might take into account—and in the increasing troubles of matrimony, which I am sure were not caused primarily by the activities of the DSS.
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If the Government were to look at that wider canvas for problems of poverty they might be rather less inclined to blame the system of social security. In fact, when we come to debate the Acheson Report, which I hope we will be able to do, I hope that we will be able to take it not just as a report on health (because it is far more than that) but also as a report on poverty. It raises the question: does poverty breed poverty? That is an area to which I hope we shall return.
While the Government are missing the impact of the wider canvas on poverty, they are also sometimes missing those few and limited areas where policy pursued within the DSS may have the effect either of creating poverty or of failing to alleviate it. I hope that the Government will be paying attention to the remarks made in the Acheson Report on benefit levels. Of course I understand the overwhelming problems involved in dealing with the latter, but I should like at least to hear their admission that there is a problem. If indeed benefit levels are causing malnutrition they may also be creating expenditure, even while saving is the apparent aim.

I should like the Government to think further about disentitlement. Perhaps they could apply to disentitlements to benefit the recommendation of the Acheson Report that all policies liable to increase poverty should be evaluated for their impact on ill-health. If benefit levels can cause malnutrition, what can absence of any benefit cause? That is a point to which I have always wanted the Government to pay attention. They should ask themselves whether they are trying to cure social exclusion with one hand, while, through disentitlement, they are creating it with the other.
I also hope that the Government will look at the extended payments rule for housing benefit where claimants have eight days to make a claim. It is not always made clear to them within those eight days that the claim has to be made in so short a time. Many people are missing out in that respect. As a result, what looked like a very welcome change is not achieving the benefit that it should.
Perhaps the Government will also look again at a number of problems involving poverty among pensioners. I am struck to discover that our pension levels are right down at the bottom of the scale; indeed, they are above only those in Ireland. The myth that we have very generous social security benefits by international comparison is one which I think ought to be changed. The much-trumpeted minimum income guarantee, passing under the slightly unfortunate acronym of MIG—a hostile acronym I should have thought—was described in another place last Monday by my honourable friend Mr. Davey as an Arthur Daley guarantee because, being delivered through income support, it applies only to those on income support. Much though I know the Minister cares about take-up, I am not yet convinced that adequate methods have been found to get all those pensioners who do not take up income support to do so.
Moreover, a great many pensioners are missing out because they are above the savings level. Once again, the savings level has not been uprated. I am sure that

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the Minister can hear me in her sleep complaining that savings levels have not been uprated. However, that is a point which gains in force rather than diminishing by repetition. I ask the Government to remember the misfortunes that overtook Harold Wilson in office through the failure to uprate the dog licence. We are in danger of getting to that point. Of course, one might have hoped that anything that discouraged saving would be contrary to Government policy.
I should like to second what the noble Lord, Lord Higgins, said about the dividend tax credit. It is a subject upon which our two parties co-operated very amicably last Monday. We are always ready to co-operate with another party where we agree with it. When I do so with the party of the noble Lord, Lord Higgins—and I will give way to him in a moment—I hope that he will recognise that, when I do so to our mutual benefit, he cannot blame me if I also co-operate with another party. I give way to the noble Lord.
Lord Higgins: My Lords, that rather makes the point on which I was about to intervene. I understand that it was not only my party nor, indeed, just the party of the noble Earl. I believe that a significant number of Labour Members in the other place also supported the Early Day Motion. It was an all-party agreement, not the Government's.
Earl Russell: My Lords, I am grateful to the noble Lord for making that point. That is very true. There were several interventions from Labour Members and a good deal of support in the background. Therefore, I believe that no one party would wish to take credit for what happened.
My honourable friend Mr. Webb has discovered that the winter fuel payment of £20 costs £12 million a year to administer, whereas if it had been paid as a weekly increase in the pension the extra administrative cost would have been nothing. Indeed, £12 million is an awfully expensive price for a headline. I did not think that even the most expensive newspapers in the country charged that much for advertising space. The Government do not seem to have any clear answer to the really big problem of pensioner poverty, which is defective contribution records. If the Minister has an answer to that I shall listen to it with great pleasure. In particular, they do not seem to have an answer for the problem which will become more common with the growth of the single market; namely, people whose contribution records are defective because of the amount of time that they have worked outside this country.
Therefore, despite the best efforts of the Department of Social Security and the rest of the Government, inequality is not diminishing. I have been very struck by the information from Households Below Average Income that 70 per cent. of Pakistani and Bangladeshi families come in the bottom 20 per cent. of income distribution. That is something which should not be. The progress towards equal pay is very nearly stalled. I hope that we will be thinking again about a new equal pay Act.
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There are many fields in which there is a great deal more work to be done. In the future, therefore, instead of barking up the wrong tree I hope that we may see the Government beginning to bark up some of the right ones.
8.20 p.m.
Baroness Hollis of Heigham: My Lords, I should like to thank both noble Lords for their contribution to this evening's debate on the up-rating order. It did not entirely surprise me that the noble Lord, Lord Higgins, asked a series of questions which would not have been inappropriate to some degree in a National Audit Office committee or Treasury committee, nor that the noble Earl, Lord Russell, raised areas of social policy which he and I have discussed on many an occasion. As I say, I think these roles into which we have fallen may persist.
I shall do my best to answer some of the questions that have been raised. As regards some of the questions the noble Lord, Lord Higgins, asked on NIRS 2, I shall write to the noble Lord because issues of commercial confidentiality are involved. The noble Lord will understand that. He asked whether it was usual to have an uprating not preceded by a Statement. As I recall I read out a Statement on this issue and welfare reform last autumn. I remember that the noble Baroness, Lady Castle, tackled those issues in feisty form. We dealt with the two issues together as it seemed appropriate to do so. I accept that that was an unusual way of tackling the matter. However, it is not every year that we set out our stall in terms of a major welfare reform Bill.
I know that the noble Lord will return to issues of working families' tax credit, means testing, the contributory principle and so on. The noble Lord raised a point which was also emphasised by the noble Earl, Lord Russell. He referred to pensioner poverty, minimum income guarantee and take up. The noble Lord said that according to the CAB people had thought that the minimum income guarantee was somehow an increase in their basic state pension as opposed to an increase in the income support related element, as the state retirement pension is below income support levels.
The following matter has been raised in this House on many occasions. There is a real problem as regards identifying the pensioners who are entitled to claim income support but are not doing so, and encouraging them to claim it. We originally estimated that about 1 million pensioners—mainly elderly single women over 75 who do not have contributory pensions in their own right—are entitled to income support who fail to claim it. That figure may be a little high as it is now clear that one of the main reasons those people fail to claim income support—or are ineligible if they do so—is that although their income may be below income support levels, their capital floats them above income support. Many of those pensioners were raised in a culture of keeping £5,000 or £10,000 in the bank to pay for their funeral or to leave to their children. That prevents them from drawing down that income. Therefore they live on an income which is below

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income support levels but they do not qualify for income support because of their capital. However, as I say, they are not willing to draw down that capital.
Of the 600,000 pensioners who are disqualified from the minimum income guarantee, we estimate that more than half have excess capital of over £20,000. Of those, some 190,000 people have capital of over £50,000. Nevertheless their income can be below income support levels. That forms a major part of the dilemma. That is not to say that the Government are not considering the capital rules. Nonetheless the spread of income on capital is as wide as the spread of income—
Earl Russell: My Lords, when the Minister considers the reluctance of pensioners to spend their savings, will she remember the rapid escalation in funeral costs?
Baroness Hollis of Heigham: My Lords, I entirely take that point. That is why the social fund now identifies reasonable costs for a funeral that will enable the pensioner or the pensioner's family members to afford a funeral with help from the social fund if they do not have sufficient savings to cover that. The point I sought to establish was that the disqualification of pensioners from income support was affected by capital which in many cases constitutes a sizeable sum.
Lord Higgins: My Lords, the sums may be sizeable but that was not my experience when I was an MP and dealt with constituents. Are not these the very people who will be hit by the tax credit problem which I mentioned?
Baroness Hollis of Heigham: My Lords, it depends how that £50,000 is converted into income. The broader question that was asked concerned why pensioners were failing to claim the minimum income guarantee to which they were entitled. As I said, one of the main reasons for that is the capital rules. We need to consider whether the existing capital rules are appropriate. We are now receiving feedback from our nine or so pilot schemes which indicate that pensioners feel there is a stigma attached to claiming this benefit and pensioners are ignorant of their entitlement to benefit. A slightly worrying feature is that a person may have applied for income support or a benefit in the past to which he was not entitled. That person was rebuffed and deterred from making subsequent applications. Having said that, I do not in any sense underestimate the difficulty—having identified the people who are entitled to the money—of persuading people to claim the benefit. That generation of older people comprises people who are extremely reluctant to claim a means tested benefit which in the past was associated with national assistance and all that that entailed. I believe noble Lords will understand what I mean.
As I said, the noble Lord referred to the CAB. However, he may have also noted that the CAB supports the steps the Government are taking to increase the take up of income-related benefits by pensioners. The CAB states that extra publicity will be necessary to ensure that all pensioners are aware of how they are to be provided with a guaranteed minimum income. We
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entirely accept that point. Obviously the longer term response must be to ensure that pensioners have access to a decent second pension. The problem with the guaranteed minimum income concerns those pensioners who have not been able to build up a decent second pension in their own right, whether through SERPS or through occupational pensions.
One of the important elements in our pensions proposals is the proposals for the new second state pension. As your Lordships will be aware, those on modest incomes who may be in and out of work and who earn between, say, £3,500 and £9,000 will in future be entitled to a pension as though they were earning £9,000 a year. That is a massive redistribution for some of the lowest paid. That will benefit women. One must take account of the implications for carers who will effectively obtain a £1 a week's worth of pension for every year of caring. That also applies to those caring for children. I think your Lordships will accept that we have a twofold problem with pensions. There is the immediate problem of the poverty of existing older pensioners and the longer term problem of ensuring that we float pensioners off poverty by giving them access to a decent second pension. That is the basis of our proposals.
The noble Lord, Lord Higgins, raised a whole set of connected issues about NIRS. I believe I have noted most of the questions asked about this. However, if I have missed any of the more technical points I shall write to noble Lords as these are technical issues. I do not think anyone would deny that there have been real and serious problems with NIRS 2. However, they should not be exaggerated as they are being overcome. There is a stabilisation and recovery plan which has been developed jointly by the Contributions Agency, Andersen Consulting, the Benefits Agency and the Employment Service, with input from the Inland Revenue. NIRS 2 is basically a computer system which does not affect the Inland Revenue. Therefore some of the noble Lord's concerns are not, fortunately, justified. NIRS 2 does not affect any of the income-related benefits, or any of the universal benefits such as severe disablement allowance, ICA, disability living allowance, DWA, income support, income-related jobseeker's allowance, child benefit, family credit, housing benefit or council tax benefit. Those account for about half of all our benefit expenditure. However, NIRS affects benefits which are dependent upon the payment of national insurance contributions; namely, retirement pensions, incapacity benefit and contributions-based jobseeker's allowance. Also affected—as the noble Lord noted—are rebates paid into approved personal pension schemes. As I say, there is a problem here and we are not trying to suggest otherwise. However the two areas which I think give rise to the need for an alternative path of income support are retirement pension and widows' benefit. Since 6th January of this year NIRS is on-stream to provide long-term benefit calculations in respect of retirement pension and widows' benefit.
The noble Lord asked a series of connected questions about compensation and the like. This is an extremely large system which handles about 65 million accounts. It is the largest in Europe. No records have been destroyed

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during the conversion, or as a result of live processing. All benefits are currently either unaffected or are using standard or interim procedures during transition. After transition any interim payments will be retrospectively adjusted and appropriate compensation on retrospective payments will be made accordingly. I hope that deals with the bulk of the noble Lord's points on that issue.
Lord Higgins: My Lords, we shall return to this on Monday, but perhaps I may just ask one question. To what extent have the pensioners and others involved been told what is going on?
Baroness Hollis of Heigham: My Lords, the noble Lord was right in his initial remarks. That sort of information tends to be generated by the very same computer which is unable to handle it. In that sense, that is true. However, in terms of the benefit helpline, the advice at local DSS offices, the voluntary agencies, from Age Concern through to CAB, there is ample information on this. We should not forget that people continue to receive an old benefit if they are not eligible through the faltering of NIRS to receive their up-rated benefit. If there are any individual cases that the noble Lord has in mind, obviously we shall look at them for him. We have got a fair amount of information. Having said that, at the end of December something like 60 per cent. of the age-related rebates that went with personal pensions were being paid compared with the previous year's records.
We are hoping that it will be on track. It was a contract established by the previous administration; it has taken a long time to bed down. We received it, with caveats, in 1998 and the problems associated with NIRS have continued to come through. We hope, having established a stabilisation programme between all the four parties—the Contributions Agency, DSS, the Employment Service and Andersen Consulting—that we shall now be on track. As I say, if the noble Lord wishes to come back to me on any of those detailed points, I shall be happy to try to answer him.
The noble Lord raised a point about the Government Actuary. He asked why, if the report said that the Treasury grant is not needed, as indeed it does, we are we making one. The contributions re-rating order provides that the maximum amount of Treasury grant which could be made available to the fund is set at 2 per cent. of annual benefit expenditure. This is a prudent and practical way of managing our finances. It means that the Secretary of State has further resources, agreed with the Treasury which he can draw on if necessary. It is not new. At this time last year the maximum estimated grant of £900 million was made available for 1998–1999, even though the Government Actuary did not estimate that we would require any such grant. That indeed proved to be the case. It is a well-established precedent of fall back.
I turn now to some of the wider points raised by the noble Earl, Lord Russell. He asked me first about BIP. We expect to see the end of the present system by the end of the financial year; that is, the beginning of April.
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Clearly the details of what exactly will be replacing it are still being discussed with the Disability Benefit Forum.
Secondly, the noble Lord said that we expected the social security system to carry the responsibility for poverty whereas that was the responsibility of the wider economy. I entirely agree. It was easy enough when most of the social security system was a contributory system based on 40 hour, 50 year jobs. What we now see is that one family in five is without work; three million children are in families without work; and we have work rich and work poor households. That is why we have support in the House for emphasising that the best pathway out of poverty is access to work. That is why we are combining that with new deals, personal advisors, minimum wage and the like in order to make work pay.
As to those unable to work, I should have thought that tonight's uprating statement which shows that pensioners will have a minimum income of £75 a week, that there will be a minimum income for disabled people and a record increase in child benefit should address the problems facing those unable to enter the labour market.
I think and hope that most of the rest of the noble Earl's discussion overlapped with that of the noble Lord, Lord Higgins on pensioner poverty, capital ceilings and how we are attempting to increase the take up of income support. I hope and believe that I have addressed most of those concerns and I hope, as a result that your Lordships will be able to accept the three uprating statements tonight.
On Question, Motion agreed to.

Social Security (Contributions) (Re-rating and National Insurance Fund Payments) Order 1999
Baroness Hollis of Heigham: My Lords, I beg to move that the draft order laid before the House on 13th January be approved [5th Report from the Joint Committee].
Moved, That the draft order laid before the House on 13th January be approved [5th Report from the Joint Committee].—(Baroness Hollis of Heigham.)
On Question, Motion agreed to.

Guaranteed Minimum Pensions Increase Order 1999
Baroness Hollis of Heigham: My Lords, I beg to move that the draft order laid before the House on 13th January be approved [5th Report from the Joint Committee].
Moved, That the draft order laid before the House on 13th January be approved [5th Report from the Joint Committee].—(Baroness Hollis of Heigham.)
On Question, Motion agreed to.

Access to Justice Bill [H.L.]
8.38 p.m.
House again in Committee on Clause 10.
Lord Goodhart Lord Goodhart moved Amendment No. 133:
Page 7, line 1, at end insert—
("( ) The regulations shall not require any payment from a person whose capital resources are such that they would be eligible for income support.").
The noble Lord said: This is a much more important amendment than, on the face of it, it would appear. I should say at the outset that the drafting leaves something to be desired. It should have said that regulations shall not require any capital payment from a person whose capital resources are such that he would be eligible for income support. It was not the intention of this amendment to exclude payments out of income from those whose income permitted them.
Without this amendment, in its corrected form, the Government's plans will suffer from a very serious, potentially devastating, defect. Under the present law, applicants for legal aid have to pay contributions from capital if their capital exceeds £3,000, and they are not eligible for legal aid if their free capital exceeds £6,000. In the case of income support, if their capital exceeds £3,000 they are not eligible. For income support, the value of the home, the dwelling house of the claimant for income support, is disregarded completely. That used to be the case for legal aid but now the equity value of the house is taken into account so far as it exceeds £100,000. The equity value of course means, in non-lawyer speak, the value of the house less the amount outstanding on the mortgage. If the equity value is more than £100,000, the owner can be and is expected to borrow against it to fund his litigation.
That is fair enough. We would not object to an amendment to this amendment to modify it to retain that provision. However, the Government now propose to change the rules. The new rules are set out in Annex A to the explanatory notes. The effect of the change is that the equity value of the house will still be disregarded for the purposes of eligibility for funding—which means that you will still get funding if the equity value of your house is worth less than £100,000, provided your other assets are worth less than £6,000. But if the equity value of your house is between £3,000 and £100,000, there will be a liability to repay any costs not recoverable from another party as a capital payment. That repayment can be deferred until the house is sold, but meanwhile the liability will be charged on that house and a market rate of interest will be charged, not as at present a relatively beneficial rate of interest.
The effect of that is obvious and disastrous. Anyone currently paying a mortgage will, in practice, be unable to claim public funding out of the community legal service fund. They will run the risk of an open-ended liability and increased payments to fund interest to the CLS fund, as well as having to pay their current mortgage instalments. If a young couple are planning a family they risk losing the equity they need to trade up to a larger house. If the owners are pensioners who have
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paid off their mortgage they risk serious hardship if they have to pay interest to the CLS out of their pension. For owner-occupiers, therefore, funding will be by way of loan charged on the equity of the house, carrying what the notes describe as a "realistic rate of interest".
The consequences of the grant of funding out of the community legal service fund to an owner-occupier are therefore so potentially damaging that in a case involving a cost potential of any significance it is almost impossible to imagine that any such owner would wish to take it on. Therefore, in practice, funding will be available only to those who are living in rented accommodation. That would be grossly unfair. I hope the Government will accept the need in this respect for an amendment. I accept that some assistance is provided by the Government's new amendment, which says that nothing will be paid beyond what is reasonable, but I think that this remains an extremely dangerous provision. I beg to move.
Lord Archer of Sandwell: I rise briefly to echo the anxiety expressed by the noble Lord, Lord Goodhart. The equity in one's house is not really capital available for expenditure. If one loses the equity in one's house, one does not have a home. I hope that my noble and learned friend Lord Falconer has grasped that point, even though I think his attention was not always entirely on the argument. I support the amendment.
8.45 p.m.
Lord Falconer of Thoroton: The amendment tabled by the noble Lords, Lord Goodhart and Lord Phillips of Sudbury, is similar to the amendment of the noble and learned Lord, Lord Archer, Amendment No. 130, in its intention but is much more limited and specific in its effect. It provides that people whose capital resources are such that they would be eligible for income support should not be required to make any payment towards services provided by the community legal service fund.
In its naked form, the amendment, as I think the noble Lord accepted, would again prevent the Lord Chancellor from making regulations which provided for the same financial conditions that exist now for legal aid. However, as the noble Lord, Lord Goodhart, explained with total clarity, he has a much more limited aim in mind. As I understand his argument, he is seeking to remove one of the proposals for changing the current regime set out in the Explanatory Notes; namely, the extent to which the first £100,000 of the equity in your house is taken into account in determining the amount you have to pay to the legal services commission. I understand that, but just for the sake of the record, perhaps I may outline the relationship between income support and legal aid without repeating what I have said in relation to the amendment of the noble and learned Lord, Lord Archer.
Under the legal aid arrangements today, if you are on income support you automatically qualify for free legal aid. If, though not claiming income support, you would qualify on income grounds, you would also qualify for legal aid without any contribution from your income. People who have some capital assets may still qualify for income support. Capital of £3,000 or less is

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disregarded altogether: so is the value of any equity that the applicant owns in his or her own home. If someone has capital worth between £3,000 and £8,000, income support is reduced by a set formula to reflect an assumed weekly income from the "free capital" between those limits. If they have more than £8,000 capital they do not qualify for income support, regardless of how low their income is.
The legal aid provisions for contributions from capital are somewhat different: below £3,000 disposable capital, a person is eligible without a contribution from capital; between £3,000 and £6,750 (or £8,560 in personal injury cases), the assisted person is required to pay the full amount above £3,000 as a contribution from capital; with disposable capital above those upper limits, people are ineligible for legal aid, unless the Legal Aid Board exercises its discretion to waive the upper capital eligibility limit in a potentially very expensive case. Under the existing provisions, the first £100,000 of equity owned in a home is disregarded in these calculations.
The point focused on by the amendment of the noble Lord, Lord Goodhart, is Annex A, paragraph 8 of the Explanatory Notes to the Bill which proposes that the first £100,000 of equity in a home should continue to be disregarded for calculating eligibility, but that it should be counted in assessing contributions. However, under the new proposal, no contribution from capital tied up in a home would be payable until the end of the case, when costs liabilities are determined. Furthermore, the Explanatory Notes explain that the legal services commission would have discretion to postpone the payment of a contribution from this source, typically until the house is next sold. This is the position that already applies when the legal aid statutory charge attaches to a home that was recovered or preserved in proceedings.
The noble Lord has explained that this is the proposal that his amendment is intended to prevent. As I have indicated, the language of the amendment would go further than that. The amendment provides that,
"regulations shall not require any payment from a person whose capital resources are such that they would be eligible for income support".
That would mean that someone whose capital did not exceed £8,000, but who had an income above the free limit, would qualify for free legal aid under the amendment. In other words, other than those exceptional cases where the upper capital limit is waived, no one who qualified for legal aid would ever be asked to pay a contribution. The noble Lord has accepted that that is not what he has in mind. He has the more limited aim in relation to the proposal with which I have just dealt.
There is a difference in kind between income support and legal aid contributions so far as the value of the house is concerned. Income support is provided as help with living expenses. Disregarding the value of the house for income support obviates the need to sell your house to live. Legal action is a one-off event. It is reasonable to ask people with assets, in whatever form, to pay what they can afford for it, especially if one considers the potential effects on other people of taking
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legal action. Capital is generally taken into account for legal aid contribution purposes and it would not be fair to owners of different forms of capital to disregard this first £100,000 absolutely. Justice is done by disregarding it for eligibility purposes and in practice making it available for contribution purposes only when the house is sold.
It is true that, under the regulations contemplated in the Explanatory Notes, delaying enforcement will be at the discretion of the commission. But the Lord Chancellor is willing to consider requiring the commission to call on the £100,000 only on sale and removing its discretion to do so earlier. I would also envisage that the commission would have a discretion not to enforce the contribution even then, where to do so would cause hardship. On that basis, which goes some way to meeting the noble Lord's argument, I invite him to withdraw the amendment.
Lord Goodhart: I do not find that answer entirely satisfactory. I was well aware that there is a power to postpone enforcement of the charge. In the example I gave of the young couple thinking of having a family, I was concerned about the threat not to the house in which they were currently living but about the fact that when they needed to sell in order to move to a larger house because of their growing family they would be unable to do so because at that point the charge would bite. While the charge is postponed there is of course a continuing liability to pay interest at what will from now on be a market rate. That is potentially a cause of hardship sufficiently great to justify returning to the matter. However, I shall wish to see what the noble and learned Lord the Lord Chancellor has to say.
I should not be favourably impressed by an amendment that went no further than stating that the enforcement of the charge must compulsorily be delayed until the house was sold. The hardship could well arise when there was a need to sell the house, which could be not merely because of a growing family but, for example, the need to move to a different part of the country for work and so on. Therefore I should wish to see, as a minimum, a commitment to giving a discretion not to enforce a charge even on sale where that would result in hardship. However, on this occasion I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 134 to 137 not moved.]
Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 138:
Page 7, line 40, at end insert—
("( ) The regulations shall provide that in any proceedings where a costs order is made in favour of any individual who has agreed to make a payment under subsection (2)(c), the costs payable to him shall include costs in respect of any payment he has agreed to make.").
The noble Lord said: Under Clause 10(2)(c) the Government effectively take reserve powers to set up a contingency legal aid fund. I understand that to be the case from paragraph 86 of the Explanatory Notes.
It is my understanding that the Government do not intend to use these powers immediately. They offer a fall-back if the CFAs fail to operate satisfactorily and

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open the possibility of a form of mixed public/private funding through hybrid legal aid CFA cases. I certainly welcome the fact that the Government are taking these reserve powers. It is a forward-looking step.
However, in the Bill the Government propose that in the case of CFAs the success fees should in future be paid by the losing party rather than by the client.
I submit that the same principle should apply to a contingency legal aid fund so that legally aided clients would be on the same footing as those under a CFA. The situation would be that if costs were recovered from a non-legally aided party, those costs should include the success fee to be paid back into the contingency legal aid fund in the same way as under a private CFA. So this amendment would put clients whose cases are brought under a contingency legal aid fund on the same basis as those who bring cases under a CFA. I beg to move.
Lord Falconer of Thoroton: This amendment, which my noble friend explained very clearly, would create a duty on the Lord Chancellor when making regulations under Clause 10 to include in the regulations a requirement that costs awarded in favour of a person receiving funded services would include any payment that person had agreed to make under Clause 10(2)(c) which exceed the costs of the funded services. I believe that by itself this amendment might act oppressively and is in any event unnecessary.
At present the successful unassisted defendant cannot recover his costs from the assisted plaintiff, nor from the Legal Aid fund in practice, unless there is substantial hardship. Clause 11 broadly replicates that position for cases funded under the new community legal services fund scheme; that is, the status quo is to be maintained.
Under Clause 10(2)(c), provision is made for services to be on terms that, in the event of success, he is liable to pay the equivalent of a success fee into the fund. This would enable the legal services fund to establish a contingency legal aid fund if so directed. We have no present intentions to do that. This is a reserve power only.
The amendment would provide that if a contingency legal aid fund were set up in this way then the successful assisted person would be able to recover the success fee payable to the contingency legal aid fund in costs from the unsuccessful defendant. That, however, would operate unfairly for defendants who could not reciprocally recover their costs from the unassisted plaintiff or the fund when they succeeded.
If a contingency legal aid fund were ever to be established in this way, and what I say offers no expectation that it ever will, then Clause 11 provides very wide powers for the Lord Chancellor to make regulations which make provision about the costs in cases. In particular, Clause 11(2)(e) allows him to specify the principles to be applied in determining the amount of any costs which may be awarded to a party who is receiving funded services. I believe that these powers are sufficient, and indeed are intended, to allow the Lord Chancellor to make regulations that can specify what should be taken into account in determining the
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costs to be paid to a successful party supported by the commission. Under this power he could, for example, make the fund liable in these circumstances.
My noble friend's amendment would, however, oblige the court to make this payment recoverable whenever an agreement has been made under subsection (2)(c). That is too inflexible. Those of us with court experience know that courts, when exercising their discretion as to costs, can feel that because of, for example, contributory negligence, or perhaps the behaviour of the parties in the litigation they are not prepared to award the successful party all or any of their costs. There needs to be some flexibility in applying any scheme for recovering costs and in allowing the courts to exercise some discretion in arriving at the final amount to be paid.
If it will help my noble friend, I can tell him that I am fully seized of what he is trying to achieve and that I believe the Lord Chancellor could achieve this under the powers already contained in the Bill if he wished to do so. I shall carefully consider how to give effect to the aim of this amendment when we come to look at the regulations that may need to be made once the Bill passes into law. On that optimistic note I ask him not to press his amendment.
Lord Clinton-Davis: I am grateful to my noble and learned friend for that semi-encouraging note. I need to examine his reply carefully and to take advice on the matter. However, having regard to that situation, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 10 agreed to.
Clause 11 [Costs in funded cases]:
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 139:
Page 7, line 41, at beginning insert ("Where services relating to a dispute have been funded by the Commission for an individual as part of the Community Legal Service, his liability under an order for costs made against him in proceedings relating to the dispute shall not exceed the amount (if any) which is a reasonable one for him to pay having regard to all the circumstances including—

(a) the financial resources of all the parties to the proceedings, and

(b) their conduct in connection with the dispute;

and, in assessing the financial resources of an individual for whom such services have been so funded, his clothes and household furniture and the tools and implements of his trade shall not be taken into account, except so far as may be prescribed.
(1A) Subject to that,").
The noble and learned Lord said: I move this amendment because, on reflection, I think it is preferable that the qualification on the right of unassisted parties to recover costs against a person receiving funded services should appear on the face of the Bill. Before I come to my amendment, it might be helpful if I explain what Clause 11 is intended to do.
The clause creates a general power for the Lord Chancellor to make regulations in relation to the legal costs of cases where one of the parties is receiving services funded by the community legal service. The

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clause goes onto define certain provisions which may in particular be included in regulations made under the power conferred in subsection (1).
The first three circumstances set out in subsection (2) relate to what are often referred to in the current Act as the cost protection provisions. These are presently contained in Sections 12, 13, 17 and 18 of the 1988 Act. They are designed to ensure, first, that those receiving publicly funded support are not deterred from proceeding with a legitimate claim by fear of the possibility of having to pay the costs of their opponent if they are unsuccessful in proving their claim (Sections 12 and 17). Secondly, the provisions protect the taxpayer by establishing the circumstances in which the commission might be required to pay the costs in place of the person receiving services (Sections 13 and 18).
The other particular circumstances in which the Lord Chancellor may make regulations are largely drawn from existing provisions contained in Section 34 of the 1988 Act. Essentially they deal with the way in which and by whom the amount of a costs order may be determined and that any costs recovered shall be payable to the commission or the body or person who provided the services. As we have set out in the explanatory notes, that is Annexe A, paragraphs 12 and 16 on pages 62 and 63. We intend to make two changes to the existing position in relation to cost protection. First, while we intend broadly to preserve the protection to those receiving assistance from the commission against having to meet a liability for costs we intend to allow the value of a person's home to be taken into account in assessing his means.
Secondly, we intend to relax the test before a court can order the commission to pay on behalf of the person and to support it. The present test requires the unassisted party to prove severe financial hardship. We intend to require the unassisted person to have to prove the lesser test of financial hardship in order to obtain payment of costs from the board. Moreover, as I said, we are taking a reserve power to establish a contingency legal aid fund. As I also said, I do not believe that I will need to use this power because the Lord Chancellor is confident that conditional fees will provide a substantial alternative to publicly funded assistance, particularly in the area of personal injury cases.
An assisted person would, however, if the reserve power were exercised, be required to make an additional payment to the contingency legal aid fund in the event of success. We believe that this payment ought to be recoverable in just the way that Clause 27 will make a success fee in conditional fee agreements recoverable from a losing opponent. In such a circumstance we believe it would be only equitable that unassisted parties should be able to recover their costs against the contingency legal aid fund in the normal way. We would therefore wish to use the regulation-making powers in Clause 11(2)(c) to ensure that this could be done.
The amendment which stands in the name of the Lord Chancellor will put the protection given to the person who is assisted by the community legal service on the face of the legislation. Given the importance of the protection in reducing the deterrent effects of
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potentially incurring a liability for costs that could not be met, the Government believe on reflection that it is better that this is set out plainly in the primary legislation. We continue to believe, however, that the protection afforded to the commission should be made by regulations, subject to the affirmative resolution procedure, so that we may respond to changing circumstances as necessary.
Consequently, Clause 11 is amended so that a new subsection (1) is inserted, which substantially carries into the Bill the protection provided by Section 17(1) of the 1988 Act. It is of course rare for costs orders to be made against assisted persons. The court, however, has a discretion to make an order by taking into account the comparative resources of both parties. If that discretion were to be exercised, then Clause 11(1) also specifies that personal goods and effects are to be disregarded in any assessment of the means of the assisted person to meet a liability for costs.
The existing subsection (1) is renumbered (1A) and made subject to the new subsection (1). The remainder of the clause is unchanged, save for an amendment to subsection (2)(a). It no longer needs to provide regulations which deal with affording the protection now provided by the new subsection (1). Rather, regulations under subsection (2)(a) will specify principles that will apply in any determination of the amount of any costs a person receiving funded services may be required to pay. In those circumstances, I move the amendment standing in the name of the Lord Chancellor. I am grateful to be reminded that in speaking to Amendment No. 139, I have also been speaking, with the leave of the Committee, to Amendments Nos. 140 and 205. I should have mentioned that earlier. I apologise for not having done so.
Lord Goodhart: I have to say that while on the face of it this looks like something I should welcome, and indeed in certain respects I do, I think it is in fact an extremely dangerous provision. Or shall we say that what lurks behind it in the Bill itself is an extremely dangerous provision. What is now proposed is stated in the Explanatory Notes, which say:
"In future, assisted parties will retain most of their protection against paying inter partes' costs. But where courts are considering costs orders against assisted parties, the value of their homes will be counted towards their assets and the statutory bar on enforcing against homes will be lifted."
This raises exactly the same point that occurred in my Amendment No. 133. That amendment related to the recovery of money by the community legal service fund from the party whom it had funded. This concerns to the different, though related, issue of payment by the assisted party to the other party to the case. As soon as the value of the home is counted towards the assets of the assisted party, that means there are going to be far more assets against which the court will be able to make an order. It is likely therefore that there will be far more cost orders made against an unsuccessful assisted party. It is even worse than in the case of the recovery of payments by the community legal service fund because in this case it appears that the whole value of the home shall be counted towards the assets—it does not say

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anything about the first £8,000—and, perhaps worse still, the statutory bar on enforcing against the home will be lifted.
This will be an enormous disincentive to anyone thinking of applying for assistance. Coupled with the problem which I attempted to deal with by means of Amendment No. 133, it means that it will be virtually impossible for anyone who is an owner-occupier to apply to receive legal assistance in any case where the costs are at all serious without incurring great danger to himself and to his home. This is a seriously misguided view. The Government should revert to the previous position. It is certainly something I shall wish to examine again at Report stage.
Lord Kingsland: I may not have heard the noble and learned Lord clearly, and I apologise if I have misunderstood. Is he saying that the liability of the commission to contribute to costs awarded in favour of an unassisted person who succeeds against the assisted party is something that will be determined by regulation, or is it now to appear on the face of the Bill?
Lord Falconer of Thoroton: The purpose of this clause is to bring on to the face of the Bill protection for those receiving funded services from having to meet a liability for costs should they lose. What it deals with—on the face of the Bill, not in regulations—is a right in certain circumstances not to be pursued for the costs if one loses.
Lord Kingsland: I am most grateful to the noble and learned Lord. I was thinking of the opposite situation and the rights of an unassisted party. I know that that is not dealt with in the noble and learned Lord's amendment.
Lord Falconer of Thoroton: This is a very Byzantine way of looking at it but, as far as an unassisted party is concerned, he has no relationship with the legal services commission or the Legal Aid Board. The individual can pursue him, often on behalf of the legal services commission or the Legal Aid Board, pursuant to the ordinary rules of costs. We would not be expected to deal with that on the face of the Bill or in regulations.
Lord Kingsland: I am most grateful to the noble and learned Lord for clarifying that matter. Clearly I misheard what he said.
Lord Thomas of Gresford: Am I right in thinking that, whereas a person who is the beneficiary of a conditional fee agreement can cover his liability for costs with insurance, a person who receives assistance under the CLS scheme may find, as a result of this clause and the amendment, that his house is taken away from him and that he is not insured against that dramatic and dreadful loss that he may suffer if he should lose the case?
Lord Falconer of Thoroton: The noble Lord, Lord Thomas of Gresford, in effect raises the same point as the noble Lord, Lord Goodhart. What is the right
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answer where the assisted person loses and on the other side there is someone of modest means who has fought and won, having spent a great deal of money fighting the battle? Where should the financial pain lie? Must it always lie with the person who has won, even though the person who has lost has a house with a valuable amount of equity in it? Is not the right course in relation to those cases for the court to be in a position to consider, having regard to the resources of both the defeated assisted party and the victorious unassisted party, what the right result should be?
Let me give an example. Suppose you have spent £100,000 in costs in fighting off an unmeritorious claim put together on the basis of perhaps unreliable evidence by the assisted party. You have to sell your house in order to pay your lawyer, even though the other party, which was assisted, had equity in a house which was even greater than the equity in your house and, because of the point made by the noble Lord, there is nothing that can be done about it. That does not feel fair to me.
Lord Thomas of Gresford: I do not think that the noble and learned Lord is addressing my point. As I understand it, conditional fee agreements with an insurance cover are there to protect a person who loses a case. It is not always unmeritorious cases that lose; there is a balance of merit. There are some cases which are hopeless and some which are marginal and on the cusp where that party loses. A person who has a CFA is protected, but it seems to me that a person who can qualify for financial assistance under this scheme has his house on the line. It is that unfairness that I should like the noble and learned Lord to address.
Lord Falconer of Thoroton: With the greatest respect to the noble Lord, that seems to me to be dealing with a completely different point. You are there comparing the unfairness, as you would have it, between a conditional fee case, on the one hand, and a legally aided case, on the other. The balance of hardship in these cases is not between the case in front of the court and some notional other case; the unfairness is between the plaintiff and the defendant. Where should the burden fall? With the greatest respect to the noble Lord, Lord Thomas of Gresford, I do not think that the comparison he makes is the right one.
The right comparison—that raised by the noble Lord, Lord Goodhart—is the point I have to deal with. Should the failed assisted party in the case be able to treat his house as protected whereas the successful party who has to pay his own costs should have his house taken into account? If he is unassisted, his lawyers will seek to get their fees from wherever they can. The point made by the noble Lord, Lord Goodhart, merits consideration, and the noble and learned Lord the Lord Chancellor has indicated that, without giving rise to any expectation that change will occur, I should say that consideration will be given to it. However, the arguments about resources are quite powerful and would have to be answered by the noble Lord, Lord Goodhart, before there was any reasonable expectation of give in relation to that issue. I hope that that is a satisfactory response to the noble Lord's point.
On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 140:
Page 7, line 45, leave out ("limiting the amount of'') and insert ("specifying the principles to be applied in determining the amount of any").
On Question, amendment agreed to.
9.15 p.m.
Lord Renton Lord Renton moved Amendment No. 141:
Page 8, line 15, at end insert (", and
(h) providing for the payment of the costs of any other party.").
The noble Lord said: On behalf of the noble and learned Lord, Lord Simon of Glaisdale, I beg to move Amendment No. 141. I have always thought it best that the courts should be given a broad discretion as to costs without tying them down to too much detail. In my time that was always the practice. I do not know whether it is still so. But here the arrangement is that regulations shall be made governing the award of costs. Those regulations may in particular make provision for the various matters that are listed. The noble and learned Lord, Lord Simon of Glaisdale, has in my humble opinion correctly suggested that we should add something to enable the payment of the costs of any third party, for example, or to enable a co-defendant who may not be legally assisted to be paid. I believe that to be an omission that the noble and learned Lord is wise to suggest should be put right.
Lord Falconer of Thoroton: I dread to think what would have happened to me had I included in the Bill a provision such as this if the noble and learned Lord, Lord Simon of Glaisdale, had been here. He would have said that such a provision was quite unnecessary. He would have drawn my attention to Clause 11(1), which gives a general power to make regulations that
"make provision about costs in cases in which services have been funded by the Commission for any of the parties as part of the Community Legal Service".
He would also have drawn my attention to Clause 11(2)(a), which explicitly provides powers to make regulations concerning the payment of costs awarded against an assisted party whether they are to be paid either by the assisted party or by the commission. These powers are not limited to apply in relation to the costs of the successful unassisted opponent but to any costs awarded against the assisted person or commission.
The noble and learned Lord, Lord Simon of Glaisdale, would have asked in tetchy tones what was the point of adding this additional clause when it was obvious to anyone of reasonable common sense that the matter was already covered and that we should not insert provisions simply for the fatuous imagination of some crazed lawyer. In those circumstances, adopting the submissions of the noble and learned Lord, Lord Simon of Glaisdale, on previous occasions, I invite the noble Lord to withdraw the amendment.
Lord Renton: In spite of the wisdom of the noble and learned Lord I must inform the Committee that I
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do not know the motive of the noble and learned Lord, Lord Simon of Glaisdale, in tabling this amendment. Presumably he did so because he thought that it was necessary. However, he will read the Official Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 11, as amended, agreed to.
Lord Goodhart Lord Goodhart had given notice of his intention to move Amendment No. 142:
After Clause 11, insert the following new clause—
("The Public Interest Litigation Fund
PUBLIC INTEREST LITIGATION FUND
.—(1) The Commission shall establish and maintain a fund known as the Public Interest Litigation Fund.
(2) The Lord Chancellor—

(a) shall pay to the Commission the sums which he determines as appropriate for the funding of services by the Commission out of the Public Interest Litigation Fund, and

(b) may determine the manner in which and times at which the sums are to be paid to the Commission and may impose conditions on the payment of the sums.

(3) The purpose of the Public Interest Litigation Fund shall be to finance the provision of services of any of the kinds specified in section 5(1) to a person who is or may become a party to legal proceedings if the conditions in subsection (4) are satisfied and the Commission thinks it appropriate to finance the provision of those services.
(4) The conditions referred to in subsection (3) are—

(a) that the proceedings give rise to an issue of substantial public importance,

(b) that the person seeking the services is not entitled to have those services funded out of the Community Legal Service Fund or as part of the Criminal Defence Service, and

(c) that neither the person seeking the services nor any other person having a similar interest in the proceedings can reasonably be expected to pay for such services out of his own financial resources or resources which may be made available for that purpose from another source.

(5) Regulations may be made for the implementation of this section.
(6) In this section "proceedings" include prospective proceedings and any step in proceedings.").
The noble Lord said: In the absence of my noble friend Lord Lester of Herne Hill, I do not propose to move this amendment on this occasion.
[Amendment No. 142 not moved.]
Lord Goodhart Lord Goodhart moved Amendment No. 143:
After Clause 11, insert the following new clause—
("Conditional Legal Aid Fund
CONDITIONAL LEGAL AID FUND
.—(1) The Commission shall establish and maintain a fund known as the Conditional Legal Aid Fund.
(2) The purpose of the Fund shall be to provide help in the conduct of legal proceedings by entering into conditional legal aid agreements.
(3) For the purposes of this section a conditional legal aid agreement is an agreement between the Commission and a person providing advocacy or litigation services and his client which provides—

(a) for the costs of the client of the proceedings and any costs ordered to be paid by him to any other party to the proceedings to be paid out of the Fund;

(b) for any costs of the proceedings recoverable by the client from any other party to the proceedings or from any other source to be paid to the Fund; and

(c) for a further sum to be payable by the client to the Fund in specified circumstances.

(4) A conditional legal aid agreement shall be enforceable.
(5) For the purposes of the making of any order for payment of costs in the proceedings, the fact that any costs are being paid out of the Fund shall be disregarded.
(6) Regulations may provide for—

(a) the categories of person with whom (as client) the Commission is authorised to enter into a conditional legal aid agreement;

(b) the categories of proceedings in relation to which the Commission is authorised to enter into a conditional legal aid agreement;

(c) the computation of any money payable under subsection (3)(c);

(d) the administration of the Fund; and

(e) such other matters as may be appropriate to ensure the effective functioning of the Fund.

(7) The Lord Chancellor shall pay to the Commission such sums by way of loan or grant as he determines to be appropriate for establishing the Fund and may guarantee payment of any liabilities of the Fund.
(8) Regulations under subsection (6) may provide that, with a view to ascertaining the demand for conditional legal aid agreements, they shall be entered into for a trial period only with persons resident in a specified part of England and Wales.
(9) The Lord Chancellor may by order repeal this section and provide for the winding up of the Fund if, having regard to experience in the conduct of the Fund, he is satisfied that—

(a) there is insufficient demand for conditional legal aid agreements to justify the continuation of the Fund; or

(b) the Fund is not, and is unlikely to become, financially self-supporting.

(10) Any power under this section to make an order or regulation is exercisable by statutory instrument, and no order shall be made under subsection (9) unless a draft order has been laid before, and approved by resolution of, each House of Parliament.").
The noble Lord said: Amendment No. 143 is a very important matter because it raises—unfortunately relatively late in the proceedings—the question of setting up a conditional legal aid fund. This fairly lengthy amendment would require the legal services commission to set up as a separate fund a conditional legal aid fund. I do not move this amendment in any great expectation that the noble and learned Lord the Lord Chancellor will accept it, but it is an important subject that requires ventilation and discussion. I believe that there are enormous and unrecognised virtues in a conditional legal aid fund.
What is a conditional legal aid fund or CLAF? From the point of view of the clients it is very like a conditional fee agreement (CFA). The clients will not pay their own legal costs if they lose. They will have to pay the mark-up on their own legal costs if they win, subject to any power of the court to order recovery of the mark up from the losing party. The vital difference
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between a CLAF and a CFA is that in the case of a CLAF the risk is borne not by the lawyers but by the fund. Lawyers will receive their normal costs, win or lose, without a mark-up. The fund will pay the client's legal costs if the client loses. The fund will receive the mark-up if the client wins.
The CLAF idea was floated by Justice in 1966 from a report on road accident cases, and was developed further in the report of a working party which I chaired in 1978. If one has CFAs, why have a CLAF? There are two reasons. First, CFAs present an element of danger to the public interest. If lawyers are at personal risk of losing fees, they will be reluctant to disclose the unexpected document damaging to their case which turns up late in the proceedings.
The noble and learned Lord the Lord Chancellor may say—indeed, he has said frequently—that lawyers should put their money where their mouth is. If that is carried too far, it turns the legal profession into speculators. Doctors have never expected payment by results. If lawyers do so, they will become a different and a worse profession. The noble and learned Lord the Lord Chancellor said earlier today that the legal profession should take risks like other businesses. Of course we take risks. For example, any solicitors' firm has to hire office space, buy computers and other equipment necessary to a modern office, and employ staff. If they do not obtain the work to meet the costs, they will go bust; and from time to time they do. But lawyers, like doctors and accountants, expect to be paid for the work they do. The only professions which operate on a no success, no payment basis are those paid on commission. Those include, for example, estate agents and insurance brokers. With all respect to the many honourable, honest members of those professions, are they the professions with which lawyers should seek to compare themselves? I believe very firmly that they are not.
The second reason for having a CLAF is that many lawyers will not wish to accept CFAs. Some firms will specialise in CFAs—for example, those with a large personal injuries business. They will have a large throughput which will enable them to carry the risk involved in any one case even if that risk, as sometimes it may be, is quite substantial. But, frankly, many firms of solicitors will not be willing to fund their client's litigation and they will prefer the certainty of payment of a CLAF to the risk involved in a CFA even if that were potentially profitable. Firms unwilling to enter into CFAs should have no objection to acting under a CLAF agreement. Therefore a CLAF will widen the choice of lawyers available to the clients. The CLAF has been tried in Hong Kong and worked effectively. It does not mean that CLAFs will necessarily work in England. But I believe that the case for CLAFs is sufficiently strong to justify an extended trial.
Perhaps I may outline briefly the new clause. It speaks largely for itself. Subsection (1) requires the commission to establish the conditional legal aid fund. Subsection (2) states that the purpose of the fund is to help in the conduct of legal proceedings by entering into conditional legal aid agreements. Subsection (3) defines a conditional legal aid agreement. Subsection (4) states

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that it is to be enforceable, because there would be doubt in existing law as to whether it is enforceable. Subsection (5) states that the fact that any costs are being paid out of the fund is disregarded when making an order for costs.
Then there is a provision for regulations. Subsection (7) requires the Lord Chancellor to grant or lend the start up costs, the intention being that the fund should be self-financing. Subsection (8) provides for a trial period. Subsections (9) and (10) allow the Lord Chancellor to wind up the fund on specified grounds; either if it turns out that there is no demand following the pilot scheme or that it is not financially worth doing.
I have already pointed out the advantages of CLAF over CFAs as a matter of public interest and the reason why many lawyers prefer it. From the client's point of view, CLAF financing is equally as attractive as the CFAs. CLAF will involve an extra level of administration because the fund will need to be administered, but the greater capacity and its management on a non-profit basis should allow it to offset administrative costs by offering a narrower risk margin than any single firm. It has been suggested that some firms may cherry-pick by keeping the best risks for themselves while passing on poor risks to CLAF. If that is thought to be a risk, and it may be, it can be suggested that firms which offer CFAs for any category of case should not be eligible for CLAF funding in the same category. One would have to choose whether to provide CFAs or CLAF.
I believe that many solicitor's firms which would be unwilling or reluctant to enter into CFAs would prefer CLAF funding. I believe that the Bar would much prefer CLAF. Few barristers, particularly young ones, can afford to expose themselves to the risk involved when a large part of their practice is conducted under CFAs; nor can they afford the delay in payment if payment is never available until the case is finally decided. I believe that the Government should commit themselves to a significant CLAF trial funded by them. CLAF agreement is not currently legitimated by Clause 27 so that under the present law it seems very unlikely that even a privately funded CLAF scheme could be tried. If the Government are not prepared to go as far as I would wish, it will be necessary to come back with a further amendment to Clause 27 which would enable a privately funded CLAF scheme to be tried out.
Lord Ackner: I strongly support the amendment. I am concerned that the CFA will ultimately affect the very existence of the Bar. The Bar, as independent practitioners, is not geared to carrying on the business of bookies, which is what the CFAs require them to do. It is the old problem of speculative litigation.
CLAF is not in that situation. One must bear in mind that the Bar is not as yet organised to run the risk of significant parts of its litigation being subject to the risk of no win no pay. One must also bear in mind that whereas the solicitors will get the litigation which is to be speculative at the earliest possible stage and can settle those which are settleable, which is a large part of the personal injury field, those which go to the Bar are
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the difficult cases in which the risk of losing is high. As has been pointed out, the young members of the Bar cannot afford to take that on.
I think one should look, as the Bar Council has, into what are the dangers of CFAs for the ultimate development of the Bar. The only way to cope with the risks is to try and separate them by some form of partnership between members of chambers. When I was Chairman of the Bar we had a committee to consider partnerships at the Bar. It was presided over by the noble and learned Lord, Lord Templeman, as he then was not. It concluded without any difficulty that the result of a partnership at the Bar would be greatly to restrict the availability to solicitors and ultimately to the lay clients of practitioners available to take on cases. All you had to do in a specialist field was to take the top silk out of one set of chambers, the top junior out of the next set of chambers, and a couple of noting briefs out of the third and fourth set of specialist chambers, and you had thereby denied to the rest of the litigating public the rest of the specialist Bar. That was the danger of partnerships.
This need not arise in respect of CLAFS and that is why this needs to be seriously developed. We have the usual clich's in this sort of legislation. The Government recognise that a strong and independent Bar is a vital foundation of liberty and all the rest. Of course it is, but you cannot have a strong and independent Bar unless you have some regard to its development. I do not see, speaking for myself, where a young man gets started at the Bar in 10 years' time. I believe that it will be a species of fusion forced upon the Bar. The judges, when they say, as they often do, at the end of a case, that they are very grateful for the assistance they have received, are really making that observation with great sincerity. Without a strong, diligent and competent Bar, the judiciary would be incapable of making the quality decisions which they now make. The judiciary are dependent upon the quality of the Bar and once we begin to undermine that quality, it will run throughout the entire system.
9.30 p.m.
Lord Falconer of Thoroton: I immediately spotted that the noble and learned Lord, Lord Ackner, was overstating his case when he stated that whenever a judge says that he is grateful for the assistance that the Bar has given in a particular case, he means it with sincerity on every occasion. I know from my own experience as a member of the Bar that that is not and could not be right, though I appreciate that there are very many occasions when it is said with sincerity.
Lord Ackner: The noble and learned Lord says that he knows from his own experience. I think he must be relying on hearsay evidence.
Lord Falconer of Thoroton: No; on the basis of my own dismal performance in front of various judges who have then congratulated me with apparent sincerity upon the performance I gave, which was out of pure politeness.

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The serious issue that divides the government side from the amendment proposed by the noble Lord, Lord Goodhart, is that the amendment of the noble Lord, Lord Goodhart, proposes that a conditional legal aid fund should be compulsory in the sense that the commission should be obliged to set it up and should be obliged to pilot it when it has been set up. On the other hand, the effect of the Bill as it is presently drafted is that there is a reserve power in the legal services commission to set up such a fund and it has been said separately from the Bill that it is thought at the moment unlikely that such a fund would be set up. We on this side do not accept that it could be right for the commission to establish such a scheme. Neither can we accept that a scheme should be piloted, as the proposed clause would allow the commission to do, in order to establish whether a CLAF would be viable.
The Government's priority for using public money is to direct it towards areas where there are no suitable alternatives. Conditional fee agreements provide a suitable alternative in certain areas of the law—in particular, personal injury cases. Conditional fees are already working in this area and increasingly are becoming a common way to fund those cases.
The noble Lord, Lord Goodhart, does not suggest that conditional fee agreements should not be available in personal injury cases or, indeed, in any other sort of case. Therefore, the effect of his proposal is that the CLAF and the conditional fee agreement should subsist side by side. It is our belief that if they exist side by side, the result will be that the strong cases are dealt with by the conditional fee agreements—they would lead to a better return for the clients because the successful client would not need to make any payment into the CLAF—whereas the weaker cases would end up in the CLAF.
The result would be that the CLAF would become the dumping ground for the weak cases and all the strong cases would be dealt with under the CFA. The significance of that would be that the CLAF would not be able to fund itself. That is the present expectation of those on this side of the Committee. If that expectation is correct, it would be wrong to set up a CLAF. If, as we believe to be unlikely, that expectation turns out to be wrong, there is the reserve power in the Bill to set up the CLAF.
With respect to the noble Lord, Lord Goodhart, that is the most sensible way of approaching the problem rather than, as he suggests, by compelling the legal services commission to expend what would be a substantial amount of money to set up the fund. He does not deal in his submissions with where the start-up money—which would run into millions of pounds—would come from or what cases should be deprived of funding to set up the CLAF. We believe it would be wrong to set up a CLAF if our expectations on the conditional fee arrangements are right.
As I said, conditional fees are already working in the area of personal injury. Products exist to provide protection insurance, as I have already explained to the Committee. Many lawyers who already work in this field are experienced in taking cases where they carry
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disbursements or have arrangements to defer payment of expert fees and the like to the end of the case. I see no reason why other lawyers cannot make similar arrangements once public funding ceases to be available for certain categories of case. Given my firm intent that public money should be used where there is no suitable alternative, chancing public money—for that is what it amounts to—to seek to establish the viability of a CLAF is not an appropriate use of public money. It will not help those on whom I wish to focus our intentions and resources.
The noble and learned Lord, Lord Ackner, made an obviously sincere defence of the Bar's decision. It is not a clich' for this Government to say, as we have said repeatedly, that we value and see the importance of an independent, strong Bar. I believe, as the Lord Chancellor and the Attorney General believe, that a strong Bar is a bastion of liberty. But in considering what is the best way to finance litigation, the Bar is not the only consideration. Other considerations apply as well, including what is best for the people who become involved in litigation. In the circumstances, I ask the noble Lord to withdraw his amendment.
Lord Ackner: Before my noble and learned friend sits down, he has said that the CFAs are working. Can he tell the Committee what monitoring exercises have been carried out to ensure that CFAs are working fairly in the sense that litigants are not being taken advantage of in cases which are open and shut—or virtually open and shut—as has been conceded to be the situation in at least 90 per cent. of personal injury cases?
Lord Thomas of Gresford: The issue that the noble and learned Lord has not addressed is this. Risk is at the heart of the problem. If a firm of solicitors has a large volume of cases and enters into a large volume of conditional fee agreements, the risk will be spread within that firm across that large number of cases. Consequently, it can carry the lost causes. It may be that the 5 per cent. or 10 per cent. of the cases that such a firm takes on under conditional fee agreements will fail and, if so, the firm will not get paid for those cases. However, the uplift received on the successful cases will pay for the ones that fail. That is all right within a solicitors' firm that has a large volume of cases. The risk will be spread fairly.
The problem to which the noble and learned Lord, Lord Ackner, referred is that when you are dealing with the Bar, or with a small firm of solicitors, there is no opportunity to spread the risk across the small practice of the individual barrister or solicitor. That is particularly so for the individual barrister who is just starting at the Bar and seeking to make his way. If he loses 50 per cent. of the cases and does not get paid that 50 per cent., his income will be taken up with all his other expenses and he will suffer a loss.
I do not believe that that is a healthy state of affairs; nor do I believe that the legal profession should be treated as a business that should carry the risks of litigation because of the conflicts of interest and all the other arguments that we have heard about on this topic.

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If conditional fee agreements had been in existence for a significant period of time—instead of the two to three years during which they have been effected—the situation might be different. But so many of the cases that have come to fruition—I do not believe that it is a high percentage—have settled. As the noble and learned Lord, Lord Ackner, pointed out, it is not the easy, settleable cases that cause the problem, but the difficult cases. The Bar's difficulty is that barristers get only the difficult cases. The risk is different.
The risk for the Bar differs in two ways. First, each individual barrister cannot spread the risk as widely. Secondly, he is not dealing with readily settleable cases. If we had had five or 10 years' experience of conditional fee agreements, we could forget about legal aid and move to that, but we have not. The CLAF ensures a fair system of remuneration that avoids a conflict of interest between the lawyer and his client, does not make it in the interest of the lawyer to come to a settlement of the case below its true value, and ensures every lawyer is properly paid, win or lose. We are thus back in a satisfactory situation where professional standards and professional ethics are maintained.
I believe that the introduction of this gambling element in relation to barristers and small firms of solicitors is highly undesirable. I note that the noble and learned Lord the Lord Chancellor shakes his head. He has no doubt never been in the position of having a range of cases, half of which he has lost and half won. Others are not quite so fortunate. If we are to maintain a strong and independent Bar, we must avoid conditional fee agreements being the sole method of funding the whole system.
9.45 p.m.
Lord Clinton-Davis: I am not totally persuaded by the noble Lord's argument. I believe that my noble and learned friend Lord Falconer clearly indicated that the Government would carefully monitor the situation. The nature of the monitoring is all important and I believe that it needs to be undertaken with a degree of independence. It is not only the Bar that faces a problem; indeed, the client also does so. With conditional fees the solicitors involved have a financial stake in the outcome of the litigation. Therefore, there is a possibility—and I put it no higher—that some solicitors will feel compelled, especially when they are carrying very heavy overheads, to ensure that there is a settlement. They will preserve that financial interest on their part, which may not necessarily be conducive to the interests of the client.
I urge my noble and learned friend to give Members of the Committee some indication, if not now, then at a later stage of the Bill's proceedings, of how the situation—which, to a large extent, is still a novel one in that it is very new—is developing. Perhaps he can also confirm that there will be no real prejudice caused to clients, which, after all, is the overriding consideration of my noble and learned friends. That being the case, while I am not necessarily asking my noble and learned friend to give an answer here and now
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on that point, I should like to hear that the Government will give it consideration and make an announcement at a later stage.
Lord Archer of Sandwell: I do not take a dogmatic position in this debate. I rise only to underline what was said a moment ago by my noble friend Lord Clinton-Davis: that the risk we are talking about is not principally to the Bar but to the clients who may, in certain circumstances, find difficulty in securing representation and, certainly in the solicitors' profession, in securing advice.
I venture simply to draw one lesson from history. The noble Lord, Lord Goodhart, said that no doctor would contemplate a conditional fee agreement. I seem to remember reading somewhere that it was the habit in parts of the Ottoman Empire to pay your doctor so long as you remained in good health. However, if you fell ill, you ceased to pay him until you recovered. There is some evidence that those who were invalids found it very difficult to find doctors.
Lord Goodhart: I am grateful for the support that my amendment has received from the noble and learned Lord, Lord Ackner, and for the considerable degree of support that it received from the noble and learned Lord, Lord Archer, and the noble Lord, Lord Clinton-Davis. The reaction of the Government is hardly unexpected; but, nonetheless, it is disappointing. I shall not go into it further, except to make two very brief comments in response to what the noble and learned Lord, Lord Falconer, said.
First, as far as concerns cherry-picking, I do not see that as being a danger. It is obvious that a conditional legal aid fund would be able to spot the bad cases that were being thrown at it and that it would look with a great deal of suspicion at any case that comes to it from a firm that is known to have a wide CFA practice. Indeed, what is far more likely to happen is that firms which are not prepared to undertake the risk of CFAs will go for CLAF. As I said earlier, this means that there will be a considerable widening of choice to potential clients. As the noble and learned Lord, Lord Archer, rightly said, it is the client's interest that we are considering in this case.
Secondly, as regards funding, I do not believe that this proposal need divert funds from anywhere. The way that I would in fact envisage this assistance being funded would be through money raised from the private sector but guaranteed by the Government. If, as I strongly believe, CLAF turns out to be viable, one would not be diverting funds from anywhere else. On this occasion I shall withdraw the amendment, but we may wish to discuss this matter further. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Lord Ampthill): I call Amendments Nos. 144 and 145. These were debated on Tuesday.
Lord Windlesham: With the leave of the Committee, I point out that there is a point of inaccuracy as regards

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the groupings list, in that Amendment No. 144, which has been debated, is grouped with Amendment No. 145, which has not been debated, as the amendment to which it was attached was not moved. Together with my noble friend Lord Kingsland I wish to make a number of points on Amendment No. 145. However, this constitutes a major new part of the Bill. Perhaps the Committee wishes to adjourn until another day. I am probably speaking out of order but I wished to make that point.
The Deputy Chairman of Committees: May I just deal with Amendment No. 144, which has not been moved, and Amendment No. 145 to which the noble Lord wishes to speak?
Lord Windlesham: I wish to speak to it, but not necessarily now. If the Committee wishes to adjourn at approximately 10 o'clock I think my remarks would receive a better welcome on another day rather than making a substantial speech now. As I said, we have
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just reached a landmark point in relation to Amendments Nos. 144 and 145. I refer to the introduction of a novelty to our system of criminal justice—the criminal defence service. It may be better to discuss that another day, if that is the wish of the Committee.
Lord Ackner: I support that proposal. We have two days next week set aside.
The Deputy Chairman of Committees: There is no proposal currently before us because the noble Lord does not intend to move that amendment at this stage.
Baroness Farrington of Ribbleton: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at eight minutes before ten o'clock.

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