Sitting of 9 March 1999

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

    Homelessness(London)
    Ms Karen Buck: What progress has been made in establishing a designated unit to tackle homelessness in London. [73412]
    The Minister for Local Government and Housing (Ms Hilary Armstrong): The new London rough sleepers unit will be operational from 1 April. It will have the tough target of reducing the number of people sleeping rough in London by two thirds by 2002. Louise Casey, currently deputy director of Shelter, will head the unit.
    Ms Buck: Has my hon. Friend had an opportunity to study "Safe in the City", a research report which identifies the 10 risk factors associated with youth homelessness? Is she aware that the South Kilburn estate, into which I look from my front window, is associated with the highest youth homelessness in London? Can she assure me that support will be given to the agencies, including not just housing authorities but schools and GPs, which aim to cut youth homelessness by tackling its causes?
    Ms Armstrong: The "Safe in the City" project is funded by one of the largest single regeneration budget grants ever given—£6 million. It specifically examines the causes of youth homelessness and targets the most vulnerable areas in London. I helped to launch the research report to which my hon. Friend refers. It gives us clues as to what should be done with vulnerable children, who may be as young as 11 or 12. The new unit will work with us to make sure that we prevent vulnerable young people from becoming homeless. That is the most effective way to tackle youth homelessness. I am determined that we will work with all organisations to meet that end.
    Mr. Nigel Waterson: Was it really necessary to waste thousands of pounds advertising for a so-called streets tsar to head the unit? Does the Minister remember that the previous Government managed to reduce dramatically the number of rough sleepers on
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    London's streets without the need for a £90,000 tsar? Should not that money be used to change people's lives, not to create more bureaucracy?
    Ms Armstrong: Exactly the opposite is happening. We are cutting through the bureaucracy to make sure that the most vulnerable in London get the assistance that they need to ensure that we reduce rough sleeping by two thirds by 2002. That is an incredibly tough target. It involves Government Departments working effectively together, and it demands that we work effectively with the voluntary sector. One person co-ordinating those efforts will, I believe, make a real difference. I hope that the Opposition will join us in our determination to cut the number of rough sleepers and to do whatever the House can to ensure that the problem does not return.
    Mr. Andrew Love: Recently, my local authority, the London borough of Enfield, carried out a spot survey and discovered, somewhat to its surprise, 14 rough sleepers. In the borough's budget for the coming year, it has allocated an additional £1 million for homelessness. Will my hon. Friend remember the outer London boroughs and the difficulties that they are beginning to face in dealing with homelessness?
    Ms Armstrong: We know that homelessness is not just a problem in inner London. It is prevalent across London and throughout the country. The Government are taking tough action—throughout the country, but particularly in London—to meet the target. I assure my hon. Friend that we are considering applications from across London and the rest of the country in our determination to reduce the number of people sleeping rough in our cities.

    London Underground
    Mr. John Wilkinson: When Transport for London is planned to assume responsibility for London Underground. [73413]
    The Minister for Transport in London (Ms Glenda Jackson): Transport for London will take over London Underground on completion of the public-private partnership.
    Mr. Wilkinson: Does not that remarkably brief answer betray the fact that the Government have totally failed to fulfil their pledges to the electorate of London, both at the general election and in the campaign for the referendum on the Greater London Authority last year? Were not the Government guilty of issuing a false prospectus, inasmuch as they are unable to say when the private sector will take over the infrastructural assets of London Underground, which is necessary to provide the finance to modernise the system? We have increasing strikes and increasing fares, but no real progress.
    Ms Jackson: Madam Speaker, my reply to the hon. Gentleman was in response to your diktat on speedy replies.
    The hon. Gentleman's supplementary question was a million miles from the facts. I am sure that, as a member of the Committee considering the Greater London Authority Bill, he is aware of that. The Government have made it abundantly clear that we will not be driven by

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    empty political ideology, as was the previous Administration, and that we will not be tied by an artificially imposed deadline. Completion of the public-private partnership will be based on best value, in terms not only of taxpayers' money, but of delivering a high-quality underground system to the people of London.
    Mr. Tom Brake: Can the Minister confirm that the timetable for the public-private partnership has slipped to at least 2002, as suggested by today's Financial Times? Can she also say how the Government will fund the investment in the tube that is needed in 2000 and beyond, given that that budget has been reduced to zero?
    Ms Jackson: The timetable for the public-private partnership has not slipped and it is regrettable that the hon. Gentleman has to support his arguments with mere speculation reported in a once-admired newspaper. In respect of the public-private partnership, I repeat that the Government will be driven by ensuring best value for taxpayers' money and best value for a high-quality service to Londoners.
    Mr. Richard Ottaway: First, can the Minister clarify the confusion about London Underground fares? Who is right—the Minister, who says that fares will rise by 1 per cent. in real terms until 2001, or London Underground, which says that they will continue to rise until at least 2002? Secondly, will she recognise that, by the Government's admission, not the admission of a newspaper, public money may be needed to subsidise the partial privatised underground—[Interruption.] Public money may be needed to subsidise the partial privatisation of the underground, and that has thrown the whole process into chaos. Is not the public-private partnership simply a maintenance contract propped up by the taxpayer? It is not a third way; it is not a second way; it is the return of old Labour.
    Ms Jackson: Given the number of times that the hon. Gentleman has asked that question, I should have thought that he would be able to deliver it without any kind of stumble or pause. He is aware that I cannot answer for London Underground. I certainly stand by what I have said about fares and I repeat, yet again, that the Government have made it abundantly clear that we will not be driven by empty political dogma or by an artificially imposed deadline. The completion of the public-private partnership will be dependent upon what is in the best interests of Londoners and of taxpayers and upon what will deliver the best service for Londoners.

    Eastern Regional Development Agency
    Mr. Bob Blizzard: If he will make a statement on the Eastern regional development agency in relation to (a) its location and (b) its budget. [73414]
    The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Alan Meale): Decisions on the location of an RDA are matters for the agency itself. Initially, the eastern region corporate headquarters will be in Cambridge, with sub-offices in Bedford, Norwich and Bury St. Edmunds. RDA
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    budgets for 1999–2000 will be announced shortly. The agency's budget for 1998–99, covering administration resources only, is £350,000.
    Mr. Blizzard: I thank my hon. Friend for that reply. In view of previous answers to me from my hon. Friend the Minister for the Regions, Regeneration and Planning and from my right hon. Friend the Deputy Prime Minister, in which they expressed their belief in decentralisation within the regions, does my hon. Friend share my dismay at the decision to locate the headquarters of the eastern region RDA in Cambridge? Should not the agency lead by example and set itself up in an area that is in need of regeneration rather than at a place that has full employment? Does he share the frustration of those in the north and the east of the region? Having argued for so long for improved roads, we have been told that the RDA can be situated only at a place within a good road network.
    Mr. Meale: I thank my hon. Friend for bringing that matter up yet again; hon. Members are well aware of the long campaign that he has mounted. I repeat that the agency will determine its own location, but I will let the chairman of the RDA in the eastern region know what has been said.
    Mr. Andrew Lansley: Is the Minister aware that the choice of Cambridge as the location for the RDA will be welcomed? Less welcome is the fact that the Government have appointed to those bodies a large number of Labour party appointees, in the east of England and across the country. Will he explain why good nominations, such as those of business-aware candidates in the east of England, were rejected in favour of Labour appointees with local government backgrounds, but no business development experience?
    Mr. Meale: I must confront the hon. Gentleman on that. The membership of the local government section in the eastern region comprises two Labour members, one Liberal and one Conservative.
    Mrs. Anne Campbell: Does my hon. Friend recognise the importance of high-tech developments in and around my constituency, and the crucial part that the regional development agency can play in ensuring that not only the region but the whole country benefit from such developments? Situating the RDA in Cambridge will provide it with an opportunity to spread high-tech industry beyond Cambridge, so that all parts of the region benefit.
    Mr. Meale: I thank my hon. Friend for her question. The Department is aware of the proposals that have been made. They will be subject to considerable discussion, but we shall bear in mind what my hon. Friend has said when, in due course, we deal with the matter.
    Mr. David Prior: Can the Minister tell us why we need the development agency?
    The Minister for the Regions, Regeneration and Planning (Mr. Richard Caborn): Because of the economic deficit.
    Mr. Meale: As my hon. Friend says, we need the agency because we have an economic deficit following 19 years of misrule by the last Government.

    Sport and Recreation
    Shona McIsaac: What action the Government intend to revise planning guidance on sport and recreation. [73415]
    The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Nick Raynsford): My hon. Friend the Minister for the Regions, Regeneration and Planning announced to the House on 29 July last year that planning guidance on sport and recreation—PPG17—would be revised. We intend to issue the draft for public consultation later this year.
    Shona McIsaac: I welcome my hon. Friend's reply, but will the guidelines fulfil the Government's stated commitment to ending the loss of playing fields, thus ending the scandal that was perpetrated under the last Government—the flogging off of playing fields left, right and centre for development? That shows what a sham their green credentials are.
    Mr. Raynsford: My hon. Friend is right to draw attention to the scandalous loss of playing fields that resulted from years of neglect under the Conservative Government. We have already acted to halt that by requiring, under a new direction, all proposed changes of use of educational playing fields to be referred to the Secretary of State when the Sports Council objects. That will provide further safeguards, on which we intend to build in the forthcoming draft planning guidance.
    Mr. Nicholas Winterton: May I bring some balance to the ministerial approach to the matter? Many Conservative Members have done their damnedest—their utmost—to preserve school playing fields. Does the Minister accept that the emphasis on development in existing towns and cities, and building on brown-field sites, pose a risk? Will not playing fields that become partly "redundant" be at risk unless the Government—whatever party may be in power—decide that school playing fields should for all time be an asset to public recreation, games and leisure?
    Mr. Raynsford: I readily accept that the hon. Gentleman has rightly fought to prevent school playing fields from being taken and developed. I wish that he had been more successful in persuading his own party to follow his line when it was in government. The present Government are determined to act, which is why we have passed the new direction that gives the Sports Council more influence, and allows referral to the Secretary of State in all cases in which there is a threat of loss of educational playing fields. That is the most effective step that can be taken to safeguard school playing fields. The hon. Gentleman is right to draw attention to the threat.

    Railway Infrastructure
    Mrs. Rosemary McKenna: If he will make a statement on the level of investment in the UK's railway infrastructure. [73416]
    The Minister of Transport (Dr. John Reid): I made it clear at the national rail summit on 25 February that the Government would be looking closely at Railtrack's
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    annual network management statement—due to be published at the end of this month—to establish whether the company's proposed investment was sufficient.
    Mrs. McKenna: Does my right hon. Friend agree that Railtrack's profits are too high, and that proper investment in the rail network would put more freight on to the railways and give passengers a better service? Given that the bulk of Railtrack's money comes from public subsidy, does it not have a responsibility to the users of railways, as well as to its shareholders?
    Dr. Reid: I am sure that my hon. Friend is right and that the whole House feels strongly that Railtrack has to meet the needs and expectations of the public and railway companies on investment in me infrastructure. The regulator has concluded that Railtrack's returns have been excessive. The Government will be looking to the regulator to establish a structure of charges that imposes incentives on Railtrack to invest properly in the network.
    Mr. Michael Jack: I am sure that the Minister will rejoice with me about the recent signing of the contract between Virgin Rail and Fiat Ferroviaria for £750 million-worth of tilting trains for the west coast main line—investment that would not have taken place without privatisation. Will he use his best endeavours to ensure that Railtrack maintains its part of the deal by investing in the new track infrastructure and signalling system, so that we may all enjoy the benefits of the new tilting trains?
    Dr. Reid: I am always suspicious when I am exhorted by a Conservative Member to rejoice, rejoice, but on this occasion we can look forward to investment in the west coast main line. It is badly needed. Of course, we should accept that, under privatisation, investment has gone up, fares have come down on average, largely because the Government regulate them, and passenger numbers have gone up dramatically. However, the right hon. Gentleman, along with the rest of the House, will be aware that there has been a serious downside—punctuality and reliability levels are not acceptable. We have said that we want year-on-year improvements on that. Therefore, we welcome any investment, increase and improvement in services to passengers.
    Mr. John Cummings: Is my right hon. Friend aware of the huge increase in passenger journeys on the east coast line, something which is creating severe overcrowding? Does he agree that uncertainty over the present franchise is inhibiting the necessary investment to cure that problem? When will he be in a position to advise the House as to the future of the present franchise?
    Dr. Reid: There is no doubt that the increase in passenger numbers has put undue strain on the capacity of both the railway system and rolling stock. I am glad to be able to tell my hon. Friend that some 2,300 new pieces of rolling stock are scheduled by 2002.
    On the question of franchises, we have made it plain that we are prepared to be a flexible and constructive partner with the railway companies if they deliver on investment and performance. However, we have made it equally plain that, when it comes to franchise

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    renegotiations, any company that is not delivering the service that passengers are entitled to expect will not have a long-term future in the industry.
    Mr. Bernard Jenkin: May I make it clear that we will support the right hon. Gentleman in his efforts to improve punctuality and reliability?
    I thank the right hon. Gentleman for acknowledging that privatisation has brought about a quantum increase in the number of passengers carried on the railway and that Labour inherited a £20 billion investment programme as a result of Conservative policies. Has he given any thought to where he would have got the money if we had not privatised the railway? Would it be like the tube, where there is no investment at all and only life-support finance because the Government cancelled plans for the tube?
    Dr. Reid: Since I became Minister of Transport, I have been prepared to accept that investment in the railways and passenger numbers have gone up, and fares have come down; the hon. Gentleman will find that in the record very often. I hope that he accepts that the downside of privatisation was a complete fragmentation of the industry, with 25 companies operating on different timetables, fragmented information systems, overcapacity and overcrowding on many routes, and unacceptable lack of punctuality.
    Through regulation and the strategic rail authority, we are trying to improve punctuality and we look for year-on-year improvements. If the hon. Gentleman is saying that Conservative Members are behind us on that, I welcome it. I am sure that we all do. We look forward to him joining us in ensuring that railway companies discharge their responsibility to the public and improve the service, which, in too many areas, has been dismal.

    Train Operating Companies (Performance)
    Mr. Desmond Browne: What steps he is taking to assess the views of railway passengers on the performance of train operating companies. [73417]
    The Minister of Transport (Dr. John Reid): At the national rail summit, on 25 February, we made it clear that service to passengers is paramount—which is why we are undertaking a national passenger survey.
    Mr. Browne: It will not have escaped railway passengers' attention that it took a Labour Government to put their interests first. Undoubtedly, the majority of railway operators will be intending to act positively in response to the message that was delivered to them at the national rail summit. However, what message does my right hon. Friend have for companies that do not intend to respond positively, or fail in responding positively, to that message—by failing to pull their socks up and deliver the services that passengers rightly demand and are paying for?
    Dr. Reid: I should send two messages to such companies: first, that they do not have a long-term future in the industry; and, secondly, that the central criterion of the performance on which the judgment will be based is
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    the passenger himself or herself: the passenger has to be king when we judge the value of rail services. We are therefore introducing a national passenger survey—to ensure that we have a standardised form of assessment throughout the industry, so that we may discover exactly what passengers think of individual companies and of the industry overall, and so that we may supplement the very important role that is already being played by the rail users consultative committee. We very much welcomed the consultative committee's presence at the railway summit, and I hope that the majority of progressive companies also welcomed it.
    Mr. Michael Colvin: Is the Minister aware that most of my constituents are railway passengers, and that they have a high regard for train operators who have invested in new rolling stock—so that my constituents may be treated as passengers and not like cattle? When he is considering the award or renewal of franchises, will he consider granting a 10-year franchise, so that train operators have greater encouragement to make, and are able to amortise, long-term investment in new rolling stock?
    Dr. Reid: We have already clearly stated our view that we shall be flexible and constructive in our attitude towards the renegotiation of franchises. However, we act as the champion of passengers. Therefore, if any railway company wants access to the market—which is what the franchises deliver to railway companies—it will have to deliver benefits to us for passengers themselves. We shall be flexible on a range of issues in renegotiating franchises, but, ultimately, railway companies themselves will have to deliver to passengers a much better service than they have hitherto delivered. We require annual improvement. The litmus test of improvement will be whether passengers receive the performance that they deserve.
    Mr. Robin Corbett: If my right hon. Friend needs to know what passengers think about rail services, may I invite him to talk to those who have booked first-class tickets on Virgin from Euston to events at the national exhibition centre, near Birmingham—but cannot get a seat? He could speak also to those who turn up at Erdington station, on the Central railway line, just after 8 o'clock in the morning—to try to get to work on time—but regularly find that trains that are supposed to be running do not arrive. What can he do to turn promise into performance, and complaint into improvement?
    Dr. Reid: We have already made a start. Until November 1998, the railway companies themselves were exclusively competitive and there was no network approach. In November, the Deputy Prime Minister and I brought the companies together to deal with the consequent problems of congestion and delay. It was agreed that there would be 800 new drivers and 500 pieces of new rolling stock over the next 12 months, and that there would be a joint Railtrack-railway companies initiative to tackle congestion black spots. For the first time, the whole industry acted together. We not only built on that action at the summit, on 25 February, but shall return to it year on year. We made it absolutely plain that current levels of punctuality, reliability and overall

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    performance are unacceptable, and that the Government intend to ensure that there are year-on-year improvements in performance.
    Mr. Cynog Dafis: Is the Minister aware that there is deep dissatisfaction at the chronic delays on the Great Western service to south Wales, Cardiff and beyond? Trains that arrive on time are now the exception rather than the rule. Although a great deal of fault lies with Great Western, does not Railtrack also have much to answer for and are not delays often caused by deficiencies in the infrastructure? Can the Minister assure us that we will get the investment that is needed? It would probably be preferable to the large-scale investment that the Welsh Office envisage to upgrade the M4 and build a new road to Cardiff Wales airport.
    Dr. Reid: The range of views expressed by hon. Members on both sides of the House testifies to the fact that there are problems throughout the nations and the regions of Britain. I repeat that the current standards of reliability and punctuality are unacceptable. As for future investment, Railtrack is due to invest about £17 billion between 1997 and 2007. However, as the regulator has made plain, more investment is necessary because the money that Railtrack distributes in dividends is inordinate compared with the risks taken. The regulator is considering that, as will the strategic rail authority, and the Government are keen to see it implemented.

    Regional Chamber (East Midlands)
    Mr. Vernon Coaker: What assessment he has made of progress in establishing a regional chamber in the east midlands. [73418]
    The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Alan Meale): I am currently considering the east midlands chamber's application for designation under the Regional Development Agencies Act 1998 and hope to be able to make an announcement soon.
    Mr. Coaker: I thank the Minister for that reply. Although I welcome the new regional structures that the Government have put in place, will my hon. Friend ensure that the new bodies address the economic and social needs of small pockets of deprivation, such as Netherfield in my constituency, as such areas are often missed out when economic regeneration is discussed?
    Mr. Meale: I thank my hon. Friend and pay tribute to his sterling work over a number of years, particularly in his constituency of Gedling. However, single regeneration budget SRB5 is not yet ready to be announced—when it is, it will be discussed on the Floor of the House. I note that the borough of Gedling, in partnership with Nottingham city, submitted a successful bid in single regeneration budget round 3 and that Netherfield was included in the proposals. I am sure that people have noticed that and want to build there.
    Mrs. Gillian Shephard: Will the Minister explain to the House the principle that has
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    resulted in the east midlands regional development agency having no representative from the county of Lincolnshire? Is it that Lincolnshire is the largest county in the region or that it is the most rural, or perhaps that it is Conservative controlled? Does he intend to apply the same principle to the establishment of the east midlands regional chamber?
    Mr. Meale: If the right hon. Lady were to do some simple mathematics, she would realise that when a body comprises four representatives from an entire region, it is impossible to have a representative from every single council. The best people for the job have been chosen to represent fully the region.

    Brown-field Land
    Mr. Gerry Sutcliffe: What steps he is taking to ensure more housing development on recycled brown-field land in Yorkshire and Humberside. [73419]
    The Minister for the Regions, Regeneration and Planning (Mr. Richard Caborn): We published our proposals for regional planning guidance in planning policy guidance note 11 on 15 February. It requires the regional planning forum for Yorkshire and the Humber to establish a target for housing development on previously used land that underpins and reflects our 60 per cent. national target.
    Mr. Sutcliffe: I thank my hon. Friend for that reply which will be most welcome in Yorkshire and Humberside where we must meet a dramatic housing need. Is not that in stark contrast to the Opposition who neglected housing need and failed to provide real incentives for recycling brown-field land? Will my hon. Friend ensure that the regional development agency in Yorkshire and Humberside has an economic strategy for bringing such land back into use?
    Mr. Caborn: I welcome those comments. When the Conservatives were in government, they left policy on household growth and the development of brown-field sites in a mess. However, we shall work through the issue and make a reasonable job of it. The regional development agencies will work closely with the planning authorities to ensure that there is joined-up thinking on land use, transport and economic planning so that we get a bigger bang for our buck.
    Mr. Nick Hawkins: Does the Minister recognise that one of the important issues relating to recycling brown-field land in Yorkshire, Humberside or anywhere else is the definition of the protections that English Nature provides? He may be aware that there appears to have been a reinterpretation by English Nature—or perhaps by the Department—of what "substantial effect on wildlife" means. I should be grateful if the Minister could tell me about that reinterpretation. If not, will he write to local authorities in Yorkshire, Humberside and everywhere else in the country to say whether that phrase has been reinterpreted to mean a substantial adverse effect?
    Mr. Caborn: I shall write to the hon. Gentleman. There has been a reinterpretation. When we took power,

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    there was not even a land use register designating what brown-field sites were, so it is a bit much for the Conservatives to complain. At the end of this month, we shall know for the first time what brown-field land we have and what state it is in.
    Helen Jackson: Does my hon. Friend agree that the flip-side benefit of building housing on brown-field land is the protection that that offers to green-field and green-belt sites that are under pressure? In parts of northern England where urban and rural areas sit so closely together, will my hon. Friend ensure that the benefits of brown-field development are matched by increased resources and powers for local authority enforcement bodies to protect the green belt?
    Mr. Caborn: Very much so. As my hon. Friend has said, we need a sustainable policy, which the Government are pursuing. The issue is not just household growth, but sustainable transport policy, the use of brown-field sites and mixed-use development. That all adds to ensuring that we drive the urban renaissance, which will protect the green-belt, and green-field sites.

    Vehicle Emissions Regulations
    Mr. Andrew Robathan: If he will make a statement on the effectiveness of the Road Traffic (Vehicle Emissions) (Fixed Penalties) Regulations 1997. [73420]
    The Minister for Transport in London (Ms Glenda Jackson): The new measures, currently confined to seven local authorities, have resulted in a welcome reduction in the proportion of vehicles failing to comply with prescribed emissions limits. We are currently reviewing the trial and will announce future plans shortly.
    Mr. Robathan: As I understand the regulations, part of the point is to stop drivers keeping the engine running when they are not going anywhere, such as those just keeping themselves warm. Will the Minister consider taking action to ensure that drivers in Westminster, where we all walk around all the time, do not sit in their cars creating emissions and polluting the atmosphere? As a start, will she ensure that all Government Departments instruct Government drivers to switch off their engines in such circumstances, which they currently fail to do within the Palace of Westminster and in the streets of Westminster?
    Ms Jackson: On the last part of the hon. Gentleman's question, we shall most certainly do as he asks. I am sure that my hon. Friends have heard what he has said. A driver who leaves the engine running can already be given a fine of £20, which rises to £40 if it is not paid within 28 days. [Interruption.]
    Madam Speaker: Order. Conversations are much too noisy. The House must come to order. We cannot hear each other speaking at the Dispatch Box.

    Brown-field Land
    Mr. Barry Sheerman: What steps he is taking to increase the amount of assistance given to local authorities to regenerate brown-field land sites in their areas. [73421]
    Hon. Members: Come on!
    The Minister for the Regions, Regeneration and Planning (Mr. Richard Caborn): I was waiting for my hon. Friend the Member for Huddersfield (Mr. Sheerman) to ask his question.
    Madam Speaker: It is too noisy. We cannot hear.
    Mr. Caborn: I totally agree. The problem is all the noise coming from the Opposition Benches.
    The Government support local authority regeneration initiatives through a range of programmes including the single regeneration budget, the new deal for communities and the land reclamation programme of English Partnerships, as well as through the revenue support grant. We plan to spend £4.6 billion on regeneration programmes over the next three years.
    Mr. Sheerman: My hon. Friend will know that I share his belief that the regenerative power of brown field can change the landscape of this country, especially our towns and cities. Is he aware that we need proper incentives to get local authorities moving in partnership with all the other new agencies, such as the regional development agencies? Is it not about time that he took off the velvet gloves with some local authorities, which still have not sent back their registration of brown-field land in their areas?
    Mr. Caborn: There has been an improvement in returns from local authorities. I hope that we shall be able to give a comprehensive appraisal of the brown-field sites that are available for development when we produce the land use data bank by the end of this month.
    Mr. Simon Burns: Does the Minister accept that the Government could have assisted local authorities if they had been quicker in providing their revised PPGs? Does he further accept that, if the draft PPG3 had been revised more quickly, fewer green-field sites would have been lost to building—as some still will be? Can he explain today why it has taken so long to provide draft revision of the guidance? When does he expect the draft guidance to be published? I assume that it will be shortly. More importantly, when does he expect the consultation thereafter to be completed, and the draft guidance to become actual guidance?
    Mr. Caborn: As soon as the Government release draft planning guidance, it is immediately material to any inquiry. We are moving systematically through the land use planning system and bringing it under a sustainable policy in which transport, economic planning and land use planning are brought together. That is what the regional planning guidance PPG11 was about. We will now modernise the system systematically. PPG3 will be out in

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    the next few weeks, and we have thought carefully about it. I hope to be able to publish it, and it will become material to inquiries as soon as we produce the draft guidance.

    New Deal for Communities
    Mr. Michael Connarty: What assessment he has made of the implementation of the new deal for communities. [73423]
    Ms Margaret Moran: What assessment he has made of the implementation of the new deal for communities. [73428]
    The Minister for Local Government and Housing (Ms Hilary Armstrong): We are delighted that people living in 17 of the most deprived neighbourhoods in England have seized the opportunity presented by our new deal for communities to confront the problems that they face. Across Government and across the country, we will continue to work closely with communities as they develop plans to deliver lasting change.
    Mr. Connarty: Is my hon. Friend aware that communities welcome in particular the move from the short-term projects of the previous Government to the sustainable improvements of this Government? She will recall that the document that launched the scheme talked about Britain and drew from good practice throughout the UK, including Scotland. Will she ensure that lessons learned from the new deal for communities will play a part in continuing dialogue with the Scottish Office and the Scottish Parliament, to ensure that we work together throughout Britain to deal with the scourge of social exclusion?
    Ms Armstrong: My hon. Friend is right. There is great support out there for a more long-term, strategic approach to the problems, involving local people identifying problems and finding solutions to them. I can assure my hon. Friend that we are determined to learn the lessons, and we will do that for the whole country—including Scotland. I am in discussions with right hon. and hon. Friends at the Scottish Office so that we can all learn the lessons from the early round, and make sure that every deprived community in Britain benefits from those lessons.
    Ms Moran: What plans does my hon. Friend have to integrate the new deal for communities with other Government programmes? She may be aware that my constituency benefits under the Labour Government— unlike under the previous Government—from several programmes, including the new deal for regeneration; single regeneration budget 4 and, we hope, 5; and a health action zone. Will she assure us that we will have joined-up government programmes, so that the community in Luton can get maximum value from all of them?
    Ms Armstrong: My hon. Friend is right: it is very important that not only the additional money going to an area, but the mainstream money works effectively to tackle the problems that communities and citizens face. We will take careful steps to ensure that we know what is going on, and that people locally can know and
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    understand the breadth of work that is going on and how it can be most effectively applied. They will benefit from Government working with them to tackle their problems.
    Mr. Andrew Rowe: Does the Minister accept that, over the past 30 years, progress in community development strategies in this country has been pathetic, whereas it has been remarkably effective overseas? Will she ensure that the lessons that have been learned all over the world are repatriated here so that we can make some serious progress?
    Ms Armstrong: I have to be careful, because I used to be a community worker and I do not want anyone to think that I am seeking to gain advantage from the Government's recognition that we cannot change communities without working effectively with the people in them. We have lessons to learn from elsewhere. We want to learn them and to ensure that people in the communities with which we are working have the opportunity to learn from others, share experiences and get the very best deal.
    Mr. John Bercow: I recognise that the new deal for communities is designed to tackle the problem of urban blight, which so many rotten Labour authorities have caused over such a long period, but what guarantee can the Minister offer us that there will be no slippage whatever in the timetable, and that the pathfinder partnerships that have submitted bids will be told whether they are successful in July 1999?
    Ms Armstrong: I invite the hon. Gentleman to read the report of the social exclusion unit on the most deprived communities in our country. The report acknowledges that Government, both nationally and locally, have sometimes been part of the problem, not the solution. The Conservative Government were massively part of the problem.

    British Waterways
    Dr. Doug Naysmith: What response he has received from British Waterways to the recent announcement of increased resources; and what indication British Waterways has given him of how those resources will be used. [73425]
    The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Alan Meale): British Waterways has enthusiastically welcomed the Government's extra investment, which will enable it to reduce its £90 million backlog of urgent safety-related maintenance.
    Dr. Naysmith: Does my hon. Friend believe, as I do, that the South West regional development agency will have a part to play in encouraging the use of inland waterways?
    Mr. Meale: I know that my hon. Friend has a long history of interest in British canals and waterways. I agree that the economic strategy for our waterways needs to be tied into the strategy of the regional development

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    agencies. I have written to the chairmen of all those bodies asking them to meet me, and that will happen very shortly.
    Mr. Michael Fabricant: That answer will cut no ice with canal users in Staffordshire. Does the Minister realise that his boss, the Deputy Prime Minister—who, I understand, is currently scuba diving in the Seychelles—has overridden an inspector's report so that the Birmingham northern relief road will cut straight across the Lichfield-Hafherton canal? Will he call on the right hon. Gentleman to return from his holiday and do something about that?
    Mr. Meale: Once again, the hon. Gentleman is wrong. Ministers had a telephone conversation this morning with the Deputy Prime Minister and he is still in India. I assure the hon. Gentleman that due regard was paid to proper procedure during the consultation that was carried out on the Birmingham northern relief road, and a judicial inquiry was held. People from British Waterways, especially those in Staffordshire and elsewhere, are enthusiastic about the Government's recent announcements and we have letters to prove that.

    Strategic Rail Authority
    Mr. Tony Clarke: When he expects to set up the proposed strategic rail authority; and if he will make a statement. [73426]
    The Minister of Transport (Dr. John Reid): The shadow strategic rail authority will be operative from 1 April, under the leadership of Sir Alastair Morton. The Bill to set up the strategic rail authority proper will be introduced as soon as legislative time allows.
    Mr. Clarke: I am grateful to my right hon. Friend for that response; my hon. Friends and I believe that the sooner we have the SRA the better. Will my right hon. Friend comment on the role that the SRA, its shadow and his Department can play in strategic planning and, in particular, in protecting access to the main line for local services? In my constituency, Silverlink Trains is concerned that access to the west coast main line, following its modernisation, could be restricted by main line operators trying to seize as much track time as possible.
    Dr. Reid: As my hon. Friend will realise, and as I said earlier, one of the grave problems caused by privatisation of the railways is the fragmentation of the system. The strategic rail authority, in its shadow form, and later in its proper form, under Sir Alastair Morton will be responsible for establishing a network-wide strategic vision and implementing policies on the ground that will contribute to the network nature of our railway system. Whatever benefits have derived from privatisation, the vast majority of people are well aware of the problems with punctuality and reliability, and the fragmentation of the network that has been a serious impediment to the sort of railway system that we want to build. The SRA will have a crucial role in rebuilding the system.
    Mr. Tim Boswell: While various investments and some co-ordination may be desirable, how much extra investment will derive from the creation of the SRA?
    Dr. Reid: The hon. Gentleman will be aware that it is not the purpose of the SRA to invest yet more taxpayers' money. The level of subsidy that we currently give is tolerable, but it is due to reduce. Enough taxpayers' money was wasted by the previous Government when they sold off Railtrack at a rock-bottom price, thus losing almost £2 billion. The purpose of the SRA is to bring back some network-wide capacity to our railway system, and to give some long-term strategic vision to it. That will be a primary role for the SRA and I am sure that it will be one of its successes.
    Mr. Boswell: When?
    Dr. Reid: The answer is in the short, medium and long term. We have now engaged with the railway companies and with Railtrack. We will see year-on-year improvements in performance and we will be back every year to see that improvements are delivered for the passengers.
    Dr. Alan Whitehead: Given that 86 per cent. of Railtrack's income comes from carriage charges, does my right hon. Friend intend to ask the SRA, when it has been set up, to examine the present system of subsidy, under which £1.5 billion goes to the rail operating companies, which then pay Railtrack, which does not invest in our rail system? Does my right hon. Friend accept that it might be simpler to give the money to Railtrack with strong investment incentives attached?
    Dr. Reid: As my hon. Friend will know, that is a matter for the regulator, whom we have asked to consider the way in which public money is put into our railways through Railtrack. We want to ensure that the blame culture, the history lessons and the transposition of blame from Railtrack to the companies and vice versa come to an end. Passengers want a decent, affordable, accessible, safe and secure railway system. The House wants that too, and the packed House I see around me is surely a testament to how seriously we all take the problem of our railways.
    Mr. Matthew Taylor: It was widely reported in the autumn that the Deputy Prime Minister had won the backing of his Cabinet colleagues for a strategic rail Bill this year, if there was progress with the House of Lords Bill. That progress has happened, but there is still no strategic authority Bill. When will it be introduced, and may we continue to imagine that it will happen during this Parliament?
    Dr. Reid: The hon. Gentleman is quite right to say that the Deputy Prime Minister was so persuasive that his colleagues agreed to add to the six Bills that he already had in the Queen's Speech. Should the House of Lords and, in particular, the Opposition prove sensible in finding

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    a solution to the problem of the early retirement of the House of Lords, we could introduce a Food Standards Agency and a strategic rail authority Bill, but it remains the position that we depend on progress in the other place.

    Landfill Sites
    Mr. David Watts: If he will enable councils to make the final decisions on planning applications for landfill sites. [73427]
    The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Nick Raynsford): Final decisions on all planning applications are made by local planning authorities, except for those that are called in by my right hon. Friend the Deputy Prime Minister for his decision, or those referred to him on appeal.
    Mr. Watts: I thank the Minister, but may I draw it to his attention that he recently approved a planning application for a landfill site next to residential properties in Haydock? The residents believe that decisions on such matters should rest with the local council. Will my hon. Friend reconsider his decision not to allow the final decision to be taken by the local authority?
    Mr. Raynsford: No. I understand my hon. Friend's concern about the case that he raised, but it is a fundamental principle of quasi-judicial procedures such as planning matters that they should be subject to a right of appeal. I have looked into the detail of my hon. Friend's case, and I have written to him about it. I am quite satisfied that the inspector considered all matters properly and reached a proper decision, on the basis of which the appeal was allowed. It would not be right to overturn that decision.
    Mr. Ian Bruce: Does the Minister agree that one of our problems is that people who create domestic waste are having to export it to other areas? Local authorities must be responsible for burying their own waste if that is how they wish to deal with it. Unless the Government take strict action, they will find that areas such as London will ship their waste to Dorset, and we should rather London kept it to itself.
    Mr. Raynsford: The hon. Gentleman makes a valid point about the growing difficulties encountered in seeking sites for landfill. It is desirable to consider alternative ways of disposing of waste, and it is right that we should give more emphasis to recycling and other more environmentally sustainable means of disposal.

    Integrated Transport Commission
    Mr. Steve McCabe: If he will make a statement on his plans to establish a commission for integrated transport. [73429]
    The Minister of Transport (Dr. John Reid): We are establishing a commission for integrated transport to give Ministers independent advice on the implementation of our integrated transport policy. We intend to announce the composition of the commission shortly.
    Mr. McCabe: It is surely common sense to seek improved co-ordination of transport and to ensure that we make the most beneficial use of all modes of transport in an integrated manner. Is not that approach infinitely preferable to the mentality of roads and profits first of the previous Government?
    Dr. Reid: Yes, my hon. Friend is right. The White Paper that we published last July was the most significant and radical document on transport for more than quarter of a century. It provided a platform and an agenda for a generation. Under our integrated transport plan, we shall renew our public transport services, provide choice for the traveller and balance economic advantage against environmental impact. I hope that the Opposition will at long last realise that, after nearly 20 years in government, they managed to leave a transport system that failed to give satisfaction or performance to transport users. The Government will not do the same.
    Mr. Norman Baker: Does the Minister agree that a key requirement of any integrated transport policy is a reduction in road traffic levels? Will he explain why he has abandoned his policy of reducing road traffic and instead adopted a Tory policy of reducing road traffic growth? Does he think that the best way to deal with congestion is to have more vehicles on the road?
    Dr. Reid: The hon. Gentleman has managed the double whammy by getting both statements wrong: we have not changed our policy; nor have we adopted the Conservative policy. We have said that we want a reduction in road traffic growth and, as part of that— [HON. MEMBERS: "Oh!"] I know that it is hard for the hon. Gentleman to conceive of two ideas at the same time, but he should let me finish. As part of that, there will be an absolute reduction in traffic levels in certain areas. That was our policy, it is our policy and it will continue to be our policy.

WAYS AND MEANS

  Financial Statement
  [Relevant documents: The Second Report from the Treasury Committee, Session 1998–99, on the World Economy and the Pre-Budget Report (HC 91-I), and the Fourth Report from the Environmental Audit Committee, Session 1998–99, on the Pre-Budget Report (HC 93).]
  Mr. Deputy Speaker (Sir Alan Haselhurst): Before I call the Chancellor of the Exchequer, it may be for the convenience of hon. Members if I remind them that, at the end of the Chancellor's speech, copies of the Budget resolutions will be available to hon. Members in the Vote Office.

  INTRODUCTION
  3.31 pm
  The Chancellor of the Exchequer (Mr. Gordon Brown): Today's Budget is a Budget for Britain to succeed in the new economy and to lead in the new century. It is a Budget that builds on strong foundations of economic stability, advances a modern framework of efficient public services and encourages a dynamic Britain of enterprise and fairness.
  With this, the last Budget of the 20th century, we also leave behind the century-long sterile conflicts between Governments of the left, who have too often undervalued wealth creation and enterprise, and Governments of the right, who have been too indifferent to public services and fairness.
  In contrast, this is a new Labour Budget built on the central idea that our future depends on enterprise and fairness together.
  The more enterprising Britain is, the more wealth we create, the higher our standard of public services and our standard of living can be—not just for the few, but for all of us.
  The fairer Britain is, the more open Britain is to the talents of all, from whatever class and background, the more enterprising and prosperous all of Britain will be.
  Because enterprise and fairness are founded on securing sound economic fundamentals, this Budget will lock in monetary and fiscal stability for the long term.
  Because enterprise and fairness depend on modem public services, we are not only providing the £40 billion extra we promised to health and education, but today I will announce more money and more capital investment in schools, hospitals, transport and fighting crime.
  And this Budget will implement far-reaching tax reform that will deliver a better deal for enterprise, a better deal for families, and a better deal for work.
  Because for too long the tax system has undervalued entrepreneurship and investment, we will cut taxes on enterprise, we will champion the needs of small business, we will introduce a new competition policy and a new computer strategy for Britain.
  Because for too long the tax system has undervalued the family, failing to reward those who take on the most important responsibility of all—bringing up children—we will cut taxes for families, helping parents when they need help most.
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  To recognise the contribution of our senior citizens to our country, the Budget will increase the income of all pensioners.
  And because for too long Governments have taken too much in taxes from people who work hard but are not wealthy, this Budget will now reform tax and benefits and deliver tax cuts that reward work and make work pay for everyone in Britain.
  So in a better deal for Britain that puts work, enterprise and families first, this Budget will cut tax rates and at the same time boost public investment—and it will do both at the right time for the British economy.

  STABILITY
  Two years ago, Britain faced the threat of rapidly rising inflation. So our first priority, and our continuing obligation, has been, and is, to build a solid foundation of economic stability.
  We took decisive action in 1997 and 1998 and, as a result, inflation is under control and for the last seven months has been at or around 2 ½ per cent.
  In the 1980s, inflation went as high as 21 per cent. Our forecast is for inflation of 2 ½ per cent. this year, next year and the year after. For the first time in our generation, Britain can look forward to sustained low inflation.
  In our first week in government, we made the Bank of England independent, freeing monetary policy from the politically driven control that, in the last economic cycle, led to 15 per cent. interest rates for an entire year and interest rates at 10 per cent. or more for four years.
  Now, because together we are steering a course of stability, long-term interest rates have come down from over 7 per cent. in May 1997 to 4 ½ per cent. now—our lowest long-term interest rates for 40 years.
  And, after five interest rate cuts in five months, saving the typical home owner around £900 a year on their mortgage, Britain now has the lowest mortgage rates in 33 years.
  All of this has happened against a background of great uncertainties in the global economy. One quarter of the world is now in recession. World growth has been cut in half. World export growth has fallen even faster. And, as a result of failures in many of east Asia's economies, our exports to them have fallen by more than 50 per cent.
  And this year, as trade imbalances worsen, and threats of protectionism grow, it will be even more important to hold to our course of stability. Britain, with other G7 nations, has rightly assumed a leadership role to address the root causes and contain the spread of future global crises.
  The storms may come again. But, because of what we have done, our economy is now better prepared to weather them.
  With public investment now set to rise and interest rates coming down, both at precisely the right time in the economic cycle, Britain's fiscal and monetary policies— often at odds in previous economic cycles—are now working together to promote growth with low inflation.
  I can confirm our growth estimate for 1999 of 1 per cent. to 1½ per cent. which is what I told the House in November, followed by stronger growth—in 2000 of 2¼ per cent. to 2¾ per cent. and then in 2001 of 2¾ per cent. to 3¼ per cent.
  Despite world conditions, more men and women are in jobs in Britain than at any time in our history, and unemployment in the last year has been at its lowest rate for 20 years. Since May 1997, youth unemployment has fallen by 57 per cent, and long-term unemployment has been cut in half.
  And because more lone parents are now in work, the numbers claiming out-of-work benefit—rising for 30 years, over 1 million when we took office—have now fallen by nearly 100,000.
  As we entered office, we also inherited a Budget deficit of £28 billion.
  We said in our manifesto we would work within the existing spending plans for our first two years.
  In our first year, the deficit was reduced by £19 billion.
  In my Budget last year, I promised we would reduce the deficit further.
  As a result of our prudence, our first two years' spending is £2 billion lower than the spending plans we inherited.
  This year, the Budget will be in surplus. The current surplus this year is forecast to be £4 billion. Public sector net borrowing will be in surplus by £1 billion—in contrast to the £28 billion deficit we inherited.
  I am determined to continue locking in this fiscal tightening for the years to come so that we continue to meet our fiscal rules and so deliver sound public finances. I have had to offset the impact of slower world growth on corporate tax revenues and lower indirect tax revenues.
  But, as a result of sound economic management, debt interest payments next year have been cut by £2½ billion from their previous forecast and, in total, debt interest payments have been cut by £4 billion over the next three years.
  Because less of our social security budget is being wasted on paying for past failures in employment policy, social security spending as a whole has not been rising as in previous years. And, over the next three years, social security spending, including unemployment—even after adjusting for the economic cycle—is set to be significantly lower than previously forecast, freeing resources for new help for families and pensioners.
  At the time of the comprehensive spending review last July, there were those who said that we could not afford the £40 billion for new investment in health and education and still meet our fiscal rules.
  I can report that the entire £40 billion of investment in health and in education will be fully delivered, and will be delivered fully within our fiscal rules. Not only that, but still meeting the test of fiscal prudence, I will today allocate from our capital modernisation fund even more investment for hospitals and schools.
  And, still meeting that test of fiscal prudence, I will be able to afford tax cuts to reward work, encourage enterprise and strengthen the family.
  Even after all the measures in today's Budget, next year's current surplus is expected to be £1 billion higher than previously forecast and £1 billion more in 2000–01. For the coming five years, the current surpluses are forecast to be—successively—£2 billion, £4 billion, £8 billion, £9 billion and £11 billion.
  In line with our golden rule, even under our most cautious assumptions, we are balancing the current Budget over the economic cycle and, for the first time in a generation, we are eliminating the current structural deficit.
  We are also meeting the second fiscal rule, that of sustainable investment—a prudent ratio of debt to GDP.
  Debt as a proportion of national income has fallen from the 44 per cent. that we inherited to under 41 per cent. this year, and it will fall below 40 per cent. to 39½ per cent. next year, then to 38 per cent, and then to 37 per cent. in 2001–02.
  Britain's fiscal position is therefore not only sound today, but on the soundest possible footing for the long term.
  For the coming five years, the estimated current Budget surplus totals £34 billion, in contrast with the last Government's deficit over the last economic cycle of minus £149 billion and their doubling of the national debt.
  For those who take a special interest in European issues, in particular the Maastricht treaty, I can confirm that Britain is well within the Maastricht criteria.
  So, as we cut debt payments and, at the same time, the bills of economic failure, I will further lock in the fiscal tightening that we have achieved over the past two years, I will continue to meet our fiscal rules and I am also able, with my Budget measures today, to boost purchasing power over the next three years by £6 billion at exactly the right time for the economy.
  Even after these measures take effect, public sector net borrowing will be lower than previously forecast in each of the next three years—at £3 billion in the coming year and then £3 billion, £1 billion, £3 billion and £4 billion in the years after.
  I have often told this House that our prudence is for a purpose. And so, I am now able to announce: a new boost to purchasing power of £6 billion over the next three years as a result of my Budget measures—net tax cuts of £4 billion targeted to working families; and, on top of that, for families and public spending, more than £2 billion of additional public investments.
  And I will also today announce major additional allocations from the £2½ billion capital modernisation fund, adding more resources to the extra £40 billion that we have already committed to invest in health and education over the next three years.
  Let me turn to the details of measures, beginning with the tax and other reforms that deliver a better deal for enterprise.

  ENTERPRISE
  To those who argue that getting interest rates down and getting inflation down is enough, I say that stability is the essential foundation, but it is only the foundation. We must build on that foundation for Britain a modern knowledge-based economy.
  Britain must make a quantum leap in skills, innovation, competition, information technology and small business. So, today, we are bringing forward seven major reforms for a new enterprise economy open to all.
  First, our tax cuts for business.
  So that more businesses—large and small—will invest, grow and prosper; so that the many and not just the few will have the chance of starting their businesses, we today cut business taxes and introduce a special enterprise management incentive scheme to reward the risk-takers.
  When we came into government, corporation tax for companies was 33 per cent. Today, it is 31 per cent. I confirm that, from April, we will further reduce the main rate of corporation tax from 31p to 30p—the lowest rate in the history of British corporation tax, the lowest rate of any major country in Europe, and the lowest rate of any major industrialised country anywhere, including Japan and the United States.
  When we came into government, small companies tax was 23p in the pound.
  In my first Budget, to encourage enterprise and investment, we reduced it to 21p, backdated to April 1997.
  From April this year, the rate will be 20p. Three hundred and fifty thousand companies are benefiting, but I want to do more. I want to create an even lower rate, which will give new incentives for men and women to start their own businesses and work their way up.
  I believe that the whole House will want to welcome what I am announcing: a new starting tax rate for small businesses of 10p in the pound. Every company making profits of up to £50,000 will benefit.
  The legislation will ensure that the beneficiaries are genuinely those who take risks. And 85 per cent. of the firms gaining from the 10p tax rate will have fewer than 10 employees—the very firms that we most want to see grow; the very firms whose growth will create the greatest number of new jobs.
  This is the lowest starting rate for small businesses in the entire history of United Kingdom corporation tax.
  Where we inherited business tax rates of 33p and 23p, the rates will now be 30, 20 and 10. I give to all companies—large and small—an assurance not just for a year, but for the rest of this Parliament: there will be no return to the higher rates of the previous Parliament. For the life of this Parliament, the rates will be 30, 20, 10, or lower.
  We will cut not only the tax rate but the cost of investing.
  I am particularly keen to strengthen the ability of manufacturing industry to invest in new equipment and new technology, with targeted tax advantages for doing so. I recognise the difficulties faced by manufacturing as a result of global instability and the strong pound. And so I will set aside an additional £325 million to allow small and medium-sized companies to write off 40 per cent. of all they invest in the coming year.
  In other areas, I am extending the tax allowance for new films made in Britain. And the shipping industry has put to me the case for enhanced training incentives and for a lower rate ring-fenced tonnage tax. While I am attracted to these options, I have to be satisfied that lower tax rates will not become a vehicle for tax avoidance and I am grateful to Lord Alexander for agreeing to conduct an independent study of the national and international issues involved.
  Secondly, I propose next a tax reform that will reward risk and stimulate new enterprise at the cutting edge of technology. I want to recruit, motivate and reward Britain's risk-takers—the innovators capable of creating wealth and jobs in the Britain of tomorrow.
  In the past, share option schemes, subsidised by the taxpayer, have rewarded those already at the top whose risks are low and rewards already high—such as utility chief executives, often operating in a monopoly environment.
  Tomorrow, we will publish details of a very different kind of targeted tax cut for those who are prepared to move from secure jobs to venture their time and effort to create wealth for our country. The new enterprise management incentive will allow the award of equity worth up to £100,000 for success in building the new path-breaking companies our economy needs.
  Our capital gains tax reforms will reward committed long-term investment.
  For the first time, Britain now has the long-term rate of only 10 per cent.
  I now announce the level at which capital gains tax will begin. There is no requirement for me to raise the threshold. But I have decided to do so.
  For all individuals, from April, the first £7,100 will be free of capital gains tax. This measure will exempt 10,000 more people from capital gains tax altogether. Britain now has the lowest long-term rate of capital gains tax with the most generous threshold in history.
  I now turn to the rate and threshold for inheritance tax. The rate will be unchanged and fewer people will pay the tax as I raise the threshold by £8,000 to £231,000.
  Ninety-seven per cent. of estates will now be exempt from tax.
  Third, I turn to targeted tax cuts and public investment to put Britain and British enterprise at the forefront of innovation.
  I propose a new R and D tax credit, which will give business and small business—the biggest source of innovative ideas—cash help to research and develop their innovations even before they have made their first profits.
  At a cost of £150 million a year, this targeted tax cut will underwrite almost one third of research and development costs for small businesses. And Britain therefore now has one of the best incentives for innovation anywhere in the industrialised world.
  Scientific innovation, as we know, is a prime catalyst of growth. I want a winner's circle in innovation— inventions in Britain, that are then developed in Britain and manufactured in Britain, creating growth and jobs in Britain.
  The seedbed is basic science, so I can announce £100 million new investment in university science laboratories and equipment, and this will be part of our £1 billion plus upgrading of British science.
  To transform these British inventions into what we want—British-made products—I propose a 30 per cent. increase in the budget of the university challenge fund. To encourage large companies to invest venture capital in innovative small companies, we will tomorrow publish proposals for a new corporate tax incentive. To ensure the necessary flow of finance to high-risk companies, I am allocating £20 million for start-up funding for high-tech venture capital funds for England, Scotland, Wales and Northern Ireland.
  My fourth measure is a new competition policy. The sharpest spur to enterprise, the ingredient too often missing in our country, is—as we found in our productivity review—competition.
  The productivity review has concluded that competition is not only the best stimulus to innovation and efficiency but gives the best prospect of a better deal for all consumers. It is time for more competition and lower prices in basic essentials like the utilities, financial services, indeed the whole range of consumer goods, where too often British consumers are paying far more than they should for what they need to buy.
  It is wholly unacceptable that consumer goods can still cost up to twice as much in Britain as in America.
  In 1997, so that interest rate decisions would be set for the long-term needs of the economy, the Government made the Bank of England—Britain's monetary authority—independent. Tomorrow, so that competition will be encouraged for the long-term needs of the economy and consumers, the Secretary of State for Trade and industry will set out a new competition policy for our country.
  With 20 per cent. extra resources, the Office of Fair Trading will now be charged with a proactive remit to root out cartels and restrictive behaviour. Obstructing investigations will be a criminal offence. Wherever there is monopoly power, we will open up the way to competition and to new entrants.
  The Deputy Prime Minister will review competition in airports and in the water industry, starting with industrial and commercial consumers.
  The Financial Services Authority will now publish league tables of costs and charges in savings, insurance and pension products, to guarantee a better deal for consumers and to avoid the mis-selling of the past. To help all home owners, all building societies and banks will, for the first time, be obliged to publish reliable price information on mortgages.
  Britain will have the most open competition policy the country has seen.
  Fifth, to match our small business tax cuts with a new champion for small businesses in government, we will establish for the first time in our country a single small business service, devoted entirely to the needs of small business.
  This one-stop open-door service—the small business service—will have new resources to offer loan guarantees, to support innovation, to advise on electronic commerce and deliver, for the first time, an automated payroll service to help new small companies starting out. Small businesses that file their tax returns electronically will be offered a discount.
  Sixth, to open Britain's economy to the enterprise of all, we propose employee shares for all. Britain can and must become a democracy of enterprise, that gives all who create wealth a greater stake in the wealth they create.
  Under our new programme of shares for all, employees will be able for the first time to buy shares in their own company from their pre-tax income. Every employer will be able to match, tax-free, what each employee buys.
  This will be the most tax-advantaged all-employee share ownership scheme that Britain has had. Our only stipulation is that it really must be shares for all, offered right across the company's entire work force.
  My seventh measure for enterprise. New targeted tax cuts and public investment to equip all our companies and all our people for what is the newest and most decisive
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  challenge of the 21st century—the mastering in our economy of the new information technologies, from the PC to the internet, from e-mail to e-commerce.
  This industry is the greatest driver of world economic growth today. Britain can no longer afford to lag behind America.
  So, today, we are allocating an additional half a billion pounds from our capital modernisation fund to launch a £1.7 billion "Computers for AH" initiative, a nationwide effort enlisting schools, colleges and companies, public and private sectors together, across the board, so that Britain can lead in the information economy.
  Our target is a national network of 1,000 computer learning centres, one for every community in Britain. They will be in schools, colleges, libraries and internet cafes in the high street. It is a whole network of computer learning with one purpose only: that the whole of Britain is equipped for the information age.
  Our targets for the new economy are ambitious: within three years, 1 million small businesses able to benefit from e-commerce; 32,000 schools connected to the internet, as a result of the work of my right hon. Friend the Secretary of State for Education and Employment, and 370,000 teachers computer trained; new help worth £20 million making it possible for more teachers to have computers for home use.
  Inequality in computer learning today will mean inequality in earning power tomorrow, so to bring more computers into more British homes, we will legislate so that employees will be able to secure computers on loan from their companies as a tax-free benefit.
  Anyone left out of the new knowledge revolution will be left behind in the new knowledge economy. So we will pioneer a system under which local partnerships will be able to loan computers and software in the new century, in the way that local libraries loaned books in the past century.
  In the new economy, the more individual talent we nurture, the more economic growth we will achieve. The tax system will offer further incentives for people to upgrade old skills and learn new ones.
  From this year, 1 million men and women will start to receive £150 to set up their own individual learning accounts. This puts the power to plan and prepare for their careers in their own hands.
  In this Budget, we will expand individual learning accounts and open up tax-free learning in computers, in basic skills and advanced skills to millions more people.
  We will legislate so that employers will be able to contribute tax-free to the new individual learning accounts.
  Employees will also pay no tax on such payments.
  And this will be skills for all, because the opportunity to learn must be offered across the company's entire work force.
  We need to do more and the Budget will go further, offering discounts for learning.
  Any adult with an individual learning account will now be able to claim a discount of 20 per cent., an additional grant of up to £100, on the cost of vocational learning.
  For all adults signing up to improve their basic education—including computer literacy—there will be a discount of 80 per cent. on course fees.
  We will pay for this measure in tax-free learning by phasing out the existing vocational tax relief which, among other things, has been subsidising non-vocational courses like diving and flying lessons.[Interruption.] It was introduced by the Conservative party.
  This century, Britain has achieved universal free education for children. This Budget introduces the new opportunity for universal education for adults—lifelong learning so that everyone will have the chance to succeed in the new economy.

  ENVIRONMENT
  As Britain works to lead in the new economy, we must resolve to lead also in respecting the environment.
  Our Government's target is to reduce greenhouse emissions by 12½ per cent. by 2010. So today, I am announcing a programme of measures that will cut carbon pollution by 3 million tonnes.
  My first proposal alone will reduce carbon pollution by 1.5 million tonnes. The Government have received Lord Marshall's report, for which I thank him, on the role of economic instruments and the business use of energy.
  We will now implement Lord Marshall's recommendations and we will introduce a levy on business use of energy from April 2001. And it will be brought in, after further consultation with the industry, on a revenue-neutral basis, with no overall increase in the burden of taxation on business. Because we intend at the same time to cut the main rate of employers' national insurance contributions from 12.2 per cent. to 11.7 per cent.
  We also intend to set significantly lower rates of tax for energy-intensive sectors that improve their energy efficiency. Today, we are inviting these companies to submit their proposals. In pursuit of our policies for sustainable development, we will allocate an extra £50 million to encourage business to invest in the new environmental technologies and in renewable fuels.
  In line with the fuel escalator first introduced by the previous Government at 5 per cent. above inflation and now 6, petrol duty will rise from 6 pm today.
  Vehicle excise duty for smaller cars will, from 1 June this year, be cut by £55—the first cut in the licence fee in 50 years. Other cars' rates are only increased in line with inflation.
  I will freeze vehicle excise duty for 98 per cent. of all lorries, and for lorries and buses with clean engines I am cutting the licence fee by up to £1,000.
  To encourage a switch to cleaner fuels, last year I promised to give an additional tax advantage to ultra-low sulphur diesel. By the end of the year, almost all producers will have switched to this cleaner fuel. This alone will cut their emissions by 20 per cent. and at a revenue cost of over £400 million, I will maintain this favourable tax treatment for cleaner diesel.
  I also propose a reform to reward the use of fuel-efficient company cars and to remove today's counter-productive incentive to drive more miles in order to get bigger discounts. So I start in this Budget with a measure that will cost the company car user with a typical car around £1 a week. This reform—to link tax to emissions—will be implemented finally in 2002 on a revenue-neutral basis.
  To reduce pollution, employees from this year will be able for the first time to secure tax-free from their employer the benefit from employer-run or employer-subsidised buses, car-sharing schemes and other environmentally friendly means of transport to work.
  Last year, we set up the new rural transport fund. To build on its success in extending the range of public transport services in rural communities, we will increase its funding—and, therefore, its accessibility for rural services—for the next two years by 20 per cent. to £120 million.
  To reduce the amount of waste going to landfill, the landfill tax, £10 per tonne in 1999, will in future rise by £1 per tonne per year.
  Taking into account all these tax changes and all the changes that I have yet to announce, there will be a net tax cut of £4 billion in this Budget.

  FAMILIES
  I turn now to policy for families. Children are 20 per cent. of the British people, but they are 100 per cent. of Britain's future. To build that future, this Budget provides a better deal for families and children.
  Family life is the foundation of society, and our first principle in society's support for the family is that the interests of children must be paramount.
  For the last third of this century, families with children have been losers in the tax system. Their tax burden has risen by nearly 20 per cent. under successive Governments—even though the time when children are growing up is the time when families need tax help most.
  So it is time to reform the tax and benefit system to strengthen the family by putting children first.
  What is today called the married couple's allowance is in fact neither restricted to marriage, nor restricted to couples; nor is it strictly an allowance. It is in fact a tax credit paid at the same flat rate to married couples, single parents and unmarried parents living together.
  Far from recognising marriage, it is now so confused that it can even be paid at twice the rate in the year of separation or divorce. A married couple's allowance that can pay more for separation or divorce cannot be said to uphold the institution of marriage.
  The last Government called the married couple's allowance an anomaly and reduced it from 40 per cent. to 15 per cent., cutting its value in half.
  If we were now to restrict the married couple's allowance to married couples only, as some propose, we would unfairly exclude, for example, widows with children, and wives who have been deserted and left to bring up their children alone.
  So I have responded to many representations and views, including one that said that
  "if we were going to phase out the married couple's allowance we should have replaced it at the same time with a new allowance, better targeted on families who really need the help"—
  the words of the Leader of the Opposition.
  So we will replace the married couple's allowance with a new family tax cut that will increase the amount that goes to help families with children. This children's tax credit will give more—not less—help to families at the time when they need it most, when they have their children and when their children are growing up.
  Today's pensioner couples will retain the married couple's allowance. Couples without children, or whose children have grown up, will benefit from other changes I will shortly announce.
  The married couple's allowance is today worth £190 to married couples. The children's tax credit, the tax cut for families to be introduced from April 2001, will be worth £416, and, as a result, the typical family with children will be over £200 a year better off.
  This tax cut for families represents the first recognition in the tax system for over 20 years of the extra costs of bringing up children. Under my proposals, the tax burden on the typical family will fall to its lowest level for 25 years. I will introduce similar improvements in the working families tax credit and income support for children.
  In the Budget last year, I set down the two principles that govern my approach: we must substantially increase support for families with children and we must do so in the fairest way. It is in fulfilment of those two principles that the children's tax credit will be tapered away for the higher-earning family where there is a top-rate taxpayer.
  In the light of this reform, my Budget decision is that child benefit will not be taxed for taxpayers on the basic rate, or on the higher rate. As our manifesto promised, child benefit itself will remain as it is, paid to all mothers, rising annually with inflation.
  When we came to power, child benefit for the first child was £11.45 a week. Next month, it will rise to £14.40.
  It has risen by 25 per cent. since we came to Government—an increase of £150 a year.
  I now propose a further increase in child benefit, well above the rate of inflation. It will rise next April to £15 a week for the first child, £780 year. I will also raise the rate for the second and further children beyond inflation to £10 a week.
  Support for children as a result of all the measures that I am announcing will be twice as high at the end of this Parliament as it was at the beginning.
  With the children's tax credit added to child benefit, families who were receiving £11 a week in 1997 for their first child will be receiving £23 a week, £1,200 a year.
  And, taking all our reforms together, the maximum support for the first child will be £40 a week for families when they need it most.
  Every child in the country in every family will get more, not less, support under this system—support ranging from £780 a year to £2,000 a year, and every child will receive more year on year.
  When we came into power, we found a chaotic, even counter-productive system of child support. It gave far too little help to mothers. It did not provide enough to those who needed it most.
  Child benefit had not been increased every year in line with inflation. The married couple's allowance could not fulfil its intended purpose. Income support for children was based on family status, not on family need. Family credit failed to guarantee a living wage for working families. What the benefits system gave with one hand, the tax system was taking with the other.
  Our long-term goal is to bring together the different strands of our support for children in the working families tax credit, in income support, in our children's tax credit
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  and so create an integrated and seamless system of child financial support paid to the mother, building on the foundation of universal child benefit.
  Already, with the changes that we are making today, we are creating the best system of family support in the history of this country.
  I also had to consider the alternative case that has been advocated for a transferable tax allowance for mothers who stay at home. The better deal for mothers who stay at home is what we are doing from October this year—the working families tax credit. A family with two children on £15,000 a year where the mother stays at home would have received nothing under the old system of family credit. Transferable tax allowances, as some propose, would give them £997. Under the working families tax credit, they will receive £1,460.
  Where both parents need to work, we will do more to help them to balance the demands of making a living and having children.
  With 1 million new child care places now being created and, from October, our new child care tax credit set at a maximum of £70 for one child and £105 for two children, Britain has a national child care strategy for the first time in our history.
  From December 1999, all parents will be entitled to three months' unpaid leave for each child.
  But currently up to 15 per cent. of working mothers-to-be are not entitled to any maternity pay. That is wrong. Today's Budget will ensure that all mothers in work earning £30 a week or more—90 per cent. of all women in work—are entitled to maternity pay and to 18 weeks of maternity pay. That is family-friendly employment in action.
  Every year, a quarter of a million children—even at the minute they are born—are born into poverty. This, too, is wrong.
  Our sure start programme for the under-threes, beginning next month, will ensure that the full resources of health visitors, primary care and schools are there to give every young child a better chance.
  Today, we are announcing a new sure start maternity grant: Government offering more help to parents, but in return for parents meeting their responsibilities. Help amounting to £200 will be conditional, linked to keeping appointments for child health advice and child health check-ups.
  When we came into power, one child in every three in our country was in poverty. With our measures today, 700,000 children are being lifted out of poverty. Families with children are better off. Instead of a past that developed only some of the potential of some our children, the future depends on developing all of the potential of all of our children.

  THE ELDERLY
  As the Budget creates a better deal for those starting out, the Budget will today provide a better deal for all those who have worked hard all their lives: the elderly. Today, I am announcing new measures that will help all pensioners—help for those who are poor, for those with incomes above benefit level but who are not wealthy, indeed for every retired person and every retired couple, taxpayers and non-taxpayers alike: a better deal in the minimum pension guarantee, in the winter allowance, and on savings and tax.
  This Government created the minimum income guarantee for pensioners. Today, I can confirm that, next April, that minimum guarantee will be increased not just in line with prices but in line with earnings. As a result of the changes we are making, the minimum income guarantee for the single pensioner will be £78 a week— which is nearly £500 a year, or £10 a week, higher than when the Government came to office.
  Pensioner couples will have a minimum income guarantee of over £120 a week—which is nearly £800 a year, or £16 a week higher than in 1997.
  As a result of measures already taken—our cut in VAT on fuel, with tougher regulation and the winter allowance—pensioners are saving £108 on their fuel bills; the poorest pensioners have been saving £140.
  But I can announce today that we will do more.
  The winter allowance is currently paid to all 8 million elderly households, at £20.
  I have decided to raise it to £100 for all 8 million elderly households.
  And this is not a one-time need or a one-time decision. In future years, the winter allowance will be £100 for all 8 million elderly households.
  To help the elderly to get more out of their savings, I have asked National Savings to issue a new National Savings pensioners bond. With the shorter-term deposits that pensioners seek, the new bond will offer the returns that pensioners need.
  I have a further improvement: a tax cut for the elderly. I am announcing a reform that will ensure that a total of 7 million elderly men and women will now be outside the income tax system.
  For pensioners, I have decided to raise the personal tax allowance in excess of inflation.
  Single pensioners will not pay any tax until they have an income of £5,720. Older pensioner couples who both use their personal allowances to the full will now not pay tax until they have income above £15,000.
  Therefore, 200,000 more pensioners will not have to pay income tax.
  In total, two thirds of pensioners will now not pay income tax.
  Taken together, the measures I have already announced add up to an additional £3 billion for the elderly—a better deal for the elderly that makes the typical pensioner household £240 a year better off.
  To help pay for that, from today, excise duty on tobacco will rise by the normal escalator: 5 per cent. above inflation. Organised smuggling, which is now a £1(½) billion a year racket, will not be permitted to undo a policy on cigarettes that successive British Governments have adopted for good and urgent health reasons. As the Government strengthen their anti-smuggling strategy, we will target new resources to detect, prevent and punish this costly form of organised crime.
  And I had a decision to make on beer and spirits. I have decided to freeze the duty on spirits, on beer and on wine at its current level. There will be no tax rise on alcohol this side of the millennium.
  I will cut the tax on pools from 28 March by one third from 26.5 per cent. down to 17.5 per cent. On this basis, the pools companies have agreed future funding of around £20 million a year for the Football Trust and the Foundation for Sport and the Arts. Details of this, of minor duty changes and of measures to combat tax avoidance are published this afternoon.
  Insurance premium tax will rise by lp in the pound from 1 July, although 80 per cent. of insurance underwritten in Britain will remain exempt.
  On VAT, today I propose there will be no increase in rates and no extension of VAT.
  I have decided to make no change to stamp duty on property sales up to £250,000. For property sales above that, the rates will be raised by ½ per cent. from next Tuesday. Ninety six per cent. of home sales are unaffected.
  I now turn to our review of charities. A Britain of strong families is also a Britain of strong communities.
  Each year, more than 1 million people give up their time in voluntary work.
  Millions more give money to our national charities.
  The Prime Minister has rightly called for our age to become a giving age.
  I want to mark the millennium in the best way by making 2000 the giving year.
  In the last Budget, we introduced millennium gift aid.
  For every £100 a British citizen donates to third world causes before the end of the year 2000, the Government will contribute £30.
  When millennium gift aid is launched on 18 March, I urge British people to give more to those who have too little.
  As Governments make their contribution to third world debt relief, all of us can make a contribution to third world poverty relief.
  Today, in our consultation document on tax and charities, we propose extending the tax advantages of millennium gift aid. We propose that every charity, national and international, should be able to benefit from this new tax relief.
  We propose in future for every £100 a British citizen donates to any charity, through tax relief the Government will contribute £30.
  Instead of charities seen in the old way, the rich bestowing favours on the poor, I want a democracy of giving where all those who can, help all those who cannot.

  WORK
  Most fundamentally, the tax reforms of this Budget provide a better deal for the hard-working majority—a ladder of opportunity for those who want to work, a chance to keep more of what they earn and, for all, a fundamental guarantee that work will pay.
  Our reforms in national insurance will give employers an overall tax cut of £1.5 billion and employees an overall tax cut on work of £2.5 billion—an average of £130 per year per employee.
  This April, as I implement the report by Martin Taylor, I am abolishing the perverse tax on work, the entry fee that every employee has to pay simply to be part of the

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  national insurance system. From this cut on work worth over £1.4 billion a year, every one of 20 million employees will gain £69 a year from April.
  Over the two financial years to follow, I will further align the starting point with that of income tax so that no one will have to pay either national insurance or income tax on the first £87 of their weekly earning. From this tax cut on work worth £1.8 billion a year, every employee will gain £99 a year.
  From April 2001 therefore, the lower limit for employees, self-employed and employers national insurance will be harmonised at £87 a week—the same as income tax. As with the lower earnings limit which is rising faster than inflation, the upper limit will rise to £575 and to complete our reforms we will also align employers national insurance and income tax in the treatment of benefits in kind.
  I also propose to extend to the self-employed national insurance rights to the full maternity allowance.
  Again, to implement the recommendations of the Taylor report, we will align national insurance arrangements for the self-employed closer to those of employees. We will reduce the unfair entry fee from £6.35 a week to £2 and we will set the class four threshold at the same point as the personal income tax allowance. But I will set contributions at a lower rate than envisaged by the Taylor report, at 7 per cent. in contrast with the 10 per cent. employees pay.
  Some 230,000 young people are now benefiting from the new deal. Now we must bring in those young unemployed who, for whatever reason, have yet to join.
  I say to them, this is our new deal for 1999: there will be better provision but there will be tougher conditions. Our responsibility is to offer training and intensive coaching to help young people get jobs. In return, their responsibility is to come into the new deal, get the skills and prepare to take a job.
  We will also help lone parents make the transition into jobs. Benefits will continue when they first start work.
  For them and others, the working families tax credit will make work pay more than benefits.
  Every working family will be guaranteed a minimum income. It will be introduced in October not at the previously announced rate of £190 a week, but at £200 a week—more than £10,000 a year. No income tax will be paid until earnings reach £235 a week.
  This is a tax cut available to 1.4 million families that will help 3 million children in our country.
  I propose that, over time, we seek to extend this principle.
  The old tax system that we inherited set a personal allowance that failed to ensure that work paid, and also made thousands pay tax even when they were forced to claim benefits.
  Not just families but all who work should be guaranteed a minimum income, and this minimum income will be paid through targeted tax cuts and credits. No one who is in work should in future have to go to the benefits office to receive a living income.
  We start in this Budget with a minimum income guarantee—a new deal for over-50s returning to work.
  Nearly 30 per cent. of men over 50 are outside the labour force—twice as many as 20 years ago.
  We need their talents. For those unemployed for six months or more, we will create a new employment credit which will guarantee a minimum income of £9,000 a year, for their first year back in full-time work—at least £170 a week.
  And, over time, I want this better deal for work to include help with housing costs—not just help with rent but also help for home owners going back to work. Taking a job should not put them in danger of losing their homes.
  Successive Governments have lowered mortgage tax relief from 40 per cent. to 10 per cent. of interest costs and they have frozen the limits at the first £30,000 of a mortgage.
  Today the allowance is worth an average of £2.50 a week.
  In the last year, mortgage rates have come down significantly and I now recognise that there is a consensus across this House.
  I have had many Budget representations and read many contributions to the long-standing debate about the housing market. One of them said that MIRAS has
  "outlived its usefulness … it should be abolished the sooner it happens, the better."
  Those are the words of the now shadow Chancellor.
  For our part, as we complete the phasing out of MIRAS, we will ensure that families are better off.
  We said in our manifesto that we would introduce a 10p starting rate of income tax for individuals when it was prudent to do so.
  I repeated in the last Budget that we would introduce the 10p starting rate when it was prudent to do so.
  However, I have to tell the House that the 10p rate will not start in April 2000, like other income tax changes we are making today.
  It is prudent instead for people to get the benefit of the 10p starting rate now.
  So it will take effect in April 1999, a 10p starting rate on the first £1,500 of income, the lowest starting rate of tax since 1962, and it will be delivered a few weeks from today. People will see it in their pay packets in May.
  Nearly 2 million people will see their income tax bills cut in half, and take home 90p of every pound they earn.
  The new income tax structure will this year be 10, 23, and 40. And income tax allowances, income limits and tax thresholds will rise as usual in line with inflation. The tax rates on savings will remain unchanged.
  So this is a Budget with a 10p starting rate of income tax, a 10p starting rate of small business tax, a 10p long-term rate for capital gains tax. The maximum small business tax is now down to 20p and corporation tax for big companies is down to 30p in the pound.
  As a result of all the tax reforms we are making, the typical one-earner family on the average wage with two children will be £460 a year better off and a two-earner family on 175 per cent. of the average wage will be £500 a year better off.
  The tax cuts I have made today are tax cuts to encourage work and make work pay, tax cuts for a purpose. They help all middle and lower-income families. They are tax cuts for the many and they are being made at the best time for the economy.
  I can confirm that the share of tax in national income next year will fall. The tax burden on the typical family with children will fall below 20 per cent. for the first time in 20 years, after our reforms.

  MODERNISING PUBLIC SERVICES
  I have one further set of announcements to make.
  After long years of neglect, step by step this Government are rebuilding our public services.
  On top of the £40 billion we are already investing in education and health, we can today allocate increased resources for key public services.
  We have identified specific areas where step changes can be made through additional investment from our capital modernisation fund.
  We are allocating an additional £170 million for crime prevention in areas where crime is highest. The Home Secretary will make a detailed statement on this to the House.
  For public transport, in addition to the rural transport fund we have created, we will make a further allocation that will be announced by the Deputy Prime Minister.
  For Northern Ireland, today we allocate additional capital spending of £50 million; for Wales, £80 million; for Scotland, £165 million. Full details of the new investments will be given by the Secretaries of State.
  The £19 billion we are already providing for education will finance smaller class sizes, more nursery education, better pay for better teachers, our drive to improve literacy and numeracy and we will help 700,000 more young people to go on to further and higher education.
  But, so that every child will have that chance, we need specific and targeted help for our inner-city schools. For upgrading their technology, the Secretary of State for Education and Employment will receive an additional £100 million.
  And for every school in the country, we will not only invest in new technology. As a result of our prudence in the last year, and following the huge take-up of the additional money provided last year, we are able this month to make another extra and larger allocation for school books: £2,000 to every school in every constituency in every part of the country; immediate new resources of £60 million; a total of 10 million new books in all.
  I turn to the health service.
  The £21 billion extra money is making possible the largest hospital-building programme since the war; a £1 billion investment in modern technology taking place in the NHS; the recruitment of 7,000 new doctors; 15,000 more nurses; and a fair pay award for nurses.
  The Government's new programme, NHS Direct, is a proven success.
  And the Secretary of State for Health will announce detailed proposals not only to extend it to all of the country by the end of next year, but to carry NHS Direct
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  right into communities, with a network of health and drop-in centres where people can get immediate advice about treatment.
  We have already provided additional resources for upgrading one third of all accident and emergency units that need modernisation.
  Today, we can go further.
  To enhance in every part of the United Kingdom the health care that people most urgently require, we today make an additional and immediate cash allocation, to be spent in the next 12 months, for the upgrading of every single accident and emergency unit that needs it, in every part of the country.
  For this and other improvements that the Secretaries of State for Health, for Scotland, for Wales and for Northern Ireland will announce, I am providing for the NHS almost half a billion pounds of extra investment today.
  Throughout the public services, more than £1 billion of additional new investment, on top of the £2 billion that I have allocated to families and pensioners.
  Public services in the months and years ahead, safe in this Government's hands.
  I have one final announcement.
  We promised to get inflation and interest rates under control, to sort out the public finances, to make this the Government of economic competence, and we have.
  We promised to invest billions more in health and education, and we have.
  We promised we would cut youth unemployment, and we have.
  I can confirm to the House that, while rebuilding our public services, our prudence in office also enables us to hold to our pledge made at the election not to raise the basic rate of income tax.
  In fact, to reward work and ensure that working families are better off, I will match the new 10p starting rate of income tax this April with a cut from next April in the basic rate of income tax to 22p, the lowest basic rate of tax for 70 years and under this Government.
  Today's Budget is a better deal for work, a better deal for the family, a better deal for business. It is for a Britain now united around values of fairness and enterprise. This is a better deal for Britain and I commend this Budget not only to the House but to the country.

  PROVISIONAL COLLECTION OF TAXES
  Motion made, and Question,
  That, pursuant to section 5 of the Provisional Collection of Taxes Act 1968, provisional statutory effect shall be given to the following motions:—

  (a) Sparkling cider (rate of duty) (motion No. 2);

  (b) Hydrocarbon oil duties (rates and rebates) (motion No. 3);

  (c) Tobacco products duty (rates) (motion No. 5);

  (d) Vehicle excise duty (increase in general rate) (motion No. 7);

  (e) Vehicle excise duty (rates for goods vehicles etc.)(motion No. 9).—[Mr. Gordon Brown.]

  put forthwith, pursuant to Standing Order No. 51 (Ways and Means Motions), and agreed to.
  Mr. Deputy Speaker: I now call the Chancellor of the Exchequer to move the motion entitled "Amendment of the law". It is on that motion that the debate will take place today and on succeeding days. The remaining motions will not be put until the end of the Budget debate next week, and they will then be decided without debate.

Budget Resolutions and Economic Situation

  AMENDMENT OF THE LAW
  Motion made, and Question proposed,
  That it is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance; but this Resolution does not extend to the making of any amendment with respect to value added tax so as to provide—

  (a) for zero-rating or exempting a supply, acquisition or importation;

  (b) for refunding an amount of tax;

  (c) for varying any rate at which that tax is at any time chargeable; or

  (d) for any relief other than a relief which—

  (i) so far as it is applicable to goods, applies to goods of every description, and

  (ii) so far as it is applicable to services, applies to services of every description.—[Mr. Gordon Brown.]

  4.40 pm
  Mr. William Hague: I begin, as ever and as usual, by complimenting the Chancellor on his fortitude in delivering a lengthy speech, and there are some things in the Budget that we wish to welcome. I of course welcome the reduction in the standard rate of income tax, which the Chancellor announced with great fanfare at the end of his speech after passing quickly over the abolition of the 20p band, with much less fanfare, earlier in his speech. Labour Members may also wish to know that all the announcements that the Chancellor made about the capital modernisation fund come from a Budget that has already been announced and that they cheered at the time. As the press release that I have just received appears to show, all those figures are from a fund that has already been announced, with no net increase in the total.
  As ever, the most interesting thing about what the Chancellor said was what he did not say. He did not say— but it is the truth—that the total tax burden will rise next year as a result of his cumulative decisions. He did not say—but it is the truth—that, as a result of his decisions in three Budgets, this is the third year running in which we will have higher taxes because of the decisions of this Government. Last year, he had imposed higher taxes twice in a row, and that gave him a reputation for higher taxes. After three years in a row, he gets to keep that reputation for ever.
  It would not have been apparent from the Chancellor's speech that he has already announced in previous Budgets tax increases for the coming year that add up to £7,200 million, including taxes on pension funds of £5.4 billion, earlier decisions on the married couples allowance of £1 billion and increases in petrol duty of £1.4 billion. [Interruption.] Labour Members like to cheer reductions, but they do not like to hear the truth about the increases. There have also been increases in stamp duty of £1 billion. People who have invested in pension funds, people who are married and people struggling to run their cars have already been paying for this Budget and those increases have already been locked in.
  The Chancellor said that the Budget is good for families. It is good for families who do not have a mortgage, who are not married, who do not run a car, who do not smoke and who do not save for a pension. For a family like that, the Budget is fine. There may even be

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  a family like that somewhere in the country: it sounds suspiciously like the Chancellor to me. If we add it all up, he has already levied additional taxes of £1,500 for every taxpayer in the country—to which he has made marginal changes today—including increases in income tax in previous Budgets amounting to an extra £200 for a typical married couple with a mortgage.
  The Chancellor is now posing as the man who likes to distribute a few little goodies, when he has imposed for the current year a huge rise in taxation. He is the man you meet in a pub who says, "Lend us a fiver and then I'll buy you a drink." He is the pickpocket Chancellor who shakes your hand with a smile after he has stealthily removed your wallet. He is the pickpocket Chancellor, aided and abetted by his next-door neighbour, the artful dodger.
  The Chancellor seems to try to deny the facts of the matter. The actual fact of his first year as Chancellor was that he raised the tax burden by £6,000 million. Let him get up and deny that if it is not right. If it is right, he should tell the Prime Minister, because he has only just realised that in the past couple of weeks. In the Chancellor's second Budget, he raised taxes for this year by £7,900 million. He might have said in his Budget speech what the total rise in the tax burden will be as a result of his decisions. He had over an hour. We heard a lot of waffle, but he forgot to mention that line.
  It is no good the Chancellor claiming that taxes are not rising. Last week, the Prime Minister finally let the cat out of the bag. He had denied for months that taxes were rising, but last week he looked at his folder and accidentally read out the truth. He said:
  "the tax burden will increase".—[Official Report, 5 March 1999; Vol. 326, c. 1075.]
  What a total betrayal that was from the man who said at the general election that there would be no tax increases at all.
  The truth after three Budgets is that the total of taxation is still rising, and the Chancellor did not have the guts to say so in his speech. Nor did he draw attention to other matters that are becoming apparent as we look into the facts that are emerging about his announcements. For example, there is a dramatic fall in the savings ratio. Not only has it fallen from 11 per cent. to 7.5 per cent. over the past two years, but there has been a fall from the Chancellor's own previous forecast, from 9.25 per cent. to 7.5 per cent. The Chancellor said nothing about savings, on which the story of the Government's policy is one of emerging disaster.
  The Chancellor will understand it if I say that we must see emerging information about, and figures for, much of what he has announced, because he is not only an expert on stealth taxes, but an expert in giving a stealth speech. Last year, the £3.6 billion hike in corporation tax was described as
  "a new instalments system of payments for … corporation tax".— [Official Report, 17 March 1998; Vol. 308, c. 1100.]
  There was, however, no reference then to the tax increase that would result.
  In 1997, the Chancellor's £5 billion tax on pension funds was described in the pocket guide to the Budget as
  "other taxes to encourage companies to invest".
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  As the director general of the Confederation of British Industry has said:
  "There is concern about the accumulation of extra costs which have been imposed on business, of which the biggest was actually the Corporation Tax changes which were very carefully portrayed as a reduction in tax rates but were actually a tax increase, exploiting the fact that the number of people in the world who understood Dividend Tax Credits is remarkably few, which allows the Chancellor to raise taxes while appearing to cut them."
  Who knows, then, what will lie behind some of the seemingly innocuous sentences that the Chancellor uttered today? Any apparently nondescript sentence could mean a clobbering for people anywhere in the country—and we heard quite a few nondescript sentences. We already know that, at the same time as the Chancellor is trumpeting tax incentives to help some firms, the Government are damaging businesses across the board with a mass of employment costs, from the social chapter to statutory union recognition and the working time directive.
  The Chancellor talks about investment, but we all know that his first Budget introduced a £5 billion tax on pension funds, and that tax has hit investment. We already know that, while he claims to cut taxes, taxes on people and businesses are soaring. We already know that the Government say one thing and do another, take a pound and give back a few pennies. They cannot be trusted to be straight, even on Budget day.
  Last week, the Prime Minister said that he wanted our economy to be more like the American economy. One week has passed, and the Chancellor has made his Budget speech. Where is the American dream? Where is the radical plan to reduce welfare bills? So far, the Government have added £40 billion to welfare bills; America is cutting its welfare bills.
  Where is the programme to curb union power, or to increase labour market flexibility? The Federation of Small Businesses says:
  "If the Government wants to take a leaf out of the American book, it would ensure the small firms sector wasn't suffocated with paperwork."
  The Engineering Employers Federation adds of the Chancellor:
  "He seems to be saying one thing and doing something else."
  What a surprise that is. The federation goes on:
  "His message is about freeing labour markets while at the same time your average small engineering company is being buried under a tide of legislation and paper."
  In the United States, businesses with turnover of under ․0.5 million are usually exempt from the minimum wage. In Florida, it costs ․150 to set up a new corporation, but in Europe there are thousands of pages of new regulations. In the United States, small businesses flourish because the Government leave them alone. Where are the Government's measures to implement the American dream about which the Prime Minister spoke so proudly last week?
  Another remarkable part of the Chancellor's speech concerned the economic forecasts on which his whole Budget is based. Experts will be astonished that his forecasts for GDP growth remain unchanged from the figures announced last autumn. He forecast 1 to 1.5 per cent. growth this year, but the upper end of his forecast is three times the rate of growth forecast by independent economists and published by the Treasury. He forecast 2.25 to 2.75 per cent. growth next year, whereas the

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  consensus of independent experts is that growth will be 1.8 per cent. That is the basis of the whole Budget and of all the Chancellor's calculations—the basis on which, even on his own figures, in the coming years there will be no repayment of public sector debt at any point in the cycle. That is not how the right hon. Gentleman chose to put it in his Budget speech, but it is the truth of the figures.
  Behind the statistics of an economic slowdown, we see families under pressure, and businesses struggling in a manufacturing sector that the Chancellor will have further hit today, as I shall describe shortly. Since the right hon. Gentleman entered office, the forecasts for this country have been downgraded more sharply than for any country in the western industrialised world. Much of our manufacturing industry is in recession, and our entire agricultural industry is in deep recession. The extracts of the Red Book that I have seen so far cover that up with statements such as:
  "these undershoots relative to the Pre-Budget Report"
  reflect
  "a larger negative contribution to GDP growth"
  by manufacturing output. In other words, manufacturing is in a mess, yet that is the sort of verbiage that the Chancellor or his civil servants come out with.
  On enterprise, of which the Chancellor has made much, there are policies that we shall welcome. We shall welcome the new corporation tax starting rate of l0p for small businesses, although we shall want to know who will judge whether they are taking the right amount of risk, as the Chancellor appeared to foreshadow in his speech. He made much of his new package of reliefs and incentives for enterprise and, when we have looked at the details, we shall welcome some of them, including the research and development credit.
  The very fact that the Chancellor appears so pleased with his latest package of measures, however, shows that he has completely missed the point. Does he not realise that what businesses need, much more than a new incentive here and a clever relief there, is to be set free from the massive burden of new taxes and regulations heaped on them by the Government? It is no good handing out one relief today and putting up other taxes tomorrow. It is no good the Chancellor coming here to talk about introducing tax breaks when the new Paymaster General chairs an Economic and Finance Council committee that is abolishing the tax breaks for the film industry that the right hon. Gentleman introduced less than a year ago.
  The shipping industry will be deeply disappointed by the Chancellor's announcement today. It is hypocritical of the Government to fail to act, having raised such high expectations before the Budget. British shipping is an industry with desperate problems, and the right hon. Gentleman will have to explain why he has not been able to resolve the problems that he talked about previously. It is because he has been unable to do that that the president of the CBI says that regulations are now producing "creeping paralysis." The Association of British Chambers of Commerce said this morning that the Government have abolished 20 regulations and introduced more than 2,000. A small business man, quoted in a Sunday newspaper said:
  "The Government is like a professor in a laboratory tinkering with his inventions and not knowing what the real world is."
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  The bad news from today's Budget is that the professor is still tinkering, that the whole of business in this country is his laboratory and that he still does not know what the real world is.
  If they are to be effective, all the schemes that the Chancellor has announced for enterprise will need to be far more effectively implemented than the Government's policies on saving over the past couple of years. If there is one area that the right hon. Gentleman has hammered more than any other and about which he has done nothing in today's Budget, it is Britain's saving culture, which has been hit by stealth taxes. It says something about the inner mentality of the Government that people who work hard, save hard and try to be independent of the state are finding themselves penalised.
  The effects can be seen in the dramatic fall in the savings ratio, of which the Chancellor made no mention. The pensions tax that he introduced is costing a typical 30-year-old saver an average of £ 150 a year. The abolition of tax credits for non-taxpayers, many of whom are pensioners on modest incomes, is costing 300,000 pensioners an average of £75 a year. Today, the right hon. Gentleman had the opportunity to put that right, but he decided not to do so.
  The Chancellor also announced the crazy abolition of PEPs and TESSAs—the most successful savings vehicles in our history. One month before the general election, the Prime Minister said:
  "the idea that the Labour Party is going to take action against PEPs and TESSAs is completely absurd"
  What is absurd is the idea that the Prime Minister would keep his promise. In three weeks, those vehicles will be abolished and replaced by the new individual savings account. There was a time when the Prime Minister used to claim that that would produce 6 million new savers. Does he still think that the new savings account will attract 6 million new savers? No, he does not say that any more. He no longer wants to hear my question, let alone answer it. Savings vehicles must be simple, and the Government have made a complete mess of savings policy in this country. They have done nothing in today's Budget to put that right.
  The figures about the tax burden are beginning to come through. It seems that the tax burden is set to rise from 38.9 per cent. in the first year—which was already an increase—to 39.5 per cent. of gross domestic product in 2001 and 2002. When we do the arithmetic, it also appears—[Interruption.] Some of us must make sense of the Chancellor's distorted announcements as we go along. Today's Budget will raise taxes next year by £1.6 billion. As a result of the Chancellor's three Budgets, taxes are set to rise by £8.9 billion. That is the actual total.
  The Chancellor today introduced the long-awaited and much-vaunted l0p tax rate. We welcome any reduction in income tax, including the 10p tax rate—although I note that the Chancellor also abolished the 20p tax rate. As a result of the Government's decisions, income tax will rise from the level it was at when Labour took office, and should be viewed in that context.
  We welcome the decision to bring the starting point for employees' national insurance contributions into line with the starting point for income tax. However, the Government must not forget that a number of benefits are linked to national insurance contributions. We want to ensure that the Government do not use that measure to undermine the contributory principle.

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  The measures announced by the Chancellor regarding the national insurance contributions of the self-employed look, at first glance, like a higher tax on the self-employed overall. The Chancellor shrugs his shoulders and looks as though it is a matter of no consequence. However, it will greatly concern the self-employed if that reform results in a further increase in taxation for them. I note that the Chancellor is not taking the opportunity to deny that the measure will have that result.
  The Chancellor's announcement about shares for all is welcome in itself, but it is in conflict with everything that he has done—and continues to do—in the area of share ownership. It is a bit rich for the Chancellor to talk in glowing terms about the merits of employee share ownership, given that he has spent the past two years undermining share ownership at every turn. What message does it send about share ownership when the Government prevent people who are too poor even to pay tax from claiming back tax credits on the few shares that they own?
  What message does it send about having a stake in one's own business when the Government abolish retirement relief on capital gains tax, bringing thousands of small business people who are selling up for their retirement into the tax net for the first time? Such people have worked hard all their working lives and regard their businesses as their pensions for the future. The Chancellor has not thought about them in this Budget. If this were really a Budget for enterprise and work, the Chancellor would have reversed his previous stupid decision. We welcome any move to boost employee share ownership, but we will judge the Government by what they have done, not by what they say they might do.
  I welcome the principle of incentives for people to run cars with low emission engines, which is good news. However, it is bad news for the Deputy Prime Minister, who is even now heading for the Maldives and will be delighted to know from the Chancellor's speech that he is to be given the job of reviewing competition in airports. He is presumably in the Maldives examining how they integrate their transport strategy. Looking at how to integrate sunbathing with water-skiing will come in handy in Hull.
  Lower road tax must be put in the context of the stealth taxes being loaded on to motorists at the same time. Not only have the Government increased the so-called fuel escalator from 5 to 6 per cent., but they have brought forward the annual Budget increases from November to March and sneaked in an extra Budget. AA figures reveal that average motorists will pay £183 a year more in tax on their petrol next year than at the time of the last election. That is an extra 62p a gallon and it is another stealth tax on motorists. People will be grateful for £55 off the excise duty, but they are left £130 a year worse off than they were going to be in the first place.
  Few people will be aware that, after today's Budget, about 85 per cent. of the price of petrol will be tax. The Government hope that people do not understand how much tax they are paying. We think that they have the right to know how much of their hard-earned income is being spent on petrol.
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  Those are the effects for private motorists, but for hauliers the situation is even worse. When one hard-pressed business man wrote to the Minister for Roads and Road Safety, Lord Whitty, the Minister gave the prize-winning reply that
  "all hauliers who operate internationally can take advantage of lower prices elsewhere"
  Is it meant to be good for businesses to take their entire lorry fleet over to France every time that they want to fill up? Is it good for the Revenue if they do that?
  The truth is that this country started raising those taxes when they were lower than those on the rest of continent, and the Government have continued increasing them by larger amounts after they have become higher than those on the rest of the continent. They have now taken their persecution of the motorist too far. They have taken the damage to the haulage industry too far. A policy change is needed.
  We shall want carefully to consider the Chancellor's measures on the environment. Increased taxes on energy use and pollution should be completely offset by tax reductions, and we welcome the intention to do that. However, Back Benchers who cheered the Chancellor's announcements about carbon tax should recognise that it will hit manufacturing industry the hardest because that is the most capital-intensive industry and the most reliant on the use of fuel. The corresponding and compensating reduction in national insurance contributions that the Chancellor announced will give the least help to manufacturing industry because that is the least labour-intensive industry. So that seemingly innocuous announcement by the Chancellor will hit manufacturing industry hard in particular areas; and all hon. Members with such businesses in their constituency will find that it causes a problem for them in the years ahead—a fact not remotely referred to the Chancellor's speech.
  The Chancellor made an important announcement about the married couples allowance, and of course we shall consider carefully what is proposed to replace it. He claimed to quote what I would do, but I have always said that the Government should ensure that the tax system recognises the costs of maintaining a family—not only children but elderly relatives—and suggested that we could have a system of transferable allowances for families in which one partner stays at home to look after the children.
  The Chancellor's announcement about replacing the married couples allowance was interesting. The difficulties that may arise are, first, that he announced a means-tested taper. It is possible that the implementation of such a taper will infringe independence in the tax system because it will be necessary to consider the whole household in order to determine it. It will further increase disincentives by introducing another means-tested payment to the tax and benefit system. It risks being another factor that has to be administered by the employer, further loading regulation and complexity on to businesses. The Chancellor may have answers to those points, and I hope that he does; otherwise that change will introduce fearsome additional complexity into the system.
  I am glad that the Chancellor has been frightened off his intention to tax child benefit, and we shall try to frighten him off doing so in future. We know that, while he is around, the prospect of that tax will be ever present.

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  The Chancellor also made announcements about a further increase in stamp duty. That may be his final revenge on the right hon. Member for Hartlepool (Mr. Mandelson). The Chancellor should reflect on how that announcement may damage the property market, and on how making it more difficult for people to sell homes in certain parts of the country will damage the creation of a more flexible work force and labour market.
  The Chancellor made much, as he always does, of plans for the new deal. We heard fine words, as ever, but it is time to check how the new deal is working. He may have seen a report in today's newspapers, saying:
  "Bosses giving up on Brown's New Deal".
  Such reports make sober reading for the Chancellor. Allied Carpets has suspended plans to take on 250 out-of-work youngsters. Bass has taken on only nine trainees even though it offered 50 places. Thistle Hotels offered 100 places, but has ended up with two trainees. Would not it be better to look at how other economies, such as America's, have created jobs by cutting taxes on business and cutting back on regulations—rather than dreaming up new ones? With unemployment threatening to rise again, one thing is clear: the new deal is not the answer—not the answer for young people, not the answer for employers, and not the answer for the economy.
  The Chancellor made much of spending additional money. As I pointed out at the beginning of my speech, he has made his spending announcements on the capital modernisation fund before. What he announced today was a rearrangement of figures over the next three financial years.
  People who are paying higher taxes—as they are—are asking where the money is going. It is mainly going to finance the huge additional cost of the welfare system, which the Chancellor has not reformed. We are in favour of higher spending on health and education—[HON. MEMBERS: "Oh!"] I say that just for the record, against the day when the Prime Minister distorts it again. The Government have presided over higher waiting lists, and people are wondering whether the money is being spent effectively.
  The Chancellor mentioned his crime reduction initiative and the additional money for it, which, as it happens, he has also announced before. At the same time as announcing that additional money for crime hotspots, he is reducing the number of police, which of course means that there will be more crime hotspots.
  Today, the Chancellor should have been attacking the forest of regulation that is strangling business, but he did not. He should have given a clear signal that the tax system will support marriage, but he did not. He should have cut fuel costs for the road haulage industry, but he did not. Instead of raising taxes by stealth, he should have started to introduce some honesty to the tax system. He should have tackled runaway welfare spending, but he did not. He should have saved poor pensioners from losing tax credits on their shares, but he did not. He should have started to support Britain's savings culture, but he did not. He should have set out a programme to lower the tax burden, but he is continuing to increase it.
  On all those issues, the Chancellor had the opportunity to act, and has failed to do so. Shut up in the Treasury, he seems to believe that he can impose taxes but that no one will notice them or really pay for them. He seems to believe that people are abstract statistics, and that Budgets
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  are just speeches and pieces of paper. He seems to think that if he keeps the tax-rise bits brief and waffles on at length about pet schemes, no one will notice that they are paying any more. But, in the real world, people stretch to pay their mortgage, try to save a bit, drive to work and drop off their children on the school ran. In the real world, people will notice; in the real world, people will come to realise that this Government have let them down. [Interruption.]
  Mr. Deputy Speaker (Sir Alan Haselhurst): Order. Mr. Ashdown.
  5.8 pm
  Mr. Paddy Ashdown: I have heard of waving papers for success, but waving in desperation is another thing—or perhaps Conservative Members were waving their Order Papers in sheer relief that that speech was over.
  In line with the traditions of the House, I offer the Chancellor my congratulations on a long Budget speech. I think the right hon. Gentleman's Budget will be considered one in which he had opportunities to do big things but decided instead to follow a scatter-gun approach and do quite a number of rather smaller things. I regret that; I shall return to the subject in a moment. Nevertheless, I think that anyone outside this place who has not had a total loss of memory will feel that the speech just made by the leader of the Conservative party was a mix of hyperbole, hypocrisy and hysteria in about equal proportions.
  I had written down that we could welcome some things in the Budget; in fact, we can welcome many things in it. It seems that the Chancellor has once again made a selective smash-and-grab raid on some of our bright ideas and proposals; they feature in considerable number. Although that was not done with the clarity and decisiveness that I would have wished, they are there, and we welcome that.
  These raids are becoming such a habit that I had thought of offering the Chancellor honorary life membership of the Liberal Democrats. Starting with giving independence to the central bank—the Bank of England—which was our manifesto policy, not Labour's, he seems to have applied more policies from our last general election manifesto than he has from Labour's. We saw those policies clearly in the proposals for vehicle excise duty, fiscal neutrality in charging a carbon tax, and the uprating of basic pensions in line with wages.
  However, the Chancellor may be relieved to hear that, on second thoughts, I have decided to withdraw the offer, for three reasons. First, I do so because, in his first two years, he cut our public services, especially those relating to health and education, more, in real terms, than even the Conservatives planned to. Whatever the Government intend to do next year, the fact remains that, by the end of this Parliament, taking the Parliament as a whole, the Government will have put funds into health and education at a lower level than the Conservatives intended.
  Secondly, I withdraw the offer because the Budget does not do as much as it should—or, we believe, given the sum of money available, as it could—to tackle poverty in Britain. [Interruption.] If the Secretary of State for Education and Employment, speaking from a sedentary position, would be prepared to wait a moment, I shall see whether I can prove that proposition to him.

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  Lastly, I withdraw the offer because, in many cases, where the Chancellor accepts our aims, the means by which he seeks to achieve them are, at best, inefficient and, at worst, ineffective; so if I sound a little grumpy in my response, I admit that it is because it is extremely frustrating to hear someone else singing snatches of our song but doing so completely out of tune.
  Before I come to the detail, let me look at the wider economic picture. Liberal Democrat Members agree with the Chancellor's basic fiscal judgment that this should be broadly a neutral Budget. I want to study the detailed figures, but I believe that it is broadly neutral. The priority must be to bring interest rates and the pound down.
  Last November—I wonder whether the Chancellor remembers; I do not suppose that he does, because he does not read my speeches every day—I told him, in my speech after the Budget, that he was wrong to deny that we would have a manufacturing recession this year. I note that, in the small print of his Budget, the Chancellor has at least had to acknowledge that he was wrong, and that we are witnessing a significant manufacturing recession. That is probable; indeed, it is probably under way as we speak. As the Chancellor well knows, the main reason for that—the main reason why exporters and manufacturing exporters and farmers are in trouble—is the overvalued pound, still 10 per cent. higher in real terms than in May 1997 and 25 per cent. higher, a quarter higher, than it was in May 1996.
  As I told the Prime Minister a couple of weeks ago, we welcome the fact that the Government have inched across the Rubicon on joining the euro, even though they still try to tell us that they have not; but, once again, the Government will the end but do not will the means. Why is the commitment to join the euro when conditions are right not followed by the policies to make them right? That is what a Government should do if they are governing and leading the nation. A change of gear is not enough if no one is driving the car.
  The Chancellor told us that the centrepiece of the Budget is his tax reform. We agree that there is some tax reform to be done, and it can be done within a broadly fiscally neutral Budget. Today's tax reforms should have been an exercise in simplicity, fairness and honesty. Instead, they have been an exercise in complexity, gimmickry and a good deal of conjuring.
  First, let us consider simplicity. The Chancellor told us last November that
  "our policy is pro-tax simplification".
  If that was his aim, he has been heading consistently and enthusiastically in the wrong direction. I shall give him some figures. A decade ago, there were four personal tax rates. Under his predecessor in the previous Government, there were eight personal tax rates. Under the right hon. Gentleman, there are no fewer than 54 personal tax rates. We will send the Prime Minister and the Chancellor the list, if they wish. My hon. Friend the Member for Gordon (Mr. Bruce), who is absent, will do that. He is no doubt making that case on the nation's television screens even as I speak.
  That does not include the further personal and company tax complications that emerged today. Under the present Government, the tax system in Britain is becoming an
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  unholy mess. In the era of self-assessment, that is madness. It is costly and complicated for businesses. It is becoming a boon only for tax accountants. We all know that the tax incentives of today, however superficially attractive in the short term, quickly become the tax avoidance loopholes of tomorrow.
  Secondly, on tax fairness, we do not object to the removal of mortgage interest tax relief. Indeed, I remember proposing it in our manifesto before the last election and in the 1992 election, and being roundly criticised by Labour for doing so. The proposal was considered outrageous. We are delighted that the Chancellor has adopted our policy. The previous Government began to phase out MIRAS, and the Chancellor has taken the logical end position. Amen to that.
  If ever there was a time to remove mortgage interest tax relief, it is now, with interest rates low. The right thing to do, it seemed to us, was to use the money generated to raise the level at which people start to pay tax. I agree with the Chancellor that tax allowances should be removed or restructured to pay for lower tax on the working poor and others on low incomes.
  The Secretary of State for Education and Employment, who questioned what I said earlier, might like to pay a little attention, rather than having a chat with the Chancellor. It is a manifest absurdity that someone on the minimum wage has to pay income tax. That is the current situation, and the Chancellor's proposals have done nothing to tackle it. That manifest absurdity remains.
  We disagree with the Chancellor's plan to create yet another tax rate—a 10p tax rate. The Secretary of State for Education and Employment might listen.
  The Secretary of State for Education and Employment (Mr. David Blunkett): I am listening.
  Mr. Ashdown: I beg the right hon. Gentleman's pardon.
  Why not increase the personal tax allowance—the 0 per cent. tax band—instead? Perhaps the Chancellor will listen for a moment to the experts in the matter, the Institute for Fiscal Studies. He has quoted them often in the past, and perhaps he accepts their view on this as well. They say that
  "a 10 per cent. tax rate is an expensive way of achieving little … it is likely to increase the complexity of the tax system"
  which
  "could be reformed for equivalent cost, yet with more progressive results … by an increase in personal allowances."
  Exactly.
  Let us admit that the 10p tax rate is a policy driven by headlines, not results. I said earlier that the Chancellor has been raiding our policy bank. Unhappily, he has raided our policy bank for a policy that we had but that we rejected because it made no sense. My hon. Friend the Member for Gordon, the Treasury spokesman, was the first person to propose it, but when we looked at it, we decided that it was nonsense. Increasing the allowances would have been far better, far more efficient, far fairer and a far more effective way of tackling poverty and encouraging jobs.
  We believe that the Chancellor should and could have taken a first step towards the long-term aim of raising tax allowances to £10,000, over two Parliaments. Perhaps we

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  should not object; that is a Liberal Democrat policy that he can raid in future years, when he finds that the 10p tax rate has failed. He should have paid for that measure by abolishing the 20p rate, as he did, and mortgage tax relief, as he did, and adding to that the introduction of a 50 per cent. tax rate for those earning more than £100,000 a year.
  There is no point in saying that such a measure would kill incentive in this country; it would do nothing of the sort, as any comparison with similar tax rates in enterprise economies abroad would show. That measure would have raised enough money to increase personal allowances this year to £5,600, taking 2.5 million of the lowest paid people in Britain out of income tax altogether, tackling poverty and improving work incentives. That would be a far more efficient way to use broadly the same amount of money.
  In respect of honesty on taxation, the Tories are a little unwise to lecture us on hidden taxes; I do not think that memories are that short. Let us be frank: neither the Government nor the Tories are telling us the whole truth on taxation and spending. The Government claim that spending on our public services is going up, but they say that taxes are not going up. The Tories imply that we are overspending and that taxes are soaring. Both are wrong.
  I have not had a chance to look at the detail of what the Chancellor has said, but figures from the House of Commons Library show that taxes will rise in this Parliament by about 2 per cent. of national income, rather more than the Government are prepared to admit to us. The Tories are wrong, because spending, as a percentage of national income, is not going up. It is going down. In the Tories' last year in power, public spending was 41 per cent. of national income. In every year of this Parliament, it will be significantly lower than that.
  The higher taxes that are being raised by the Government—2 per cent. over the period—will instead tackle the huge structural budget deficit built up under the debt-ridden Tory Government. That is the truth of the matter, but honesty and transparency in taxation is not only about being honest with the figures; it is also about being honest with the public.
  I should like to know, either now or later, what has happened to the tax contract which we heard that the Government would produce. It was a good idea—a Liberal Democrat idea, as it happens. We hand it over to the Government and are happy for them to apply it if they wish to. There was a great fanfare about introducing a tax contract. I say to the Chancellor that that should be objectively done—it should not be a vehicle for Government propaganda—but the measure does not even appear. It is gone; vanished. Why? Is not the Chancellor— [Interruption.] Is the Chancellor saying to me that he will introduce the measure next year perhaps? Yes, he is. I congratulate him.
  Mr Bob Russell: A millennium contract.
  Mr. Ashdown: A millennium tax contract. I am delighted; I will send the Chancellor our manifesto for the next election so that it is not applied beforehand.
  We should like an independent audit on taxation to be carried out, setting out how many new tax rates have been introduced or abolished, what measures have been taken to promote simplification and what extra administrative cost burden will arise for businesses as a result. That is being honest with the public about taxation.
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  The two other big issues that I want to deal with briefly are the environment and public spending. Today, some significant and welcome steps in the right direction have been taken on the environment. Lower car tax on small-engined cars is good—we have been proposing it for 10 years—but the Chancellor has not gone as far as he could have done. There is a perfect case for abolishing tax—vehicle excise duty—on cars of less than 1,600 cc altogether. There is no earthly reason why that should not be done, and I suspect that that will happen; that will be the Chancellor's destination in due course.
  I commend the Chancellor on his commitment to an industrial energy tax. That is undoubtedly good news for our environment, and we warmly welcome it. I do not want to sound churlish—the devil will be in the detail, as the old cliché has it—but at what level will the tax be set, and, crucially, is this a stand-alone policy or part of a serious strategy to fulfil the Government's commitment to cutting carbon dioxide emissions by 2010?
  Finally, let me ask about public spending. Of course we understand that no Budget statement from this Chancellor would be complete without the regular announcement of a little more money—or, more often, the regular recycling of money already committed—for education and health. Given that that has become so regular, one wonders why the amounts cannot be allocated in the first place, allowing time for planning, rather than being drip fed into the system.
  I am ready to be disabused if I am wrong, but is it not a fact that today's extra money for health, education and the police is not actually new, but has been taken from the capital modernisation fund that was announced last year? Is it not also a fact that the sums announced by the Chancellor are sums for not one but three years?
  I seem to recall that, when the capital modernisation fund was announced last year, the Government proudly told us that it would be
  "allocated to Departments on a competitive basis assessed in part by the merit and quality of Departmental Investment Strategies."
  All that sounds jolly reassuring, doesn't it? But the press tell us that, in fact, the extra money was agreed at midnight on Friday after what they euphemistically call an "eleventh-hour dispute"—for which we should read "late-night punch-up, involving Cabinet heavyweights and a personal intervention from the Prime Minister". I suppose that could be described as competition of a sort, but I had not expected "three falls and a submission".
  This, surely, is the important and serious point. We need to get away from short-term crisis management of the funding of our schools and hospitals, and into adequate long-term investment. Incidentally, I am afraid that the extra money for schools and hospitals, although welcome, is rather small beer. While I was listening to the Chancellor's statement, I turned to one of my colleagues and said, "My God! are they going to hold an election this year?" Of course, they are: they will hold elections on 6 May and 10 June. No doubt, Labour Members are smiling because they think that the Budget will help them in those elections. They should speak to the 29 out of 32 Scottish councils that have been forced to cut their education budgets for the past two years, and see whether they are equally pleased about an amount that will provide cold comfort after those two years of cuts.
  The Budget money will also be cold comfort for a national health service that can stem the rise in official waiting lists only by doubling the number of people who

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  are waiting to see a consultant. It will be cold comfort for police forces that have had to cut police numbers for the past two years. And I fear that, although it will be some comfort—quite a lot, in fact—to some pensioners, it will be cold comfort for the millions of poor and elderly pensioners over 80 who continue to receive a supplement of just 25p to their weekly pensions. That is less than the cost of a first-class stamp, but the amount has been set at that level for 30 years. Surely it is time to increase it.
  We believe that, even in a neutral Budget such as this, the Chancellor could have found the money needed to increase the pension top-up from 25p to £5 a week for pensioners over the age of 80, and to £3 a week for those over 75. Instead, he chose to focus on headline-grabbing gimmicks, which I do not think will be very effective in the long term, such as the 10p tax rate.
  This is a Budget that may be—indeed, is—strong on good intentions; but I fear that it is still weak on most of the policies that are necessary to deliver them.
  5.30 pm
  Mr. Derek Foster: We have just heard three very good speeches and probably parliamentary democracy at its best. I am sorry that the House now has to come down to reality. I could not possibly match the eloquence and command of detail of the previous three right hon. Members who spoke. I am just an old party hack, but I will do my best.
  The Chancellor's speech was the usual tour de force. When he sat down, I thought that the new Jerusalem had already arrived. When the Leader of the Opposition sat down, I thought that things were as bad as they were under the Tories, but the right hon. Gentleman did a remarkably fine job in what is the worst possible speaking engagement in the whole year; he also has the worst job in British politics.
  I know something about that because, for 10 years, I did the second worst job in British politics. On 18 occasions, I sat listening to my leader trying to make a speech in response to a Chancellor who had command of all the detail and the vast Treasury at his disposal, while he himself had limited facilities.
  The Leader of the Opposition is my neighbour. I have the strange experience of being sandwiched between the Prime Minister and the Leader of the Opposition. They are people for whom I have enormous respect and regard, particularly the Leader of the Opposition. He has the worst of the two jobs, of course: whatever he does and says will be dismissed because no one that thinks that he will win the next election.
  That happened to Neil Kinnock, now Commissioner Kinnock, during my many years of working with him. No one really believed that he was going to win the next general election until 1992, when we all believed that we might do extremely well. Of course, in the end, we did not.
  The Chancellor said so many good things in his speech that it is difficult not to make a speech entirely in praise of his policies and what he said, but I have no ambitions to be sycophantic; colleagues may have noticed that from time to time. That is not what being a Member of Parliament is all about. We are here to bring the
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  Government to account, to tell them where we think that they may be right and to mention those things about which we may be worried.
  I would have wanted the Chancellor to say that he recognised that deflation, rather than inflation, was the problem facing the economy. Indeed, the international economy faces deflation, not inflation. The Economist has woken up to that. Its leader column last week gave great coverage to an exposition of why deflation is now the problem, not inflation.
  My old friend Keynes was a great Liberal. I have ambitions for my Chancellor to be as radical as Lloyd George. He is coming along; he is doing pretty well. Once he has had a bit more experience and we have been able to kick him up the backside occasionally, he may attain that radicalism. If we can do that, perhaps he will adopt Keynesian policies.
  Those policies were always deeply respectable within the Labour party, although it was Lloyd George in 1929 who was the first to espouse them. In 1935, President Roosevelt espoused them and transformed the United States economy. In 1945, of course, the Labour party also espoused Keynesian policies, giving us full employment. Keynesianism was so successful that it informed the consensus until about 1970. In the 1970s, we had the two oil hikes, which most people believe blew Keynesian policies out of the water.
  If Keynes had a weakness, it was that he did not address the issue of inflation. For him, inflation was not a problem. During the 1920s and 1930s, deflation was the problem. Keynes had a brilliantly successful strategy for dealing with deflation, for which we all owe him a great debt of gratitude. In my book, he is far and away the greatest economist of the 20th century. Without him, we should not have had the Bretton Woods agreement, which ushered in a period of tremendous prosperity for the whole of the western world. That seems to have been forgotten by Labour politicians.
  The Deputy Prime Minister managed to use the word Keynes only at Christmas, when the Prime Minister was away. So courageous are we now in our political beliefs in the Labour party that we can whisper the word Keynes only when the Prime Minister is out of the country.
  Keynes gave us full employment. The reason why I came into politics was to get rid of unemployment and to get rid of poverty. Only when we get back to the type of policy advocated by Keynes will we make the maximum impact on those two problems.
  Why do I say that? In my region—the northern region—many of the Chancellor's policies are not working. We have the new deal—I am an enthusiastic supporter of all the new deals in all their aspects—but, without jobs, all that improved employability is dissipated all too quickly.
  In those parts of the country where jobs are plentiful— in the south-east—people who have finished the new deal programme go straight into work. That has been enormously beneficial to them, to their communities and to their economies. If we are able to get more people into work, we shall bear down on inflation, thereby allowing us to run the economy at a higher growth rate. However, in my region, in Scotland, in the north-west, in Wales, in Yorkshire, in Humberside and in parts of the west midlands, when new dealers finish the new deal, there are not sufficient jobs for them to go to. We have to employ

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  a twin strategy, as we do in the making work pay strategy, because making work pay works only if there are jobs to go to.
  Mr. Andrew Tyrie: Is the right hon. Gentleman aware that the areas that he has mentioned have much manufacturing, which—as he is probably aware—has been hit badly in the Budget? The carbon tax will be almost penal for some manufacturing that has a very high energy input. Levelling off employers' tax on national insurance contributions and benefits in kind, and company car tax increases, will also hit manufacturing.
  Mr. Foster: I thank the hon. Gentleman for his intervention, as I was about to deal with that point.
  I am sorry to say that the Treasury, the Bank of England and the City are part of the problem. For 40 if not 50 years—certainly for as long as I have been observing the problems of manufacturing industry, since studying them at Oxford in the 1950s—the problems of manufacturing industry have not changed. They have remained exactly the same: under-investment, poor research and development, poor training and development of staff and poor productivity—all of the problems that we are now trying to deal with—have been with us for the past 40 years or so. They have defied every Government's attempts to deal with them.
  Part of the problem is the Treasury, because the Treasury prefers a strong pound in order to bear down on inflation. Every Treasury Minister of whatever political complexion is advised by the Bank of England, the City and Treasury officials that we need a strong pound, but by God, a strong pound is just what manufacturing industry does not need.
  I know that my right hon. Friend the Chancellor has given his influence over interest rates to the Bank of England, but it was still open to him to say, "I want a continual reduction in interest rates until we converge with Europe and I want the pound to fall in value to enable our exporters to export far more effectively into Europe."
  Oddly enough, I have been a pro-European for 40 years, but I have always been cautious about the single currency. If we went into the single currency now, at least we would get rid of the problem of the high pound. We may encounter one or two other problems and we need to be honest about the political agenda which is Europe. We pretend that it is only an economic agenda, but of course it is a political agenda and one that I welcome. Frankly, I do not mind power migrating upwards to Europe and downwards to the regions.
  Mr. Andrew Lansley: Is not the right hon. Gentleman being far too sanguine? I appreciate that he may have the same concern, but does he agree that, if we were to enter the euro at our mid rate in the exchange rate mechanism, the equivalent of DM2.95, we would lock sterling into an uncompetitive and overvalued level?
  Mr. Foster: The hon. Gentleman is quite right. I was quite happy for us to join the ERM. Of course, the previous Prime Minister, when he was Chancellor of the Exchequer, chose the only time that he could persuade his Prime Minister to enter the ERM. We all knew that we
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  entered at the wrong rate at the wrong time and for the wrong reason. The value of the pound was too high. So the hon. Gentleman is quite right to say that we cannot enter now because the pound is far too high. We need it to be at something like DM1.50 or DM1.60—some would say even lower—in order to be competitive with Europe.
  Manufacturing industry does matter. We have to get that across to the Government because manufacturing employers do not believe that the Government take manufacturing industry seriously. It may be wrong, but that is their impression. When I talk to manufacturers in the north east—and there are some truly global players, including Glaxo-Wellcome, Black and Decker, Thorn Lighting and Nissan, which is the most successful motor manufacturer in Europe—they all say the same thing: the Government do not take manufacturing industry seriously. Whether or not there is truth behind that perception, it must change. We have to get the message across that we know that manufacturing industry matters.
  The previous Chancellor knew that. He understood manufacturing and cared about it. He made it clear that he wanted to create an environment that was favourable to it. He may not have succeeded to the extent that he or I would have wished, but at least he understood the problem. I want to make sure that the present Chancellor, for whom I have enormous regard and respect as a great intellect and someone with great drive—indeed, he is the intellectual driving force of the Government—and whom I greatly support, grasps the problems of manufacturing industry.
  My right hon. Friend has grasped the other part of the problem. He speech was outstanding on information and communication technology. That is the future, but we must bring together the two elements. The future of manufacturing industry lies in going up market, producing higher added value, upgrading its technology and getting into information and communication technology. If we can apply ICT to manufacturing industry across the spectrum, from global players to small and medium enterprises, we shall begin to solve the problem. Industry is too slow to embrace information and communication technology, as are the Government. We speak a lot of warm words, but we are way behind the Australians in adopting information and communication technology. In our better government policies to renew the public services, we are lagging far behind the United States and Australia.
  The Budget contains some superb measures, which I fully support. However, it will not go down very well in the north-east once people have realised the bad news. In my experience, all Budgets are waved to the echo on the day by supporters of the Government in the Chamber. They think that it is marvellous. The next day, it is not quite so good. By Friday, by God it is turning out to be a bit of a disaster, because everyone has worked out the effects on themselves.
  People do not judge Budgets by the public sector borrowing requirement—or whatever its equivalent is now—the rate of investment or even interest rates; they ask what a Budget will do to their job, their mortgage, their ability to put petrol in their car and their tobacco. Regardless of whether we like the fact, 15 million people smoke cigarettes. They will not be pleased tomorrow.
  My constituency has 600 square miles of rural territory. The people there will tear me to pieces when I go to see them at the weekend, saying, "Look what your Chancellor

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  is doing." I care about the working poor. The rich in rural areas can look after themselves, but the working poor cannot. We cannot make work pay for them if we price them out of their cars. They have no buses or trains. Their only way of getting to work is by car. If we make it impossible for them to use their cars, we shall be doing the opposite of what we intend. My right hon. Friend must appreciate that if he is to be effective in rural areas as well as in urban areas.
  Rural areas are neglected by the Government. That is understandable, because most of us are urban men and women. Only 160 Members of Parliament come from rural areas. The rural economy needs just as much of a boost as the urban economy, because farming is going through its greatest crisis for 25 years and tourism has done badly because of the overvalued pound. We need to come to the aid of the rural economy and make it more competitive.
  We need to boost tourism. The Scots and the Welsh get £5 per head to develop tourism. We get 8p per head in the northern region. If we had £5 per head in the north-east, we could create hundreds and thousands of jobs. I want my right hon. Friend the Chancellor to give us parity with the Scots and the Welsh. While he is at it, I should like him to revisit the Barnett formula.
  5.48 pm
  Sir Michael Spicer: We have heard a fascinating speech from the right hon. Member for Bishop Auckland (Mr. Foster). He was violently off-message—he would have been horrified in his previous job to hear one of his colleagues making such a speech—but the speech was very interesting.
  The right hon. Gentleman said that deflation, not inflation, was the problem. However, that flies in the face of a central aspect of Government policy. They have put it into statute—made it illegal to act against the policy— that 2.5 per cent. inflation is the core objective of the Monetary Policy Committee of the Bank of England. The Chancellor skated over the fact that they are not complying with that, because inflation is currently higher than the target rate. There are signs, such as the tight labour market, that inflation will rise. What happens if inflation rises and interest rates have to go up?
  What will happen in the context of the policy of shadowing the euro downwards, which the Liberal Democrats certainly are encouraging? There is potentially a massive conflict of interest between the measures advocated by the right hon. Member for Bishop Auckland and those advocated by the Liberal Democrats and, indeed, by Government spokesmen. I have just received an answer from the Economic Secretary, which says:
  "The Government's policy is for a stable and competitive sterling-euro exchange rate over the medium term".—[Official Report, 4 March 1999; Vol. 326, c. 858.]
  That is one of the Government's objectives. The right hon. Member for Bishop Auckland has pinpointed a colossal dilemma that the Government are refusing to address.
  As the right hon. Member for Bishop Auckland said, the speech after the Budget is possibly the most difficult speech in the world to make, but I thought that my right hon. Friend the Member for Richmond, Yorks
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  (Mr. Hague) did it brilliantly. One of his central points was that this Budget can be seen only in the context of the two previous Budgets.
  Two essential features were involved. First, the £40 billion of extra expenditure was based on a false forecast of economic growth. I was amazed when the Chancellor said that he was sticking to his 1 to 1.5 per cent. growth forecast for this year. The Bank of England's central forecast is now for about 0.5 per cent. growth, and the Bank's tendency has been to revise any new forecast downwards.
  Secondly, the £40 billion—which came out of previous Budgets—was based on assumptions about income going to the Exchequer which will not come about. Presumably—on the basis that they do not believe their own forecasts—the Government have anticipated that they will not be able to find the money. That is why, even before the Chancellor stood up this afternoon, £8.5 billion of extra taxes were built into the system for this year. We have learned from the latest calculations that the figure has now risen to £8.9 billion.
  The Budget is not neutral, as the right hon. Member for Yeovil (Mr. Ashdown) said. It is another tax-increasing Budget. We have a serial tax increaser in the person of the Chancellor of the Exchequer.
  To be fair, the great conundrum in domestic politics for any party in power is that the electorate face the Government, of whatever complexion, with two completely conflicting objectives. One is to lower taxation; the other is to raise expenditure on public services. That conflict of demand has built up as the population has aged and as demands have become more sophisticated. There is a constant demand for more expenditure—linked, paradoxically, with a demand for lower taxes and greater choice. Those shrill demands are made with equal force.
  The question is how the circle can be joined. It is not feasible to conceive of a left-wing, socialist Government—despite any spin that is put on it—ever being able to square the circle. Solving the problem involves the joining of private enterprise and resources with public services—whether we are talking about pensions, health, education or transport. It requires the marriage of private resources and enterprise with the provision of what have been termed public services.
  The previous Administration tackled some of the relatively easier areas—the provision of utility goods and services such as electricity. We are now entering the highly controversial areas of health, pensions and education. We cannot escape it—we will have to get to grips with it. The Conservative party was grossly misinterpreted at the last general election when we proposed linking private enterprise to the provision of pensions, but we made a start. Some might say that it was unwise to enter the fray at the beginning of a general election, as the other side exploited it. Now the Labour Government will have to get to grips with it. They will not, of course—but they will try.
  It can really only be the Conservative party that will tackle this matter. Left-wing parties—whatever the words or spin used—will never be able to grasp the concept of enterprise. Traditionally, as part of its constitution, the Labour party was wedded to the ownership of the means of production. With enormous fanfare, that was removed from

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  the constitution. However, the concept of ownership has been replaced—particularly under this Administration—by that of regulation.
  Increasingly, the Government are introducing the concept of regulation. That is starting with consumer protection, but it is leading, ultimately, to economic regulation until intervention by regulatory bodies nullifies any enterprise in the economy. Nowhere is this clearer than in the Financial Services Authority proposals which are now before Parliament. That matter is vital to the economy, and vital to the question of where we find the resources to meet the demands of public services—either directly through taxation or indirectly, as I believe, through private sector involvement.
  The Financial Services Authority proposals are so critical because financial services—directly and indirectly—now account for 25 per cent. of the entire gross national product. That is more than the entire manufacturing sector. Much has been said about manufacturing, but the financial services sector now contributes a greater proportion than the manufacturing sector to this country's well-being and economic growth.
  The Government will be setting before Parliament a system of regulation, the enormity of which few of us have yet fully appreciated. The regulatory body will have its own discretionary powers over what it does. It will be able to insist that new products are invented and promulgated. It will intervene in the marketplace.
  I welcomed some of the words from the Chancellor on monopolies, on making it difficult for new entrants and on cartels and secret price deals. That is good, and I think there should be greater competition legislation.
  That is all put to nought when we consider the context in which the Government are operating. We have a highly organised, interventionist and anti-competitive regime which starts in the City, but also affects the energy industry and pretty well all the major industries of this country. The Government are taking control of the command points of the economy. That must be anti-competitive and anti-enterprise in a way that makes nonsense of the use of the word "enterprise". The idea that the Government can match private enterprise to public services in the way that is clearly needed in the 21st century is also, therefore, nonsense. It will come as no surprise that, as the economy slows down, the Government will not be able to create enterprise and growth and will be forced to continue increasing taxation as a percentage of gross domestic product.
  In addition to the Government's insatiable demand for money from the taxpayer, further tax pressures are coming from the European Union. There are currently three potential demands for tax increases in this country that the Government have said that they will stand against. I want to put on record some comments that the Economic Secretary made in the Treasury Committee on those three potential sources of increased taxation. It is fashionable to say that Select Committees are more important than the Chamber, but what is said on the Floor of the House is enormously important, certainly as a consolidation of statements made upstairs.
  The Economic Secretary gave three assurances. On 26 January—the context was the art market, but the principle applies to VAT generally—she said:
  "there are no proposals for the harmonisation of corporation tax."
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  I asked:
  "Would that apply to indirect taxation as well?"
  She said:
  'There is a substantial legislative framework set out under European law for the VAT which allows Member States to make decisions for VAT in their own country but within a common framework."
  She went on to say:
  "The key issue for us in this country has been the safeguarding of the position on our zero rates. We will not change that … VAT matters within the European Community are subject to unanimity."
  That was the first assurance. The Government have in effect said that they will veto any attempt by the European Union to increase VAT. We shall keep an eye on exactly what happens.
  The second assurance was on the vital question of withholding tax in the City. I asked:
  "Just to be absolutely clear, you said that you would not accept a directive with respect to the withholding tax. Does that mean you would veto any tax regime which included a withholding tax?"
  The Economic Secretary replied:
  "We would not accept a directive that required Member States to introduce a withholding tax."
  I said:
  "That means you would veto any such regime."
  She said:
  "That is correct."
  The Government have given an absolute assurance on a veto on withholding tax, and I hope that there will be no messing around on that.
  The third tax issue concerns the abatement, won originally by Lady Thatcher. I asked:
  "Is it true that the Government plan to stand absolutely firm on the present level of abatement?"
  The Economic Secretary replied:
  "It certainly is."
  The Government have given a complete and unqualified assurance on all three pressures from the European Union. I hope that my right hon. and hon. Friends have noted that and that there will be absolutely no question of the Government being able to budge on those crucial points.
  The great future issue of tax and the European Union concerns the effect on tax of entry into the single currency. There can be no disputing the fact that, with a single currency, comes a single price system. The price system will be transparent; it will allow minor variations according to location and transport costs, perhaps, but it will be basically a single system. It will be largely generated by supply and demand conditions in the advanced, powerful economies.
  For the foreseeable future, the market will be imperfect in terms of labour movements. For example, Portuguese people will want to stay in Portugal—they speak Portuguese and have lived there all their lives—so Portuguese labour costs will remain about half those of Germany. In crude terms, the Portuguese will have to pay German prices while getting Portuguese wages, and there will be a lot of unhappy people in Portugal unless there is a massive transfer of funds from the northern to the southern part of Europe. Clearly, the cohesion funds and all the other funds that are beginning to emerge are aimed precisely at that.

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  There will be massive tax increases under the single currency, beside which the relatively marginal tax changes that we have been discussing today will pale into insignificance. That makes what has been happening in Germany over the past couple of weeks extraordinary and laughable. The Germans think that, in the near future, they can cut their taxes or cap their contributions to the European budget; that is quite apart from the fact that they have been told by the president of the central bank that, because of the stability pact, they may not alter their fiscal arrangements.
  If we enter the single currency, there will be no point in having a Budget debate, and this will be one of the last. There will be nothing much to debate because, under the terms of the stability pact and the new tax regimes associated with the single currency, we will have given all powers to determine our tax and monetary rates to a central bank. That will be the end of all Budgets.
  Mr. Lansley: On a point of order, Mr. Deputy Speaker. Have Ministers approached you seeking to make a statement to correct a figure in the Red Book that is clearly wrong? On page 26, the figure for current receipts at £335 billion is clearly at odds with the more accurate figure on page 151 of £345 billion. It is important for the House to have correct information on which to base our debates.
  Mr. Deputy Speaker (Mr. Michael Lord): That is not a point of order for the Chair, but no doubt Ministers will have heard the hon. Gentleman's point.
  6.8 pm
  Mr. Barry Jones: It is always a pleasure and a privilege to follow the hon. Member for West Worcestershire (Sir M. Spicer). I was glad to hear the speech of the right hon. Member for Yeovil (Mr. Ashdown). I was not glad that it was his last response to the Budget as leader of the Liberal Democrats. I think that I have heard every one of his Budget speeches.
  Like my right hon. Friend the Member for Bishop Auckland (Mr. Foster), I appreciated the way in which the Leader of the Opposition responded this afternoon. He made a good fist of it, as indeed he did of being Secretary of State for Wales. I did not agree with a word that he said—I will take out that insurance—but I was not surprised to see him come to the Dispatch Box in that manner. Such performances bring the House alive.
  I very much appreciated the contribution of my right hon. Friend the Chancellor. As far as I could assess it, it was a Budget for social justice and an agenda for economic regeneration. As ever, it was delivered with an easy command; sometimes humorously, sometimes teasingly, sometimes mockingly. It was produced well, and I thought it very heartening. I especially appreciated the measures that my right hon. Friend announced for our pensioners, which will be warmly welcomed in every constituency. I was much taken also by the imaginative announcement that every school will get a large subvention to be spent on books, which are a measure of our civilisation. That proposal is not before time and our children can only benefit from it. I was glad that my right hon. Friend found the time, in a complicated Budget, to make a statement of such significance for our children.
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  The Budget will be a boost for Wales. I estimate that Wales will receive some £1 billion, and that is magnificent news from which Wales will benefit hugely. That £1 billion will be spent on schools and hospitals, and on help for our people in Wales to get back into work. It will also be used to cut taxes to widen opportunities for families. Some 500,000 Welsh pensioners will benefit and they will see a real difference this winter in their incomes, with the winter allowance being increased to £100, from £20 and £50 for those on income support. I also calculate that pensioners will benefit from the new guarantee on tax.
  The Budget was a clever one and will be successful. The country needed it, but I agree with my right hon. Friend the Chancellor that we must close the productivity gap with our competitors. We must steer a stable course for lasting prosperity, and we need high and stable levels of growth and employment.
  Like my right hon. Friend the Member for Bishop Auckland, my theme will be manufacturing. I am not as critical as he is, because I heard much in the Budget on the subject of manufacturing that encourages me. I will take any help that the Government give to manufacturing.
  In my constituency, manufacturing remains a top priority, as it is for Wales and the whole of Britain. I want more manufacturing, and so does my constituency. I want to see small and medium enterprises, not just large factories, benefiting from Government measures. In Wales, we still overwhelmingly depend on small businesses. I welcome the new measures. Do they mean that we will invest more in capital plant and research? I believe that the answer is yes, but I have not read the small print.
  The Government should act to enhance the standing of careers in manufacturing. We should have more measures aimed at making it a priority for our school leavers and graduates to enter manufacturing. Manufacturing as a career should have status and reward. I am far from sure that it has had that image in this century so far. As part of that process, more policy makers should have manufacturing experiences, and I draw a parallel with the Industry and Parliament Trust. Officials in our civil service and other policy makers need more experience in our manufacturing industries.
  I wish to single out the steel industry. We need short-term measures to deal with the dumped and subsidised steel that is now flooding into the European Union and this country as a result of the collapse of the Asian economies. The consequence of the Asian crisis is now being visited on the European and British steel industries. Specifically, we need a cap on the electricity pool price and recognition that the steel industry is an intensive energy user. The industry faces sometimes ruinous costs for energy. We also need a negotiated agreement on the environmental consequences of steel making. Such an agreement needs teeth, but it should be negotiated because, without it, further costs could be imposed on what is still a great industry.
  Steel in Britain is a success story. Shotton steelworks is in my constituency and I have observed its steelworkers meet every challenge set by the company. Like the British steel industry, Shotton steelworks is a thundering success. Output per employee has risen fivefold in the past 20 years. I thank the industry and my constituents, the steelworkers at Shotton, for that. The steelworks has

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  achieved a 10 per cent. per annum increase and the industry now exports 50 per cent. of United Kingdom production. Two out of every three tonnes go to the European Union and Germany is our biggest customer. One problem is still the strength of the pound; because of the burden that the strength of the pound places on our steel exports, I ask the Government to introduce urgent measures to assist the industry.
  No hon. Member would deny that the aerospace industry boosts our export earnings. There are 3,700 British Aerospace workers on Deeside. They have called for more support for research and technology development in the industry. I must give credit to my right hon. Friend the Chancellor, because he mentioned research, technology and investment in that sphere, but we need to know how much and how soon. Will the amount meet the demands already expressed by the industry?
  Investment launch aid is how huge projects in the industry become successful. It is Government assistance, but British Aerospace repays it over the years from its profits. So far, investment launch aid has been a winner and British Aerospace is paying back handsomely for the investment aid that it has had in years gone by. British Aerospace and Airbus Industrie in Europe have a colossal and mighty competitor in Boeing. At one time, Boeing swept everything before it. British Aerospace and Airbus have fought back and, arguably, they now have parity with Boeing. However, if they are to continue to deliver exports of high value, the industry will need more investment launch aid.
  Mr. David Maclean: I have listened carefully to the hon. Gentleman's comments about the pressures on British manufacturing industry, especially aerospace, compared with Boeing. Is he worried that, while Boeing is able to thrive in the USA in a highly deregulated economy, we are imposing more regulatory burdens on all our industries—including aerospace—making them less competitive?
  Mr. Jones: I am not complacent, but I do not share the right hon. Gentleman's worry. If ever a brutal blow were delivered to British manufacturing, it fell between 1979 and 1982 when at least 2 million manufacturing jobs were lost because of the deliberate policies of the then Mrs. Thatcher, Sir Geoffrey Howe and Sir Keith Joseph. Those three highly placed Ministers dealt a brutal blow to the future of British manufacturing, and that is one of the reasons behind what I am saying today.
  I have only £535 million in mind as investment launch aid—perhaps before the end of the year—for the latest airbus project, the ACXX. That would be the largest civil airliner ever built and marketed, and it would take on the Boeing empire. I request those funds on behalf of my constituents.
  There is a proposal that Britain should purchase 40 to 50 heavy-lift aircraft, previously known as the future large aircraft project. I hope that the Government will make a decision on that soon, and I propose that British Aerospace and the airbus consortium should be asked to build the aircraft. My constituents would willingly, happily and skilfully make the wings for that aircraft, as well as wings for the ACXX.
  Our aerospace manufacturing industry is the most efficient in Europe. In 1997, it generated more than £15 billion-worth of sales, and it directly employed
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  121,000 people. The industry consistently makes a major contribution to our balance of payments. In 1997, it contributed £3.1 billion to the trade balance. Maintaining the competitive position of that great industrial sector is important to our country. It creates wealth, and it generates a large number of high-quality jobs.
  In 1997, the civil aircraft sector in Britain provided 46 per cent. of our country's aerospace sales. We should be proud of that record. The leading company in the civil airframe sector is British Aerospace, along with its subsidiary, British Aerospace Airbus Ltd. which manages the company's 20 per cent. shareholding in Airbus Industrie. At the end of October 1998, Airbus Industrie had secured total orders for 3,140 civil aircraft. I was delighted that my right hon. Friend the Secretary of State for Trade and Industry was able to celebrate with my constituents and me on Deeside the delivery last month of the 2,000th wing set from the Broughton factory.
  Current airbus programmes provide direct employment for more than 21,000 people who work in British Aerospace factories or for major equipment and raw material suppliers and for the smaller companies that supply goods and services. The wealth created by airbus work is estimated to sustain a further 41,000 jobs in Great Britain. That makes a total of 62,000 jobs sustained by the programmes, in my constituency, in Wales, in Scotland and in England. That sector of manufacturing industry is making a massive contribution to the fortunes of Britain and the European Union.
  I interpreted positively what I heard from my right hon. Friend the Chancellor about research and manufacturing. However, I would like the Ministers to confirm that my interpretation is correct. This great industry generates not only work, but skills. It trains in the local community, and it supports the education action zones. It contributes to, and sustains, the new deal. British Aerospace is an industry of which my constituency is proud.
  The Treasury and the Ministry of Defence work together closely on huge projects. I have met Ministers at the Department of Trade and Industry, the Welsh Office and the MOD to talk about the latter's £750 million airborne stand-off radar project, for which a competition is being run. My plea to the Government is that they should resolve to give the project to Raytheon, which is in my constituency. Several hundred highly skilled workers there know that 400 or more jobs would be created over several years, and Britain would also experience a transfer of technology.
  An important review relating to British manufacturing is the current review of the assisted area map. It is vital that our constituencies continue to receive the benefit of assisted area status. Deeside suffered Europe's largest ever redundancy in 1980, when 8,000 job losses were announced in one day. It was estimated that at least 10,000 consequential jobs were also lost. We got over that terrible blow to a fair degree because we were given assisted area status, from which infrastructural developments resulted.
  I do not want my constituency to lose assisted area status. I have said so to the DTI, the Welsh Office and the Treasury. Ministers have given me a fair hearing, for which I am grateful, when I have approached them on my constituents' behalf. Flintshire county council has put forward a fine case, which I support to the hilt. We have

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  lost a lot of jobs in the past year, although we have gained jobs, too. All the evidence suggests that the loss of assisted area status would deal us a severe blow.
  My right hon. Friend the Chancellor rightly made much of the new money that he announced for schools and hospital trusts. I thank him for that, but I have a question for him: can he be sure that the money for schools and hospital trusts will be spent wisely, prudently and against the headings earmarked for it? I am not sure.
  The money is urgently needed, and I suggest that the Treasury should set up an audit so that every local education authority and hospital trust has to show where the new money is spent. They would have to show that it was used for the purposes identified by the Chancellor. I am not saying that Flintshire's LEA does anything other than spend wisely. However, in general, I suspect that Ministers' generosity is sometimes misplaced at the grassroots level.
  In summary, we are on course to rebuild public services with considerable additional investment in our hospitals and schools. I have heard enough from my right hon. Friend the Chancellor today to know that he is sticking to the principles of our movement, and I note that the official Opposition are shifting to the right and that the Conservative party is now governed by opportunism, as we have certainly seen of late. Even today, we saw some opportunism from the official Opposition; it might have been delivered in a fighting spirit, but at times there was weasel-worded dexterity.
  I am proud of the measures introduced by our Government; I welcome the windfall tax, the minimum wage, the working families tax credit, the social chapter, the measures to help our pensioners, such as the increased help for heating costs announced today, and the huge subventions to our health service and to our schools. I congratulate my right hon. Friend the Chancellor.
  6.31 pm
  Mr. Charles Wardle: It is always instructive to listen to the hon. Member for Alyn and Deeside (Mr. Jones) when he talks about manufacturing. I recall some useful discussions with him at the Department of Trade and Industry during the previous Parliament. I mean no disrespect to him or to the right hon. Member for Bishop Auckland (Mr. Foster) when I point out that the Government Back Benches appear to be peopled this evening with an interesting blend of old lags and some bright graduates of the Public Accounts Committee.
  Without fear of being teased, because I am one of those Back Benchers who has not so much as raised an eyebrow at the mention of Opposition Front-Bench preferment during this Parliament, I can safely say that, in the almost 16 years that you, Mr. Deputy Speaker, and I have been Members of this House, I have never witnessed such a virtuoso performance as that given by my right hon. Friend the Leader of the Opposition this afternoon.
  What makes today's Budget so predictable is the fact that so much of what the Chancellor said in the House this afternoon had already been leaked in detail to the media by Treasury Ministers and press officers. The idea that only a couple of generations ago a Labour Chancellor of the Exchequer had to resign for dropping the merest
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  indiscreet hint about the Budget to the press must seem risible to the current Chancellor. Not even the sidelining of Charlie Whelan has deterred him; he has continued to foster his symbiotic relationship with the media, whereby he trails his policies well before they are heard in this place; and grateful editors, for their part, portray the Chancellor as a model of prudence and fiscal rectitude.
  That image is not borne out by the reality of the Chancellor's first three Budgets. It is not upheld by the Treasury's own forecast of a rising trend in the tax take as a proportion of GDP during this Parliament, as even the Prime Minister had to admit last week. Nor is it confirmed by the sharp fall-off in actual and projected economic growth, especially in the manufacturing sector. Although the Chancellor continues to hope—all too optimistically, I fear—for 1 to 1.5 per cent. growth, I am sure that the Bank of England's estimate of 0.5 per cent. is the top end of the realistic target.
  The Chancellor's image is not well reflected in his hollow rhetoric on the international stage about sweeping changes in global financial architecture. The Budget was an interventionist Budget, full of meddling and the promise of future red tape. It paid no heed to the lesson that could have been learned from the United States. The Budget did not emulate, in any sense, what the Americans have done; it was more like the Swedish performance of the 1970s. If the Chancellor really understood business and enterprise and how 18 million jobs had been created—all in the private sector—over the past eight years in the United States, he would have presented a very different Budget.
  One has only to look at the damage being done to order books in the new generation of small and medium enterprises—particularly in manufacturing companies. Until recently, such companies had proved to be extremely competitive, but they now face extra burdens from the social chapter, the minimum wage and the Employment Relations Bill. Those companies do not need an econometric model to tell them that they are already in recession; they have only to look at their order books and the shipments from the factory gate to understand exactly what the pain is.
  Cheap imports and the domestic downturn in this country add to the problems that those companies already face overseas in weak export markets, as not only the economies of the Pacific basin and Latin America, but those of much of Europe, including Germany, slow down. None of the Chancellor's measures today will alter the fundamentals of that dismal reality. With savings down by a third and investment falling, the Chancellor's record of introducing huge increases in indirect taxation by stealth and his attempts to redistribute wealth will come back and bite him if the motivation for enterprise and wealth creation is diminished by new Labour's interventionism.
  Many of the measures headlined by the Chancellor this afternoon had a familiar ring. The promise of more debt repayment and the undertaking not to borrow, except for capital investment, have been heard before, as has the talk of fiscal caution and controls on spending, and the hope of further interest rate cuts on the horizon and a soft landing later this year. However, the real test for all those virtuous aspirations will come sooner rather than later if there is another severe jolt in world markets, which could propel this country, and others, into a sharp downswing. That jolt could be triggered if, after eight years

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  of expansion, the United States economy were to cool rapidly, followed by a sharp downward correction on Wall street.
  The United States already has a huge trade deficit, which has cushioned the weaknesses in America's trading partners and has acted as a safety valve for demand in the USA. It could also put pressure on the US dollar and push up prices in the USA. There are other warning signs for the US economy that we should not ignore—for example, the shortage of skilled labour. If the psychology of the US market falters for any reason, the prospect of a soft landing here in the UK will vanish. Similarly, the slowdown in Germany—this country's most important export market in euroland—could hinder our economy. It would also put the euro under more pressure in the markets. I must say that the euro already looks less than wholly convincing as a single currency for 11 far-from-convergent national economies; it is not playing its part, even in its infancy.
  Elsewhere, the sharp rise in the People's Republic of China's current account deficit could still lead to a devaluation in that country, despite China's substantial foreign currency reserves. That would reverberate through world markets. Meanwhile, those who look to an early recovery in Japan—still the engine room of Asian economic performance—fail to understand the depth and complexity of the mess into which Japanese business has got itself. Significant risks remain elsewhere, all of which could seriously dent the Chancellor's calculations. Britain depends on export markets much more than the United States or Japan do, so another seismic shock in world markets would mean a hard landing here, a rise in unemployment and even higher social security outlays, which would cause the Chancellor to reassess the outlook that he claimed for the British economy in his speech this afternoon.
  The commitment to further tax reform and the announcement of the much-heralded, but hardly dramatic, 10p tax rate have long been on the cards and are unlikely to make a big impact. The same can be said of the micro-measures for business, such as the increase in capital allowances, tax allowances for research and development and for venture capital schemes, and the changes in employers' and employees' national insurance contributions.
  The Chancellor said that he will cut taxes for the family, and he has raised child benefit and added to the working families tax credit. However, he has also abolished the married couple's allowance; he is going to scrap mortgage interest tax relief at source; and he has raised petrol tax, company car tax and insurance tax. The list is long and damaging.
  In respect of the brewing industry, the announcement of yet another Customs and Excise drive to tackle smuggling from the continent is welcome. However, the move treats only the symptoms, not the cause of the problem. The cause undoubtedly lies with United Kingdom beer duty, which is seven times higher than its equivalent rate in France. No change today in the price of a pint of beer is helpful—and, I might add, personally welcome—but ultimately, if the damage to the livelihood of small pubs is to be halted and if smuggling is to become a pointless activity, the Chancellor will have to lower beer duty rates.
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  There are two areas where the structural damage already caused by the Chancellor through the stealth taxes announced in his previous two Budgets has not been relieved by his announcements today. The first area is stealth taxes on business and the second area is stealth taxes on pensioners. Like the Prime Minister, the Chancellor wants to be seen to be business friendly. However, he has been nothing of the sort.
  The Confederation of Business Industry has calculated that, while the headline rates of corporation tax have fallen—they did so again today—the Government have increased taxes on businesses and shareholders by about £25 billion over the course of a full Parliament. That is a net £5 billion a year in extra business tax: no wonder business leaders say that the business horizon has darkened since Labour came to power.
  The move to a new quarterly payment system for corporation tax will hit company cash flows and will bring in an extra £1.6 billion in tax in the year ahead. The abolition of dividend tax credits, which was little understood by the public at large, will raise a further £5 billion each year. Increased road fuel duties will probably remove 26,000 jobs from the haulage industry alone. Increases already made in stamp duty will harm the commercial property market and hit business competitiveness. The arbitrary windfall tax on privatised utilities has taken another £5.2 billion from the business sector.
  For pensioners, the news is even more bleak under new Labour—in spite of the Chancellor's promises this afternoon. Elderly people with modest savings have already been hit by the drop in interest rates, which may be welcome to mortgage borrowers but which hurts retired people with a small building society deposit. Increased tobacco and petrol duties, stamp duty and the phasing-out of retirement relief on capital gains tax, as well as the uncertainty that the Government have created over occupational pensions, will damage the quality of life of pensioners who fought wars, raised families, lived active and responsible lives and deserve better from the Government.
  Three of the most damaging of the stealth taxes in this area are the withdrawal of dividend tax credits for individual non-taxpayers, the abolition of tax relief on private medical insurance, and the abolition of dividend tax credits for pension funds. The Chancellor told the House this afternoon that pensioners will be better off by £240 per annum per household. However, some 300,000 non-taxpaying pensioners will lose an average of £75 a year and another 80,000 will lose more than £100 a year as a result of the stop that has been put on dividend tax credits for individual non-tax payers.
  The decision to abolish tax relief on private health care insurance earlier in the Parliament was as vindictive as it was shortsighted. It has already rebounded on national health service waiting lists. The abolition of tax credits for pension funds—equivalent to about 3p on the basic rate of income tax—will mean that people must contribute more to their pension schemes now or face the prospect of lower pensions on retirement. When local authority pension funds make their actuarial adjustments, council taxes will rise for that as well as other reasons.
  In conclusion, this Budget is unremarkable because it has already been so widely leaked. I fear that the Chancellor has over-simplified the outlook for the United

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  Kingdom economy at a time when adverse developments elsewhere in the world could easily undermine stability everywhere, including in this country. If some of the Chancellor's measures are welcome, they amount to little when compared with the structural damage that he has already done by stealth with swingeing increases in the overall tax burden.
  6.45 pm
  Mr. Alan W. Williams: I am grateful for the opportunity to participate in the first night's debate on the Budget. I agreed with part of the analysis by the hon. Member for Bexhill and Battle (Mr. Wardle) of international problems— particularly the large United States deficit and the dangers that could arise if the United States economy experiences any difficulties. The hon. Gentleman also pointed to problems in the Asian economies and the rather surprising decline in the euro. I shall return to some of those points later. I also echo some of the hon. Gentleman's concerns about manufacturing industry—although we will not take any lessons from the Conservatives about manufacturing. Some 2 million manufacturing jobs were lost in the early 1980s and another 1 million jobs were lost in the early 1990s in two recessions that were totally self-induced.
  I listened intently to the speeches of my hon. Friend the Member for Alyn and Deeside (Mr. Jones) and of my right hon. Friend the Member for Bishop Auckland (Mr. Foster) in which they expressed concern about manufacturing industry and the rather anomalous continuing great strength of the pound. That is a problem that lower interest rates— which will result from this Budget—will help to solve.
  I welcome the announcements made this afternoon, the Chancellor's overall strategy and many individual measures. The Budget redistributes wealth to families, particularly children. The abolition of mortgage tax relief was long overdue. I do not quite understand the changes to the married couples allowance, but they are designed to shift support to children. The rise in child benefit— which is even larger than had been forecast—will be an enormous help to poor families.
  The working families tax credit, the philosophy of making work pay and the particular help to the low paid through the 10p tax rate are also welcome. I have some sympathy with the right hon. Member for Yeovil (Mr. Ashdown), who said that it might be more effective to raise tax thresholds than to introduce the 10p rate. However, this is a long-term policy and we hope that the band will expand. I endorse enthusiastically the general redistribution in favour of poorer families, especially families with children.
  The Budget contains measures that will help the environment. Hon. Members have been lobbied heavily by the road haulage industry. Like my right hon. Friend the Member for Bishop Auckland, I represent a rural constituency where petrol duty causes problems. However, we are confronting a global problem. Carbon dioxide emissions must be curtailed, and the transport
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  sector is responsible for the greatest increase in such emissions. We are simply continuing the policies of the previous Government on fuel duty.
  Mr. Maclean rose—
  Mr. Williams: I will not give way on this point, as there is cross-party agreement about this matter. We inherited that policy from the Conservatives and, unfortunately, the overall philosophy must be right: it is a green tax.
  As for vehicle excise duties, the £55 discount for smaller cars must be correct. I have thought about that for a long time.
  Mr. Owen Paterson rose—
  Mr. Williams: No, I will not give way on this point. I may do so later in my speech.
  Carbon dioxide emissions are an incredibly difficult problem politically, but we must address that issue in the long-term interests of the planet. This is the right time to introduce an energy tax because world oil prices—at $10 or $11 a barrel—are lower now than they have been in the past 30 years. I am pleased that the measure will be revenue neutral, in that the proceeds of the tax will be reimbursed in lower national insurance contributions for employers.
  I wish that the landfill tax had gone up a little more steeply than by £1 on the current £10 a tonne. I visited a landfill site in my constituency two or three weeks ago. It is very concerned about the new EC directive on recycling and the diminishing role of landfill in the next 20 years. The process must be aided by green taxes, so we need a bigger rise in the landfill tax.
  I very much welcome the help to small companies, including the tax credits for research and development and innovation. The Chancellor also suggested that, if senior personnel from privatised industries or large companies opt to work for new companies, generous allowances will be available, and that will help to transfer their commercial experience to that sector. There are many such individual measures that I welcome.
  On the overall management of the economy, under the Chancellor's stewardship, the Government have reduced the £28 billion deficit that we inherited and transformed it into a surplus of £34 billion over the next five years. That means that economic growth will pause this year. We inherited a growth rate of about 3 per cent. and an incipient inflation problem. Interest rates have cut back growth to between 1 and 1.5 per cent., but the Chancellor predicts that the growth rate will recover in the next two years to between 2.5 and 3 per cent.
  Mr. Lansley: Does the hon. Gentleman recall that, in the last Budget before the general election, the Conservative Government predicted a negative public sector borrowing requirement—a debt repayment—in 2000–01 equivalent to 0.75 per cent. of GDP, which would amount to several billion pounds? This Government are not proposing, even in the low part of the economic cycle, to undertake a debt repayment.
  Mr. Williams: I recall that, under the previous Government, the PSBR was ballooning out of control year

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  after year. We inherited a deficit of £28 billion, and during the five years of the previous Government the accumulated deficit was £152 billion. Our accumulated surplus in our five years in government is projected to be £34 billion. Deficit has been turned into massive surplus.
  Mr. Maclean: Since the Chancellor made a strong point of boasting during his Budget speech that he had not changed the previous Government's spending plans in any way, can he and the hon. Gentleman take credit for the reduction in the PSBR?
  Mr. Williams: For the first two years in government we stayed with the public expenditure plans that we inherited and, in fact, we obeyed plans even tighter than those laid down by the previous Government. We have got rid of the deficit through those tight constraints on public expenditure and through economic growth, and we are now in surplus.
  Today's Budget demonstrated that overall public finances are healthy. The Budget is broadly neutral; it is not a giveaway Budget. About £4 billion is given away in tax cuts and there is an extra £2 billion in public expenditure. We can well afford those investments.
  By running the economy so prudently, we have created a climate that gives the Bank of England scope for interest rate cuts. In the past six months, interest rates have come down from 7.5 to 5.5 per cent. As the Chancellor pointed out, we have the lowest long-term interest rates for more than 30 years. They have fallen from 7 per cent. in May 1997 to 4.7 per cent. now—2 per cent. lower in only two years. There is every reason to expect interest rates to continue to fall this year.
  Indeed, part of our macro-economic strategy is to bring the British economy into line with European economies to make it possible to join the euro in 2001, 2002 or thereabouts. The challenge to the Chancellor is to create an economic climate in which the independent Bank of England can continue gradually to lower interest rates from 5.5 per cent. to below 3 per cent. by 2001. We are on course.
  As those interest rates fall—as they must if we are to be able to join the euro—the pound will, at some stage, start falling. I am an enthusiast for joining the euro, but I would not want Britain to do so at current exchange rates. As we heard in earlier exchanges, DM2.90 to the pound is uncompetitive. I believe that the pound needs to go down to DM2.70, better still DM2.60, and perhaps as low as DM2.50. As interest rates continue to fall over the next three years, the pound will devalue at some stage.
  Mr. Paterson: Will the hon. Gentleman give way?
  Mr. Williams: As the hon. Gentleman tried to intervene earlier, I will.
  Mr. Paterson: Has the hon. Gentleman read articles 118 and 123(4) of the treaty of Amsterdam, which require us to enter the euro at the central rate on the ecu basket, and which state that we can enter only with the total unanimity of all other members, which would mean that we would almost certainly enter at our median ERM rate of DM2.95?
  Mr. Williams: I do not accept the hon. Gentleman's interpretation. There is no question of our entering at
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  anything like that rate. We shall wait and see what happens in the next two or three years. We have very prudent management of the public finances, the Government's account is in surplus and we are managing the incredibly difficult manoeuvre of the soft landing.
  Over the next two or three years, we want to achieve, through careful economic management, a return to steady growth at a rate of 2 or 3 per cent. We have had enough, and the country has had more than enough, of the previous Government's boom and bust policies. Next year and the following year, as interest rates fall and the pound falls in value, the problem for the Chancellor will be to prevent a boom. The great problem in the British economy is that when one takes one's eye off the ball, demand suddenly rises and can produce boom conditions. Interest rates are at 5.5 per cent. The target is 3 per cent. and below because European interest rates may well fall this year; I hope that they will. We therefore want to halve interest rates.
  Mr. Damian Green: Will the hon. Gentleman give way?
  Mr. Williams: I may take an intervention later, but I want to develop my argument.
  As interest rates fall and are, perhaps, halved over the next three years, there is a danger of a take-off in housing, business and other sectors and of the economy growing out of control. That is why it is important to expand the work force and encourage skills and training. Our policies, like those of Clinton in the United States, will help unemployed people, including the long-term unemployed, to move from welfare into work. The new deal is also working exceptionally well to provide the option of work for the disabled. Today's Budget also included measures for the over-50s.
  One of the previous Government's appalling policies resulted in many men in their 50s retiring prematurely on incapacity benefit following redundancy. That certainly happened in my part of the world, where coal mine closures in the late 1980s affected virtually all the miners. Many people in their 50s—perhaps 1 million in Britain— could be working. There are problems of low economic activity in older industrialised areas, where only 70 per cent. of people aged from 18 to 65 are in work. We want as a Government to ensure that there is work available for those who can and want to work. That is part of our anti-inflation strategy, which will be very important next year and the following year, as the economy resumes substantial expansion.
  All of our achievement has been made with low inflation, which has been sustained at 2.5 per cent., or thereabouts. In granting the Bank of England independence to set interest rates, the Chancellor and the Government chose very wisely to give it a symmetrical target inflation rate of 2.5 per cent. If inflation looked like being higher than 2.5 per cent. in two years' time, interest rates would therefore rise, and if it looked like being less than 2.5 per cent., interest rates would fall. It seems as if, over the next six or 12 months, inflation will undershoot the target. Eddie George—I noticed that he was present to hear the statement—has made it abundantly clear that he will be just as vigorous in cutting interest rates if we threaten to undershoot as he was in putting them up 12 months ago.
  I wish that the European central bank had the same symmetrical target. In the euro economy at the moment, inflation is under 1 per cent., and interest rates are set at

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  3 per cent. When the ECB met last week, it decided not to cut interest rates. The European economy—I return here to some of the comments of the hon. Member for Bexhill and Battle—is crying out for expansion. Unemployment stands at 10 per cent., while inflation is below 1 per cent. The combined balance of payments surplus in euro countries last year was $177 billion. As the hon. Gentleman pointed out—I agree with him—the United States deficit last year was $256 billion. The economies are almost mirror images of each other. The American economy is being run at a large deficit so that the rest of the world can market its products mainly in America.
  The European surplus is a very deflationary influence on other countries. The German Chancellor, Oskar Lafontaine, is absolutely right to put pressure on the ECB to lower interest rates. Interest rates of 3 per cent. are absurd when inflation is below 1 per cent. and unemployment at 10 per cent. The ECB should not take just inflation into account.
  In debates on the Maastricht treaty in this House and within the parliamentary Labour party, I remember Bryan Gould, the then Member for Dagenham, arguing vigorously, time after time, that the terms of the ECB were deficient. I remember the arguments of some of the Euro-sceptics, too, such as my right hon. Friend the Member for Llanelli (Mr. Davies) and Lord Shore, the former right hon. Member for Bethnal Green and Stepney. The treaty that set up the ECB was far too monetarist in taking account only of inflation. The bank would be much better run if it adopted the same system as the US Federal Reserve, under Alan Greenspan, which takes into account growth and unemployment—a much wider set of parameters.
  This Budget has been excellent for the country. It has redistributed in favour of families and children. It is very positive for the environment, small businesses and innovation. It is fiscally prudent, and—I think—has been calculated to cut interest rates. Those cuts in interest rates will follow during this year.
  7.5 pm
  Mr. David Maclean: It is a pleasure to follow the hon. Member for East Carmarthen and Dinefwr (Mr. Williams). As I was listening to his wish list, and his incredible economic theories of how the economy would perform if the rest of the world and the European economy did not exist, I unkindly concluded that the only soft landing that he was likely to encounter would be on his head. That is too unkind; he did not make any unkind remarks, and I should desist from doing so.
  I agree entirely with the hon. Gentleman on one point. His Government are certainly trying to model the British economy on other European economies. That means over-burdensome regulation, powerful trade unions that control too much of their industries, stagnation, high unemployment and, of course, an arrogant presidential style of government that ignores the national Parliament.
  It was a real pleasure to listen to the right hon. Member for Bishop Auckland (Mr. Foster) and the hon. Member for Alyn and Deeside (Mr. Jones). The only criticism that I would make of the right hon. Gentleman's speech—I shall pass this on to him—is that, with customary
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  modesty, he denied that he could interest the House as much as the Chancellor. He does himself a disservice. He made a fascinating speech. Although neither he nor I could match the Chancellor's rhetoric, the right hon. Gentleman came across as a man of intense integrity, who is passionately concerned with rural areas in his part of the north of England, as I am with those on the western side of the Pennines.
  This is a clever Budget, which has increased taxes by stealth yet again. Labour's first two Budgets increased taxes by more than £40 billion over the course of this Parliament. It is legitimate to use that figure because we keep hearing about the £19 billion on schools, which is of course for the whole of this Parliament, and the £22 billion that is supposed to go into the health service, which is of course to be spent over the whole of this Parliament. It is therefore legitimate to say that, over the whole of this Parliament, Labour—so far—has increased taxes by £40 billion. In fact, most taxpayers will be paying more income tax under this Government in the coming year.
  Why do we say that this is a stealth Budget? I shall give a little example of the Chancellor's sneakiness. We heard about the abolition of the married couples allowance and the introduction of the working families tax credit. Two things that the Chancellor did not tell us were that the amount to be paid out in working families tax credit is infinitely less than that lost through the abolition of the married couples allowance, and, of even greater importance—one does not discover this until one goes through all the fine details, the small print and all the Budget statements, which the media will no doubt catch up with in the next few days—the married couples allowance will be abolished 12 months before the introduction of the working families tax credit. The Chancellor spins that the Government will do much for married couples, but that may happen 12 months after the abolition of the married couples allowance.
  We heard much from the Chancellor on, for example, the 10p tax band, but no mention, as my right hon. Friend the Member for Richmond, Yorks (Mr. Hague) said in an absolutely brilliant speech, of the abolition of the 20p band. We have to wait to find those things out, by searching for them. However, the Chancellor then said that that would mean a saving of 90p a week for the average family. Earlier in his Budget statement, he made the passing remark that petrol duty would rise by the normal rate of 6 per cent. That includes the inflation rate—[HON.MEMBERS: "Plus inflation."] By my calculation, that works out at an increase of about 13p a gallon, so the average family which benefits from the 90p a week reduction as a result of the 10p in the pound income tax band will pay £3.50 a week extra in fuel duty. The Chancellor did not mention that in his Budget. We must wait to find that out ourselves.
  Mr. Paterson: If my right hon. Friend turns to page 109 of the Red Book, he will see that unleaded petrol has increased by 17.24p per gallon.
  Mr. Maclean: I am grateful to my hon. Friend for that observation. Perhaps my maths are as good as the arithmetic of the hon. Member for East Carmarthen and Dinefwr. I thank my hon. Friend for his better mathematical and arithmetic skills.

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  Throughout the Budget statement, the Chancellor spoke about the 10p corporation tax rate and the 10p in the pound income tax rate. There is also 17p a gallon on petrol; that is why he does not mention the figures. That is typical of the 1998 Budget.
  Throughout the seven days of the 1998 Budget debate, no one in the House heard the Chancellor or any Treasury Minister mention the new tax that would be imposed on the purchase of a motor vehicle. We had to wait until the appearance of the Finance (No. 2) Bill before that fact was discovered. That is why we can say that this Chancellor is adding taxes by stealth.
  I have given examples only of the small things that I, while sitting in the Chamber, have been able to figure out. Goodness knows what will emerge in the next few days and weeks, and when the Finance Bill is published. Goodness knows what underlies some of the Chancellor's bland statements today, which may contribute to the ever-increasing tax burden imposed by the present Government. The past three Budgets have contained tax increases totalling £8.9 billion.
  Rural areas have nothing to cheer in the Budget. I suppose that a family on a very low income, with lots of children, living in a rural area and with access to a bus passing close to their door might be slightly better off as a result of the Budget.
  Mr. David Davis: Not if they smoke.
  Mr. Maclean: I hope that they do not smoke; provided that they do not, they may be slightly better off as a result of the Budget.
  However, as the right hon. Member for Bishop Auckland pointed out, with the best will in the world, tens of millions of people in this country cannot make use of an integrated transport policy. The motorist has been fleeced in this and the previous two Budgets. The motorist is paying billions into the Treasury and we are not getting that money back in better roads and better-maintained roads; all we get is talk of an integrated transport policy.
  Mr. Michael Fabricant: Is my right hon. Friend aware that the latest analysis shows that, for the very first time, the cost of petrol in the United Kingdom is higher than it is anywhere in Europe?
  Mr. Maclean: I am grateful to my hon. Friend for that observation. I believe that the hon. Member for East Carmarthen and Dinefwr would say that that was part of the Prime Minister's plan to bring Europe into line with what the Government are doing here.
  It is outrageous for the Government to keep talking about an integrated transport policy, which might work for a few hundred thousand extra people on the outskirts of Manchester—and perhaps some in parts of London and other big cities—but would not work for tens of millions of our constituents, including nearly all of mine.
  My constituents use the train—the west coast main line—whenever possible. I use it constantly to travel to London. I would not dream of driving 300 miles to London—except when, occasionally, I have to empty kit out of my flat—but, to get to that train, there is only one option: the car. For everyone using that line for most of its route between Carlisle and London or between
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  Glasgow and London, the only way to get to the train— the only thing that we have within hundreds of miles of an integrated transport strategy—is the motor car, and those rural motorists are being penalised.
  The Government may think, "Ah; rural motorists. They must be awfully wealthy people. Serves them right; they are driving cars." They could not be further from the truth. The right hon. Member for Bishop Auckland is right; the Government are not helping the low-paid in rural areas, or helping people in rural areas to get jobs, by clobbering the motor vehicle.
  There are no great bus services in rural areas. The money that the Government announced last year is ludicrous. In Cumbria alone, the money that they have announced to help buses in rural areas has easily been eaten up by one week's loss of income in agriculture, which has been placed under enormous pressure by the Government.
  The Budget has attacked the job creators. It has clobbered those in small businesses who want to create jobs for others and create wealth.
  As my right hon. Friend the Leader of the Opposition said, and according to some articles in yesterday's press, if the Government want to do anything for business, they should cut regulation, cut bureaucracy and cut some of the 2,000 extra regulations that they have created in their 20 months in power.
  In my constituency, elsewhere in Cumbria and in large parts of England and Wales, the proposals for the food tax and the Food Standards Agency will mean that tens of thousands of rural shops, small hotels and bed-and-breakfast outlets will be clobbered by the tax rate that big supermarkets will pay. That is not a Budget for enterprise. That is not a Budget for little entrepreneurs who want to build up their small rural bakeries and so on. The costs of the huge increase in the budget of the Meat Hygiene Service will be passed back to farmers, but they will also clobber large sections of industry, as will the minimum wage and the maximum working week.
  If the Government really want to help tackle crime, it is not enough for them to make available a few amounts of money for crime hotspots around the country— electoral bribes, with the local elections coming up. If the Government want to do something to tackle crime, they should stop cutting the police budget. I am delighted to declare an interest in that. I am an adviser to the Police Superintendents Association of England and Wales, and very proud that I was offered that responsibility. However, I am not speaking on its behalf when I speak of the loss of budgets throughout the country for police, policing and police services. Metropolitan police numbers are declining to dangerous levels. For the first time, the Government have insisted that police funding be tied to a 2 per cent. efficiency drive, without saying how they will measure an improvement in efficiency.
  The Chancellor boasted about measures for reducing crime. The first and best measure that we have for reducing crime is the British police service—not ideas such as part-time wardens patrolling the streets of Sedgefield.
  This and previous Budgets have given us gimmicks and taxes by stealth. The gimmicks include computers or, as we read in the press at the weekend, laptop computers for every teacher to take home. What is the point of laptop computers for every teacher to take home if schools do

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  not have the technology and infrastructure to teach pupils by computers and electronic means so that they may use the programme?
  Mr. Alan W. Williams: Will the right hon. Gentleman give way?
  Mr. Maclean: The hon. Gentleman gave way to me once, so I give way to him.
  Mr. Williams: The right hon. Gentleman says that the Budget is full of gimmicks and then mentions computers, schools and laptops. Even if he is not into information technology, will he concede that £2,000 for books for each school is not a gimmick?
  Mr. Maclean: I am happy for money to be made available to schools if it is spent on books. I am happy for schools to spend money on technology. Of course I am into IT. I am a child of the new millennium—I surf cyberspace regularly—and I am happy for technology to be used in schools, but let us get the basic technology into schools first. Let us ensure, not only that every teacher has a laptop computer, but that there are proper computers for every pupil to use, and that there are computers on which teachers can access the programmes and print out lessons. Then, teachers might be able to make use of a laptop computer.
  I am not an IT whiz kid, but I have learned one thing: the pointlessness of having a laptop computer to cart back and forth unless one has the technology in one's office to enable one's staff to use the material that one plays around with on the laptop at the weekend.
  The other point—on which I shall conclude, as many of my hon. Friends and others want to speak—about schools and the £2,000 for books is that that is all very well, provided that the county councils spend that money on the books and on the schools. The lesson that I have learned over the past few weeks is that Labour-controlled Cumbria county council will not spend the full amount of the standard spending assessment allocated by the Secretary of State for Education and Employment on education. The council has siphoned off £1.4 million.
  We even had the incredible spectacle of the Department for Education and Employment and the Secretary of State himself issuing a press release condemning Cumbria county council. The council presumably made representations to the Secretary of State, and the press release was withdrawn by the Department. Still, the county council is not putting the full amount of the Secretary of State's money for education into education. It has found savings elsewhere and has siphoned off some of that money.
  It is all very well for Labour to boast about the Chancellor announcing money for the education budget to be allocated to schools. Too much of the money is retained by county halls and it is not reaching the chalk face. Similarly, money allocated to hospitals is not reaching them.
  What we have heard today from the Chancellor is wonderful soundbite stuff. No doubt, we will read it ad nauseam in the press tomorrow. People in the housing estates in Cumbria and in other Labour areas tell me,
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  and people write to me saying, "I voted Labour, but it is all sound. Nothing is happening on the ground." The nurses and doctors are saying that now.
  As people begin to realise that Labour is all soundbite and no substance, the Government have taken an important step to rectify that, as we saw last week. As their initiative to deal with that accusation, they have recruited yet another top BBC executive to go into No. 10 to deal with better spinning. Mr. Bush, recruited as head of research in the news department of the BBC, is to be brought into No. 10 to head up the spin-doctoring on whether Labour is meeting its manifesto commitments.
  Last year, no Minister made a speech from the Dispatch Box without saying, "We keep our promises; the Tories do not keep theirs." Ministers have not said it once this year. The Government are recruiting BBC spin doctors into No. 10 because they are breaking their promises and they are being rumbled. We have had a lot of spin today. In a few weeks, the truth will come out as the nurses, doctors and teachers realise that the money is not materialising, as the small businesses realise that they are being clobbered, and as the rural areas realise that they are being crucified by the Government. That will be the real proof of the Chancellor's spinning today.
  7.23 pm
  Mr. Derek Twigg: I welcome the statement made by my right hon. Friend the Chancellor. His excellent performance today underlined why we are getting the economy right and what was wrong under the Tories. This Budget, like previous Labour Budgets, deals with the legacy left to us by the Conservative party, but it also takes us forward into the millennium and deals with the issues of today and tomorrow.
  The Budget rewards work and makes it pay. It offers a better deal for families. It rebuilds our public services. It provides a better deal for small business. It locks into economic stability. The Chancellor made the important point that he was doing away with the arguments of left and right, the notion that there was only one way of doing something, and the public-private argument. We see the Government taking the best of each sector, and using that to make sure that the economy grows; that we get better public services; and that people live better lives.
  The connection between greater wealth and the provision of better public services is not often recognised. Greater wealth allows us to invest more in public services, as the Labour Government will continue to do and as the previous Government never did.
  The Budget must be seen in the context of the Tory legacy and fundamental weaknesses in the economy left to us by the previous Government: inflation was rising; they had ducked decisions on interest rates, leading to the problems that faced us in the first year of our government; they had lost control of the public finances; and the national debt had doubled.
  The Conservative Government wasted important public money on social security. They paid it out but did nothing to help people get back to work. They did not use the money well, so they wasted the Department of Social Security budget. It was all boom and bust under the previous Government—they never aimed at stability or long-term planning.
  Another part of the Tory legacy was Black Wednesday, which cost us a great deal of money and caused severe problems for the economy. A further example is the Tory

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  Government's handling of the BSE crisis, which cost £5 billion. Their attempts to deal with the mess that they had created cost another £2 billion. There was also the cheap sell-off of public services. Important public assets were sold off on the cheap, and shortly afterwards we saw the share prices rocket.
  Ms Diane Abbott: My hon. Friend referred to the problems caused to the previous Government by Black Wednesday. As he will remember, the problems of Black Wednesday were caused by fixed exchange rates and the unsustainability of such a system. Does it occur to him that, if we went forward into economic and monetary union, which is just another fixed exchange rate system, with no real evidence of the true convergence of the economies, we might experience our own Black Wednesday in due course?
  Mr. Twigg: The Government have made it clear that certain criteria must be met. Our competence in managing the economy is on a different level from the incompetence of the previous Government. We have only to recall how they dealt with the poll tax. Councils around the country are still paying for it. That is part of the catalogue of Tory incompetence over 18 years in power. As a result, we have had to take some tough decisions early on, to get the country back on the right course and achieve stability.
  As a party, we introduce important policies which support work and families, and help pensioners and society generally. The Conservatives oppose the new deal, the working families tax credit, and the national minimum wage. We hear much about America, although America has a national minimum wage. They oppose the cut in VAT—they would raise it further if they were in power. They have opposed the entire plan to improve economic stability. They are not interested in getting the country back on the right track, after the mess that they created.
  The Government's economic policy has had a major positive impact on my constituency. The Chancellor is right to focus on economic stability, growth, better public services and more jobs. We are getting away from the boom and bust of the previous Government. Inflation is now close to its target level. We are taking tough action on borrowing. The borrowing record of the Conservatives was astoundingly bad. They took incredible risks with the economy. In the early 1990s, interest rates peaked at 15 per cent. I will not go into what they went up to in just one day on Black Wednesday, but they certainly went up to 15 per cent.
  Mr. David Taylor: For a year.
  Mr. Twigg: For a whole year. Under our Government, interest rates peaked at 7.5 per cent. That is a result of the fact that we have been dealing with the mess and taking decisions that the previous Government ducked. Mortgage rates are at their lowest for 30 years. Interest rates will probably come down again. That helps stability and allows us to plan for the future.
  According to a report today in the Financial Times, a survey by the Office for National Statistics shows that UK manufacturing rose during January. Reports in the local financial press and from various organisations refer to a
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  soft landing for our economy. Again, that is a result of the Chancellor's excellent economic policy. There has even been a rise, albeit small, in high street spending. According to a recent Gallup poll, the majority of fund managers thought that the economy was going forward. All that is confirmation that the Government are on the right track.
  Mr. Tim Loughton: The hon. Gentleman cites as a source for his economic criteria fund managers in the City of London. Does he agree with those same fund managers, whose best forecast for GDP growth next year is about 0.7 per cent., which is rather less than half of the top forecast of his Chancellor this afternoon? Were the fund managers right then, and are they wrong now?
  Mr. Twigg: The Chancellor set out his strategy clearly today. He is confident about the growth factor, as am I. A number of important issues are raised by the Budget, which should be examined in more detail. The Opposition have had a difficult time attacking the Budget. They have gone off at a tangent, with lengthy debates about Europe and other matters that are wholly irrelevant. Conservative Members have real difficulty, because this is a good Budget; it makes good sense to most people and will improve their standard of living.
  Conservative Members like to talk a lot about families, but their record in government was one of failure. The Budget supports lower and middle-income families and provides help when it is needed most—when people have children. As a father, I totally and utterly support that. The Conservatives did not provide such support. The child tax credit has been introduced, child benefit has been raised—13,300 families in my constituency will benefit from that—and there will be a major improvement in the standard of living of people with children.
  Mr. Jonathan Sayeed: Will the hon. Gentleman give way?
  Mr. Twigg: In a moment. I have taken two interventions and I want to continue with my speech.
  When we came to power, child benefit was £11.40 a week. It is going up to £23 a week, which is a major increase for which we deserve credit. The Conservative party has an interesting record on child benefit—it froze rates between 1987 and 1991—and also froze married couples allowance between 1990 and 1995. That does not support the Conservative Members' view that they have always been in favour of child benefit increases and the married couples allowance.
  Mr. Sayeed: Has the hon. Gentleman read any part of the Red Book? Would he care to look at page 112? Item 17 shows that the married couples allowance will be abolished from April 2000. That will save the Treasury £1.6 billion, but the children's tax credit will not be introduced that year. Although the hon. Gentleman does not realise it, the Chancellor has fiddled the figures—he has taken money away by abolishing the allowance, but he is not giving money back through the children's tax credit.
  Mr. Twigg: I am interested in the points that the hon. Gentleman makes, but I would like to hear him praise my

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  right hon. Friend's increase in child benefit. I do not hear that praise, although there has been a major increase. [Interruption.] Does the hon. Gentleman want to praise the increase in child benefit?
  My constituency has a large number of pensioners. I often think—wrongly, and I shall explain why—that some pensioners have felt a bit left out of the previous two Budgets, although we have done a considerable amount in terms of the standing fuel charge, extra fuel payments and the cut in VAT on fuel. We have also taken a number of other initiatives. The Budget contains a £3 billion package for pensioners, with an increase in the winter allowance to £100 over the next three years. That means that slightly more than 14,000 pensioners in my constituency will benefit from help towards their fuel bills. That underlines the Government's commitment to helping pensioners and shows that the particular difficulties that pensioners have during the winter have been recognised.
  There has also been an increase in the minimum income guarantee for pensioners and it has been related to earnings rather than prices—it was nice to see the look on Conservative Members' faces when my right hon. Friend announced that measure this afternoon; they did not have much to say about it—and 200,000 pensioners will be taken out of paying tax. Many pensioners in my constituency will benefit from that.
  My right hon. Friend talked about rewarding and improving our public services. It is useful to put into context what the Government have already done. Like the other improvements in funding, the £19 billion commitment to education in the comprehensive spending review will benefit my constituency. For example, five schools had been waiting for more than 10 years for new classrooms, but, within 18 months of the Government's election, three have had plans for new classrooms approved. I understand that a fourth school hopes to have its plans approved shortly. That money will help with bringing class sizes down, which is another great commitment that is widely supported in my constituency.
  Halton borough council has been given £2 million from the standards fund, and five summer schools have been set up to improve literacy and numeracy. Those important developments have been achieved because the Chancellor has made improvements by providing additional cash for schools in his Budgets. Additional money has already been made available for school books and a further commitment, to which I shall refer in a moment, has been made today.
  There has been talk about national health service waiting lists. I can tell Conservative Members that my local hospital not only met the reduction in its waiting list last month, but exceeded it by 282. That excellent performance shows that that money is being well spent— and that is not to mention the additional money that has been provided for mental health and other health services in the Halton area.
  On transport, there has been significant change and I can see a significant difference between this Government's policies and those of the previous Government. I referred to that matter briefly a few weeks ago in my speech on the local government settlement. For many years, we in Halton have been trying to get extra money to deal with the maintenance problems affecting
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  the Widnes-Runcorn bridge. We were unable to get that money under a Tory Government, but, this year, the Labour Government have allocated an extra £2 million, which is an important investment. Dealing with those problems may prevent more fundamental problems occurring later. There has been additional money for transport generally in my constituency, and the Government's integrated transport strategy is important not only because of the problems with the bridge but because we have a busway and because there is a low rate of car ownership compared with other constituencies.
  I am particularly interested in education. The Government have made clear their commitment to lifelong learning, skills and training and, through investment in further and higher education, they are trying to provide a better economic base from which firms can prosper. The further education college in my constituency has an important role to play and the Government have allocated extra money in the comprehensive spending review to be spent on further education and supporting students. The Government recognise the importance of further education to getting the economy on the right track and providing skills and investment in our communities.
  There is new investment from the capital modernisation fund, which I am pleased about, and £2,000 has been allocated to each school to buy new books. That is a significant sum for many schools and, although there has been an increase over the past two years, an extra £2,000 for books is important. When I went into schools during my time as a councillor or a governor, I never tired of being worried about, or annoyed by, the state of some of the books that the children had to use. Some books were tattered and torn, or there were perhaps five to a whole class, and it was difficult to get hold of the wide range of books necessary for children of differing abilities.
  That problem always worried me, but the Government have acknowledged the problem and have put £2,000 into each school. That is an improvement. One of the obvious problems caused by not having access to books is that children do not pick up a love of reading as well as they might. They do not find it easy to find books to read, and that affects their literacy. The Government have recognised the problem. Although £2,000 per school is a small amount in terms of the overall allocation of money in the Budget, it is important.
  Mr. Lansley: Like my hon. Friend the Member for Mid-Bedfordshire (Mr. Sayeed), I am concerned that the hon. Gentleman has not read the Red Book. Page 111 makes it clear that the money in the capital modernisation fund—£250 million will be brought into 1999–2000—is expressly drawn forward from later years and is not new money.
  Mr. Twigg: I do not want to go over the ground that I have already covered—that money is in the fund. I would like to hear the hon. Gentleman and the hon. Member for Mid-Bedfordshire expressing support for the extra £2,000 for each school. I did not hear them doing that—I assume that they do not want to talk about that money—and they may be against investing £2,000 in each school.
  The Budget highlighted the £410 million that is being given in respect of access to computers. Some schools seem to be better off than others. Access to computers and training are extremely important, and it is a shame

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  that some children do not have the same access as others or are not able to gain experience and training. My son, who is nine, has been very fortunate in school and has managed to develop his computer skills, but I have seen real problems in other schools that I have visited and the money should be widely welcomed.
  There is extra money for public services in the health services, which will be invested in modernising accident and emergency departments. We have all seen problems in our local hospitals, and around the country generally, and the staff of accident and emergency units and their patients have difficulties in respect of both waiting times and equipment. Such investment must be warmly welcomed, and I am sure that it will be. Notwithstanding what others have said today, I think that both NHS staff and patients will welcome the money.
  Comments have been made about the £170 million to make communities safer. It is a shame that some Conservative Members have taken the attitude that they have. Under Conservative Governments, crime rose. I am interested by the fact that the right hon. and learned Member for Folkestone and Hythe (Mr. Howard), the former Home Secretary, is not present. He wanted to send more people to prison and subject them to short, sharp shocks; but he did not manage to do anything that reduced crime.
  It is clear from what I hear in neighbourhoods in my area that people there are worried about crime, neighbour nuisance and the behaviour of some groups of young people. Some are afraid to go out at night. It is crucial for the money to be spent on dealing with those fears, and improving the situation.
  At a recent conference, I spoke about the Government's crime and disorder audit. The police and communities are being brought closer together, along with the voluntary sector and other agencies, to establish a strategy for crime. It is all about creating safer communities. The Conservative party scoffed at the idea, but I do not think that my constituents would consider it a laughing matter, or consider that the Government were wasting money. I think that they would say that this was a positive move to deal with crime and disorder, and to involve local communities in that.
  Rewarding work has been a major plank of the Government's policy in the last two Budgets, and also in this Budget. It is worth repeating what has happened, in order to set the scene for today's statement. A total of £3.5 billion was taken from the privatised utilities to pay for the welfare-to-work initiative and the new deal; already 60,000 young people have been helped, and a total of 300,000 have been helped. It is all very well for the Opposition to scoff at the programme, and to have a go at it. Many of them do not support it, and I believe that a number have not even troubled to support it in their constituencies. People like me, however, have worked closely with the Employment Service, with employers and with other agencies to try to ensure that young people and the long-term unemployed are given the best help that is available.
  Having talked to unemployed young people, and to adults who have been long-term unemployed, I have witnessed the desperation, the lack of hope and the sense of failure that troubles them. They have been thrown on the scrap heap. The last Government's policy for dealing with unemployment was to take people off unemployment
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  benefit and put them on to incapacity benefit. They had no real policy to return people to work; their policy was, "Let the market decide, and we shall see what happens." The present Government's policy involves working with the private sector, the public sector and the voluntary sector to produce policies to help people into work.
  I recently attended a presentation for the Prince's trust, at which 10 young people were to receive awards after taking a course. They had moving stories to tell. Many had been sponsored by the new deal to work with the trust; some who had formerly been shy and introverted, and had problems in communicating, had become outgoing, confident, able young people. That is the sort of effect that the Government's policy is having, and that is why they continue to support the new deal.
  I have also talked to employers, and I know that problems can arise. Things are not always perfect. Nevertheless, the employers to whom I have spoken want to get involved: they want to support young people, and to give them the skills and training that they need. I was pleased that the Chancellor made it clear today that the Government's help would continue. Conditions would, of course, be attached, but I approve of that: there must be responsibilities as well. I am glad that is still a major plank of the Government's policy.
  Last year saw a proposal to cut national insurance by £65 a year, and a decision by Parliament on the national minimum wage. Those, too, are important planks in the Government's policy of both rewarding work and putting people into work.
  Like other Members of Parliament, I have seen factories and companies close in my constituency, but unemployment in my constituency—and around the country—is lower than it has been for 20 years. A better deal now exists, making work pay and encouraging people to work. Under a Tory Government, there was hardly any difference between what could be gained from benefits and what could be gained from work. People had no incentive to work. Most people want to work, but they want to be able to earn a decent living.
  The new 10p income tax rate is vital, as is the cut in the standard rate from 23p to 22p. Rewarding work in that way will ensure that families are better off. The working families tax credit has been increased by £2.50; there has been an increase in the minimum income guarantee of £2 a week for full-time working families; and no family earning less than £235 a week will pay tax. That is a major step forward, and an important incentive for families and individuals.
  The last Government's use of the benefit system was not aimed at helping people to return to work. That Government were not interested. They paid out benefit, but they did not want to devote any effort or time to assisting people to work. There is a stark difference between this Government's policy and that of their predecessor.
  I have already mentioned the new deal. Today's announcement about the new deal for the over-50s and the guarantee of a minimum income of £170 for the first year is very welcome. In my area—and, I am sure, those represented by others—there has been a major shake-up in manufacturing industry over the past 20 years. I should add that, under the last Government, two out of five manufacturing jobs—2 million—were lost. Manufacturing industry was devastated all over the country.

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  Halton, Runcorn and Widnes are in a chemical industry area. The sector employs more than 4,000 people in ICI alone, and probably employs up to 12,000 in the chemical industry and support industries. It is a vital sector in my constituency. Part of the result of what happened during the 1980s and early 1990s was that many people were made redundant and took early retirement, and now find it difficult to return to work because of their age. I welcome the Government's recognition of the problem. I have talked to people in that age group, and they feel that they would be helped to return to work if they could improve old skills and gain new ones.
  That is often the problem: the need to acquire new skills, and to secure a chance of obtaining work. In the past, it has not been possible for people to have training and to acquire new skills. The importance of today's announcement should not be understated, and many people in constituencies such as mine who are over 50 and unemployed will welcome it.
  The Government's emphasis on the importance of supporting small business is also an important part of our strategy. Ten or 15 years ago, a Labour Chancellor might not have said what the Chancellor did. As I said earlier, I think that being Chancellor means taking the best from both private and public sectors, and supporting businesses as means of wealth creation. The biggest opportunity for businesses to grow lies in the small and medium-sized sector. During the 1980s and 1990s, what I heard about from my constituents who owned businesses were their problems with the last Government: problems in getting loans, problems with red tape, problems with late payments of bills and problems owing to a general lack of support and advice. Those problems were very stark, and one wondered why nothing was done.
  It should also be remembered that, under the last Government, there was a record number of bankruptcies. A record number of small businesses went under. Given the legacy that they left, the Conservatives have no right to talk about the importance of supporting small businesses. They destroyed hundreds of thousands of businesses with their boom-and-bust policies.
  Small businesses have complained to me about skills shortages, the difficulty of obtaining funds from banks, lack of advice, lack of training and even payroll difficulties. That is interesting, because the Chancellor mentioned it today. I am pleased that the Chancellor is to set up a new small business service, which will be warmly welcomed. Again, the 10p corporation tax rate for small companies will benefit 270,000 companies. It follows the changes in last year's Budget to corporation tax and capital gains, which have been a major incentive and been warmly welcomed by those companies.
  Let me emphasise a point that I was making earlier. One small business man showed me the list of electrical contractors that existed in my constituency 10 or 12 years ago, and how many are left—the latest booklet on the figures was published about a year or so ago. Less than half are left. The business man said that he had great difficulty in recruiting skilled people, including electricians, and that, because there were not as many of them, the demand on wages was much greater: the cost of employing people was much greater. He said that that
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  had all happened under the Tory Government—that there had been a complete sea change in the way in which business was able to deal with such problems.
  That man, who works very hard throughout the country to get work, said that it had not been worth his while to take on any apprentices, because his profit margin was so tight that he would have difficulty funding new staff. The point about the new deal is that it tries to help towards that problem.
  That happened under a Tory Government. That is a real-life case. I saw the figures. There was a complete change in the number of companies that were around.
  Some points have been made about manufacturing generally. Of course, I take a different view on manufacturing from the Conservative party. It is an important industry in my area. As I have said, ICI and the chemical industry have been, and are, an important player there.
  In my constituency, companies have closed for a number of reasons. Interest rates have caused difficulties for companies such as ICI, but what is interesting is that ICI is saying that these things are cyclical. It expects in two or three years, or even less than that, to do much better.
  There has been major world upheaval in the chemical industry. South-East Asia's problems have had a major effect. I recently went to a chemical industries presentation on the chlorine industry, which, again, is a particularly important part of the work of ICI in Halton. Most household products and most drinking water have elements of chlorine, so it is an important industry to the country.
  The ICI complex at Runcorn in Cheshire used to use 1 per cent. of the electricity produced by the national grid; it used as much electricity as the city of Liverpool. That is a tremendous amount of electricity and power.
  Mr. Loughton: Will the hon. Gentleman admit that the chemical industry, which is so important in his constituency, will be hit hard by the energy tax that the Chancellor has announced this afternoon?
  Mr. Twigg: If the hon. Gentleman will hold his impatience for a second, I will explain exactly why the problem exists.
  At the presentation—a number of the hon. Gentleman's colleagues were there, by the way—it emerged that the cost of energy was a massive problem for the chemical and other industries. That problem had been raised with the previous Government on numerous occasions. When the previous Government privatised the power companies, they made things worse: the cost of energy went up. Therefore, not only did the previous Government decimate the manufacturing industry with their economic policies generally but, on issues such as energy, which is so important to manufacturing industry, they got it wrong completely.
  I understand what the Chancellor said today about the energy tax. He has made it clear that there will be a reduction in national insurance contributions. I am pleased that he will continue the consultation. I did not hear anything that would in any way damage my particular industry, given the commitments that he made.

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  I was pleased to see the Chancellor's commitment to renewable energy. Because of the problems that the energy strategy and policy of the previous Government caused ICI, it was worth its while building its own power station, or certainly getting a company to build it; Intergen did the work. It is still looking at another source of renewable energy—steam—but it has made numerous savings in energy cost by reusing energy that is produced in its plant. That is the sort of strategy that the Government will want to encourage in the industry as a whole, so good practice is there.
  Let me conclude my remarks—[Interruption.]I could also read out the tax increases that the Conservatives introduced when they were in power. If they want to talk about tax, we can do so.
  Without doubt, today's was another confident performance by the Chancellor; my right hon. Friend's performances are confident. Even the International Monetary Fund is saying that what the Chancellor is doing should be regarded in other countries as a model of good practice. What a change from what the IMF said under the previous Labour Government. There has been a change in strategy and in the way in which we are dealing with the economy. There is now confidence in the handling of the economy by the Chancellor and Government. This week, the IMF again praised the Chancellor and said that Britain's policy should be used as a good example elsewhere.
  The Budget has again been about spreading wealth, helping the low-paid and disadvantaged, and redistribution to the less well off. All the Conservative party was interested in was helping the best off, doing nothing to help people get out of poverty. This is another Budget that deals with redistribution, ensures that people get a fair run at resources, encourages them to get back into work and promotes and encourages incentives, innovation within the economy and enterprise. Public services have also been improved and will continue to improve. It is a good all-round Budget and I am proud to support it.
  7.57 pm
  Mr. William Ross: I have sat through quite a number of Budgets and I have rarely heard the two Front-Bench spokesmen behave with the vividness with which they both behaved today. Whether there was any more content in it today, and whether it will mean any more at the end of the week than after many past Budgets, remains to be seen.
  One of the things that has always concerned me is the public sector borrowing requirement. It seems, from what we are being told, that that, at least, is going very fast and far in the right direction. I have always thought that a nation should try to balance its budgets. I do not see much point in paying a lot of taxpayers' money in interest: we have paid far too much over the past few years.
  I welcome many of the minor items—and there were many—that will have a good effect. For example, the 10p starting tax rate is welcome for both business and individuals. I also welcome the fact that the capital expenditure for Northern Ireland will go up by £50 million. In particular, I welcome the announcement that there will be £2,000 for books for each school in the land. What I am not clear about is whether, when the Chancellor was expressing that good news, he was
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  including Northern Ireland—or whether the £2,000 per school is restricted to Britain, as the last announcement was. Perhaps that could be made clear before we leave the building this evening.
  I listened with interest to the Chancellor's growth forecasts. I hope, for all our sakes, that we hit the 3.75 per cent. increase that he thinks we will achieve in 2001. As I have said, I have sat through quite a number of Budgets in this place, and I have found out by hard experience over the years that it does not take much to go wrong, and to go from a Budget surplus to a £50 billion deficit. Anything can go wrong given the fragile nature of the world economy. Most people are behaving as though it is in a robust state, but I think that the full effects of last year's Asian crisis have not yet worked through the system.
  Mr. Tyrie: Has the hon. Gentleman noticed that the Chancellor's growth forecasts are extremely optimistic compared with those being provided by independent forecasters? The Chancellor's forecast for growth this year is 1 to 1.5 per cent., against independent forecasters average forecast of 0.6 per cent. For 2000, the Chancellor's forecast is 2.25 to 2.75 per cent., compared with independent forecasters average forecast of 1.8 per cent. Does it not very much reinforce the hon. Gentleman's point that, if that growth is not forthcoming, the public finances could be gravely imperilled?
  Mr. Ross: Economics is called the dismal science. As it is such a dismal science, many economists try making a wide range of forecasts, in the hope that at least one of them will be right and happy for a day or two. All Chancellors fall into that general trap. Heaven only knows what the effect on public revenues will be if we have only 1 or 0.75 per cent. growth instead of 3.25 per cent.
  I noticed that the Chancellor announced, with much cheer and a great flourish, that the inheritance tax band will be raised. Everyone thought that that was quite a substantial sum. However, a check of the books reveals that the band is being raised only to match the inflation rate of the retail prices index. I wonder by what percentage house values have increased in the past one or two years. I suspect that that increase is rather higher than the inflation rate and the RPI. Therefore, perhaps the Chancellor is not being quite as generous as he is telling us. Whenever I discover the Chancellor telling us one such story, I wonder how much more smoke and how many more mirrors are around the place. Usually, there are quite a lot more.
  I do not smoke for many reasons—not least because I could not afford it when I was young and foolish enough to start. When I was old enough to understand the ill effects of smoking on health, I backed away from it very rapidly. However, other people in Britain smoke—a figure of 15 million was mentioned earlier. Only education will stop smoking, if it can be stopped at all.
  The Government have previously, through the tax system, applied quite a lot of pressure on people to stop smoking. However, page 149 of the Red Book shows that, in the next few years, the tobacco tax take is forecast to fall. Are the Government trying to tell us that there will be a tremendous decrease in the number of people who smoke? Or are the Government being pragmatic and realising that the tax take will decrease not, because of a drop in the number of smokers but because of a very large increase in the amount of smuggled tobacco?

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  Every year, the Gallaghers firm, in Northern Ireland, comes to see us. In Northern Ireland, 3,000 people are employed in tobacco factories. Gallaghers' representatives told us that, in the United Kingdom, seven out of 10 packets of hand-rolling tobacco are smuggled. An awful lot of that is produced in Ballymena. It goes over to the continent, but is back in a fortnight or less.
  Although there is no tax increase on hand-rolling tobacco, there is an increase on pipe-smoking tobacco and on cigarettes. The tax increase on cigarette prices works out at 17.5p per pack of 20. However, where is that revenue disappearing? The reality is that the Government are factoring in a very large increase in cigarette smuggling. This year, the Gallaghers representatives warned us about the problem. I hope that Ministers will take heed of the dangers inherent in smuggling.
  I should like also to draw the attention of the House and the Chancellor—if he needs his attention drawn to it yet again—to the road fuel tax. In 1996, Northern Ireland accounted for 2.8 per cent. of the total United Kingdom road fuel market and provided 2.8 per cent. of United Kingdom fuel excise duty. Until today, duty in the United Kingdom was 43.99p per litre for petrol and 44.99p for diesel. In the Irish Republic, duty was 24.54p per litre of petrol and 21.35p per litre of diesel. Today, in the United Kingdom, leaded petrol duty went up by 4.25p per litre, unleaded petrol duty went up by 3.79p per litre, ordinary diesel duty rose by 6.14p per litre and low-sulphur petrol duty by 4.96p per litre.
  Smuggling from the Irish Republic into Northern Ireland was already immense, even without those duty rises. A tanker of 25,000 litres gives the smuggler a profit of £4,450 in saved excise duty. Additionally, UK VAT, at 17.5 per cent., also is not paid, taking the smugglers profit to £6,380.50.
  Diesel smuggling began in 1997. Large-scale petrol smuggling began after last year's Budget, which increased United Kingdom duty far above that in the Irish Republic. How much is smuggled? Although that is very difficult to determine, a few months ago smuggled fuel was being openly advertised on roadsides. Although the Revenue cracked down on it, the Revenue is short of staff.
  We do know that, in the past year, 48 vehicles and 400,000 litres of fuel were seized. However, the Government know that 24 million litres have been smuggled into Northern Ireland in the past year, resulting in a Treasury loss estimated at £100 million. Such extensive fraud is not acceptable to any hon. Member. It is even less acceptable to honest traders in Northern Ireland, who are left in the position of having either to break the law or to close the doors of their businesses. The loss of those businesses would have a real effect on local residents.
  Very often, in rural areas and smaller towns, service stations have replaced many corner shops. Local fuel oil and distribution companies are also suffering grievously, as they supply low-volume fuel stations and sustain the operations of smaller companies that the major companies, such as Shell and Esso, simply ignore. They have all been very hard hit. The major oil companies are making an effort to combat smuggling, and have said that their year-on-year losses by value are up to 40 per cent. They are subsidising some of their outlets, but they cannot continue to do so. No one should expect them to do so.
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  Taxes on road traffic affect transport companies, contractors and construction firms and the aggregate trade. They are all being hit very hard. I should like to know how the Chancellor plans to address the issue. Buying smuggled fuel is not a matter of having to go across the channel, but of driving a mile or two down the road, filling up the vehicle and coming back. The difference in large vehicle excise duty between Northern Ireland and the Irish Republic is, in some cases, several thousand pounds. I am speaking specifically about the heavy vehicles used in the aggregate sand quarrying industry, but also about many other types of vehicles.
  Some time ago, I tabled a question on the amount of duty paid in each European Union country on comparable vehicles. No one knew the answer—or at least that is what I was told by the Treasury. I leave it to hon. Members to judge whether the Treasury did not know the answer or did not want to tell me the answer. Regardless, the Treasury was not able to tell me, saying that the figures were not available.
  Recent reports show that fuel operators in Great Britain have been hit by vehicle excise duty, as they have been hit by fuel duty. Companies are moving across the channel. In the past week, I saw a report in the newspapers on the Stoddart company's decision to consider moving across the channel.
  British traders and lorry owners have difficulty in comparing prices between Britain and those on the continent. However, it is not difficult for people who live in Northern Ireland to compare prices with those in the Irish Republic. Nor is it difficult for them to drive down the road. Firms are transferring their vehicle fleets across the border, taxing them there and operating out of the Irish Republic into Northern Ireland. Those Northern Ireland jobs and companies—which are United Kingdom jobs and companies—are being exported because of the tax structure that operates in the United Kingdom.
  Although not too many changes have been made today, higher rates will apply to lorries with axle weights over 11.5 tonnes. There are quite a number of those heavy lorries on our roads. Many of them operate on the continent and many of the firms that use them trade with the continent. I suspect that, by upping the tax on heavy lorries that operate out of the United Kingdom, the Government will simply make it easier for firms that operate out of the Irish Republic, France, the Netherlands and elsewhere in Europe. So where is the benefit? If we are trying to get rid of the heavier axle loading in order to save our roads and bridges—after all, we spent many millions of pounds on upgrading them to EU standards to accommodate the 38-tonners—what is the point of making life difficult for the owners of such vehicles in the United Kingdom, given that everyone else can run them much more cheaply? It is just crazy, and the sooner the Treasury wakes up to that, the better. The Treasury should go back and look at it again.
  Green Budgets are a very good idea when one is not in competition with others, but, in practical, terms they will produce real greenery—there will be weeds growing in many business premises in Northern Ireland and ultimately Great Britain as well.
  I echo the words of the right hon. Member for Penrith and and The Border (Mr. Maclean) on the use of cars in rural areas. I agree with every word that he said. The car is not a luxury for rural families. It is certainly not a luxury in

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  Northern Ireland; it is absolutely essential. People who live in large conurbations with a bus service that actually works and gets them from A to B within a reasonable time can manage without cars. Where I live, there is no bus unless one is going to school. After that, one has to walk, ride a bicycle or drive. If one lives five miles out into the country, one does not walk or ride a bicycle; one has to have a car. We are continually upping the cost of transport for some of the lowest-paid people in the community to get to and from their places of work. It is not fair and it is not right. The whole system of green politics does not work in the real world.
  The right hon. Member for Bishop Auckland (Mr. Foster) began by expressing his regrets that he not got a job in the Government, or something like that. I have no spite against the right hon. Gentleman, who is not in his place. In fact, I have known him for many years and I hold him in very high regard. However, I think it is a good thing when a person who has been close to the centre of things in government or in opposition does not get a job because he knows where all the bodies are buried. He is an invaluable source of information to the House and we are glad to have him here. I was most interested in what he said and he made an excellent speech. However, I was disappointed when he said that he was attracted to the single currency—as the Chancellor undoubtedly is—as an aid to trade with Europe.
  The hon. Member for West Worcestershire (Sir M. Spicer) spoke about the need to transfer money within Europe. I thought that he was going to refer to the United States, which is often held up as an example when we debate Europe. However, he did not do that. I am sure that he and other hon. Members know that, in the United States, it is not necessary to transfer very much money because, due to their common language and culture, people move to where there are jobs. That does not happen in Europe because the language barrier creates difficulties for workers, so it becomes necessary to transfer money. In my view that is where the euro will run into immense difficulty.
  If all our trade were with Europe, the idea of a single currency producing easier trade and simpler systems would have great force, but that is not the case. A great deal of our trade is outside the EC. Whenever we lift our eyes from the channel and look to the open sea that leads to the rest of the world, our perspective changes about where Britain's future lies. I believe that the open sea tilts the balance decisively in favour of retaining sterling for world trade. It also brings into focus the simple fact that the single currency is not just an economic issue, but a political one from which certain economic and revenue-raising implications would inevitably flow.
  For example, taxes would have to harmonise right across the Community. They would be set not by the House, but by others who would seek economic and employment benefits for their own communities. They are bigger and stronger than we are and we know that, whenever they have the power, they will seize the advantage. It has always happened and it always will. I wonder whether the Chancellor really wants his successors to become the puppets of others. He may say that the future will be one of equals contending for common policy on revenue and on expenditure, but I do not believe that. I think that it will be dog eat dog and that we will lose out.
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  The real future will be analogous to the position of the old Stormont Finance Minister in relation to the Treasury. Perhaps more right hon. and hon. Members should examine what actually happened then. After the war, the Unionist Government in Stormont took a conscious decision to remain in step with the social and other policies of the rest of the United Kingdom. For them, the fulcrum was not between the haves and the have-nots; it was between belonging to this nation and being different and being shoved out. The fulcrum on which their decisions turned was constitutional rather than economic. For that reason, they decided to remain in step with the rest of the United Kingdom, although that resulted in their position changing from contributors to the Exchequer to net recipients.
  The net outflow to that region of the United Kingdom—and to others—has steadily increased from that day to this. The decision put them in a position where they were always supplicants to the Treasury and I think that they were very often short changed. The Stormont Government had taken a cold-blooded political decision to serve a political and constitutional purpose. If we apply that reasoning, that thinking and that standard to the concept of the European single currency, we reach a far more accurate understanding of what is actually involved.
  Mr. Andrew Stunell: The hon. Gentleman has drawn an analogy between Northern Ireland and the rest of the United Kingdom in relation to the euro. Perhaps he should consider the situation between the Irish Republic and the United Kingdom from 1921 and 1979, when there was a common currency but wildly different social and political policies, particularly during and immediately after the second world war—a period to which he has already alluded. Does that not indicate that considerable divergence is possible within that economic linkage?
  Mr. Ross: I had considered raising that point, but I left it out as I thought that it would take too long. At the time, the currency of the Irish Republic was tied to, and guaranteed by, the pound sterling, as other minor currencies throughout the world still are. To some extent, the Government of the Irish Republic were, as they believed, puppets of the British Treasury. That is why they saw fit to break the link. Like children let loose in a sweetie shop, they then foolishly went on a spending spree that got them into the most horrendous difficulties. Only when they began to receive the endless torrent of funds that they have enjoyed from Europe in recent years were they able to redeem their position. I hope that that helps the hon. Gentleman. If not, perhaps he will go back and look at the issue in the light of what I have said.
  When the House considers the best interests of the United Kingdom and all our citizens, it should come to the conclusion that they are best served by trade with the whole world. That would at least be following in the footsteps of Churchill. The freedom of action that we enjoy in setting our taxes and on economic policy should remain here, with the elected Members of Parliament who represent the people of the United Kingdom. This is where such decisions should be made.
  8.21 pm
  Mr. Christopher Leslie: It is always a pleasure to follow the hon. Member for East Londonderry (Mr. Ross), who made an interesting and lively contribution.

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  I welcome the Budget that my right hon. Friend the Chancellor delivered this afternoon. I should like to refer to some of the points made earlier by my hon. Friend the Member for Halton (Mr. Twigg) on the themes of the Budget. I saw two clear themes, which have been evident throughout the Government's tenure of office: stability in an uncertain world climate and tight and prudent fiscal policy, providing a firm foundation for sustainable growth. Those two themes cannot be reiterated often enough. We should recognise that those polices are welcome in today's economic climate. They were woefully missing from the record of the previous Conservative Administration. That helps to explain where the Conservatives went wrong and where we are going right.
  My hon. Friend the Member for Halton mentioned the history of Tory stewardship of the economy, eloquently contrasting the Labour Government's achievements with the boom and bust instability that the Conservatives created. The Tory years were marked by recklessness, with fiscal policy all over the place and public sector borrowing and the national debt spiralling out of control. Thank goodness the Labour Government came in when we did, or who knows what would be hanging around the necks of future generations?
  Throughout the Budget statement, there was a gleam in the eyes of Conservative Members. They were green around the gills with jealousy. It is telling that we seem to have forced so many of them to vacate their seats this evening. The fact that it is towards dinner time is no excuse.
  It is useful to consider the general economic context. Hon. Members have talked about the history of the British economy, but we also need to consider the current worldwide situation, which is full of uncertainty and unpredictability. We have to navigate the British economy through a lot of choppy waters. My right hon. Friend the Chancellor mentioned that a quarter of the world is in recession and the German economy is shrinking. The hon. Member for Bexhill and Battle (Mr. Wardle) ran through many of the problems in the world economy. There are difficulties in Asia and Latin America and a boom in the United States, with the stock market continuing to rise inexorably, propping up a lot of world demand. In this difficult time, it is important to focus on steering a course of stability for the British economy. The Conservatives failed to recognise that in their replies on the Budget this afternoon.
  The British economy shows many signs of success. My hon. Friend the Member for Halton referred to the International Monetary Fund, whose article IV consultation concluded last week. The executive board directors made some insightful comments about the state of the economy. The report said:
  "Executive Directors commended the authorities for the United Kingdom's impressive economic performance in recent years and their skilful management of the economy."
  The report went on to describe many of those skills and how they had manifested themselves, adding later:
  "Several Directors considered that the United Kingdom's experience … could offer useful lessons for other advanced and developing countries."
  That is an objective ringing endorsement of what the Government are doing.
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  The International Monetary Fund and other external observers are not the only ones who are saying that our economy is on the up. The Ernst and Young Item Club forecasters recently said:
  "Britain is on the verge of a golden economic scenario, with low inflation allowing interest rates to fall towards 4 per cent."
  The recent DHL international quarterly survey talked specifically about manufacturing industry and the upturn in confidence among exporters. It said last week that 54 per cent. of manufacturing exporters were expecting orders to increase. That is an excellent sign that we are turning the corner and moving towards a more stable, sustainable growth pattern. Even direct foreign investment—we have heard much criticism on that subject from the Conservatives—has improved. The managing director of the French Chamber of Commerce said last month:
  "We have noticed that the number of investments from French companies into Britain has increased quickly in the past two years."
  He went on to say that the French
  "are also seeing Britain as a good marketplace, whereas it was previously seen as a little complicated."
  That was the case under the previous Conservative Administration.
  Considering the position of the British economy on monetary and fiscal policy is a good way to assess the impact of today's Budget. Inflation is clearly being brought under control, thanks to the independence granted to the Monetary Policy Committee of the Bank of England. I am sure that many people will grow to appreciate that policy, when contrasted with the threat posed by the Conservatives, who would probably scrap Bank of England independence. The Conservatives getting their grubby political hands all over monetary policy again would pose a risk to everyone's prosperity. We shall find out what their policy is in time. If they do not like Bank of England independence, I should like to know what they would do like.
  Mr. Green: As I understand it, the stated policy of the Labour party is to abolish the Monetary Policy Committee. The hon. Gentleman cannot have it both ways. Either he thinks that the committee is a good thing, and should be allowed to set British interest rates, or he wants to abolish it by entering the single currency—but he cannot have both at once.
  Mr. Leslie: There is a very long word, Mr. Deputy Speaker—depoliticisation. Labour recognises that it is important to depoliticise decisions on interest rates, and to make sure that the world around us does not fear political tinkering with interest rates. The Conservatives cannot resist such short-term political fixing, and that miserable lot would return to it if they were re-elected.
  The IMF report also state:
  "Directors praised the government's efforts to strengthen the framework for monetary and fiscal policy in recent years … The revamping of the framework was most advanced with respect to monetary policy … this framework had worked well in the UK … On the transparency of the monetary framework, Directors considered the UK to be close to the frontier."
  That is almost like a quote from "Star Trek"—boldly going where others would fear to tread.

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  Recently, I was flicking through the annual report and accounts of a company called Fleming Claverhouse Investment Trust plc.
  Mr. Stunell: As you do.
  Mr. Leslie: I was doing so because of an interesting quote from the company's investment manager, who said:
  "The new Labour Government gave the Bank of England operational independence … thus reinforcing their pre-election claims of economic prudence and the need for low inflation."
  That quote jumped out at me because the right hon. Member for Hitchin and Harpenden (Mr. Lilley)—the deputy leader of the Conservative party—is a director of Fleming Claverhouse Investment Trust. His own company is commending the Labour Government's careful stewardship of monetary policy.
  Interest rates are down from their peak of 7.5 per cent. to 5.5 per cent. We have the lowest mortgage rates for 33 years, and the lowest long-term interest rates for 40 years—an excellent sign for the future. Cheltenham and Gloucester published an affordability index recently, which said that that represented a fall of more than a quarter in the amount that the average home buyer spent on their mortgage. The company predicted that rates would drop significantly further.
  Another study, by the National Institute for Economic and Social Research, predicted that interest rates would fall to below 4 per cent. by early 2001—the lowest level since 1955—as inflationary pressures eased. There are more testimonies to the success of the British economy in terms of monetary policy.
  The British Bankers Association highlighted a record £1.21 billion increase in mortgage lending this year. It called that "remarkable" and said that it was "genuine new demand". This will come through the system to ensure not only that we have a soft landing, but that we return to sustainable prosperity and increases in growth over the coming years. The growth forecasts have not changed, and growth will continue, along with low inflation.
  The Building Societies Association said:
  "borrowers might find the housing market particularly affordable this year".
  I am glad to see that things are looking up in that regard. Things can only get better, as we know—and they have got better.
  On fiscal policy and national debt, we see a transformation not only in the Government's coffers, but in how much debt is hung around the neck of the nation. We are going into a surplus in the current Budget of at least 0.5 per cent. over the economic cycle, and the tough control of public borrowing—cutting the deficit by about £19 billion in our first year in office—has laid the foundations for a sound revenue base which can pay for the vital public services and the long-term investment that we want.
  The Red Book highlights an equivalent of 6 per cent. reduction of debt in terms of GDP over the next six years—a significant achievement for the Government. As we get debt down as a proportion of GDP, we stop having to pay all that interest on the debt. The money that we save in that regard can be used for other parts of public expenditure.
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  My hon. Friend the Member for Halton highlighted the history of the Conservative party's aims in public expenditure, and referred to the way in which the Conservatives seemed to focus on consumption and on throwing money away in debt charges, willy-nilly. They were happy to pay money on interest, rather than using the money to invest in the future and the infrastructure of the nation.
  There were significant tax cuts in previous Budgets, with national insurance cut by £69 for each year from April 1999 and tax promises which have been kept with regard to VAT and income tax. We have the lowest-ever business taxes, with the main rate of corporation tax cut to 30 per cent, and the rate for smaller businesses reduced to 20 per cent. The list goes on.
  The income tax cuts are a significant achievement— particularly the new 10p starting rate of income tax, which will be welcomed widely across the country. The right hon. Member for Penrith and The Border (Mr. Maclean) said that he was already receiving letters telling him that people did not like the Budget. I have not checked my e-mail this evening, as I have been in the Chamber, but I know that people will be extremely pleased about the new 10p starting rate and, more importantly in some regards, the 22p basic rate from April 2000.
  All in all, each year the average household will be £380 better off, the average working household £450 better off and the average household with children £740 better off. The Budget cuts taxes for the vast majority, and I know that my constituents in Shipley will be extremely pleased with it. I expect plenty of letters to come flowing through my door; perhaps I will forward them to the right hon. Member for Penrith and The Border.
  We should focus on the capital modernisation fund. It has not been mentioned much, because my right hon. Friend the Chancellor had to rattle through so many excellent reforms. The nation will benefit from long-term investment in infrastructure, and an extra £1.1 billion was announced today on top of the £40 billion for schools and hospitals. For example, there is an extra £470 million for the national information technology strategy and £430 million for modernisation of accident and emergency provision in the NHS.
  Under the Labour Government, Bradford royal infirmary will get a new accident and emergency department that will be quintuple the size of the old one. The extra £170 million to tackle crime has already been mentioned. The investment from the capital modernisation fund will be extremely welcome and will start to filter through shortly.
  Pensioners will benefit tremendously from the Budget. Shipley has a high proportion of pensioners. They will welcome the increase in the older persons allowance, which will cost the Exchequer £100 million; the increase in the minimum income guarantee, not merely by prices but by earnings, which will cost £220 million; and, most significantly, the £100 winter allowance, which will cost £640 million and be worth every penny—pensioners need that allowance, and they will see even more clearly than before the contrast between our support for people who have worked and saved hard all their lives and the derisory amounts given to them by the Conservative Government.
  Enterprise is a theme that pervades the Budget. My right hon. Friend said that he was making seven announcements, but I counted 12 initiatives, including low

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  corporation tax; the extension of 40 per cent. first-year capital allowances for small and medium enterprises, which will encourage reinvestment in production process technology; the research and development tax credit; and something called "university challenge" in the Red Book, which may be more appropriately described as a £100 million boost for university science laboratories. We should not undervalue the benefits brought by that seedcorn money.
  The single small business service should not be overlooked in a review of the Government's achievements. It will come to be seen as a radical and enlightened reform. Conservative Members say that anything that the Government introduce adds bureaucracy and red tape, but one of the service's sole objectives will be to help with the administrative burden, cutting through red tape, giving loan guarantees and helping with automated payroll services for small firms. That will be welcomed by many small firms. Some of the biggest costs that they face are caused by the bureaucracy involved in pay-as-you-earn and so on.
  I also look forward to announcements on the new competition policy reviews taking place in the Department of Trade and Industry and the Department of the Environment, Transport and the Regions, especially the review of whether it is possible to reduce the cost of water for consumers and to ensure that profit is not always at the top of the privatised utilities' agendas.
  One of the Government's themes was helping poor people, especially families with children. The child support provided by the state will double during this Parliament, taking into account the increase in child benefit and the £416 given in the child tax credit. That will mean that the average family with children will be £740 a year better off. That move is very welcome, as are the Government's other initiatives, such as making work pay, the national insurance changes, the working families tax credit, the national minimum wage and the return to work initiative for the over-50s.
  I shall conclude my remarks to allow other hon. Members to speak. I look forward to hearing how Opposition Members intend to plug the revenue gap that would be created by the amendments that they propose to the Finance Bill. For the financial year 2001–02, their proposals would reduce revenue by £7.5 billion. Would they plug that gap by cutting public services, by adding extra to tax or by returning to increases in the national debt? What would the Tories do about Bank of England independence? Would they scrap the £40 billion extra spending on schools and hospitals? Given that they would also make no preparations for the euro, their policies represent a significant threat to the financial well-being of every man, woman and child in this country, should the Tories ever get back into office.
  The country wants stability in the economy, not the old boom and bust. I look forward to April as the month of delivery. People will start to see the benefits of our changes, including the national minimum wage, sure start, increases in child benefit and the extra £40 billion of the comprehensive spending review. Most of all, I look forward to the day when people see the benefit of the 10p tax rate, which will be extremely welcome. It is an excellent Budget and one that is worthy of this fantastic Labour Administration.
  8.43 pm
  Mr. Jonathan Sayeed: I congratulate the hon. Member for Shipley (Mr. Leslie) on a fluent speech, very little of which I agreed with. For the sake of brevity, I wish to take him up on one issue only. He said that he was delighted with the measures for families and children, but I urge him to read page 112 of the Red Book. Item 17 states that the married couples allowance will be abolished from April 2000, with a saving to the Exchequer of £1.6 billion, but its replacement, the children's tax credit, will not be introduced until a year later. That is the way in which this Chancellor has consistently clawed back money.
  In preparation for the Budget, I organised a survey of a large number of organisations in my constituency. Those organisations are not economists, statisticians or even politicians: they are businesses that employ people and produce profits. Out of the employment that they provide and the profits that they produce, they supply the taxes that Parliament spends.
  It is against the yardstick of what those businesses think of the Government that we should judge this Labour Chancellor. A wide range of businesses were included. Some are manufacturers, some are in construction; some are in wholesale and others are in retail. Some are in the service sector, and 23 per cent. of what they produce, they export.
  Over the past 12 months, business has grown for one third of them, has contracted for one third, and has stayed the same for one third. Before Labour Members congratulate themselves on that stand-still policy, I should tell them that quite a few companies said that they had been doing so well despite the downturn in the economy because they were living off the good times under the Tories.
  I asked what the companies predicted for the next 12 months. Anyone who has run a company will know that one knows a lot about what will happen during the next 12 months. One knows one's contracts, wage bills and much else so that one may make a fairly clever, careful prediction. It is true that 38 per cent. of the companies thought that business would improve, but 62 per cent. thought the situation would remain the same or get worse. That is a statement by business that we are in for a period of economic stagnation, and no Government should be satisfied with that.
  I thought that I should check that the companies were wide awake and that they were not sitting on their laurels, but looking to the future and trying to invest. I asked whether they were ready for the millennium and whether their computers were ready, the computer chips in their lifts were checked, and their weighing machines with microchips in them were fully tested. Ninety-seven per cent. said yes.
  I asked whether the companies were prepared for the euro, and 49 per cent. said that they were, and had been for some time. I asked how many were in favour of joining a single currency, and three fifths said, "No, never." They said that it was perfectly simple to run a business that deals with many currencies—as I have— without the need to join a single currency.
  The companies wanted a Government that they could chuck out when they needed to do so. [HON. MEMBERS: "They did that."] They wanted a Government that they could elect when they wanted to. [HON. MEMBERS: "They did that, too."] Labour Members may laugh,

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  but the same may happen to them. However, only if we are a sovereign nation will chucking out a Government matter. Most of the businesses want to be part of Europe, but they do not want to be run by Brussels or Frankfurt.
  I asked what the Government had done that most affected the businesses, either positively or adversely. Top of the list for three quarters of them was the European working hours directive. They said that, the Government had increased labour costs by 7 per cent. One commented that no overtime could now be permitted. Administration has become more complicated, and there has been a net increase of 1,980 regulations. They said that, under this Government, administration has become more expensive and less flexible. Shift coverage will be difficult. Put all that together with the minimum wage and the increase in upper levels of national insurance, and the companies are finding life hard.
  What do the companies want? They want more flexibility and less bureaucracy. They want reduced fuel taxes. They want the Government to encourage capital investment, and to keep their promise to deal with the payment terms of larger companies. The companies were relieved to hear the Prime Minister recognise at long last that taxes are increasing under his Government, and that they would continue to rise. They said that, until the Prime Minister understood that, there was no chance of taxation coming down.
  Cutting taxes matters and that is where the Government fail consistently. They trumpet that they cut corporation tax by £800 million, but what they failed to tell us was that, at the same time, by abolishing advance corporation tax and changing the system of collection, they increased the cost to business by £3.6 billion. We have the headline figure for reduced corporation tax, but the figures for ACT and the system changes are hidden. That happened in the previous Budget, and is apparent again in today's Budget.
  It is not only headline figures that matter. The Chancellor claims that corporation tax in this country is the lowest in Europe, but he is wrong. Sweden is in Europe, and its corporation tax is 28 per cent. However, Sweden suffers from a brain drain and a capital drain because all its other taxes are so high. It is the totality of tax that matters.
  Foreign companies based in Britain produce 40 per cent. of British exports, so it is essential not only that we get them to invest in this country, but that we keep them here. Those companies owe no loyalty to this country and we shall not keep them here unless we can prove that they have a better fiscal environment here than elsewhere. It is critical that the totality of tax, in whatever form it comes, is lower here than it is in any other place where those companies might want to settle.
  I believe that a Budget that lacks transparency lacks honesty. This Budget is at best translucent. However, amid the Chancellor's obfuscation, the hidden figures and the unannounced tax increases, some things are clear: tax is too high; tax on mortgages will go up; tax on marriage will go up; and tax on petrol, company cars, pensions, savings, home purchase and business is set to go up. All that from a Prime Minister who said a few weeks before the election that Labour had
  "No plans to increase tax at all".
  Worst of all is what has been done to the savings of people in this country. It is a monstrous disgrace that the savings ratio has declined so dramatically, from nearly
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  11 to 7.5 per cent. Savings protect the future of the elderly people of our country; they are our future. By damaging that, a Government make certain that more people will be dependent on the state in the future. To damage the savings ratio is a profound mistake for any Chancellor and the current Chancellor has done so in every Budget that he has delivered.
  Now and again, we hear nice things, for example, that there will be more money for health, education and the police; but then we read in the Red Book that those modest sums will be paid over three years. Furthermore, it is not new money; it was announced almost a year ago. But then I consider Bedfordshire police and remember that the Labour Government cut the funding to that police force during this financial year. The Government say that they will give money in the future with one hand, but this year they have taken away more money with the other hand.
  Some would call the Budget dishonest and they would do so because it hides the truth—[Interruption.]As you see, Mr. Deputy Speaker, I am trying to keep within the rules. What is clear is that the Chancellor is anxious to hide some truths.
  The Government are unravelling Britain. The Prime Minister is likely to go down in history as the Prime Minister who broke up the United Kingdom. The Government clearly believe in gutting the constitution. They are undermining parliamentary democracy and making our voting system less democratic. The Government are intent on abandoning our currency and are raising taxes inexorably. The best thing that this Government could do is learn some lessons from the past. There is a very simple lesson that they should learn: when we tax less, we incentivise more. Let the Government get on with that and we might have a worthwhile Budget.
  8.55 pm
  Ms Diane Abbott: It is with considerable amusement that I have sat in the Chamber all afternoon and evening watching the Tories floundering in response to a Budget that is, in many ways, a symphony on their best themes: the family, support for business and enterprise, and low taxation. Of course, it was presented with considerable panache and flourish by my right hon. Friend the Chancellor of the Exchequer.
  However, I warn my colleagues who have, again and again, prayed in aid the International Monetary Fund in support of the Government's economic strategy that, if I were them, I would beware of plaudits from the IMF. It is a ferociously monetarist organisation, which is not interested in poverty alleviation, the redistribution of wealth or a strong public sector. Some of my colleagues have said with great pride that one of the Government's achievements has been depoliticising monetary policy. That is a contradiction in terms.
  Of course decisions about economic policy are political, but those processes and decisions must be accountable and transparent. We mislead the public when we say that we can depoliticise issues that have a bearing on the life and liberty of our electorate. What some of my colleagues call "depoliticising monetary policy" others might call "abdicating responsibility for monetary policy". We shall see the consequences of that in the long term.
  Before I leave monetary policy—some hon. Members may be aware that it is one of my favourite subjects—let me say that it is interesting to note how the Government

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  try to have it both ways. They have abdicated responsibility in favour of that estimable man, Eddie George, at the Bank of England. However, when it suits them, the Government try to claim responsibility for the successes. I heard the Chancellor say this afternoon of monetary policy that "together, we are steering a course of stability." When Eddie George makes unpopular decisions, they are his; however, when those decisions appear to be working, the Government claim that they are steering a course "together". There is no "together" about it: for better or worse, we have given away control of monetary policy.
  Sir Robert Smith rose—
  Ms Abbott: I am sorry. I would usually give way, but I cannot do so now as time is short and several of my colleagues wish to contribute to the debate.
  The Government have given away control of monetary policy just as we will give away control of other spheres of economic policy if there is economic and monetary union.
  Let me move to the substance of my speech. My right hon. Friend the Member for Bishop Auckland (Mr. Foster) said that it is important not to judge Budgets immediately. He is quite right. I sat through 10 or 12 Tory Budgets, and I know from experience that, however much one thrashes around and waves one's arms at the time, the consequences of a Budget are best considered in the cold light of morning. Being neither new nor new Labour, I know enough to understand that a Budget is best judged not by reading the party handouts but by studying the Red Book. When one examines the Red Book, one sees a number of lacunae, which I am not able to shed light on at present.
  I was struck by an item in the Red Book that described how the Government would save £500 million in public expenditure by countering avoidance in the provision of personal services. My mind boggled as to how the Government planned to save expenditure on personal services and my curiosity led me to discover what that meant. When I referred to the Red Book and the supporting press releases, I found a press release that said that the Inland Revenue is looking at tax avoidance by people who leave employment and return to the same jobs as consultants. However, it provided no information as to how the Government planned to counter that tax avoidance. So how they can say in the Red Book that they will save £500 million in that area, I do not know. Having sat through 12 Tory Budgets, I strongly suspect that more such scams would be discovered in the Red Book if people only had time to consider it.
  I want to address the Budget's effect on families, not only working families—which are the Government's buzz words at the moment—but all families, including pensioners and single parents. I very much welcome the increase in child benefit. It has been established for many years that the most effective way to help children is not fiddling with the tax regime but providing child benefit. Equally, I welcome the Chancellor's decision not to tax child benefit, at least for the time being, because any attempt to do so would unravel the independent taxation of women, which is one of the few economic accomplishments of the previous Tory regime.
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  If one considers the Red Book, however, to try to work out the Budget's effect on families, one notices that working households gain the most. The Chancellor trumpets that as a great accomplishment, but let us think about that. We might think that the people who are losing out are non-working households—people who sit around watching daytime television and smoking cigarettes—but of course most of those households, who gain the least from the Budget, are pensioners, single parents and the disabled. Much as I applaud the Government's focus on work and working households, I must, even at the risk of being considered off-message, draw their attention to the importance of households whose members cannot work. They are not people who choose not to work, but those who have no practical prospects of gaining access to the labour market in the foreseeable future.
  One of the interesting points that is hidden—although not very well hidden—in the Red Book and the supporting press releases is that there will be further elements of coercion in the new deal. No doubt, that will be spelt out in the coming days and weeks. Young people will be forced to take part in the new deal and to go to interviews or lose their benefit. My concern is that the creeping element of coercion for young people will, in time, be replicated for other groups, particularly single mothers and disabled people.
  Single mothers are a particular concern of mine. I point out in the kindest and most comradely way possible that the Chancellor and the Secretary of State for Social Security know nothing about bringing up a child on one's own. We would hear less glib talk from them about the importance of single mothers going out to work if they had ever had to get up before dawn, put a child in a buggy, take the child to the minder and find themselves a job on public transport or filling shelves so that, at the end of the week, they had a few pounds more than they would have received in benefit.
  I say to my colleagues on the Treasury Bench that I went back to work when my son was eight days old, but I enjoyed my job and I had every support. I and many other Labour supporters in the country would be horrified if a Labour Government moved towards coercing mothers of young children back to work. Although Ministers would deny that they are doing so, if we consider the trend in the way that they are structuring social security, we can see that it is a possibility. What is the merit in young, under-educated women leaving their children in the care of other young, under-educated women so that they can go out and fill shelves?
  In his Budget speech, the Chancellor spoke of failing to reward those who take the most important responsibility of all. Our attitude to single mothers means that we are failing to reward them. The Government cannot continue to imply that the only way for single mothers, whatever the age of their children, to improve their standard of living is to go out to work. If anything, we should pay single mothers of children under five more benefit because it is their choice to stay at home, and we should not coerce them into going to work by artificially keeping down the levels of benefit and by constant propaganda about entering the labour market and the work force. The reality for those young women is not becoming a Member of Parliament, a merchant banker or some other well paid jobholder, but demeaning, underpaid work, with all the misery and practical problems of using public transport to get to work and to childminders. I am sorry

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  to labour the point, but I feel strongly about it. Ministers overlook it in their obsession with getting everyone into work.
  I welcome the fact that the Chancellor of Exchequer has talked much about the books and computers that he will get into schools, but all the books and computers in the world will not matter if we cannot retain teachers. Hon. Members can call me simplistic, but in a market economy, the key indicator is cost. So, if we value teachers, we must pay them.
  My son is at a state primary school on the border between Hackney and Islington. Since the beginning of this school term, he has had six different teachers—not because the school does not care, but because it is impossible to retain teachers in inner London on the pay that they are offered. It is no good Treasury Ministers talking about superteachers. Ordinary parents want ordinary teachers to teach their children. I do not know about the rest of the country, but staff in the inner city will be retained only if the average teacher is offered higher pay. We are fooling the public if we pretend otherwise.
  I would like my son to have more books and computers, but I would also like him to have a teacher who stays at the school for an entire school year. I would like him not to have to put up continually with supply teachers and a desperate head teacher who cannot retain his staff. On the present salary, young teachers living in London cannot buy a house or have any kind of life. I await the time when Treasury Ministers get up and get real about issues of recruitment and retention in the public sector. They should think not about fast-streaming some, or offering money to superteachers and supernurses, but about reflecting market realities and paying people the proper rates for the job.
  I noticed that the Chancellor said that there would be action on competition policy. I welcome that; I hope that it will involve action on competition among newspapers and the Murdoch empire. Action on Murdoch would be widely welcomed both in the Labour movement and among the general public.
  I noticed that the Chancellor talked about financial services, which is a very important subject. As we approach the millennium, we are moving into an era in which we are looking to the financial services industry to provide many parts of the welfare state, such as benefits for unemployment or sickness and higher education, which my generation assume will be paid for out of taxation. If colleagues had served, as I did, for eight years on the Treasury Committee and seen the horrors of pension mis-selling and the financial services industry, they would know that it will take more than league tables to get the industry into line on such matters.
  I notice in the Red Book that the Government are laying a great deal of stress on the private finance initiative to meet their requirements for capital investment. This is not the debate in which to address the PFI, but the Government are going down a blind alley with it. The PFI is simply not suitable for certain public expenditure, especially in the health service, as the Government will find to their cost.
  We have one of the most able, accomplished and intellectually self-confident Chancellors of modern times, yet he has a tendency to dwell on micro-economics, supply-side measures and new computers and books to
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  the exclusion of macro-economic issues, on which ultimately we judge a Chancellor. When we strip out the soundbites and the little tasty things that are designed to affect the elections in May, we will find that what really matters to the economy are prospects for growth, world trade, monetary policy, public spending and the burden of taxation. Only a close study of the Red Book in the coming weeks and months will reveal what is really happening on those issues.
  There is much to welcome in this Budget, but, as I have said in the House before, I doubt very much whether the aspirations of Labour voters can be realised within what is essentially—despite the protestations of the Tories—a Tory macro-economic framework.
  9.10 pm
  Mr. Damian Green: It is always interesting to follow the hon. Member for Hackney, North and Stoke Newington (Ms Abbott). I do not agree with her that the Chancellor makes a convincing Tory, but I agree that Labour voters will find him unconvincing, whatever clothes he is trying to put on.
  The hon. Member for Shipley (Mr. Leslie) cast doubt on whether my right hon. Friend the Member for Penrith and The Border (Mr. Maclean) was in a position to know the instant public reaction to the Budget. I am happy to report to him and the House that, about half an hour after the Chancellor sat down, the hon. Member for Gravesham (Mr. Pond) and I appeared on a radio programme, and that, after the hon. Gentleman had said that the new Jerusalem had arrived and I had said that the Budget was essentially a con trick, members the public were asked their views, and they all said substantially the same thing—that the Budget pretended to give with one hand, while it took with the other, and that there was nothing in it for them.
  I am also happy to report that the public's views had nothing to do with my penetrating analysis or eloquence because the interviews were pre-recorded, so the Chancellor can take all the credit for that instant disillusionment with his measures. Obviously, the people of Kent have more savvy than the Labour Back Benchers who waved their Order Papers earlier.
  I do not want to travel to the wider shores of macro-economic policy, as so many colleagues have done so. I should like to make three points that are especially pertinent to my constituency and other parts of Kent, and two wider national points on aspects of the Budget that deal with training and lifelong learning.
  My first—very practical—point concerns the Chancellor's non-change in alcohol duties. Although that will be welcome, it will not be enough to prevent what is becoming quite a serious fiscal and social problem for the whole country, but especially a social problem for my constituents and others who live in Kent, which is the first port of call for smugglers of drink and tobacco. The Treasury is aware that levels of beer duty, which the Chancellor has left unchanged, are seven times higher than levels of French beer duty, and that that gap provides a straightforward and easy economic incentive to smuggling and fraud.
  Every day, about 1.5 million pints of beer are smuggled. One in three pints of beer drunk in Kent is now bought in France. Some of that trade is legal, but the vast bulk of it is illegal, and it costs the Treasury about

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  £900 million a year in lost tax revenue. The Chancellor made some announcements about improving the resources of Customs and Excise to tackle the problem, but he must know that those improvements are only a fig leaf. As long as the economic incentive is there, the trade will carry on.
  Alcohol smuggling is not only a fiscal issue but a serious social issue. As a result of keeping tax too high, paradoxically, alcohol is too cheap, because so much smuggled alcohol enters the country, and therefore it is more accessible to children. The journal of the British Institute of Innkeeping drew attention to the fact that a police camera sequence filmed in the centre of my constituency showed youngsters as young as 11 or 12— who, the police discovered, had got drunk on illegally smuggled alcohol—trying, as they put it, to stop the traffic. They were wandering around the streets, hopelessly drunk, putting themselves and other motorists in severe danger.
  The fact that our alcohol taxes are too high is not simply a matter of the Treasury losing income and revenue; it is a social disaster happening under the Government's nose. I urge them to set in train a full-scale review of excise duties, because that would be not only in the Treasury's interests but in the wider interests of law and order.
  I am sure that the Minister knows that tobacco smuggling poses an equally serious problem. I am sure that every hon. Member approves of the use of high taxation in an attempt to discourage smoking; that is not at issue. However, at the moment, it is not working. One in seven packets of cigarettes smoked in this country is smuggled, so cigarettes are available much more cheaply than the Government, any health professional or any hon. Member would wish them to be. The Chancellor is shooting himself in the foot, and the money that the Secretary of State for Health spends on anti-smoking propaganda is wasted because the Government cannot bring themselves to address the issue. I have been told by my local police that they have known packets of 20 cigarettes to be available in schools in my constituency for as little as 35p. Quite apart from the revenue aspects, a serious health aspect is clearly involved.
  Mr. Tyrie: Does my hon. Friend agree that the Government should take a leaf out of William Pitt the Younger's book? He faced the same problem. The excise duty was falling because of the increase in smuggling. There were calls to increase the number of Customs officials to go chasing the smugglers. He did the opposite. He lowered the excise duties, particularly on spirits. As a result, revenues increased. He found a superior means by which revenues would increase—lower rates of duty. That is a much better way to deal with the problem.
  Mr. Green: My hon. Friend makes an elegant historical point.
  There is a further serious social issue. The smuggling is attracting professional criminals to what is otherwise a peaceful and tranquil part of the country. The police warn that unpleasant criminal gangs are assembling and taking over local areas. They warn that there will soon be gangland shootings in small villages in east Kent unless
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  something is done about the matter. This is more than a Treasury issue. It is a serious law and order issue which the Government have it in their power to address. Unfortunately, they do not seem to have the will to do so. I urge them to deal with it.
  The third issue that concerns my constituents is the accelerating increase in petrol duty that the Government insist on introducing. The right hon. Member for Bishop Auckland (Mr. Foster) referred to it in the context of his constituency. That was many hours ago. Those of us who sat through the speech of the hon. Member for Halton (Mr. Twigg) may think that it happened in a previous lifetime.
  For my constituents, cars are not a luxury. They are not even a necessary evil. They are a necessity for people to get to work and to lead an ordinary life. The Government seem to be trying to shove the car into the category of goods which, in principle, they would like to ban. They cannot quite bring themselves to do that, so they will tax its use out of existence. There may be arguments for that in urban areas, but there are no arguments in rural areas.
  The Government are making rural motoring impossible for the less well-off. As the right hon. Member for Bishop Auckland observed, the better-off shrug and bear it, but people who have a car as a marginal good and worry about the price of petrol face increasing difficulty. The Government have got themselves on to a treadmill, which they must get off. If not, we can only agree with the right hon. Gentleman's conclusion that the Government have no regard for rural areas and those who live there.
  Lifelong learning is one of the Government's great catch phrases, but I am forced to conclude that it is no more than a slogan. The Chancellor devoted part of his Budget statement to individual learning accounts. For anyone who knows anything about the scheme, that section of his speech was slightly surreal. He spoke about how the scheme could be extended, how it would be tweaked, and how it would be tied in with the use of computers.
  The fact is that individual learning accounts do not exist. They are chimera in the Chancellor's mind. He spoke of extending them, but he cannot extend them until he introduces them. Last year, the Government produced a Green Paper on the issue and promised us a White Paper. We have seen no sign of the White Paper. The Department cannot tell us when it will come out.
  The Government said originally that the scheme would be introduced on 1 April. There are still no details about them. [HON. MEMBERS: "1 April."] I intended to refrain from 1 April references, but, as my hon. Friends have not done so, that may be an appropriate date for the Government to consider introducing the scheme.
  The Government say that they will provide £150 a day which, with the £25 a day that the individual claimant must put in, will allow two days of training on Windows. That is all well and good, although it will not transform the life chances of anyone who goes on such a training scheme funded by an individual learning account. So far, those things do not exist, yet the Chancellor devoted a section of his Budget statement to them. I shall be delighted if a Treasury Minister can explain what on earth the Chancellor was on about.
  The gap between rhetoric and reality is startling in other areas, such as the new deal for the over-50s, which was much trumpeted. We read about it on the front page of

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  one of the national newspapers in the now-traditional pre-Budget leak. I read with great eagerness table 4.1 on page 58 of the Red Book, where I discovered that this enormously important scheme will have precisely £10 million spent on it this year. To put that in perspective, £820 million will be spent on the new deal for young people. Those over-50s who think that their lives will be transformed by that new scheme will be sadly disappointed.
  I wondered whether the scheme was merely a pilot project that would be extended next year, but I discovered that, for every year for the rest of this Parliament, precisely £20 million will be spent on it. This is not a major scheme.
  Mr. Tyrie: May I give my hon. Friend another example of a surreal aspect to the Budget? We are told that there is £20 million for a venture capital challenge competition. The venture capital industry is to be revived, somehow. Of a total investment in the country of £132 billion per annum, what difference will £20 million make?
  Mr. Green: As the debate continues, others of my hon. Friends will find more nuggets in the Red Book that reveal the enormous gap between rhetoric and reality. For example, the university for industry, which is one of the Government's big ideas and a major training initiative, has funding of £5 million for 1998–99. That is fair enough, because it is for the start-up costs. Will funding be serious next year, when the university is established? Funding for 1999–2000 is zero, funding for 2000–01 is zero and funding for 2001–02 is zero. There is no money for this major Government initiative to promote lifelong learning.
  Mr. David Taylor: If the hon. Gentleman reads the Red Book in a little more detail, he will see a footnote that makes it clear that the funding for the university for industry is taken over by departmental totals at that stage. Although the funding does not appear in the table, it is referred to.
  Mr. Green: I am grateful to the hon. Gentleman, because I was coming on to that point. Footnote 7 on page 58 states:
  "Other costs of the UfI are funded from within departmental expenditure limits."
  In other words, the funding has been junked inside the Department because the Government do not know what to do with the policy and do not care about it very much. That is symbolic of the Budget: provide a leak, add some gloss, give it some spin and let the policy look after itself. That does not wash and the longer that the Government are in office, the less that will wash. The British people will see through the Budget and, in the long run, it will be judged a failure.
  9.23 pm
  Ms Sally Keeble: I am pleased to speak in a debate on a Budget that will greatly benefit my constituents. I agree with the hon. Member for Ashford (Mr. Green) that the British public will see the Budget for what it is—they will see it to be a resounding success. In particular, the families and the pensioners who make up the bulk of my constituents will feel the benefits of the Budget.
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  I had a rather rueful thought as the hon. Member for Ashford talked about the problems of smuggled alcohol. Such smuggling has, from time to time, been a real problem in my constituency and an extremely dramatic case was splashed all over the papers. Alcohol was smuggled in from France and sold in the local Conservative club, and there was an extremely high-profile raid.
  I want to comment on some of the facts that were put forward by the hon. Member for Mid-Bedfordshire (Mr. Sayeed), who is no longer present. He said that, year on year, the Chancellor had damaged the savings ratio, but, from my understanding of the Red Book, that is not true. The ratio will edge up slightly, from 7 to 7.5 per cent.
  I also take issue with the incorrect information that the hon. Gentleman provided about the increase in taxes on ordinary families. What he said was untrue. Page 157 of the Red Book shows that the tax take is lower than it was for most of the Tory years and page 71 shows that it is lower this year for families with two children than in any year since 1992, which—surprise, surprise—was an election year. Apparently, by 2001, the tax burden on families with two children will be roughly half what it was for most of the Tory years. Many families will feel the benefit of that, and will realise that it is due to the Chancellor's sound management of the economy and his generous and thoughtful tax and benefit arrangements.
  Let me now deal with the Budget's impact on families. Children's tax credit is to replace the married couples allowance. That will produce real benefits that will be much more carefully targeted. There will be a dramatic increase in child benefit. Moreover, the working families tax credit and child care tax credit will shortly be introduced. Taken together, those measures will radically transform the living conditions of many of my constituents, and, in particular, will end the outrage, which has existed for many years, that children are always those most affected by poverty. Many will be relieved when children receive the greatest support from the Government.
  The Budget contains a number of other measures to benefit children, which many families will see coming into effect very quickly. For instance, extra money is being put into education. Cash for books will constitute a substantial improvement for many schoolchildren, while improvements in maternity grants will plug a gap in our tax and benefit system, providing support for women and children at the point at which it is often most needed— the point at which they are most vulnerable. Families of the type that constitute the bulk of my constituents will benefit by roughly £40 a week as a result of all the changes in the Budget.
  In my constituency, I have been constantly lobbied by pensioners, not just about the level of their state pensions but about the impact of tax on their incomes, and the importance to them of their long-term savings. I was pleased to hear confirmation that the increase in the minimum income guarantee would be linked with earnings. That will provide a cushion for pensioners who are having to struggle on the lowest-possible incomes. I am sure that the national savings bond for pensioners will also be very welcome in a community in which people understand that, to a large extent, they must provide their own security for long-term retirement.

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  I recently engaged in a consultation exercise with a number of pensioners, from which it emerged that most would prefer to make their own choices, and to have the support and the tax structure that enabled their income to be protected. I was therefore pleased to note that the tax structure would be changed to provide larger allowances for pensioners over 65 and over 75.I am sure that will go a long way towards persuading those whose private income takes them above the minimum level, who have felt bitter about their inability to increase their income, that the Government are supporting them and helping them to make ends meet.
  I single out the winter allowance, which, again, for many people addresses a real need: they face real hardship. The increase from £20 to £100 is dramatic: it is beyond what anyone expected. It will make a substantial difference, not just easing the costs of heating, but making people more likely to keep the heating on, rather than turning it off in the coldest months.
  One further aspect might be overlooked, but will certainly affect many of my constituents. Most people in Northampton are in work. They will benefit from all the measures that will help families in work. Many people are self-employed or run small businesses. It is a town with a huge amount of enterprise and many small firms, which remain small and do not have any ambitions to grow into multinationals or anything like that.
  For those businesses, the 10p tax rate, the continuation of the capital allowances and the changes in the payment of PAYE and national insurance contributions will make a substantial difference in cash terms, and will also make them feel that their enterprise and work are rewarded.
  It is not just people in this country who will feel the benefits. The changes in the Budget and the skill with which the Chancellor has handled the economy have made us the envy of the rest of the world. My hon. Friend the Member for Shipley (Mr. Leslie) mentioned the praise from the International Monetary Fund. I quote, perhaps in more practical terms, the fact that, last year, this country had record levels of inward investment—not because it is the sweat shop of the world, as the Tories tried hard to make it, but because of the opportunities and skills that we offer.
  People in Northampton, North will find that the Budget echoes all the things that are important in their lives. It will make work pay, reward thrift and planning, encourage saving and reward and help those people who have—[Interruption.] People scoff. At the same time, there is the support for pensioners' savings, and individual savings accounts are coming into line, and they will provide a big draw for people on low incomes who have smaller savings.
  The Budget will encourage enterprise and support families. It comes between international women's day and mother's day, and it will be incredibly popular with many women. It will support all those things that make our society work. It will make Northampton, North one of the benchmarks of the country. In future years, it will be seen as a Budget that marked a real turning point for our country and put things on an upward curve for many people.
  9.33 pm
  Mr. Tim Loughton: One Minister leaking to the Financial Times over the weekend promised a "substantial, surprising and important" Budget. What is substantial is the amount of revenue that the Chancellor is filching by stealth from the back pockets of the British public—£40.7 billion over the lifetime of the Parliament. Before he got up this afternoon, £6.4 billion of extra taxes were already guaranteed without his having to say a word.
  At least the Prime Minister last week came clean on the tax burden going up under the Government. It is a shame that the Chancellor did not follow his example. The whole Budget was an illusionist's dream. Labour Members cheered the 10p tax rate, but failed to realise that, by scrapping the 20p tax band, the Chancellor was taking it back with the other hand.
  There has been no let-up from many of the iniquitous, unfair and shameful tax rises that have already been introduced by the Government. There has been no reprieve for 300,000 non-taxpaying pensioners who will lose their dividend tax credits, or for those people about to sell their lifetime businesses, who will lose out on retirement tax relief. There has been no reprieve from the extra taxes on business of £5 billion over the past two Budgets, which it is now estimated will cost some £20 billion over the next two years.
  It was a Budget of failed opportunities, disguised with a series of technical measures for start-up companies, promises of jam tomorrow, recycled announcements that we had heard over the past few months and downright gimmicks.
  Tax breaks for small companies, which, by their nature, do not make profits, are not exactly very useful. The truth is that, by 2001, the Budget will increase the tax burden as a proportion of gross domestic product, to 39.5 per cent. or more. That is the highest level in 12 years.
  The Government have also vastly complicated the tax system, so that now we have over 54 different rates, three new bands of stamp duty, two rates of value added tax, two rates of insurance premium tax, dozens of rates of capital gains tax, differential rates of vehicle excise duty, five new rates of income tax and five rates of corporation tax. Overall, the Budget contains 23 tax increases.
  I should like briefly to mention green taxes. The Minister said in the Financial Times that the Budget would be surprising. One surprise, which has been cleared up, is the absence of the Deputy Prime Minister, who is away scuba diving in the Maldives. That caped crusader for the environment has been sidelined yet again. From a Government who promised to place environmental concerns at the heart of decision making, the Budget has been an enormous let-down. Last year's Budget was described by environmentalists as "as green as mud." Tomorrow, environmentalists' verdict on today's Budget will be less kind.
  We have heard so little today about the energy tax. The Marshall report was remarkable in dealing with that tax, and not only because it—a report from a former chairman of British Airways—did not propose applying the tax to aviation fuel. It is a downstream tax. It is not a real carbon tax, as it will not tax energy production at the power station. It also does not discriminate against the least environmentally friendly energy production, such as coal-fired power stations, for example.

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  Yet again, the gas-fired power station industry—which contributed most to reducing our carbon dioxide emissions—is to be sidelined in favour of propping up the coal industry and the Government's friends the miners. The Government's target was to generate 10 per cent. of power demand from green sources by 2010. The Budget will do virtually nothing to achieve that target. For starters, the Government should end the moratorium on gas-fired power stations.
  The energy tax—a downstream tax that is not a carbon tax—will encourage a further switch from manufacturing to services. Which sectors will pay most? How will the Government persuade households to use less energy? How will it reduce CO2 emissions by 3 million tonnes? How will the Government hypothecate tax back to different types of businesses? What incentives are there for power generators to fit scrubbers to treat emissions? How much lower will tax need to be if the system is not rigged to be pro-coal? The tax will have an enormous effect on manufacturing industry, particularly in northern Labour constituencies, and especially in the chemical industry.
  We heard absolutely nothing today about emissions trading permits. The Budget was tokenism of the worst kind—as demonstrated by the provision of only £50 million to encourage business investment in renewable fuel and cleaner technology. The Government are interested only in gloss. On green taxes, the Budget is a damp squib.
  Other minor provisions in the Budget were intended to encourage use of smaller cars and lower-emission lorries, but the Government demonstrated no serious intention to achieve the objectives. Last year's token Budget provisions completely failed to give the Government a veil of environmental friendliness.
  On 1 February, in a written answer, the Minister for Transport in London admitted that, in the lifetime of this Parliament, the number of buses that have been encouraged to convert to road fuel gases has risen from 20 to 53. The number of heavy goods vehicles able to use road fuel gases has increased from 41 to 96. That is hardly a testament to the Government's green credentials or to the green measures provided in last year's Budget.
  Today's token measures will achieve the same token result. The Budget provides no specific tax incentives to manufacturers of motor vehicles powered by road fuel gases. We need a bold move—of the kind that the previous Government made—to encourage lead-free petrol. We need a five-year plan for the road fuel gas industry properly to establish the necessary capital structure.
  The Budget contains nothing to equalise VAT treatment of new-build and green-field sites, renovation of existing properties, and redevelopment of brown-field sites in towns. Landfill tax is to go up, but there is absolutely nothing in the Budget to facilitate alternatives to the 84 per cent. of waste that goes into landfill. There is absolutely nothing in the Budget about recycling, reusables or composting.
  Similarly, raising the fuel escalator on petrol—so that a gallon of petrol now costs £3.10—does not reduce car mileage travelled but simply adds £120 per annum to the costs of the average middle-income family and discriminates against those living in the country, those who have to take children to school, and the disabled who rely on their vehicles.
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  On capital taxes, the Government have completely complicated the capital gains tax system. They missed the opportunity to raise CGT allowances to £10,000 which would have exempted about half the people who currently pay CGT, accounting for just £27 million.
  The Budget has indeed been substantial, surprising and important, but largely from what it has patently failed to do despite all the warm words that have been piled high on the British public for so long. It is surprising for the audacity with which the Chancellor has attempted to dress up a tax-raising, tax-complicating, regulating and red-tape-generating Budget.
  Putting up tax and benefits is not a neutral act, but rather a measure of stealth to extend the hand of the state yet further. While the Chancellor attempts to grab the headlines with a 10p tax rate, he loses no time in simultaneously grabbing that back and more from the wallets of industry, business, home owners, car drivers, pension fund holders, the self-employed, smokers and married couples. When the small print has been studied carefully, the euphoria heard from the Labour Benches this afternoon will soon be but a distant echo.
  9.41 pm
  Mr. Andrew Stunell: I am delighted to speak in the debate. First, I have to give credit where it is due and to say that any observer from any part of the House would have to give the Chancellor nine out of 10 for presentation this afternoon. It was very skilfully done, but the words of the right hon. Member for Bishop Auckland (Mr. Foster) must be borne in mind: what seems brilliant on Tuesday can often seem sour on Friday. I wonder whether today's message of tax cuts all round and enhanced public services will stand up to inspection. I have a strong feeling that, when many pensioners in their 80s in my constituency look at the small print, they will be disappointed at the small scale of the largesse that they are to receive.
  Having endured cuts of £10 million in the last year of the Conservative Government, and £12 million in the first year of the Labour Government—and having just been confronted with another £4 million in cuts for next year— the chief executive of Stockport council will no doubt find the idea that public services are receiving extra support somewhat hollow.
  The chief constable of Greater Manchester has reported that, during the last five years of the Conservative Government, the number of uniformed police officers in Greater Manchester fell by 156; that, in the period between the general election and last September, it fell by a further 34 officers; and that, as a result of the £12 million budget cuts next year, it will fall by a further 130 officers. I have a feeling that he, too, will not be convinced of the largesse that the Chancellor has been handing out.
  I shall now concentrate my remarks on the environmental impact of the Budget. Last year, the Chancellor made himself look a little foolish by promising to produce a Green Book to match the Red Book, which would outline measures in respect of the environment. In the event, he produced one page. This year, he has done better; he has produced two pages: pages 84 and 85 of the Red Book.
  The Chancellor said that the Government were committed to a target of a 12.5 per cent, reduction in carbon dioxide emissions by 2010. He did not say too

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  much about the domestic target of 20 per cent. which is referred to elsewhere in the Red Book. That set of environmental Budget proposals is intended to reduce carbon emissions by 3 million tonnes a year. In broad terms, that is only 2 per cent. of the target that we need to reach, so there is a very long way to go to achieve even the limited statement of green objectives and results.
  I shall comment on two of the proposals. First, we welcome the fact that the Government are taking seriously the Marshall report. We very much hope that it will be implemented in a practical and worthwhile way. We regret, however that what is proposed is not a genuine carbon tax. It does not allow consumers and industrialists to choose to use green and renewable energy and therefore to bypass the tax. Although the measure will no doubt raise money and be an incentive for greater efficiency, it will not promote the use of renewable energy.
  The other features of the Budget that the Chancellor waved around to demonstrate his green credentials were the changes to vehicle excise duty and the fuel escalator. It is a great pity that he did not listen more carefully to what the Liberal Democrats have said. We proposed that vehicle excise duty on all vehicles smaller than 1,600 cc should be eliminated. The revenue should be compensated for by an increase on fuel duty of 5p per litre. That would leave any motorist doing less than 23,000 miles a year marginally better off. It would overcome the criticism to which the Chancellor has rightly been subject from hon. Members on both sides of the House—that his proposal will hit rural motorists particularly hard. Under his proposal for a £50 reduction for cars with smaller engines, motorists with cars smaller than 1,100 cc will be in credit for only the first 6,000 or 7,000 miles. After that, they, too, will pay more than before the Budget.
  The Chancellor also omitted many other practical and sensible proposals that would have helped him to reach his Kyoto targets and would have benefited the people whom he was anxious to protect—those who live in poverty. A reduction in VAT on energy-saving materials and energy efficiency measures for buildings would have gone a long way towards helping many of the 8 million households living in fuel poverty, who currently spend more than 10 per cent. of their income on keeping warm. It would have helped them to have properly insulated and heated homes and would have helped to avoid the 40,000 excess deaths each winter in this country that result from fuel poverty. That is six deaths per week per constituency throughout the winter. The Chancellor's silence has denied us the chance of that benefit. There is scope, too, for an investment policy that concentrates on renewables. I could say a lot more if the clock were not racing towards 10 pm.
  The Budget also lacks a clear policy on integrated transport. It was fine to hear that the Deputy Prime Minister will make a wide, sweeping statement, but we want to know when that is coming. The extra money that we have for rural bus services cannot be used to help existing services, but must be used on new ones. That produces some absurd results in my constituency on the urban fringe of Greater Manchester. To qualify for the grant, the strangest routes have to be devised. They must not run on an existing bus route and must have a qualifying amount of rural road. If that is the best that we
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  can do to create an integrated transport strategy, the Secretary of State needs to come back from the Maldives in double quick time.
  There were no proposals for a green-field development tax. We must ensure, particularly in areas such as Hazel Grove, that there is a strong disincentive to build on green-field and green-belt sites. I very much hope that there will be opportunities for consideration of such proposals in further debate on the Budget.
  The aim of the Budget was to address some urgent priorities. We share those priorities, including a sound regime of taxation, high-quality public services and a real concern for the environment. Sadly, the opportunities have been missed in many areas. That is particularly true in terms of the environment.
  In 2010, the Government's guideline figures become legally enforceable via the treaty into which we have entered. As a result of the Budget proposals we have heard today, we will be well behind the game. We are clearly missing the Kyoto targets with these proposals, and we are missing the opportunity for jobs and investment that worthwhile and vigorous pursuit of those targets would bring.
  Worst of all, in the long term, we are heading into a situation where pursuing those environmental targets is seen as something that only people with hair shirts are prepared to pursue. The targets could be seen as a way of improving the quality of life for the people of this country, improving the investment and export potential of its businesses and giving a world lead on climate change. Those opportunities have been missed today. That is a great shame and a great mistake.
  9.51 pm
  Mr. David Chaytor: I am grateful for the opportunity to follow the hon. Member for Hazel Grove (Mr. Stunell), who made some constructive criticisms. It was interesting that both he and the hon. Member for East Worthing and Shoreham (Mr. Loughton) concentrated on environmental taxation—the point that I wish to raise.
  If the hon. Member for Hazel Grove looks deeper into the Budget documents, he will find that, in addition to the progress made on environmental taxes today, further announcements will be coming on-stream in due course and further work will be set in train—particularly on the question of tax on aggregates, on pesticides and on water extraction.
  Today's Budget is a landmark Budget, in so far as environmental taxation is now being taken seriously. It is crucial that the environmental objectives are integrated into fiscal policy. Some Conservative Members have said that not enough is being done to protect the environment, while others criticise the energy tax and the fuel taxes. There is a schizophrenia deep in the heart of the Conservative party on environmental policy.
  The previous Government, to their credit, were the first to initiate environmental taxation with the landfill tax and the introduction of the road fuel duty escalator. However, when the Tories have the nerve to criticise the impact on petrol prices, we should point out that the difference between petrol prices under the Conservatives and under this Government is three Budget increases of 1 per cent.— the previous Government's policy was to increase duty by 5 per cent.; ours is to increase it by 6 per cent.

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  The Budget is important in so far as it restores fairness to the heart of taxation policy. For a generation, it has been impossible to have a serious debate about taxation in this country because of the obsession with the level of taxation and with reducing taxation. By the various measures that my right hon. Friend the Chancellor has announced today, we once again have the concept of fairness at the heart of our tax policy. Many thousands of low-paid workers in my constituency, as well as the 15,000 pensioners, will welcome the new emphasis on fairness.
  I wish to concentrate on the environmental measures, and I congratulate my right hon. Friend the Chancellor on grasping the nettle of the industrial energy tax. Had the previous Government not made such a mess of their VAT on fuel policy, that industrial energy tax could have been in place—developing, working and cutting carbon dioxide emissions. We are five years behind where we should be because of the incompetence of the previous Government on VAT on fuel.
  Having said that, I urge the Chancellor and the Government to think seriously about the implementation of the energy tax. The ground has been well prepared by Lord Marshall and his colleagues, and most large companies are well aware of the implications of the tax—many are already developing their own internal emissions training systems. However, I fear that many smaller companies have not yet grasped the importance of the energy tax. They have not yet understood how it will impact on them. The Government must take the issue seriously and ensure that advice is available to small companies on how they can not only adjust to, but benefit from, the energy tax.
  For many years we have not thought seriously about the use of industrial energy. We have become profligate because we have got used to low energy prices. When companies seriously consider how to conserve energy they will quickly find that they can save a considerable amount on their bottom line; but they can do that only with professional advice.
  I hope that the Government will keep under constant review the way in which the proceeds from the industrial energy tax are used. It is right to establish the principle that it should be revenue neutral, but if it is used only to reduce employers' national insurance contributions an opportunity will be lost. If the tax is to work, it must be set against investment in renewable energy. Companies should be able to claim exemption if they can show that they are switching to renewable energy sources. That is one of the most effective ways of reducing greenhouse gases and other emissions.
  We should consider the impact on rural motorists of road fuel duty, but we should not overplay the issue— and, when we talk about petrol prices and poorer people, we should remember that the poorest third of households do not have a motor car at all and are not affected. There is no real argument against the principle of the road fuel duty escalator, and there are other mechanisms whereby low-income motorists in rural areas can be protected. One method is to use the standard spending assessment system and adjustment to council tax. One of the most effective ways of protecting those poorer motorists is to adjust council tax to compensate them.
  Mr. Paterson: Will the hon. Gentleman give way?
  Mr. Chaytor: I would very much like to, but I am afraid that, in view of the time, I cannot.
  Mr. William Ross: On a point of order, Mr. Deputy Speaker. Am I correct in thinking that the hon. Gentleman is wrong in believing that he has to finish his speech by 10 pm? Surely he could resume it tomorrow.
  Mr. Deputy Speaker (Mr. Michael J. Martin): I think that we will take one day at a time.
  Mr. Chaytor: I am grateful for the suggestion that I might be able to finish tomorrow, but I am happy to finish at 10 o'clock precisely.
  I welcome the changes in vehicle excise duty and the introduction of a lower rate for smaller vehicles. I especially welcome the fact that, buried deep in the Budget documents, is the proposal that, as of next year, we will have a fully fledged variable excise duty, related to vehicles' emissions ratings. That is long overdue. We should not only reduce the duty for lower-emission vehicles, but increase it for higher-emission vehicles.
  The motor car is a key indicator of affluence, and one of the most effective means of introducing fairer taxation is to recognise that better-off people have bigger cars and drive further in them, while poorer people have either no cars or small old cars and do not drive many miles.
  We need to be more confident in our support for environmental taxation. The Government need to be up-front in explaining that we are going through an historical transition, away from a tax system that is almost entirely dependent on taxes on labour and towards a tax system that becomes increasingly dependent on taxes on pollution and the depletion of natural resources. That trend is welcome and the public as a whole would appreciate it if it were clearly pointed out to them. We do not need to be reserved or shy. We should stand up for environmental taxation—
  Mr. Deputy Speaker: Order.
  It being Ten o 'clock, the debate stood adjourned.
  Debate to be resumed tomorrow.

PETITIONS

  DNA Samples
  10 pm
  Mr. Steve Webb: This petition arises from the murder on Christmas day 1995 of 18-year-old Louise Smith from my constituency. In the course of the police investigation into her murder, 4,600 local men gave DNA samples to the police to assist in the capture of her murderer. Those DNA samples, freely given, had to be destroyed by law, even though those who gave them would have consented to their retention for use in future investigations. Therefore, the petition, signed by 9,266 residents of Northavon and others:
  Declares that current legislation which requires the Police to dispose of DNA profiles provided by volunteers during a Police investigation is wasteful of Police resources and reduces the effectiveness of investigations into other crimes.

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  The petitioners therefore request that the House of Commons introduce legislation to amend the Police and Criminal Evidence Act 1984 to allow the retention of such DNA profiles where consent for such retention is granted by those submitting a specimen.
  And the petitioners remain, etc.
  To lie upon the Table.

  Rural Road Hauliers
  10.1 pm
  Mr. Paul Marsden: I wish to present a petition, which I strongly support, on behalf of Mr. J. G. Jordan and 156 other rural road hauliers from in and around Shrewsbury and Shropshire. While greatly appreciating the general help that my right hon. Friend the Chancellor has given road hauliers today in his Budget, the petitioners request:
  That the House of Commons recognise that rural road hauliers are especially disadvantaged as the Government strives to meet its environmental targets and as such they should receive a fair package of financial support.
  And the Petitioners remain, etc.
  To lie upon the Table.

  Meath Home
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Pope.]
  10.2 pm
  Mrs. Virginia Bottomley: I appreciate the opportunity to raise in the House a matter that is not only of great concern in my constituency but a cause of profound disquiet across the charitable sector. Today, in the Budget statement, the Chancellor said that he wanted us to be a giving society and that this should be a giving year. My concern is that many of those involved in the provision of long-term care feel more like giving up than going on, because of the Government's refusal to take seriously, and act on, their concerns.
  The Minister may have heard the BBC "Today" programme in January, when Stewart Etherington of the National Council of Voluntary Organisations said that two out of three voluntary organisations providing care were subsidising the local authority and more and more of them were having to spend their scarce money in investing in legal fees to obtain their entitlement. The Minister may also be aware of the letter from the Prime Minister to Mr. Norman Thody of the Disabilities Trust. Mr. Thody had complained, with the all-party disablement group, about the intolerable position in which so many providers of care find themselves. The Prime Minister's letter stated:
  "I am concerned that you feel the Government is overlooking the contribution of the voluntary sector. We place great importance on the input of voluntary and community organisations to the social, cultural, economic and political life of the nation. We also value their role in helping Government to achieve its objectives."
  Interestingly, the letter continued:
  "You may also be interested to see a leaflet issued in October by the Charity Commission, 'Charities and Contracts—CC37'. The leaflet gives practical guidance to trustees and staff thinking of entering into contracts with public bodies to provide services on behalf of those public bodies in return for payment."
  That document makes it clear that it is not the job of the charitable sector to subsidise the state and the delivery of services under the National Assistance Act 1948. It states:
  "We recognise that there will be gaps in some services, because the public bodies required to provide the services at public expense are unwilling or unable to pay for them. We strongly advise charities not to enter into contracts to deliver a service that a public body is required to provide unless the public body pays the economic cost. A charity may offer, as part of the contract, to raise the standard of a service above the standard required of, and paid for by, the public body. But we advise that a charity does not commit itself in a contract to 'fill the gap' in a service which is not funded up to the standard which the public body is required to provide."
  That is precisely the situation at Meath, and at other voluntary homes across the country, such as the Cheshire homes in my constituency. The Meath home is a magnificent organisation. It was founded more than 100 years ago by Mary Jane, Countess of Meath. It is the house in which General James Oglethorpe lived. As well as being one of my predecessors as Member of Parliament in 1722, he went, in his spare time, to the United States, where he founded Georgia, before he returned to his parliamentary duties.
  The Meath home was always enlightened in its traditions. In 1892, when the home was dedicated by Her Royal Highness the Duchess of Albany, the amount of

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  care and rehabilitation for people suffering from epilepsy was moderate. The home was enlightened, but developments in medical science and in styles of care have ensured that it has kept pace. It is highly regarded and extremely popular.
  The Countess of Meath's approach was also enlightened. She
  "reported as to the character of the institution, which she said would be worked on the lines of the Home, and not of a hospital".
  It was her
  "wish that it should be a Home of Comfort, all being made as bright and cheerful as possible."
  Time has moved on. There are 64 residents who have epilepsy and associated disabilities. There are day care and community-based activities for people from the local community and the region with similar disabilities. Up to 23 local authorities have placed residents there. It is the only residential home of its type south of the Thames. It caters for individuals with a wide range of disabilities, and it offers clients a home for as long as they wish. Each client has an individual care package which is regularly reviewed.
  The home has been highly commended by the registration officer as
  "A first class home for the residents in every respect."
  Grateful letters are received regularly from parents and others. I could not speak too highly of the Meath home, whether as the local Member of Parliament or—I must declare this interest—as a patron of the home.
  I have observed a deteriorating situation in recent years, however. The Registered Homes Act 1984 was enacted at the time when I became a Member of Parliament. It drove standards up and it required more and more of residential institutions. The Community Care (Residential Accommodation) Act 1992 changed the relationship once again, however, with substantial sums of money being transferred to local authorities.
  I do not intend to labour long and hard about the deplorable settlement that Surrey social services has received this year. The Meath home's argument is not essentially with Surrey, which has been as reasonable and co-operative as it can be. Suffice it to say that the national average increase in personal social services is 5.8 per cent. this year. Half the local authorities received more than 7 per cent.
  The Under-Secretary of State for Health will know from colleagues in the north, whom he meets regularly, that they are grateful for their settlements. However, Surrey received 2.36 per cent., although it requires at least 7.5 per cent, to stand still. Surrey is an area with a high cost of living, and there are great charges for staff and others. The working time directive and various other measures have compounded the difficulties at Meath.
  It is not Surrey that Meath home is having to take to the small claims division of the High Court, however. The problems with Birmingham, Haringey, Enfield and a great number of the other authorities which have residents at the Meath home are quite appalling. The time, effort and frustration spent on securing payment for residents who are being given a value-for-money, quality home for life is unacceptable. I ask the Minister to intervene.
  I shall go over some of the background issues, because it is a reflection of the desperation felt in the voluntary sector that so many voluntary bodies are now taking legal
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  advice on what steps to take next. Several cases that have reached the courts make clear the obligations and rights involved, even though going to court is never a step that anyone would choose to take, because of the invidious nature of doing so.
  Under section 21 of the National Assistance Act 1948, a local authority is required to provide residential accommodation for the elderly or disabled adults in their area who require it. There are two recent cases that are relevant. In 1997, the House of Lords decision in the case of Barry stated, that in assessing the needs of a person for services to be provided under the Chronically Sick and Disabled Persons Act 1970, the local authority could take into account its own financial resources.
  In the Court of Appeal decision in the case of Sefton, which was made shortly after the Barry decision, Lord Woolf said that he did not see the resources argument as playing a significant role in deciding whether a person required residential accommodation. He emphasised that, once a local authority has concluded that the person concerned requires residential accommodation not otherwise available to him, the accommodation must be provided and the local authority cannot plead lack of resources in argument for failing to do so.
  The similarity under both Acts and both decisions is that, once the assessment has been made, the accommodation or services must be provided, irrespective of the local authority's resources. It follows that, if the local authority cannot provide them itself, it must pay someone else to do so; and it cannot limit the payment by arguments based on its lack of resources.
  In 1994, the High Court decision in the case of Avon was to the effect that the local authority must also take into account the psychological needs and wishes of the person, even if the local authority has to pay much more than it wants to for more expensive accommodation. That may make it extremely difficult for a local authority to shift residents when they have become established in a home.
  There is no desire to have those issues subject to endless judicial review, but I have to warn the Minister that, unless there is assistance, action and intervention from the centre, that is the route down which all the voluntary homes will have to go.
  Several other recent legislative measures are relevant. Although it does not come into force until March 2000, the Competition Act 1998 prohibits conduct on the part of one of more undertakings that amounts to an abuse of a dominant position in the market, and there are severe penalties for breaching the prohibition. Conduct may be an abuse if it consists of indirectly or directly imposing unfair purchase or selling prices, or other unfair trading conditions.
  The Late Payment of Commercial Debts (Interest) Act 1998 imposes a fierce 16 per cent. interest charge on the late payment of debts by large businesses, including local authorities, to providers that are small businesses. That may not be immediately relevant to the Meath home, which has 80 employees, rather than 50 or fewer, but the Act does reflect how seriously all those involved are having to take the current problems.
  My understanding of contracts is that the court will generally enforce a contract in accordance with its terms unless it is unlawful. Where the contract says nothing about the price to be charged, or there is no written contract,

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  the court is likely to assess the fees on what is fair and reasonable. It will not pay attention to extraneous factors such as the parties' financial circumstances. In other words, we are moving close to judicial review territory, which is not an outcome to which either the Minister or those involved in care would turn lightly.
  I have several practical suggestions which I hope the Minister will follow up. Although the matter is not one that solely concerns a home for people with epilepsy, there are specific issues relating to epilepsy. I am delighted to see my hon. Friend the Member for Chesham and Amersham (Mrs. Gillan) in the Chamber; she has a particular interest in Chalfont, and I was delighted to visit the centre there when I was Secretary of State for Health. The centres at St. Piers, Lingfield and at St. Elizabeth in Hertfordshire and in Liverpool would give an account similar to that of the Meath home. The members of the all-party group on epilepsy group are extremely vexed and hope to accompany representatives of the Joint Epilepsy Council to visit the Minister, so that he is made aware of the complexity of the issues relating to long-term care for people with epilepsy.
  However, there are more general and widespread issues concerning the delivery of voluntary care. My requests to the Minister are as follows. First and foremost, a standard, simplified form of contract should be adopted which would reduce the current appalling bureaucratic waste of time and money. A huge amount of staff time and energy is spent chasing 23 different local authorities, each of which has its own contract. It is time to offer central guidance and good practice. Frankly, I had hoped to achieve that aim when I was with the Department. The assurance always was that local authorities would simplify the matter themselves, but they have not and they will not, and they need a central steer.
  Secondly, authorities must be stopped from using their dominant position in the market in breach of the Competition Act, which is driving many homes out of business, by requiring all contracts to provide that the authority will pay a proper price under contract for the services that its clients receive rather than imposing a price arbitrarily. The contracts must contain a mechanism for independent mediation or arbitration in the event of a dispute over fees or other issues. It is appalling that homes must threaten to reject a resident. The Meath home has never done that, but other homes have reached that stage before local authorities have taken their concerns seriously.
  Thirdly, the Government must stop authorities flouting the court decisions in the Sefton and Avon cases by claiming that lack of finance precludes them from paying a proper and reasonable price for those in residential care under section 21.
  Fourthly, the Government must indemnify trustees of unincorporated and other charities against personal liability for redundancies or losses arising from failure of authorities to pay a proper price for services.
  Fifthly, the Government must extend the scope of the Late Payment of Commercial Debts (Interest) Act so that it covers not just small businesses but all voluntary and private providers that have contracts with local authorities.
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  Sixthly, the Government must ensure that local authorities receive central Government funding to enable them to meet their statutory obligations to the disabled and others under the National Assistance Act 1948. I will not labour the Surrey point again here, but I am delighted to see the Opposition health and social services spokesman, my hon. Friend the Member for Runnymede and Weybridge (Mr. Hammond), in the Chamber. He, too, represents a Surrey constituency, and shares in my predicament.
  Seventhly, the Government must ensure that adoption of the compact on relations between the Government and the voluntary and community sector, which was launched last November, is made to work effectively at local level.
  This is a matter of profound concern. Our traditions of charity and philanthropy in this country are second to none. The trustees, chairman John Jeffrey and chief executive Eleanor Lochner at the Meath home are outstanding, philanthropic, responsible and enlightened people. The Government's refusal to act is putting an appalling strain on all concerned. A decision cannot await the royal commission on long-term funding, which evidently the Government have kicked into touch. I have given the Minister seven practical suggestions and I hope that he will deliver on them.
  10.18pm
  The Parliamentary Under-Secretary of State for Health (Mr. John Hutton): I congratulate the right hon. Member for South-West Surrey (Mrs. Bottomley) on her success in obtaining this Adjournment debate. I welcome the chance that she has given me to set out the Government's position on the issues that she has raised. I join her in paying tribute to the dedication and professionalism of the staff at Meath house, and I certainly look forward to a future meeting with her and the delegation on epilepsy to which she referred.
  The social services department in Surrey has been negotiating with Meath home trustees since autumn 1998 to put the financial arrangements between the social services department and Meath home on a sounder, more permanent footing. Negotiations are constructive, but they have been tough on both sides. I understand that the social services department sees the home as rightly ambitious about the service developments upon which it wishes to embark. However, the social services department in Surrey believes that it has a responsibility to strike a fair balance between funding the home and obtaining best value for Surrey residents. Some progress has been made. The social services department has indicated that it is prepared to make a special arrangement whereby Meath home is guaranteed a retail prices index increase in fees, year on year.
  However, towards the end of February, Meath home wrote to the social services department with a proposal for new increases in residents' fees ranging from 2.3 to 85 per cent., with an average increase of 30 per cent. per resident for the coming financial year. If the social services department agreed to those increases, the cost to the local authority would amount to over £112,000 a year.
  The social services department is not against the idea of paying fees according to the disability of residents at the home, but it will, quite properly, want to negotiate concerning the costings put forward by Meath home trustees.

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  Notwithstanding the recent additional complications in the contractual arrangement between Surrey and Meath home, the social services department is continuing to negotiate. I have the assurance of the director of social services in Surrey that he hopes that the position for 1999–2000 will be resolved in the near future. I am sure that the right hon. Member for South-West Surrey will understand that those negotiations must be left to the parties concerned, but I certainly hope that they will be resolved very shortly in a way that is satisfactory to both parties and, of course, to the residents of Meath home.
  Mrs. Bottomley: As I made clear in my remarks, less than a third of the residents come from Surrey. The most acute problems are not with Surrey but with the many other local authorities that send residents to the home and then refuse to increase the fees or even pay the bills.
  Mr. Hutton: I know that the right hon. Lady made those points, and I shall turn to the contractual arrangements with other local authorities in a moment. She has not left me much time to respond as fully as I would like, but I shall do my best.
  I turn quickly to some of the other issues on which the right hon. Lady remarked. On 2 December, my right hon. Friend the Deputy Prime Minister announced the provisional local government finance settlement for next year. He told the House that the Government's support for local authorities would increase by 5.5 per cent. next year— more than double the rate of inflation. On 4 February, having listened to representations from many local authorities about the settlement, he announced the Government's intention to add £30 million to the provisional settlement. He also guaranteed that every social services authority would receive an increase in Government support of at least 1.5 per cent. next year. That is, without doubt, the best financial settlement for local government since the introduction of council tax in 1993.
  As for funding for social services, within the total amount for local government, the Government have provided for a 6.3 per cent. increase for social services departments. For the first time, we have guaranteed that national resources for social services will be increasing in real terms for each of the following two years, enabling social services departments to plan ahead knowing that there will be increased funding. In fact, social services will receive almost £3 billion more in total over the next three years—an average of 3 per cent. more than inflation in each of those years.
  We have also honoured our election manifesto pledge to make the distribution system fairer by introducing changes to the standard spending assessment formulae to ensure that the resources provided nationally are allocated in accordance with need. Some of those changes did not benefit Surrey, but I am happy to take this opportunity to convince the right hon. Lady of the wisdom of making the changes.
  We changed three of the four SSA formulae for social services this year. I shall deal with each change in turn, explaining why it was made and how Surrey was affected.
  First, we completely changed the formula used to allocate resources for children's social services. The old formula for calculating the SSA for children's services was based on evidence from almost a decade ago and was heavily criticised. It was out of step with current policy
  276
  and my Department has spent three years on research to improve the formula. That work was started by the previous Administration, of which the right hon. Lady was a prominent member. The Local Government Association has been closely involved throughout, and many authorities have commented on the proposals in that time.
  There are no lingering doubts about the factors in the allocation formula. All the major objections have been dealt with, and we believed that this was the moment to introduce the new formula. Surrey will gain somewhat from its use.
  We also made two changes to the SSA formula used to allocate resources for residential care for older people. I know that the right hon. Lady was concerned about that. First, we decided to include in the formula a factor that reflects the number of people aged over 65 who are in receipt of disability living allowance. That has proved to be an uncontroversial change.
  The second change was to exclude from the calculation the number of people living in institutions. We made that change for a number of very good reasons. First, the research that led to the formula was based on the characteristics of people living in the community. As the research did not consider people living in institutions, it follows that they should also be excluded when the formula is applied.
  Moreover, if the SSA calculation reflects the total number of people in institutional care in an area, it will be giving the wrong amount of financial credit to each authority. That is because some of the people publicly supported in care in Surrey are not Surrey's financial responsibility. Some will be paying in full for their own care and will not represent a call on Surrey's resources. Others will be in care in Surrey, but will have been placed by another authority, such as a London borough, perhaps—the right hon. Lady referred to some such people—and will therefore be the financial responsibility of that other authority. As I understand it, that applies to some of the residents at Meath house.
  Thirdly, and very importantly, people have said to us that it is not fair to take account of the numbers in care when allocating resources, because that number is open to local authority influence so should not appear in an objective allocation formula. What signals would it send for the Government to use a formula which, in effect, gives credit for putting people in residential care, yet gives no credit for keeping people out of residential care, especially since it is one of the Government's main priorities—it was outlined in the recent social services White Paper—to promote independence?
  It is manifestly wrong for the SSA formula to give a perverse incentive to local authorities to place people in residential homes, rather than caring for them in the community, promoting independence and self-sufficiency. Making this change worked against Surrey, but I hope that the right hon. Lady can understand why we chose to make these changes and the powerful logic behind them.
  The right hon. Lady may feel that the Government are being unfair to Surrey, but let us look at some statistics. On children's services, Surrey has less than half the number of children in families on income support compared to the national average.
  Mrs. Bottomley: I made it clear that I did not want to discuss Surrey's funding, I sent the hon. Gentleman the seven questions that I hoped that he would address, and the place is called Meath home, not Meath house.
  Mr. Hutton: With great respect, I have been referring to Meath home throughout my remarks. The right hon. Lady referred specifically to the deplorable settlement in Surrey, and I am contesting the basis on which she made those remarks. She chose to raise that issue, so I am afraid that she will have to accept that I intend to respond to that part of her speech. We have made a number of changes to the SSA formula, and I have given the reasons why we did so. I feel confident that they are fully justified and have led to a fairer distribution system.
  I ought to correct the impression given by the right hon. Lady that we have somehow reduced spending on social services in Surrey. Nothing could be further from the truth. In general, resources for local government spending in Surrey will increase by 4.6 per cent. next year. Spending on personal social services will increase by 2.4 per cent. Total social services expenditure in the county was £141.427 million last year. Next year, that will rise to £144,625,000. Those are the facts.
  The right hon. Lady also expressed her concerns about the way in which local authorities purchase residential care in the independent sector, and called for more direct Government control over the rates at which such care can be contracted. The Government's position on this issue was spelled out clearly in the White Paper "Modernising Social Services", in which we identified four key elements of good commissioning practice.
  Local authorities should use a variety of contract types to deliver positive outcomes for users and security for good providers. We encourage authorities to issue block contracts to providers of innovative services for which there is a need. Block contracts can give security to providers by guaranteeing certain levels of income each year. I agree with the right hon. Lady that contract prices should not be set mechanistically, but should pay proper regard to providers' costs and planned outcomes for users.
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  Such encouragement, with our proposals for best value and a new performance assessment framework for social services, will help local authorities to deliver services to a clear standard—covering both cost and quality—by the most effective, economic and efficient means possible. Best value must be secured in all social services, whether provided in-house or contracted out to the private sector. We do not take an ideological approach to this issue. We have no preconceived ideas about whether the public or private sector should be the preferred providers. Those decisions should ultimately be based on judgments about best value and optimum outcomes for local users. Local authorities must be able, in the final resort, to demonstrate that their arrangements are delivering that.
  The right hon. Lady expressed some concern that she was not able, during her period in office, directly to intervene in, and regulate, those matters. It is only fan-that, I point out to her that the system that she is drawing to the attention of the House, about which she is complaining, is the one that she bequeathed to this country. It is a bit rich that the right hon. Lady is complaining about the system of which she was the prime architect. We announced in the White Paper our proposals to improve the commission process. We believe that that is a significant step forward—a step that the right hon. Lady was unable to take.
  The right hon. Lady drew attention to several important issues, and I have been unable, in the time that I have, to respond fully to all her arguments and points. I shall correspond with her about some of the other points that she raised.
  All hon. Members share a common concern to protect vulnerable people and especially to ensure that our local social services are able to provide the effective care and support that is necessary for that purpose. I believe that the action that the Government have taken—including the additional resources for local government and our plans to modernise social services—will help local authorities such as Surrey county council to do just that.
  Question put and agreed to.
  Adjourned accordingly at twenty-nine minutes to Eleven o'clock.

LORD CHANCELLOR'S DEPARTMENT

  Departmental Expenditure
  Mr. Don Foster
  To ask the Minister of State, Lord Chancellor's Department if he will list the expenditure incurred by his Department, agencies and non-departmental public bodies on(a) the setting up and (b) the operation of websites, indicating the cases in which the expenditure has been above that budgeted; and if he will list for each web site (i) the topics covered, (ii) the current average number of hits per month and (iii) the estimated expenditure on each web site for each of the next three years. [70968]

  Mr. Hoon
  [holding answer 15 February 1999]: The information sought regarding the websites of my Department, agencies and non-departmental bodies is listed. In no case was expenditure above budgeting.

  Websites

  The Lord Chancellor's Department

  (a) Set up costs: £7,368

  (b) Operation costs: £16,200

  (c) Topics covered: What's New?, Press Notices, The Department, LCD Research, The Courts, Judges-QCs, Magistrates, Speeches, Consultation Papers, Access to Justice, Legal Aid, Civil Matters, Individual and Family Matters, Criminal Matters, Statute Law Database, Related Sites, and Complaints Procedures.

  (d) Average number of hits per month: 10,000

  (e) The estimated expenditure on the website for each of the next three years includes the appointment of a full-time web manager.

  (i) 2000–2001: £45,000

  (ii) 2001–2002: £45,000

  (iii) 2002–2003: £45,000

  The Court Service

  (a) Set up costs: £18,542

  (b) Operating costs: £15,404

  (c) Topics covered: Court of Appeal and High Court judgments, Practice Directions, Daily Lists and Notices; Supreme Court Taxing Office; Crown Court Daily Lists and Warned Lists; county court contact details; court forms and information leaflets, the Court Service IT strategy, annual report and the Courts' Charter; the Office of Social Security and Child Support Commissioners and the Immigration Appellate Authority and links to the Lord Chancellor's website and to various other related sites.

  (d) Average number of hits per month: 50,377

  (e) The estimated expenditure on the website for each of the next three years:

  (i) 2000–2001: £18,000

  (ii) 2001–2002: £18,000

  (iii) 2002–2003: £18,000

  The Northern Ireland Court Service

  (a) Set up costs: nil

  (b) Operating costs: nil. The NICS maintains a number of pages on the Northern Ireland Civil Service website.

  98

  (c) Topics covered: Courts Charter and complaints procedures.

  (d) Average number of hits per month: not monitored by NICS.

  (e) The estimated expenditure on the website for each of the next three years:

  (i) 2000–2001: unknown at this stage

  (ii) 2001–2002: unknown at this stage

  (iii) 2002–2003: unknown at this stage

  The Public Trust Office

  (a) Set up costs: £2,500

  (b) Operating costs: £2,000

  (c) Topics covered: introduction to the PTO; the work of its Divisions; and details of the complaints procedure.

  (d) Average number of hits per month: Not currently monitored. The PTO monitors the number of e-mails received.

  (e) The estimated expenditure on the website for each of the next three years:

  (i) 2000–2001: £5,000

  (ii) 2001–2002 and 2002–2003: With a view to Better Government targets, the website is to be developed further. Consideration will be given to the provision of forms for downloading and possible inter-active completion. Costs associated with this project will probably be in excess of £100,000.

  The Public Record Office

  (a) Set up costs: nil

  (b) Operating costs: £14,250 (1998–99)

  (c) Topics covered: the public records, the services provided by the PRO and Family Records Centre, the operation of the public records system, the PRO contribution to the National Grid for Learning and information for records managers, conservators and the archives profession.

  (d) Average number of hits per month: 135,000

  (e) The estimated expenditure on the website for each of the next three years:

  (i) 2000–2001: £17,000

  (ii) 2001–2002: £22,000

  (iii) 2002–2003: £30,000

  Her Majesty's Land Registry

  (a) Set up costs: £1,000

  (b) Operating costs: £8,675 (1998)

  (c) Topics covered: About the Land Registry; Exhibitions and events; How to complain; Press Notices; Areas served by the Land Registry; Direct Access Service; Fees calculators; On-line publications including Annual Report and Accounts; Business Plan; information leaflets; District Land Registries; Year 2000 Compliance Reports; Residential Property Price Reports; Guide to Land Registry services; Feedback facility

  (d) Average number of hits per month: 30,000

  (e) The estimated expenditure on the website for each of the next three years:

  (i) 2000–2001: £15,152

  (ii) 2001–2002: £15,152

  (iii) 2002–2003: £15,152

  The Law Commission

  (a) Set up costs: £2,400

  (b) Operating costs: £10,675

  (c) Topics covered: a library containing the full texts of publications since March 1997; background information on the organisation and work of the Law Commission; details of current recruitment campaigns.

  (d) Average number of hits per month: 1,400

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  (e) The estimated expenditure on the website for each of the next three years:

  (i) 2000–2001: £9,900

  (ii) 2001–2002: £9,900

  (iii) 2002–2003: £9,900

  The Lord Chancellor's Advisory Committee on Legal Education and Conduct (ACLEC)

  (a) Set up costs: £673

  (b) Operating cots: £75

  (c) Topics covered: Membership of the Committee and its members' biographies; the work of the Committee; Sub-Committees and Working Groups; and the Committee's publications.

  (d) Average number of hits per month: 480

  (e) The estimated expenditure on the website for each of the next three years: It is likely that ACLEC will be disestablished and the Committee is working on the premise that this will happen before the end of 1999. The Committee therefore has no plans to incur further expenditure on its website.

  The Judicial Studies Board

  (a) Set up costs: £925

  (b) Operating costs: nil to date

  (c) Topics covered: the structure and work of the JSB and its committees, the JSB Annual Report, Specimen Directions, training materials available to the public.

  (d) Average number of hits per month: 450

  (e) The estimated expenditure on me website for each of the next three years:

  (i) 2000–2001: £2,180

  (ii) 2001–2002: £180

  (iii) 2002–2003: £180

  The Magistrates' Court Service Inspectorate

  (a)Set up costs: £7,000.

  (b) Operating costs: due to go 'live' in the summer.

  (c) Topics to be covered: What's New?, MCSI executive summary reports; thematics, MCSI's remit; operational plan and strategic plan; organisational chart; pen pictures of inspectors; publications order form; and related sites.

  (d) Average number of hits per month: nil.

  (e) The estimated expenditure on the website for each of the next three years:

  (i) 2000–2001: £5,490

  (ii) 2001–2002: £4,590

  (iii) 2002–2003: £4,590

  The Civil Justice Council

  (a) Set up costs: £1,116

  (b) Operating costs: £1,175 (1998–99)

  (c) Topics covered: the background of the Council, the membership of the Council and its Sub-Committees, and summary reports of Council and Sub-Committee meetings.

  (d) Average number of hits per month: Not monitored.

  (e) The estimated expenditure on the website for each of the next three years:

  (i)2000–2001: £1,175

  (ii) 2001–2002: £1,175

  (iii) 2002–2003: £1,175.

  Marriage Preparation Schemes
  Mr. Kidney
  To ask the Minister of State, Lord Chancellor's Department what assessment he has made of the marriage preparation pilot schemes. [74808]
  100
  Mr. Hoon
  The Lord Chancellor's Department funded a programme of 13 marriage support pilot projects in 1997–98. Three of the projects were concerned with marriage preparation.

  The Department assessed the effectiveness of each project in terms of its achievement of specific aims and objectives, and its cost effectiveness. Take-up of the marriage preparation offered was limited, but those who did participate generally found it helpful.

  Mediation Schemes
  Mr. Kidney
  To ask the Minister of State, Lord Chancellor's Department what assessment he has made of the mediation pilot schemes under the Family Law Act 1996. [74809]

  Mr. Hoon
  Research has been carried out, by a consortium led by the University of Bristol on behalf of the Legal Aid Board, into the mediation pilot schemes run by the Board. This research is not yet complete and it is therefore too early for the Government to make any assessment of those pilot schemes.

  Family Law Act 1996
  Mr. Kidney
  To ask the Minister of State, Lord Chancellor's Department if he will postpone the introduction of the remaining provisions of the Family Law Act 1996, until after the implementation of the initiatives set out in the Government consultation document "Supporting Families". [74810]

  Mr. Hoon
  The Government have indicated that they will implement Part II of the Family Law Act during the year 2000. It is too early to say whether the outcome of the consultation paper "Supporting Families" will lead to any of the initiatives in that document being implemented.

  Deregulation
  Mr. Quinn
  To ask the Minister of State, Lord Chancellor's Department what plans he has to bring forward proposals under the Deregulation and Contracting Out Act 1994. [74953]

  Mr. Hoon
  It would not be appropriate to announce any specific deregulation order proposals at this time as they are subject to detailed consultation with all interested parties.

  However, I propose to use the contracting out order-making power to facilitate the contracting out of functions relating to the summoning of jurors under section 2(6) of the Juries Act 1974.

TREASURY

  Working Families Tax Credit
  Mr. Webb
  To ask the Chancellor of the Exchequer (1) if he will estimate the total number of people who will receive the proposed working families tax credit if everyone entitled to the credit were to take up their entitlement; and what would be the cost in 2000–01 of the credit on that basis; [70078]
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  (2) what assumption was made, for the purposes of forecasting the public expenditure consequences of the working families tax credit, about the percentage of those who will be eligible for the new credit who will take up that entitlement. [70077]

  Dawn Primarolo
  [holding answer 9 February 1999]: In forecasting the cost of the Working Families Tax Credit (WFTC), it has been assumed that the behavioural response of those households eligible to claim WFTC will be broadly similar to that in Family Credit. This response partly depends on net incomes and differences in the shape of the income distribution of those eligible for Family Credit and WFTC and means that the assumed take-up percentage is slightly higher for WFTC. The assumptions for costing WFTC are consistent with other welfare-to-work measures where the costings and entitlement figures do not take into account any benefit savings from people moving from welfare to work. It is estimated that, if everyone entitled to the WFTC were to take up their entitlement, in 2000–01 there would be about 1.65 million in receipt of the credit, with a total expenditure of about £4.9 billion.

  Tax Ready Reckoner
  Mr. Malcolm Bruce
  To ask the Chancellor of the Exchequer when he plans to publish the "Tax Ready Reckoner and Tax Reliefs 1999;" and if he will make a statement. [75352]

  Dawn Primarolo
  [holding answer 8 March 1999]: Copies have today been deposited in the Library of the House.

  Student Loans
  Ms Lawrence
  To ask the Chancellor of the Exchequer if he will make a statement on the Government's policy on the second student loan debt sale; and what assessment he has made of the costs. [76048]

  Mr. Milburn
  I welcome the successful second sale of student loan debt of around £lbn announced today, Official Report, House of Lords, columns 20–21, by my noble friend the Minister for Education and Employment.

  My right hon. Friend the Chancellor of the Exchequer explained the Government's approach to the student loan debt sales to the House on 10 July 1997, Official Report, columns 607–08. The overriding policy considerations which determined that approach were as follows.

  The Government are committed to the development of a wide range of public-private partnerships which involve a transfer of risk to the private sector. As with the first sale, this sale will shift much of the default risk to the private sector, which has much more experience in dealing with such risks. The sales will also enable the markets to establish a clearer understanding of student loans and could in future encourage financial institutions to play a more direct role in the provision of student support.

  In addition, the Government were elected on the basis of a manifesto pledge to work within the spending plans already announced for 1997–98 and 1998–99. This, and our other economic pledges on inflation and taxes, were designed to create the conditions for economic stability
  102
  and a platform for sustained growth. Going ahead with both student loan debt sales has played a critical role in enabling us to keep this pledge.

  These overriding objectives were paramount in the decision to proceed with the first and second debt sales.

  The Government accept that the sales will result in the payment of subsidies to purchasers of the loan debt, much of which flows from our commitment to preserve the existing favourable terms for borrowers. We accept that the level of subsidy will vary from year to year in the light of economic conditions, including movement in interest rates, and that it will vary between the sales, as each is based on a separate competition.

  The extra cost of selling loan debt under the first sale compared with the cost of retaining the loans was calculated at £50m-£60m, in accordance with the guidance in the Green Book, "Appraisal and Evaluation in Central Government", published by my Department. Using the same methodology, the additional costs of the second sale will be £85m-£100m. The difference between the two costs reflects changing circumstances at the time of the two sales, including market conditions and the maturity of the portfolio of loans sold. A strong competition was run and the most competitive bid has been accepted. We have therefore achieved the most competitive outcome consistent with our policy objectives.

  National Minimum Wage
  Mr. Jenkins
  To ask the Chancellor of the Exchequer if he will estimate the number of people who will benefit from the introduction of the national minimum wage in(a) the Tamworth constituency, (b) Staffordshire and (c) the West Midlands. [75737]

  Ms Hewitt
  The information requested falls within the responsibility of the Director of the Office for National Statistics. I have asked him to reply.

  Letter from Tim Holt to Mr. Brian Jenkins, dated 9 March 1999:
  As Director of the Office for National Statistics (ONS), I have been asked to reply to your recent parliamentary question on the number of people who will benefit from the introduction of the proposed national minimum wage (NMW).
  The New Earnings Survey (NES) can provide earnings data for small geographical areas. However, the release of NES data is restricted to figures that are derived from a sufficiently large sample of employees, and have an acceptable level of accuracy. Accordingly, no estimates for the parliamentary constituency of Tamworth can be given
  Estimates of the proportion of people who are currently earning below the proposed minimum wage for a range of geographical areas have been placed in the House of Commons Library under the title of New Earnings Survey 1998—National Minimum Wage Distribution Tables. These include available information for Staffordshire and the West Midlands. The tables provide an historical position against the 1998 values of the proposed NMW, and make no judgement on whether its introduction will have any effect on the number of jobs.

  Dividends
  Mr. Laurence Robertson
  To ask the Chancellor of the Exchequer when he expects to reply to the letter
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  from the hon. Member for Tewkesbury dated 22 July 1998, regarding tax payable on dividends by non-taxpayers. [75762]

  Dawn Primarolo
  I have responded to the hon. Member's letter.

  Government Borrowing
  Ms Lawrence
  To ask the Chancellor of the Exchequer if he will give details of the Government's borrowing programme in 1999–2000. [76047]

  Ms Hewitt
  The main details of the Government's borrowing programme are set out in Annex B of the Financial Statement and Budget Report, published today. Copies of the financing remits for 1999–2000 set by the Government for the Debt Management Office and for National Savings have been placed in the Libraries of the House. They will also be included in the 1999–2000 Debt Management Report to be published on 17 March, and copies of the Report will be made available to the Libraries of the House on that day. The report will also set out the Government's debt management policy, review the Government's borrowing programme in 1998–99, and give details of the Government's borrowing programme in 1999–2000.

EDUCATION AND EMPLOYMENT

  Summer Schools Programme
  Mr. Jim Cunningham
  To ask the Secretary of State for Education and Employment what assessment has been made by Ofsted of the summer schools programme; and what changes will be made this year. [73198]

  Ms Estelle Morris
  [holding answer 9 March 1999]: I have asked Chris Woodhead, HM Chief Inspector of Schools, to write to my hon. Friend to address the first part of his question regarding Ofsted's assessment of the summer schools programme, and for a copy of his letter to be placed in the Library.

  This summer, the numeracy programme will expand from a pilot of 51 schools to over 300 schools and 9,000 pupils.

  For Literacy the number of schools participating in this summer's programme will rise from over 500 schools to 900 schools catering for over 27,000 pupils. Each school will also introduce a literacy intervention programme during the first four terms of secondary school, to support those children who transfer from primary to secondary with poor literacy skills.

  Mr. Maclean
  To ask the Secretary of State for Education and Employment what evaluation he has undertaken of the effectiveness of literacy summer schools. [74772]

  Ms Estelle Morris
  Evaluation of the 1998 Summer Schools Programme was carried out by the National Foundation for Educational Research. A report of the key findings will be made available to Local Education Authorities next week. Copies will be placed in the Library.
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  Cultural Diversity
  Dr. Starkey
  To ask the Secretary of State for Education and Employment (1) what additional resources his Department plans to make available in order to support the training of teachers and head teachers to implement the new emphasis in the national curriculum on valuing cultural diversity and preventing racism, as proposed in the Macpherson report;[74548]

  (2) if valuing cultural diversity and preventing racism will be designated as a priority area for school management and included as a compulsory element in the new qualifications for deputy and head teachers. [74549]

  Ms Estelle Morris
  The Government will shortly be publishing a detailed response and action plan about all the recommendations in the Macpherson report, including those relating to education and the national curriculum.

  We are committed to an inclusive education service which enables and encourages all children to achieve to the best of their abilities. As part of our vision for a modernised teaching profession, set out in the Green Paper, "Teachers, Meeting the Challenge of Change", published on 3 December, we are determined to ensure teachers have the skills and knowledge they need effectively to raise standards for all their pupils.

  The national standards for teachers, published by the Teacher Training Agency (TTA) and endorsed by Government, which span qualified teacher status through to headship, make clear the need for teachers, on entry to the profession and at all stages in their careers, to have the skills and understanding necessary to meet the needs of an ethnically diverse pupil body. The national standards for head teachers, which underpin the training programmes for aspiring and serving head teachers, make clear the responsibility of heads for ensuring that pupils are aware of the ethnic and cultural diversity in their schools and in society and that there are positive strategies for developing good race relations and for dealing with racial harassment. The TTA also will be producing supplementary materials for Initial Teacher Training providers to ensure that new teachers have the skills to deal with ethnic and cultural diversity in schools.

  Class Sizes
  Mrs. May
  To ask the Secretary of State for Education and Employment how many additional full-time qualified teachers have been identified by local education authorities in their plans for reducing infant class sizes submitted to his Department as being required to implement(a) the required reduction in infant class sizes in the school years 1999–2000 and 2000–01 and (b) measures required under paragraph 10 of the Schedule to the Education (Plans for Reducing Infant Class Sizes) (England) Regulations 1998. [75489]

  Ms Estelle Morris
  [holding answer 8 March 1999]: We have allocated £71,882,000 to fund 4,308 additional teachers to reduce infant class sizes in 1999–2000 (including 1,527 teachers funded from September 1998). For the following two financial years, we will be monitoring local authorities' progress in implementing their plans before making allocations to fund the teachers required. As a result of the Comprehensive Spending Review we have made available £160 million for the revenue costs in each of those years of achieving

  105
  the pledge. Local education authorities confirmed in their plans the arrangements they have put in place to ensure that no child will have to attend a school more than a reasonable distance from home.

  Sunderland City TEC
  Mr. Etherington
  To ask the Secretary of State for Education and Employment if he will allow Sunderland City Training and Enterprise Council to retain the proceeds of sale of an asset purchased with funds deriving from his Department. [76008]

  Mr. Mudie
  I have agreed that Sunderland City Training and Enterprise Council can use the proceeds of sale to lever in matched European funds to further develop their Business Innovation Centre thus creating more business opportunities and jobs for the area.

  Student Loans
  Kali Mountford
  To ask the Secretary of State for Education and Employment if he will make a statement on the outcome of the competition to sell a second part of the Student Loan Portfolio. [76009]

  Mr. Mudie
  My noble Friend the Minister for Education and Employment has today,Official Report, House of Lords, columns 20–21, announced the conclusion of the second sale of a portfolio of student loans to the private sector for around £1 billion in a written answer to Lord Burlison. The sale has been achieved after a very vigorous competition and we have accepted the most competitive bid. A consortium of the Nationwide Building Society and Deutsche Bank AG was the successful bidder. As a result, the portfolio will be sold to HONOURS Trustee Limited, a company formed for the purpose of acquiring the assets.

  The loans sold are those made under the original loan scheme. None of the new income contingent loans introduced at the beginning of the current academic year are involved.

  My right hon. Friend the Chief Secretary to the Treasury has confirmed the policy considerations which have determined the Government's approach to student loan debt sales in a written answer today, Official Report, columns 101–02, to my hon. Friend the Member for Preseli Pembrokeshire (Mr. Lawrence).

  HONOURS Trustee Limited have appointed the Student Loans Company, the existing administrator, to administer the sold loans on their behalf. Borrowers who are currently repaying their loans or who have made deferment arrangements will consequently notice little change. We have legislated previously to ensure that the position of borrowers is protected. Borrowers will retain their existing rights of deferment, where their income is below 85 % of average earnings, and interest rates will continue to be linked solely to inflation.

  These rights mean that original scheme student loans are provided at subsidised rates. Subsidies will therefore be paid to the purchaser to reflect this. During the 1999–2000 financial year a subsidy of about £64m will be paid.

  Part of the gross subsidy payment will be repaid to the Government through the administration charges paid to the Student Loans Company and tax receipts on private
  106
  sector profits. Given the value of loans sold, and that some of the loans will be outstanding for a considerable length of time, the estimated net present value of these subsidies is broadly in the region of £395–£405m. This compares with estimated net present value costs of around £310m which we would have incurred had the loans remained publicly owned. The estimated cost to the Government of selling these loans will therefore be in the region of £85–£100m or 25–30 % above the cost of keeping loans in the public sector over the lifetime of the portfolio.

  The agreement between the Government and HONOURS Trustee Limited, with commercially confidential information removed, will be placed in the Library of the House on completion of the sale.

  School Funding
  Mr. Chaytor
  To ask the Secretary of State for Education and Employment if he will list for each local education authority in England, the funding made available to date through(a) the Standards Fund and (b) the New Deal for Schools. [73537]

  Ms Estelle Morris
  Details of funding made available through the Standards Fund for 1997–98, 1998–99 and 1999–2000, and through the New Deal for Schools for 1997ߝ98 and 1998ߝ99, are given in tables that have been placed in the Library. The allocation of the grants for New Deal for Schools for 1999ߝ2000 have not yet been made. For the Standards Fund the figures shown in tables include the grant made by the Department and the contribution made by the local education authority.

NORTHERN IRELAND

  Prisons (Drugs)
  Mr. Moss
  To ask the Secretary of State for Northern Ireland if she will list the amount of illegal drugs discovered in Northern Ireland prisons in each of the last three years, broken down by type of drug. [71400]

  Mr. Ingram
  The amount of illegal drugs discovered in Northern Ireland prisons in each of the last three years is shown in the following table:

  1996–97

  1997–98

  11998–99

  Cannabis

  314 grammes

  1,176 grammes

  79 grammes

  Ecstasy

  6 tablets

  121 tablets

  29 tablets

  LSD

  —

  1 square

  —

  Amphetamines

  —

  —

  2.5 grammes

  Anabolic

  Steroids

  —

  2x10 ml bottles

  6x10 ml bottles

  Other tablets2

  389

  981

  182

  1 Up to 31 December 1998

  1 Mostly prescribed drugs found on a non-prescribed basis

  Mr. Moss
  To ask the Secretary of State for Northern Ireland what public funds have been spent on mandatory drug tests in Northern Ireland prisons in each of the last three years. [71401]

  Mr. Ingram
  There is no mandatory drug testing in Northern Ireland prisons. The Northern Ireland Prison Service drugs strategy focuses on four key action areas of
  107
  control, care, education and information. As part of the strategy, a voluntary testing scheme is currently in operation on a pilot basis in one prison establishment.

  Schizophrenia Psychoses
  Sir Alastair Goodlad
  To ask the Secretary of State for Northern Ireland how many of those convicted of crimes in Northern Ireland in the last year for which figures are available have ever been admitted to National Health Service mental illness hospitals with a main diagnosis of schizophrenia psychoses. [73355]

  Mr. McFall
  The subject of criminal convictions is a matter for the Lord Chancellor's Department. However, I understand from that Department that these figures are not available and could be obtained only at disproportionate cost.

  Mater Hospital
  Mr. Beggs
  To ask the Secretary of State for Northern Ireland which hospital services Her Majesty's Government are obliged to maintain at the Mater Hospital, Belfast, under the terms of the 1971 Deed of Arrangement. [74453]

  Mr. McFall
  The Mater Infirmorum Hospital entered the health service under the 1971 Deed of Arrangement, which secured the preservation of the Roman Catholic character and association of the hospital. The Deed set out specific requirements for the general administration of the hospital and provided for a review of the internal allocation of beds and facilities and for the preparation of a scheme for the initial reconstruction and modernisation of the hospital's buildings and facilities. The deed of Arrangement does not require the maintenance of specific services at the hospital. Whatever services are provided must however preserve the character and associations of the Hospital.

  Mr. Beggs
  To ask the Secretary of State for Northern Ireland what extension plans have been prepared for the Mater Hospital, Belfast; and if she will make a statement. [74454]

  Mr. McFall
  The Trust have recently completed an extension to provide a 50-bed acute psychiatric unit. This was approved by the HSSE. A building programme for the construction of a new three storey block containing wards, a day procedures unit and a pharmacy has now started. This will be funded by the Mater Hospital Trustees and does not require Departmental funding. The

  (b)

  Task forces/review groups

  Public consultation exercises

  NIO

  Independent Commission on Policing

  A series of 35 public meetings were held throughout Northern Ireland, and written and oral submission were invited.

  Northern Ireland Drugs Strategy Review

  Public invited by newspaper advertisements to comment on current NI Drugs Strategy.

  Criminal Injuries Compensation Review

  Notices were placed in the local press in September 1998 and February 1999 inviting evidence from anyone with an interest in the Criminal Injuries Compensation scheme. A series of semi-public meetings also held throughout Northern Ireland to hear from those who had experience of claiming injures compensation.

  108
  Trust also has plans for the refurbishment and upgrading of the original building. These have not yet been submitted for Departmental approval.

  Mr. Beggs
  To ask the Secretary of State for Northern Ireland what extension plans for the Mater Hospital, Belfast, have had approval from the Department of Health. [74495]

  Mr. McFall
  A 50 bed acute psychiatric unit has recently been completed. No further extension plans for the Mater Hospital have been approved by the Department at present.

  Maternity Services
  Mr. Beggs
  To ask the Secretary of State for Northern Ireland what progress has been made on the 1997 recommendations by Professor Donaldson's Medical Review Panel on(a) the development of a Provinceߝwide strategic plan for maternity services and (b) smaller obstetric units without 24 hour on-site paediatric cover. [74496]

  Mr. McFall
  As with other hospital services, strategic decisions about maternity services will be a matter for the new Northern Ireland Assembly. An analysis of the issues involved was contained in the paper "Putting it Right", which I presented to the Assembly on 14 December 1998. It envisages the concentration of acute hospital services, including maternity services, at Area and Regional level, supported by a network of local hospitals. Board reviews of acute hospital services, some of which have already taken place will be completed in the near future, will help to inform the Assembly's consideration of the issues involved.

  Task Forces
  Dr. Tony Wright
  To ask the Secretary of State for Northern Ireland if she will publish a list of (1) task forces and (2) policy reviews established by her Department since May 1997 which(a) had external members recruited by way of public advertisement, and details of any person so appointed and (b) engaged in public consultation exercises, and the form that these took. [74471]

  Mr. Paul Murphy
  The information for the Northern Ireland Office and the Northern Ireland Departments is as follows:
  (a) Nil
  Most task forces and reviews are shortߝterm bodies established to give thorough consideration to important and difficult issues. External members are invited to sit on some reviews and task forces because they are able to contribute specific experience and expertise. In such cases, public advertising would be inappropriate and disproportionate.
  109

  (b)

  Task forces/review groups

  Public consultation exercises

  DED

  Economic Development Services Review

  Advertisement in newspapers and associated press release inviting comment.

  Economic Development Strategy Review

  A consultation panel, with representation from some 60 organisations (academic, business, trade union, voluntary and community sectors) was established. Three meetings of the panel have been held and members were also invited to make written contributions.

  Working Group to plan for a single NI Equality Commission

  Consultation paper issued to some 220 organisations/individuals on 2 February 1999. Seminar held on 19 February.

  New Deal in Northern Ireland

  Consultation Seminars, which focused on the design of New Deal for 18–24 year olds, took place at a number of venues throughout Northern ireland during October and November 1997.

  Review of Training Centres and FE Colleges

  Report and Consultation Paper on the Review's findings and recommendations published in September 1998 with comments invited.

  DENI

  Youth Service Policy Review Group

  'Initial Considerations' consultation paper was published in January 1998 and a 'Youth Service Policy Review—A Consultation Report' in October 1998. These were launched at a one-day Conference for young people and at a launch event for delegates from the statutory and voluntary youth sectors respectively.

  DHSS

  Review of the District Councils' Community Services Programme

  Written submissions invited from relevant interests including Political Parties. Focus group meetings held with voluntary and community groups, District Councils' Community Services Officers, and key informants.

  Strategy for Reducing Alcohol Related Harm in Northern Ireland-A Policy Development Project

  Advertisements in local newspapers requesting contributions; letters sent to 587 'key stakeholders' asking for contributions and to identify other people/organisations who might have an interest; three workshops with key stakeholders; a series of seven focus groups, five with ex-addiction service users and two with young people; and a 'mini' consultation exercise where initial proposals were sent out to all 587 stakeholders for comment.

  Human Rights Commission
  Rev. Ian Paisley
  To ask the Secretary of State for Northern Ireland if she will list the known(a) religious and (b) political affiliations of the Commissioners recently appointed to the new body on human rights for Northern Ireland. [75291]

  Mr. Paul Murphy
  [holding answer 8 March 1999]: The Secretary of State announced on 18 January and 1 March appointments to the Northern Ireland Human Rights Commission. There are 10 Commissioners including the Chief Commissioner. The religious background of candidates is established for monitoring purposes only. It is not the Government's policy to release the religious affiliation of each member, but we are satisfied that the Commissioners, as a group, are representative of the community in Northern Ireland. Candidates are asked to declare political activity over the last 10 years; only one of those appointed had declared any political affiliation, which was to the SDLP and the Women's Coalition.

  Rev. Ian Paisley
  To ask the Secretary of State for Northern Ireland how many applications for appointment to the Human Rights Commission were received; on what dates the posts were advertised; and in what journals. [75279]
  110
  Mr. Paul Murphy
  [holding answer 8 March 1999]: There were 28 applications for Chief Commissioner and 154 for Commissioners. The Chief Commissioner post was advertised as follows:

  Date

  The Guardian

  5, 6 & 9 November

  The Guardian Website

  25 November

  Belfast Telegraph

  24 November & 1 December

  Newsletter

  26 November & 3 December

  Irish News

  26 November & 3 December

  NIO Website

  5 November onwards

  The Commissioner posts were advertised as follows:

  Date

  The Guardian

  2 & 3 December

  Belfast Telegraph

  1 December

  Irish News

  3 December

  Newsletter

  3 December

  NIO Website

  1 December onwards

  Bovine Tuberculosis
  Mr. Mallon
  To ask the Secretary of State for Northern Ireland how many herds were restricted due to evidence of tuberculosis, in each month, from January 1995 to January 1997. [74571]
  111
  Mr. Paul Murphy
  The information requested is provided in the following table.

  Number of herds restricted due to TB from January 1995-January 1997

  Month

  Number of herds

  January 1995

  127

  February 1995

  117

  March 1995

  144

  April 1995

  114

  May 1995

  121

  June 1995

  99

  July 1995

  82

  August 1995

  92

  September 1995

  99

  October 1995

  93

  November 1995

  88

  December 1995

  86

  January 1996

  105

  February 1996

  128

  March 1996

  138

  April 1996

  141

  Number of tuberculosis infected cattle discovered in each veterinary division area from January 1995 to January 1996

  Armagh

  Ballymena

  Coleraine

  Dungannon

  Enniskillen

  Larne

  L'Derry

  Newry

  Newtownards

  Omagh

  January 1995

  80

  10

  31

  35

  23

  21

  3

  123

  65

  15

  February 1995

  49

  7

  14

  59

  24

  21

  4

  103

  73

  23

  March 1995

  83

  19

  33

  65

  17

  74

  4

  140

  31

  35

  April 1995

  52

  32

  26

  63

  15

  22

  1

  97

  17

  12

  May 1995

  54

  14

  15

  62

  21

  12

  5

  106

  46

  18

  June 1995

  53

  30

  17

  37

  21

  14

  2

  75

  37

  10

  July 1995

  23

  11

  12

  45

  13

  16

  5

  104

  35

  4

  August 1995

  71

  19

  15

  55

  7

  21

  2

  68

  45

  10

  September 1995

  79

  12

  15

  66

  16

  4

  6

  57

  29

  17

  October 1995

  28

  17

  15

  74

  13

  21

  8

  94

  39

  22

  November 1995

  20

  20

  21

  68

  8

  33

  6

  78

  33

  16

  December 1995

  25

  33

  10

  67

  21

  22

  4

  52

  28

  25

  January 1996

  41

  20

  20

  66

  23

  41

  8

  83

  26

  15

  February 1996

  34

  17

  27

  50

  24

  47

  15

  116

  74

  32

  March 1996

  31

  10

  22

  49

  32

  14

  11

  141

  38

  30

  April 1996

  89

  44

  29

  66

  10

  35

  21

  81

  50

  32

  May 1996

  37

  27

  17

  22

  28

  35

  1

  82

  41

  52

  June 1996

  41

  10

  16

  20

  16

  21

  2

  46

  36

  15

  July 1996

  16

  21

  12

  22

  8

  13

  4

  115

  38

  23

  August 1996

  66

  28

  16

  27

  15

  17

  2

  83

  48

  23

  September 1996

  33

  24

  19

  28

  9

  10

  1

  156

  35

  19

  October 1996

  44

  45

  13

  70

  14

  12

  1

  157

  125

  63

  November 1996

  18

  21

  22

  110

  11

  5

  8

  128

  59

  32

  December 1996

  42

  39

  14

  78

  17

  30

  2

  81

  37

  122

  January 1997

  30

  29

  20

  70

  10

  36

  9

  83

  50

  63

  Total

  1,139

  559

  471

  1,374

  416

  597

  135

  2,449

  1,135

  728

  Grand total

  9,003

TRADE AND INDUSTRY

  Transatlantic Postal Services
  Mr. Hoyle
  To ask the Secretary of State for Trade and industry if he will list(a) the air cargo carriers which are currently contracted to transport post in each direction between the United Kingdom and the United States of America and (b) the weight which each carried in each of the last three years. [72881]

  Mr. Ian McCartney
  The contracting of air carriers to transport post to the United States of America is a
  112

  Number of herds restricted due to TB from January 1995-January 1997

  Month

  Number of herds

  May 1996

  120

  June 1996

  70

  July 1996

  77

  August 1996

  78

  September 1996

  87

  October 1996

  90

  November 1996

  96

  December 1996

  102

  January 1997

  108

  Total

  2,602

  Mr. Mallon
  To ask the Secretary of State for Northern Ireland how many tuberculosis-infected animals were discovered in each veterinary division area, in each month, from January 1995 to January 1997. [74570]

  Mr. Paul Murphy
  The information requested is provided in the following table.

  commercial matter for The Post Office. The air transport of post from the United States Postal Services to the United Kingdom is a matter for that administration.

  Credit Unions
  Mr. Drew
  To ask the Secretary of State for Trade and Industry what plans he has to allow credit unions to gain easier access to post offices to(a) encourage saving and (b) publicise their activities. [73914]
  113
  Mr. Ian McCartney
  [holding answer 3 March 1999]: Arrangements for access to post offices for credit unions are an operational and commercial matter for the Post Office and the credit unions. However, I have asked the Post Office to consider what actions can be taken to improve working relations between them and the credit unions, within the context of the Post Office's strategic plans.

  Social Partners Meetings
  Mr. Maclean
  To ask the Secretary of State for Trade and Industry if he will list those items of legislation since 1 May 1997 which originated from the Social Partners meetings at European Communities level. [75078]

  Mr. Wilson
  The items of legislation since 1 May which originated from agreements between the Social Partners at European Communities' level are the Parental Leave Directive and the PartߝTime Work Directive. These measures will be implemented through provisions in the Employment Relations Bill and through subsequent secondary legislation.

  Discretionary Grants (Worcestershire)
  Mr. Lock
  To ask the Secretary of State for Trade and Industry if he will list (i) the names of the beneficiaries of all the discretionary grants awarded by his Department to organisations within Worcestershire during 1998, (ii) their monetary value, (iii) their total value and (iv) the proportion that total sum comprises of the total
  sums awarded by his Department in discretionary grants in 1998. [75251]

  Mr. Wills
  If organisations can be interpreted as companies, we can provide the following information about the RSA, Smart and SPUR schemes for the calendar year 1998 in Worcestershire.

  (i) & (ii) Regional Selective Assistance

  Company name

  Value of offer (£)

  Premier Bathrooms Ltd.

  35,000

  Advanced Casting Co Ltd.

  45,000

  Metal Pressings Group Ltd

  80,000

  (iii) Total value of these offers = £160,000

  (iv) Total RSA offered in the West Midlands Assisted Area in 1998 was £36,614,000. On that basis, RSA offered in Worcestershire accounted for 0.43 per cent. of the total offered in the West Midlands.

  Note:

  Only a very small part of Worcestershire falls within the West Midlands Assisted Area.

  (i) & (ii) Smart and SPUR

  Company name

  Value of offer (£)

  C P Eng Systems Ltd.

  88,391

  Newbow Eng Industries Ltd.

  45,000

  D Parmenter

  45,000

  Lorica Research Ltd.

  45,000

  Bioriginal Ltd.

  45,000

  Spring Electronic Ltd.

  44,071

  Red Deer Herbs Ltd.

  122,276

  Enigma Research Ltd.

  45,000

  Greenfinch Ltd.

  88,390

  114

  (i) & (ii) Smart and SPUR

  Company name

  Value of offer (£)

  Sencon Europe Ltd.

  53,037

  Haydon Marketing Ltd.

  45,000

  Arden Services

  45,000

  (iii) Total value of these offers = £711,165

  (iv) Total Smart and SPUR offered in West Midlands in 1998 = £2,862,665. Therefore, Worcestershire received 25 per cent. of all grant offered on these schemes in the West Midlands during the calendar year.

  Black-start Facility, Keadby
  Helen Jackson
  To ask the Secretary of State for Trade and Industry if he is yet in a position to make his decision on Keadby Generation Ltd's application to construct a blackߝstart facility at its Keadby power station in North Lincolnshire. [76013]

  Mr. Battle
  I have today granted consent under Section 36 of the Electricity Act 1989 to Keadby Generation Ltd's application to construct a 25MW gasߝfired black start facility (the extension) at its existing power station at Keadby. The decisions have been taken in accordance with the policy set out in the White Paper entitled 'Conclusions of the Review of Energy Sources for Power Generation and Government response to fourth and fifth Reports of the Trade and Industry Committee' (Cm 4071).

  I have also given Keadby Generation Ltd. clearance to build the extension under Section 14(1) of the Energy Act 1976 and directed that planning permission for the extension be deemed to be granted, subject to 36 planning conditions agreed with the North Lincolnshire Council. These conditions meet issues raised by the Council and others.

  Decisions on other applications under consideration will be announced in due course.

  Copies of the Press Notice and decision letter are being placed in the Library of the House.

  Children (Employment Law)
  Mr. Kidney
  To ask the Secretary of State for Trade and Industry when he expects to report the outcome of his review of Employment Law relating to children. [74811]

  Mr. Hutton
  I have been asked to reply.

  We expect that the review will report shortly.

DEFENCE

  Brunei (Jungle Training)
  Mr. Hancock
  To ask the Secretary of State for Defence if he will list the countries which had armed forces involved in the jungle training exercise in Brunei carried out between 1 April 1997 and 31 March 1998. [72789]

  Mr. Doug Henderson
  The armed forces of the United Kingdom only were involved in this exercise.
  115

  Fast Insertion Craft
  Mr. Hancock
  To ask the Secretary of State for Defence how many fast insertion craft are operated by his Department; what is their cost; and when the first craft was brought into service. [72643]

  Mr. Spellar
  Each vessel costs between £600,000 and £950,000, and they have been in service since 1994. Details of the numbers operated are withheld under exemption 1 of the Code of Practice on Access to Government Information.

  Mr. Hancock
  To ask the Secretary of State for Defence what was the cost of repairing the damage to the Royal Marines' fast insertion craft incurred on 19 January in Norway. [72645]

  Mr. Spellar
  The cost is estimated to be £106,000.

  Infantry Exercises (France)
  Mr. Hancock
  To ask the Secretary of State for Defence if he will list the countries which had armed forces involved in the three infantry exercises in France carried out between 1 April 1997 and 31 March 1998. [72928]

  Mr. Doug Henderson
  The armed forces of the UK and France were involved in these exercises.

  Defence Agencies
  Mr. Hancock
  To ask the Secretary of State for Defence when he expects to set targets for the(a) Defence Secondary Care Agency and (b)Defence Vetting Agency for the year 1999ߝ2000. [72952]

  Mr. Doug Henderson
  Key targets for both agencies will be published by the end of April 1999.

  Departmental Policies
  Mr. Maclean
  To ask the Secretary of State for Defence what systems he has in place to ensure that policies being developed by his Department are subject to a crime impact(a) assessment and (b) audit and are not likely to lead to enhanced criminal opportunities. [72693]

  Mr. Doug Henderson
  [holding answer 24 February 1999]: In addition to the regular audit of systems carried out by our Internal Audit organisation, my Department has a Fraud Analysis Unit which is tasked with the evaluation of suspected irregularity in the conduct of MOD business. Lessons learnt are incorporated in the process of policy development. The Department also has, in the Ministry of Defence Police, an independent constabulary whose tasks include the prevention and investigation of crime and fraud in the Defence environment; local policing plans have been developed to reflect the crime concerns at areas policed by the Force.

  Single Currency
  Mr. Maclean
  To ask the Secretary of State for Defence what plans he has to issue information from his Department to help the public make an informed decision when they vote on the single currency. [73588]

  Mr. George Robertson
  Any plans by the Government to issue information during a referendum campaign on whether or not the UK should join the single currency would be made in light of the Government's response to 116
  the recommendations from the Neill Committee on the conduct of referendums. The Government will announce their conclusions on those recommendations when my right hon. Friend the Home Secretary publishes a White Paper and draft Bill before the summer recess.

  Mr. Maclean
  To ask the Secretary of State for Defence if he will list the subject areas within his Department's responsibilities which will be covered by the information campaign on Britain's membership of a single currency. [73668]

  Mr. George Robertson
  The Treasury will continue its dialogue with key external bodies to determine what information the public and business would need at each stage of the changeover process. Any information campaign would cover key concerns that the public and business may have. Chapter eight of the Treasury's Outline National Changeover Plan provides further information. Copies of the Plan are available in the Library of the House.

  NATO Exercise (South Africa)
  Mr. Hancock
  To ask the Secretary of State for Defence if he will list the countries which had armed forces involved in the NATO joint exercise in South Africa carried out between 1 April 1997 and 31 March 1998. [72985]

  Mr. Doug Henderson
  [holding answer 2 March 1999]: There were no NATO joint exercises in South Africa between 1 April 1997 and 31 March 1998.

  Military Exercises (Jordan)
  Mr. Hancock
  To ask the Secretary of State for Defence (1) if he will list those countries which had armed forces involved in the two desert exercises in Jordan carried out between 1 April 1997 and 31 March 1998; [72972]

  what is his assessment of the principal benefits of the two desert exercises in Jordan carried out between 1 April 1997 and 31 March 1998. [72976]

  Mr. Doug Henderson
  [holding answer 1 March 1999]: Exercise DESERT SONG comprised two exercises involving members of the UK and Jordanian armed forces and was conducted in Jordan in September and October 1997. These exercises were intended to maintain and develop the capacity of the participating personnel to conduct operations in a desert environment, and are assessed to have succeeded in their aim.

  Joint Venture Oversight Group
  Mr. Matthew Taylor
  To ask the Secretary of State for Defence on what dates the US/UK Joint Venture Oversight Group on the defence response to the threat posed by chemical and biological weapons is due to meet in 1999; in which country each meeting is due to take place; which of his Department's officials attend these meetings; and if any other Government Departments attend these meetings. [74257]

  Mr. George Robertson
  It is currently envisaged that the Joint Venture Oversight Group will meet twice a year and that the meetings will be held alternately in the United
  117
  States and the UK. The inaugural meeting of the Group having taken place in the United States in December 1998, the next will be held in the UK in June

  The principal UK official for these meetings is the MOD Deputy Policy Director. The composition of his supporting team depends on the business of each meeting, but is likely normally to include staff with responsibility for relevant policy issues, operational assessment and scientific research. Other Departments would be represented if required.

  Press and Broadcasting Advisory Committee
  Mr. Mitchell
  To ask the Secretary of State for Defence if he will list members of the Ministry of Defence, Press and Broadcasting Advisory Committee. [74312]

  Mr. George Robertson
  The current make-up of the Defence, Press and Broadcasting Advisory Committee is:

  Chairman

  K. R. Tebbit Esq. CMG

  Permanent Under Secretary of State Ministry of Defence

  Vice Chairman and Chairman, Press and Broadcasting Side

  R. Hutchinson Esq.

  Editiorial Policy Adviser to Jane's Information Group

  [Nominated by Periodical Publishers Association]

  Government Members

  D. B. Omand Esq.

  Permanent Under Secretary of State Home Office

  R. T. Jackling Esq. CB CBE 2nd Permanent Under Secretary of State Ministry of Defence

  D. J. Manning Esq. CMG Deputy Under Secretary of State Foreign and Commonwealth Office

  Press and Broadcasting Members

  S Anderson Esq. Controller News and Current Affairs, ITV [ITV]

  J. D. Bishop Esq. Editor-in-Chief, Illustrated London News Group [Periodical Publishers Association]

  G. Brock Esq. Managing Editor, The Times [Newspaper Publishers Association]

  J. Cassidy Esq

  Editor, Sunday Mail [Scottish Daily Newspaper Society]

  T. H. S. Cole Esq. Managing Editor, Sky Television pic [Sky TV]

  R. Esser Esq. Executive Managing Editor, Daily Mail [Newspaper publishers Association]

  A. Goode Esq. Chief Executive, Bristol Evening Post and Press [Newspaper Society]

  P. Harding Esq. Controller, Editorial Policy, BBC [BBC]

  A. S. M. Hutchinson Esq. Associate Editor, The Daily Telegraph [Newspaper Publishers Association]

  P. J. Potts Esq. Editor, PA News [Press Association]

  R. G. Tait Esq. Editor-ins-Chief, Independent Television News Ltd. [ITN]

  W. Wilson Esq. Editor, Express and Star, Wolverhampton
  [Newspaper Society]

  Secretary

  Rear Admiral D. M. Pulvertaft CB

  Deputy Secretary

  Commander F. N. Ponsonby LVO OBE.

  Membership of the Committee and the Defence Advisory Notices themselves are kept up-to-date on the Internet at the Committee's home page: WWW.bitinternet.com/~d.a.notices
  118

  MOD Police (Jurisdiction)
  Mr. Mitchell
  To ask the Secretary of State for Defence what powers of jurisdiction over civilians(a) not employed by his Department and (b) employed by his Department the Ministry of Defence Police Agency has. [74309]

  Mr. Doug Henderson
  I refer my hon. Friend to the answer given on 2 March 1999,Official Report, column 655, by my hon. Friend the Parliamentary Under-Secretary of State for Defence, which outlined the circumstances in which MOD Police officers have the powers and privileges of constables. There are a variety of circumstances in which MOD Police officers might be able to exercise constabulary powers in relation to civilians whether or not they are employed by the Ministry of Defence.

  Gifts (Weapons and Military Equipment)
  Mr. John Cryer
  To ask the Secretary of State for Defence if he will list the countries which have received gifts of(a) weapons and (b) other military equipment from Her Majesty's Government since 1 May 1997, indicating the (i) types and (ii) value of equipment given. [74679]

  Mr. Spellar
  According to central records, the countries which have received gifts of weapons and other military equipment from Her Majesty's Government since 1 May 1997 are as follows:

  Country

  Value (£)

  (a)Weapons

  Canada

  2 x Chieftain main battle tanks

  @ 5,000 each

  (b) Other military equipment

  Congo (Army)

  Pickets and barbed wire

  450

  Congo (Red Cross)

  Ration packs

  2.578

  Canada

  4 x Ferret scout cars

  4,000

  Former Yugoslavia (Vitez)

  Accommodation equipment

  14,040

  Hong Kong

  Hardstick furniture

  21,605

  Italy

  25 x Portakabins

  25,000

  USA

  Inert WE 177 training round

  1

  Canada

  2 x Land Rovers

  1,154

  All these items were surplus to requirements. The main battle tanks were gifted to museums.

  VALUE Programme
  Mr. Keith Simpson
  To ask the Secretary of State for Defence what are the key milestones and timetable for the Value-added Acquisition and Logistics for Ultimate Efficiency Programme; and if he will list the names and appointments of(a) civil servants, (b) military personnel and (c) external consultants on the programme. [74660]

  Mr. George Robertson
  [holding answer 4 March 1999]: The VALUE programme is analysing the processes and key data elements of defence logistics, in support of the formation of the Defence Logistics Organisation and the implementation of the Smart Procurement Initiative. The main analytical work will be completed by 31 March 1999; the remaining work, which is due to be completed by 30 June 1999, will support the establishment of a programme of continuous improvement in defence logistics.
  119
  Members of the VALUE team are listed on the MOD website (http:/www.mod.uk). No external consultants are directly employed on the VALUE work.

  Smart Procurement
  Mr. Keith Simpson
  To ask the Secretary of State for Defence if he will list the names and appointments of the(a) civil servants, (b) military personnel and (c) external consultants who make up the Smart Procurement Implementation Team. [74647]

  Mr. George Robertson
  [holding answer 4 March 1999]: The Implementation Team for the Smart Procurement Initiative planning phase comprises 48 full and part-time members. Team members include 25 civilian and 15 military personnel and 8 representatives from industry. The Implementation Team is being supported during the planning phase by external consultants from McKinsey & Co and KPMG, supplemented by occasional temporary attachments of civilian and military personnel on ad hoc activities. The names of some members of the Smart Procurement Implementation Team are included on the team's website (www.mod.uk/policy/smart).

  Mr. Keith Simpson
  To ask the Secretary of State for Defence what assessment he has made of the impact of the recent merger of BAe and Marconi on his Department's Smart Procurement policy. [74643]

  Mr. George Robertson
  [holding answer 4 March 1999]: The MOD is currently assessing the impact of the proposed merger and will be advising the regulatory authorities in due course. It is not, however, expected to have any impact on our Smart Procurement policy.

  Strategic Defence Review
  Mr. Keith Simpson
  To ask the Secretary of State for Defence if he will list the names and appointments of the(a) civil servants and (b) military personnel of the Strategic Defence Review Implementation Team. [74645]

  Mr. George Robertson
  [holding answer 4 March 1999]: The central Strategic Defence Review Implementation Team is a small civilian/military team of 9 personnel including support staff. The team has responsibility for monitoring and chasing progress on implementation of the Strategic Defence Review.

  The Implementation Team works closely with many others across the Ministry of Defence and the Armed Forces engaged in implementing particular aspects of the Review.

  Scout Reconnaissance Vehicle Programme
  Mr. Key
  To ask the Secretary of State for Defence if he will make a statement on the project definition, milestones and costs of the armoured scout reconnaissance vehicle programme. [69571]

  Mr. Spellar
  [holding answer 8 February 1999]: The Armoured Scout Reconnaissance Vehicle is a collaborative programme between the UK and the USA to study candidate technologies to meet our common requirements for battlefield reconnaissance for the Army of the future. Contracts for a 42 month Project Definition Phase were awarded to the SIKA and LANCER consortia on 29 January 1999. No commitment has been made to
  120
  the programme beyond the Project Definition Phase. Decisions will be made following a Balance of Investment Study, which will determine the optimum solution to the Land Commander's information gathering requirement. As part of the wider study, we will also be investigating the use of Unmanned Aerial and Land Vehicles.

  The total cost to the UK for the joint elements of the Project Definition Phase contracts will be around £90 million, excluding VAT. In addition, the UK will be spending around £7 million, excluding VAT, on UK specific issues.

  Holy Loch
  Mr. Baker
  To ask the Secretary of State for Defence for what reasons the projected cost of the Holy Loch clean-up of debris left behind by US visiting forces has risen to between £8 million and £10 million. [75116]

  Mr. Spellar
  [holding answer 8 March 1999]: The estimated costs of the Holy Loch clean-up operations are based on the practical experience gained during operations covered by the current contract. This has led to the forecasted final expenditure of £8 million to £10 million.

  Iraq
  Mr. Baker
  To ask the Secretary of State for Defence what has been the total weight of bombs dropped by British forces on Iraq(a) during Operation Desert Fox and (b) subsequently. [75671]

  Mr. George Robertson
  During Operation DESERT FOX in December last year, a total of 28,560kg of bombs were dropped by British forces on Iraqi military targets. Subsequently, British forces have dropped 20,520kg of bombs in the course of operations over Iraq.

  Mr. Gill
  To ask the Secretary of State for Defence to what extent RAF pilots forced down in Iraq will be protected by the terms of the Geneva Convention; and if he will make a statement. [75670]

  Mr. George Robertson
  The Geneva Conventions are applicable in any international armed conflict, whether or not a state of war exists between the parties; the application of the Conventions are not dependent upon a formal declaration of war or hostilities. Accordingly, any of our aircrew forced down in Iraq would be entitled to the status of prisoners of war. We would expect Iraq to meet all its obligations under international law, including all applicable international conventions.

  Falkland Islands
  Mr. Hoyle
  To ask the Secretary of State for Defence if he will review his Department's decision to reduce the number of Tristar flights to the Falkland Islands. [75756]

  Mr. Doug Henderson
  The reduction in the number of RAF Tristar Airbridge flights to the Falkland Islands by one flight per calendar month was one of a range of efficiency proposals identified by the Strategic Defence Review. It represents a rationalisation of the use of Tristar aircraft, following technical improvements that allow them to carry an increased payload, rather than representing any significant reduction to the overall capacity of the Airbridge. Final arrangements for the implementation of this measure are still under consideration.
  121

HOME DEPARTMENT

  Police Officers (Ethnic Minorities)
  Mr. MacShane
  To ask the Secretary of State for the Home Department how many police officers from an Asian or Afro-Caribbean background hold the rank of(a) chief constable, (b) assistant chief constable and(c) chief superintendent. [74539]

  Mr. Boateng
  Currently there are(a) no Chief Constables, (b) one Assistant Chief Constable, (c) three Chief Superintendents (one currently on temporary promotion) and six Superintendents from an Asian or Afro-Caribbean background.

  The rank of Chief Superintendent was abolished on 1 April 1995. At that time, the number of existing Chief Superintendents maintained their rank and a number of forces continue to use the designation.

  Equine Welfare
  Mr. Alan Campbell
  To ask the Secretary of State for the Home Department (1) what representations he has received from equine welfare organisations on the tethering of horses; [75122]

  (2) what assessment he has made of the welfare standards of the existing legislation on the tethering of horses; and if he will make a statement. [75120]

  Mr. George Howarth
  We have not received recent representations from equine welfare organisations about the tethering of horses.

  The welfare of horses that are tethered is safeguarded by the general protection afforded by the Protection of Animals Act 1911 and the Protection Against Cruel Tethering Act 1988. Additional protection is provided by the Abandonment of Animals Act 1960.

  Under the 1911 Act, it is an offence to cause any unnecessary suffering to any domestic or captive animal. The Protection Against Cruel Tethering Act 1988 created a specific offence under the 1911 Act of causing unnecessary suffering to a horse by the manner of condition of its tethering. In addition, the Abandonment of Animals Act 1960 makes it an offence to abandon a domestic or captive animal, whether or not permanently, without reasonable excuse and in circumstances likely to cause suffering.

  Mr. Alan Campbell
  To ask the Secretary of State for the Home Department how many prosecutions there were in England during 1998 of individuals for their ill treatment of horses. [75121]

  Mr. Boateng
  Information held on the Home Office Court Proceedings Database concerning offences under the Protection of Animals Act 1911 does not distinguish individual offences within the Act or identify the species of animal involved.

  London Fire Brigade
  Mr. Cohen
  To ask the Secretary of State for the Home Department how many firefighters in the London Fire Brigade are of black or ethnic minority origin; what 122
  proportion of the total they form; and what measures are planned to increase the number of black and ethnic minority firefighters in London. [75135]

  Mr. George Howarth
  At 31 March 1998, there were 5,771 firefighters on the operational strength of London Fire Brigade. Of these, 249 (4.3 per cent. of the total) classified themselves as black or from an ethnic minority group.

  We have announced that targets will be set for the recruitment of ethnic minority groups into the Home Office and its services. All chief fire officers have been asked to set targets to improve black and ethnic minority representation to reflect the community their brigade serves. The London Fire and Civil Defence Authority has already taken a number of initiatives of its own to increase the numbers of black and ethnic minority firefighters in London.

  Horses (Nutritional Deprivation)
  Mr. Cohen
  To ask the Secretary of State for the Home Department for what reasons he granted a project licence for the study of the effects of nutritional deprivation in the womb of horses at the Equine Fertility Unit near Newmarket, with particular reference to the cost benefit test under section 5(4) of the Animal (Scientific Procedures) Act 1986; into what severity band the procedures were placed and for what reasons; and if he will review the application of the cost benefit test in relation to these procedures. [75174]

  Mr. George Howarth
  The project licence authorising this work was granted in 1994. The objectives of the research were to study pregnancy in mares to determine how genetic and growth factors might affect the nutrition of the foetus, given that poor nutrition of the developing foetus can result in abortion or the birth of poorly viable offspring. The potential benefits of the work are, therefore, to the welfare of horses. It is, however, possible that the results will also be beneficial to other species, including man.

  The procedures on the horses entailed mainly non-surgical recovery of uterine material from pregnant and non-pregnant animals. This involved sedation but no general anaesthesia and the procedures were classified as being of mild severity. However, in the early work under the authority of this licence, some of the procedures also involved surgery, which was classified as being of moderate severity. The overall severity for the project licence is mild.

  The relevant project licence is no longer in force. If further work is to be carried out in this area, a new application will have to be made and the costs and benefits will again be weighed before deciding whether to grant a new licence.

  Criminal Memoirs
  Mr. Dismore
  To ask the Secretary of State for the Home Department what plans he has to prevent criminals profiting from the publication of(a) memoirs and (b) magazine and newspaper articles based on their criminal activities. [74879]
  123
  Mr. Boateng
  In the light of the concerns expressed last year after the publication of Gitta Sereny's book 'Cries Unheard' an inter-departmental group is considering the law relating to criminal memoirs, and whether it might sensibly be strengthened. The issues raised are difficult and complex, and include how the need to prevent criminals from benefiting by publishing details of their crimes and causing distress to victims and their families can be balanced against the rights to freedom of expression set out in the European Court of Human Rights and the Human Rights Act. The working group expects to report in the summer.

  Sexual Assaults
  Mr. Leigh
  To ask the Secretary of State for the Home Department (1) how many people aged (i) under 14, (ii) 14 to 17, (iii) 18 to 20, (iv) 21 to 40, (v) 41 to 64 and (vi) 65 years and over, convicted of the offence of rape of a man in each year from 1987 to 1997 were sentenced to immediate custody; [75034]

  (2) how many people aged (i) under 14, (ii) 14 to 17, (iii) 18 to 20, (iv) 21 to 40, (v) 41 to 64 and (vi) 65 years and over, convicted of the offence of indecency between males in each of the years 1987 to 1997 were sentenced to immediate custody; [75031]

  Table A: Number of persons convicted at all courts for the offence of indecent assault on a male or female by sex and age of victim, England and Wales, 1987–97

  Offence/sex

  1987

  1988

  1989

  1990

  1991

  1992

  1993

  1994

  1995

  1996

  1997

  Indecent assault on a male person under 16 years of age

  Males

  420

  455

  400

  413

  338

  356

  287

  316

  331

  349

  353

  Females

  10

  5

  6

  8

  13

  7

  6

  8

  8

  6

  10

  Indecent assault on a male person aged 16 years or over

  Males

  76

  86

  101

  152

  113

  98

  112

  84

  123

  124

  112

  Females

  1

  —

  1

  —

  2

  2

  2

  —

  —

  —

  4

  Indecent assault on a female person under 16 years of age

  Males

  1,542

  1,640

  1,643

  1,525

  1,458

  1,320

  1,193

  1,350

  1,440

  1,590

  1,621

  Females

  14

  10

  14

  12

  11

  11

  12

  5

  6

  7

  6

  Indecent assault on a female person aged 16 years or over

  Males

  755

  858

  1,009

  1,036

  944

  925

  855

  847

  925

  818

  852

  Females

  4

  3

  5

  3

  4

  4

  6

  1

  6

  4

  5

  Table B: Number of persons convicted at all courts of the offence of male rape1 by sex, age and result, England and Wales, 1995–97

  Year/disposal

  Aged 10–13

  Aged14–17

  Aged18–20

  Aged21–40

  Aged 41–64

  Aged 65+

  All Ages

  1995

  Convicted

  Male

  —

  2

  —

  5

  2

  —

  9

  Sentenced

  Male

  —

  2

  —

  5

  2

  —

  9

  Immediate custody2

  Male

  —

  2

  —

  5

  2

  —

  9

  1996

  Convicted

  Male

  1

  9

  4

  5

  5

  —

  24

  Sentenced

  Male

  1

  9

  4

  5

  5

  —

  24

  Immediate custody2

  Male

  —

  9

  4

  5

  5

  —

  23

  124
  (3) how many (a) prosecutions, (b) convictions and (c) cautions for the offence of indecent assault on a male there were of persons who were aged (i) under 14, (ii) 14 to 17, (iii) 18 to 20, (iv) 21 to 40, (v) 41 to 64 and (vi) 65 years and over giving in each age group how many were (1) male and (2) female, in each year between 1987 and 1997;[75032]

  (4) how many (1) cautions and (2) convictions there were for the offences of (i) indecent assault on a female under 16 years, (ii) unlawful sexual intercourse with a girl under 16 years, (iii) indecent assault on a male under 16 years, (iv) gross indecency with a girl under 14 years, (v) unlawful sexual intercourse with a girl under 13 years, (vi) gross indecency with a boy under 14 years, (vii) buggery of a male under 16 years and (viii) incest in (a) 1985 and (b) 1995; and if he will indicate in each case the percentage change; [75029]

  (5) in how many cases the victim of a person convicted of indecent assault or other party to an offence of indecent assault for which a conviction was secured was aged (a) under 14, (b) 14 to 17, (c) 18 to 20, (d) 21 to 40, (e) 41 to 64 and (f) 65 years and over, giving in each age group the number who were (1) male or (2) female for each year between 1987 and 1997. [75030]

  Mr. Boateng
  Available information is given in the tables. Information held on the Home Office Court Proceedings Database on the age of victims of the offence of indecent assault is restricted to identifying those 'under 16' and '16 and over'.
  125

  Table B: Number of persons convicted at all courts of the offence of male rape1 by sex, age and result, England and Wales, 1995–97

  Year/disposal

  Aged 10–13

  Aged 14–17

  Aged 18–20

  Aged 21–40

  Aged 41–64

  Aged 65+

  All Ages

  1997

  Convicted

  Male

  1

  7

  4

  15

  14

  1

  42

  Sentenced

  Male

  1

  6

  4

  15

  14

  1

  41

  Immediate custody2

  —

  5

  4

  15

  14

  1

  39

  1 New offence created under the Criminal Justice and Public Order Act 1994. Prior to this defendants would have been charged with
  non-consensual buggery.

  2 Includes persons sentenced under section 53 of the Children and Young Persons Act 1933.

  Table C: Number of offenders cautioned for the offence of indecent assault on a male by sex and age, England and Wales, 1987–97

  Age and Sex

  1987

  1988

  1989

  1990

  1991

  1992

  1993

  1994

  1995

  1996

  1997

  10–13

  Male

  33

  38

  29

  44

  43

  39

  35

  35

  19

  25

  18

  Female

  7

  3

  6

  5

  3

  2

  1

  5

  1

  1

  1

  14–17

  Male

  54

  62

  70

  83

  83

  81

  54

  64

  54

  30

  34

  Female

  4

  4

  9

  7

  7

  7

  4

  4

  6

  3

  4

  18–20

  Male

  10

  8

  10

  22

  14

  22

  12

  7

  10

  7

  5

  Female

  3

  2

  2

  1

  1

  7

  3

  2

  2

  2

  1

  21–40

  Male

  27

  27

  32

  40

  38

  49

  57

  47

  30

  40

  20

  Female

  11

  8

  10

  11

  3

  9

  13

  7

  12

  2

  8

  41–64

  Male

  9

  24

  13

  29

  31

  22

  60

  40

  30

  28

  25

  Female

  1

  1

  —

  —

  1

  2

  —

  1

  —

  2

  1

  65+

  Male

  19

  13

  24

  16

  20

  16

  20

  14

  14

  12

  12

  Female

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  All ages

  Male

  152

  172

  178

  234

  229

  229

  238

  207

  157

  142

  114

  Female

  26

  18

  27

  24

  15

  27

  21

  19

  21

  10

  15

  Table D: Number of defendants prosecuted at magistrates' courts for the offence of indecent assault on a male by sex and age, England and Wales, 1987–97

  Age and Sex

  1987

  1988

  1989

  1990

  1991

  1992

  1993

  1994

  1995

  1996

  1997

  10–13

  Male

  5

  6

  3

  4

  3

  1

  1

  11

  4

  3

  4

  Female

  —

  —

  —

  —

  —

  —

  —

  1

  —

  —

  2

  14–17

  Male

  47

  48

  46

  49

  33

  42

  32

  41

  49

  57

  64

  Female

  1

  —

  4

  —

  —

  1

  —

  1

  1

  2

  3

  18–20

  Male

  37

  49

  58

  47

  42

  48

  29

  32

  23

  16

  13

  Female

  1

  —

  —

  4

  —

  2

  2

  1

  —

  —

  1

  21–40

  Male

  290

  306

  322

  331

  315

  280

  269

  231

  247

  159

  178

  Female

  16

  9

  7

  15

  11

  11

  9

  14

  11

  10

  14

  41–64

  Male

  235

  244

  238

  288

  290

  243

  231

  262

  239

  206

  241

  Female

  1

  —

  3

  1

  2

  3

  5

  4

  2

  2

  2

  65+

  Male

  34

  35

  34

  33

  38

  25

  37

  42

  33

  28

  20

  Female

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  All ages

  Male

  678

  688

  701

  752

  721

  639

  605

  619

  595

  469

  520

  Female

  19

  9

  15

  20

  13

  17

  16

  21

  14

  14

  22

  126 127

  Table E: Number of offenders convicted1 at all courts for the offence of indecent assault on a male by sex and age, England and Wales, 1987–97

  Age and Sex

  1987

  1988

  1989

  1990

  1991

  1992

  1993

  1994

  1995

  1996

  1997

  10–13

  Male

  4

  3

  3

  2

  2

  1

  4

  6

  —

  2

  3

  Female

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  2

  14–17

  Male

  33

  37

  32

  32

  24

  31

  22

  26

  34

  39

  44

  Female

  1

  —

  1

  —

  —

  —

  —

  1

  1

  2

  2

  18–20

  Male

  29

  32

  44

  32

  24

  24

  22

  24

  18

  21

  13

  Female

  —

  —

  1

  3

  2

  —

  1

  —

  —

  —

  1

  21–40

  Male

  232

  246

  202

  254

  188

  180

  168

  160

  174

  172

  163

  Female

  8

  5

  4

  5

  12

  7

  5

  7

  6

  4

  9

  41–64

  Male

  172

  192

  193

  211

  184

  197

  155

  165

  230

  208

  221

  Female

  2

  —

  1

  —

  1

  2

  2

  —

  2

  —

  —

  65+

  Male

  26

  31

  27

  34

  29

  22

  29

  20

  25

  31

  21

  Female

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  All ages

  Male

  496

  541

  501

  565

  451

  455

  400

  401

  481

  473

  465

  Female

  11

  5

  7

  8

  15

  9

  8

  8

  9

  6

  14

  1 Includes persons proceeded against in earlier years or for other offences

  Table F: Number of males convicted at all courts for the offence of indecency between males by sex, age and result, England and Wales, 1987–97

  Year/disposal

  Aged 10–13

  Aged 14–17

  Aged 18–20

  Aged 21–40

  Aged 41–64

  Aged 65+

  All ages

  1987

  Convicted

  —

  9

  42

  523

  353

  24

  951

  Sentenced

  —

  9

  42

  522

  353

  24

  950

  Immediate custody1

  2—

  1

  —

  19

  11

  —

  31

  1988

  Convicted

  —

  12

  52

  645

  553

  71

  1,333

  Sentenced

  —

  12

  52

  645

  553

  71

  1,333

  Immediate custody1

  2—

  —

  —

  8

  12

  —

  20

  1989

  Convicted

  1

  15

  46

  772

  606

  63

  1,503

  Sentenced

  1

  15

  46

  772

  605

  63

  1,502

  Immediate custody1

  2—

  2

  1

  13

  7

  —

  23

  1990

  Convicted

  —

  14

  36

  532

  427

  37

  1,046

  Sentenced

  —

  14

  36

  530

  429

  37

  1,046

  Immediate custody1

  2—

  —

  —

  6

  5

  —

  11

  1991

  Convicted

  —

  5

  15

  349

  232

  26

  627

  Sentenced

  —

  5

  15

  349

  231

  26

  626

  Immediate custody1

  2—

  —

  —

  5

  6

  —

  11

  1992

  Convicted

  —

  3

  20

  298

  230

  27

  578

  Sentenced

  —

  3

  20

  298

  231

  27

  579

  Immediate custody1

  2—

  1

  —

  4

  3

  —

  8

  1993

  Convicted

  —

  —

  6

  192

  169

  22

  389

  Sentenced

  —

  —

  6

  191

  169

  21

  387

  Immediate custody1

  2—

  —

  —

  4

  2

  —

  6

  1994

  Convicted

  —

  4

  8

  226

  226

  16

  480

  Sentenced

  —

  4

  8

  226

  226

  16

  480

  Immediate custody1

  2—

  —

  —

  3

  4

  1

  8

  1995

  Convicted

  —

  3

  3

  203

  176

  25

  410

  Sentenced

  —

  3

  3

  203

  176

  25

  410

  Immediate custody1

  —

  —

  —

  5

  12

  1

  18

  128 129

  Table F: Number of males convicted at all courts for the offence of indecency between males by sex, age and result, England and Wales, 1987–97

  Year/disposal

  Aged 10–13

  Aged 14–17

  Aged 18–20

  Aged 21–40

  Aged 41–64

  Aged 65+

  All ages

  1996

  Convicted

  —

  2

  4

  108

  97

  8

  219

  Sentenced

  —

  2

  4

  108

  97

  8

  219

  Immediate custody1

  —

  —

  —

  3

  1

  —

  4

  1997

  Convicted

  —

  —

  3

  112

  105

  17

  237

  Sentenced

  —

  —

  3

  112

  104

  17

  236

  Immediate custody1

  —

  —

  —

  3

  3

  —

  6

  1 Includes persons sentenced under section 53 of the Children and Young Persons Act 1933

  2 Not applicable

  Note:

  In some cases total sentenced is higher than total convicted—this will include persons convicted at magistrates' courts but sentenced at a later date at the Crown Court

  Table G: Number of offenders cautioned and convicted at all courts for specific sexual offences for the years 1985 and 1995 and showing percentage change, England and Wales

  Cautioned

  Convicted

  Offence

  1985

  Cautioned 1995

  % change

  1985

  Convicted 1995

  change

  Indecent assault on a female under 16

  970

  670

  -31

  1,446

  1,446

  0

  Unlawful sexual intercourse with a girl under 16

  1,155

  400

  -65

  395

  203

  -49

  Indecent assault on a male under 16

  146

  137

  -6

  528

  339

  -36

  Gross indecency with a girl under 14

  46

  30

  -35

  160

  99

  -38

  Unlawful sexual intercourse with a girl under 13

  58

  41

  -29

  110

  81

  -26

  Gross indecency with a boy under 14

  16

  28

  +75

  106

  56

  -47

  Buggery of a male under 161

  22

  11

  -50

  167

  129

  -23

  Incest

  21

  14

  -33

  128

  48

  -63

  1 For 1995 may include buggery of a woman or animal

  Hostels
  Mr. Beith
  To ask the Secretary of State for the Home Department what was the national average occupancy rate in hostels in England and Wales on the latest date available; and what are his Department's relevant key performance indicators for 1998–99. [75242]

  Mr. George Howarth
  The average occupancy rate in approved probation and bail hostels for the year 1998–99 currently stands at 84 per cent. This is above the 83 per cent. target for the key performance indicator for hostel occupancy, which will increase to 87 per cent. in 1999–2000.

  Gaming Act 1968
  Ms Moran
  To ask the Secretary of State for the Home Department what responses he received to the consultation paper on modernising the Gaming Act 1968 in respect of(a) postal and group applications, (b) limited print advertising and (c) introduction of casino gaming machines; and if he will make a statement. [75219]

  Mr. George Howarth
  We consulted on 5 August 1998 about proposals to relax certain Gaming Act controls on casino membership, advertising and jackpot machines. The consultation period ended on 21 October.

  We received 39 responses, most supporting the proposals. We have been discussing specific issues with the Gaming Board and the industry, and hope to make an announcement shortly.
  130

  Immigration Officers
  Mr. McCabe
  To ask the Secretary of State for the Home Department if training for immigration officers includes guidance on facilitating legitimate travellers who wish to visit family and friends in the United Kingdom. [75650]

  Mr. Mike O'Brien
  The greater majority of passengers are, of course, entitled or qualified to enter the United Kingdom. This includes those wishing to visit family and friends here. Immigration Officers are given training which reflects this priority, with particular emphasis on professionalism, inter-personal skills and awareness of the needs and concerns of those with whom they come into contact, including the family and friends of passengers.

  Mr. McCabe
  To ask the Secretary of State for the Home Department what common training is given to all immigration officers. [75649]

  Mr. Mike O'Brien
  Immigration Officers undergo a variety of common training during their careers in the Immigration Service. In particular, they are given ten weeks' induction training to enable them to apply the requirements of immigration-related legislation and instructions. Areas covered include their powers and obligations, operating the controls in accordance with Government policies, interview skills, professional standards and skills such as forgery detection.

  Thereafter, Immigration Officers are given consolidation training in order to reinforce their knowledge and experience, as well as more specialised training for those working in areas such as computerisation, resource management and training.
  131
  Mr. McCabe
  To ask the Secretary of State for the Home Department what training is given to immigration officers working in the Indian sub-continent. [75648]

  Mr. Mike O'Brien
  All Immigration Officers working abroad, including those in the sub-continent, receive a comprehensive Entry Clearance Officer course which addresses a number of issues in the operation of a faster, fairer and firmer immigration control overseas. Officers are required to demonstrate a sound knowledge and understanding of the principles of Best Practice in the Foreign and Commonwealth Office and its importance in the successful management of an entry clearance operation. The course reflects the importance of treating each applicant with courtesy and respect as an individual, with particular emphasis on a professional approach to the interview process.

  The four-day course is delivered by Immigration Service trainers all of whom have had recent experience in entry clearance work overseas. Areas covered include types of interviews that Entry Clearance Officers carry out and the range of different applications, including visitors and students. A substantial part of the course is devoted to the area of family settlement.

  On arrival in post, they receive additional training, with particular guidance on the cultural background and life specific to the country in which they will be working. This includes those going to the sub-continent.

  Metropolitan Police
  Mr. Austin
  To ask the Secretary of State for the Home Department (1) what the additional special payment allocated to the Metropolitan Police was for each of the years 1997–98, 1998–99 and 1999–2000; [75755]

  (2) pursuant to his answer of 1 March 1999, Official Report, column 556, if he will set out the basis upon which the additional special payment allocated to the Metropolitan police was calculated; and what criteria were adopted; [75753]

  (3) what new factors he took into account in calculating the additional special payment allocated to the Metropolitan Police for 1999-2000 compared with 1998–99. [75754]

  Mr. Boateng
  The special payment was £130 million for 1997-98, £151 million for 1998-99 and will be £176 million for 1999–2000.

  The payment was set at £151 million for 1998–99 following a review by Home Office officials which was the first comprehensive attempt to cost the Metropolitan Police's national and capital city functions. The report provided a degree of transparency about the additional payment which was not previously available.

  In setting the special payment for 1999–2000, factors taken into account included inflation, policing related to millennium celebrations, and the overall importance of maintaining public confidence in the policing of the capital city.

  Correspondence
  Mr. Beith
  To ask the Secretary of State for the Home Department when he expects to reply to the letters of 132
  3 December and 26 January, from the right hon. Member for Berwick-upon-Tweed concerning a computer database for tracing stolen property. [75744]

  Mr. Boateng
  I am sorry for the delay and shall reply to the right hon. Gentleman as quickly as possible.

  Number Plates
  Mr. Jenkins
  To ask the Secretary of State for the Home Department what assessment he has made of the effectiveness of the auto number-plate recognition system in reducing crime. [75659]

  Mr. Boateng
  No systematic assessment has been made, but the technical performance of automatic number plate recognition systems is kept under review.

  Stephen Lawrence Inquiry Report
  Mr. Maclean
  To ask the Secretary of State for the Home Department if the investigation into the leak of the Macpherson report will extend to those members of Ministers' staff who are not civil servants and are not based within the Department. [75791]

  Mr. Straw
  The conduct of the inquiry, including the question of who should be interviewed, is a matter for the investigator to determine.

  Ministerial Staff
  Mr. Maclean
  To ask the Secretary of State for the Home Department (1) what guidelines are in place regarding the disciplinary action which can be taken against those members of Ministers' staff who are not civil servants and are not based within the Department, where they are found guilty of misconduct or gross misconduct; [75797]

  (2) what guidelines are in place regarding access to (a) unpublished documents and (b) material with a restricted classification by members of Ministers' staff who are not civil servants and are not based within the Department. [75798]

  Mr. Straw
  Ministers' staff are either civil servants or paid or unpaid special advisers. Paid special advisers are civil servants, employed under individual contracts (the model of which was promulgated by the Prime Minister on 19 May 1997), and are subject to the same conditions of service and the same rules of conduct as other civil servants. Unpaid advisers are subject to the normal rules of confidentiality, as the Ministerial Code, published in July 1997, makes clear. The employment by Ministers, in their capacity as Members of Parliament, of staff to assist with constituency business, is not a matter for me.

SCOTLAND

  Departmental Expenditure
  Mr. Don Foster
  To ask the Secretary of State for Scotland, pursuant to his answer of 14 January 1999,Official Report, column 232, if he will list the expenditure not included in his answer incurred by (a) his agencies and non-departmental public bodies and (b) the Central Office of Information for relevant work carried out for his Department. [71022]
  133
  Mr. Dewar
  [holding answer 15 February 1999]: The information requested is not held centrally for non-departmental public bodies and could be collected only at disproportionate cost. The Central Office of Information has carried out no work for my Department in the period.

  Care and Repair Grants
  Mr. Davidson
  To ask the Secretary of State for Scotland if he will publish(a) a list of care and repair grants made for each local authority in Scotland and (b) how much each local authority in Scotland received for such grants per 1,000 of population, for each of the last three years. [74014]

  Mr. Macdonald
  [holding answer 8 March 1999]: Details of individual Care and Repair grants provided by local authorities are not held centrally. The cost of grants given to owners benefiting from the Care and Repair scheme is met from the gross capital resources available to local authorities. The Scottish Office and the Convention of Scottish Local Authorities have agreed that expenditure on Care and Repair should be a shared priority for central and local government. The value of works completed in 1997–98 was around £6 million, covering some 1,400 homes. Revenue funding in 1997–98 amounted to £1.2 million.

  From 1 July, this will be a matter for the Scottish Parliament.

  Percentage of school leavers from publicly funded secondary schools in Scotland entering full-time higher education 1993–94 to 1997–98

  Percentage of school leavers entering full-time HE1

  Local authority

  1993–94

  1994–95

  1995–96

  1996–97

  1997–98

  Scotland

  27

  27

  28

  29

  30

  Aberdeen City

  23

  22

  26

  26

  30

  Aberdeenshire

  28

  28

  33

  36

  38

  Angus

  32

  32

  33

  34

  33

  Argyll and Bute

  35

  35

  32

  34

  33

  Clackmannanshire

  28

  26

  22

  25

  27

  Dumfries and Galloway

  30

  31

  33

  33

  30

  Dundee City

  23

  21

  22

  22

  22

  East Ayrshire

  24

  26

  25

  24

  30

  East Dunbartonshire

  41

  42

  45

  43

  44

  East Lothian

  30

  24

  30

  29

  26

  East Renfrewshire

  43

  42

  45

  42

  47

  Edinburgh, City of

  25

  26

  25

  27

  27

  Eilean Siar

  31

  38

  37

  37

  39

  Falkirk

  22

  20

  27

  25

  27

  Fife

  29

  29

  31

  30

  30

  Glasgow City

  14

  14

  15

  17

  17

  Highland

  30

  30

  30

  28

  31

  Inverclyde

  28

  24

  26

  29

  28

  Midlothian

  24

  25

  26

  26

  22

  Moray

  27

  27

  26

  29

  30

  North Ayrshire

  29

  26

  28

  27

  27

  North Lanarkshire

  24

  23

  25

  26

  28

  Orkney Islands

  46

  39

  37

  36

  40

  Perth and Kinross

  34

  32

  32

  35

  35

  Renfrewshire

  32

  32

  30

  31

  34

  Scottish Borders

  29

  32

  31

  33

  33

  Shetland Islands

  30

  32

  32

  24

  33

  South Ayrshire

  36

  38

  39

  38

  33

  South Lanarkshire

  28

  30

  31

  32

  32

  Stirling

  30

  34

  33

  39

  38

  West Dunbartonshire

  21

  21

  23

  26

  25

  West Lothian

  20

  18

  21

  24

  26

  1 Figures for 1997–98 (but not other years) include those school leavers who have an unconditional offer of a place in higher education, deferred for a year.

  Note:

  Figures exclude school leavers from special and independent schools and people who do not enter higher education direction directly from school

  Source:

  HMI Audit Unit Destinations from Scottish Secondary Schools.
  134

  M74
  Mr. David Marshall
  To ask the Secretary of State for Scotland if he will review the proposal to change the name of the M74 motorway to the M6; and if he will make a statement. [74409]

  Mr. Macdonald
  The previous Government had proposed that once the Glasgow to Carlisle road was upgraded to motorway throughout, its name should change to the M6. I confirm that there is no intention to renumber the route before all the remaining sections of the all-purpose route have been upgraded. From 1 July 1999, this will be a matter for the Scottish Parliament.

  University Attendance
  Mr. David Marshall
  To ask the Secretary of State for Scotland what assessment he has made of the proportion of school children who went on to university, broken down by residence in each Scottish parliamentary constituency, in each of the last five years. [74399]

  Mrs. Liddell
  Information is not available in the format requested. However, information is available on the percentage of school leavers from publicly funded secondary schools in Scotland entering a full-time course of higher education for each Local Authority area. This information is set out in the table:
  135
  As from 1 July 1999, this will be a matter for the Scottish Parliament.

  Primary Education
  Mrs. Laing
  To ask the Secretary of State for Scotland what the level of primary education funding was per primary school pupil in(a) cash terms and (b) 1998–99 prices in each year since 1992 in each local authority area. [74544]

  Mrs. Liddell
  The information is given in the tables. 1996–97 is the latest financial year for actual expenditure information is currently available. The figures, which are derived from local authority returns, do not include the cost of home-to-school transport, school meals, education authority central administration costs and loan charges.

  Net current expenditure per pupil in local authority primary schools

  (£ at out-turn prices)

  Regional/Islands Councils

  1992–93

  1993–94

  1994–95

  1995–96

  Borders

  1,885

  1,935

  1,943

  1,870

  Central

  1,722

  1,733

  1,724

  1,732

  Dumfries and Galloway

  1,745

  1,749

  1,719

  1,761

  Fife

  1,729

  1,721

  1,752

  1,771

  Grampian

  1,842

  1,805

  1,774

  1,860

  Highland

  1,907

  1,970

  2,000

  1,893

  Lothian

  1,659

  1,650

  1,695

  1,745

  Strathclyde

  1,763

  1,769

  1,811

  1,906

  Tayside

  1,709

  1,711

  1,766

  1,757

  Orkney

  2,106

  2,560

  2,537

  2,640

  Shetland

  2,382

  2,945

  2,576

  2,499

  Western Isles

  2,429

  2.390

  2,490

  2,478

  Net current expenditure per pupil in local authority primary schools

  (£ at 1998–99 prices)

  Regional/Island Councils

  1992–93

  1993–94

  1994–95

  1995–96

  Borders

  2,193

  2,193

  2,171

  2,030

  Central

  2,003

  1,964

  1,926

  1,880

  Dumfies and Galloway

  2,030

  1,982

  1,921

  1,912

  Fife

  2,011

  1,950

  1,957

  1,923

  Grampian

  2,143

  2,045

  1,982

  2,019

  Highland

  2,218

  2,232

  2,235

  2,055

  Lothian

  1,930

  1,870

  1,894

  1,894

  Stratclyde

  2,051

  2,005

  2,023

  2,069

  Tayside

  1,988

  1,939

  1,973

  1,907

  Orkney

  2,450

  2,901

  2,834

  2,866

  Shetland

  2,771

  3,337

  2,878

  2,713

  Western Isles

  2,826

  2,708

  2,782

  2,690

  Net current expenditure per pupil in local authority primary schools in 1996–97

  Councils

  (£ at out-turn prices)

  (£ at 1998–99 prices)

  Aberdeen, City

  1,805

  1,901

  Aberdeenshire

  1,857

  1,955

  Angus

  1,799

  1,894

  Argyll and Bute

  2,382

  2,508

  Clackmannanshire

  1,761

  1,854

  Dumfries and Galloway

  1,766

  1,860

  Dundee

  1,793

  1,889

  East Ayrshire

  1,820

  1,917

  East Dunbartonshire

  1,659

  1,748

  136

  Net current expenditure per pupil in local authority primary schools in 1996–97

  Councils

  (£ at out-turn prices)

  (£ at 1998–99 prices)

  East Lothian

  1,764

  1,858

  East Renfrewshire

  1,571

  1,654

  Edinburgh, City

  1,774

  1,869

  Eilean Siar

  2,531

  2,666

  Falkirk

  1,755

  1,848

  Fife

  1,754

  1,847

  Glasgow City

  2,007

  2,114

  Highland

  1,966

  2,070

  Inverclyde

  1,780

  1,875

  Midlothian

  1,882

  1,983

  Moray

  1,513

  1,593

  North Ayrshire

  1,750

  1,843

  North Lanarkshire

  1,836

  1,934

  Orkney

  2,711

  2,855

  Perth and Kinross

  1,834

  1,931

  Renfrewshire

  1,785

  1,880

  Scottish Borders

  1,896

  1,997

  Shetland

  2,497

  2,630

  South Ayrshire

  1,723

  1,815

  South Lanarkshire

  1,893

  1,993

  Stirling

  1,947

  2,050

  West Dunbartonshire

  1,912

  2,014

  West Lothian

  1,830

  1,928

  From 1 July 1999, this will be a matter for the Scottish Parliament.

  Mr. Swayne
  To ask the Secretary of State for Scotland how many primary school classes there were in Scotland in(a) 1996, (b) 1997 and (c) 1998. [74981]

  Mrs. Liddell
  There were 17,731 classes in publicly funded primary schools in Scotland in 1997. Of these, 13,052 were single-stage classes and 4,679 were composite classes. The information requested was not collected in 1996 and information for 1998 is not yet available.

  From 1 July 1999 this will be a matter for the Scottish Parliament.

  Schools Statistics
  Mrs. Laing
  To ask the Secretary of State for Scotland (1) how many(a) primary schools and (b) secondary schools in each local authority area were opened in each year since 1992; [74511]

  (2) how many (a) primary and (b) secondary schools in each local authority area were closed in each year since 1992. [74555]

  Mrs. Liddell
  Information derived from the database of schools held by The Scottish Office to enable it to conduct the annual School Census and other surveys is given in the following tables. 1993 is the earliest year for which reliable information is available in this form. The figures represent the primary and secondary schools/departments added to or removed from the database. In a number of instances this may be for reasons other than closure, such as merger. Specific information on such circumstances is not held centrally.
  137

  Number of publicly funded primary and secondary schools/departments in each local authority area that were opened in each year since 1993

  1993

  1994

  1995

  1996

  1997

  1998

  Primary

  Secondary

  Primary

  Secondary

  Primary

  Secondary

  Primary

  Secondary

  Primary

  Secondary

  Primary

  Secondary

  Aberdeen City

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  1

  —

  Aberdeenshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Angus

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Argyll and Bute

  —

  —

  —

  —

  —

  —

  —

  —

  2

  —

  —

  —

  Clackmannanshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Dumfries and Galloway

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Dundee City

  —

  —

  —

  —

  —

  —

  2

  1

  1

  1

  —

  —

  East Ayrshire

  —

  —

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  East Dunbartonshire

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  East Lothian

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  East Renfrewshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Edinburgh City

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Eilean Siar1

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Falkirk

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Fife

  —

  —

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  Glasgow City

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  Highland

  —

  —

  —

  —

  3

  1

  1

  —

  —

  —

  1

  —

  Inverclyde

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Midlothian

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Moray

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  North Ayrshire

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  North Lanarkshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Orkney

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  —

  —

  Perth and Kinross

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  —

  —

  Renfrewshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Scottish Borders

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Shetland Islands

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  South Ayrshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  South Lanarkshire

  —

  —

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  Stirling

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  West Dunbartonshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  West Lothian

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  1 Formerly known as Western Isles

  Number of publicly funded primary and secondary schools in each local authority area that were closed in each year since 1993

  1993

  1994

  1995

  1996

  1997

  1998

  Primary

  Secondary

  Primary

  Secondary

  Primary

  Secondary

  Primary

  Secondary

  Primary

  Secondary

  Primary

  Secondary

  Aberdeen City

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  4

  —

  Aberdeenshire

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  2

  —

  Angus

  —

  —

  —

  —

  —

  —

  2

  —

  —

  —

  —

  —

  Argyll and Bute

  —

  —

  —

  —

  —

  —

  —

  —

  2

  —

  2

  —

  Clackmannanshire

  —

  1

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  Dumfries and Galloway

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Dundee City

  —

  —

  —

  —

  —

  —

  5

  2

  2

  2

  —

  —

  East Ayrshire

  —

  —

  —

  —

  —

  —

  5

  —

  —

  —

  —

  —

  East Dunbartonshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  East Lothian

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  East Renfrewshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Edinburgh City

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Eilean Siar1

  —

  —

  2

  1

  —

  —

  1

  —

  —

  —

  —

  —

  Falkirk

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  —

  —

  Fife

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Glasgow City

  —

  —

  1

  2

  —

  —

  5

  —

  3

  1

  —

  7

  Highland

  1

  —

  1

  —

  1

  —

  4

  —

  2

  —

  1

  —

  Inverclyde

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Midlothian

  —

  1

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Moray

  —

  —

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  North Ayrshire

  —

  —

  —

  —

  —

  —

  2

  —

  —

  —

  —

  —

  North Lanarkshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Orkney

  —

  —

  —

  —

  2

  —

  1

  —

  —

  —

  —

  —

  Perth and Kinross

  1

  —

  1

  —

  1

  1

  —

  —

  —

  —

  1

  —

  Renfrewshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Scottish Borders

  3

  —

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  Shetland Islands

  —

  —

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  South Ayrshire

  —

  —

  1

  —

  —

  —

  —

  —

  —

  —

  —

  —

  South Lanarkshire

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  —

  Stirling

  —

  —

  1

  —

  —

  —

  2

  —

  —

  —

  2

  —

  West Dunbartonshire

  1

  —

  —

  —

  —

  —

  1

  —

  —

  —

  —

  —

  West Lothian

  —

  2

  —

  —

  —

  —

  —

  —

  1

  —

  —

  —

  1 Formerly known as Western Isles

  138 139
  From 1 July 1999, this will be a matter for the Scottish Parliament.

  Nurses
  Mrs. Laing
  To ask the Secretary of State for Scotland how many people(a) undertook nurse training and (b) qualified as trained nurses, and how many and what percentage of qualified nurses gained employment in the NHS, in each year since 1992. [74514]

  Mr. Galbraith
  The available information is as follows:

  (a) Student nurse intakes

  (b) Student nurse completions

  1992–93

  2,325

  2,359

  1993–94

  2.377

  2,295

  1994–95

  2,230

  2,047

  1995–96

  2,209

  1,805

  1996–97

  2,386

  1,683

  1997–98

  2,367

  1,606

  (c) Information on the percentage of qualified nurses gaining employment in the NHS is available centrally for the years 1992 to 1994 only. It is published in Table 9.16 of Scottish Health Statistics 1996, a copy of which is held in the Library of the House.

  Note:

  The reduction in completions results from reduced intakes during the period 1990–95, which included the introduction of P2000 courses in place of the old style '1982' courses.

  From 1997–98 onwards, intakes have been informed by the annual Student Nurse Intake Plans, which assess the supply and demand of nurses. These exercises are conducted in partnership with the Management Executive, NHS Trusts, Health Boards and the Private Sector and includes all specialist areas in nursing. The model used takes account of demographic trends including the age profiles of nurses currently employed within the NHS, and the number of students which require to be trained is estimated over a 5 year cycle.

  Source:

  Training Data—National Board for Nursing, Midwifery and Health Visiting for Scotland

  Employment Data—Information and Statistics Division of the Common Services Agency for the NHS in Scotland.

  From 1 July 1999, this will be a matter for the Scottish Parliament.

  NHS Bureaucracy
  Mrs. Laing
  To ask the Secretary of State for Scotland how much money has been saved from reducing bureaucracy in the NHS in Scotland since 1 May 1997; and what these savings have been spent on. [74540]

  Mr. Galbraith
  The estimated savings from reducing bureaucracy for 1997–98 and 1998–99 are approximately £25 million.

  The savings have been generated and retained at individual Health Board level and have been re-invested in patient care in line with local priorities and needs.

  From 1 July 1999, this will be a matter for the Scottish Parliament.
  140

  Class Sizes
  Mrs. Laing
  To ask the Secretary of State for Scotland if he will list by individual school and local authority, the average number of pupils per(a) primary school class, (b) primary years one, two and three class and (c) secondary school class. [74545]

  Mrs. Liddell
  The answer to parts(a) and (b) of the question is lengthy and I have arranged for a table giving the information requested to be placed in the Library. The information requested in part (c) of the question is not held centrally.

  From 1 July 1999, this will be a matter for the Scottish Parliament.

  NHS Staff
  Mrs. Laing
  To ask the Secretary of State for Scotland how many(a) NHS administrators and managers, (b) nurses, (c) hospital doctors, (d) hospital consultants and (e) general practitioners there were in each health board area, in each year since 1992. [74512]

  Mr. Galbraith
  As the information requested is rather lengthy, I have arranged for copies to be placed in the House of Commons Library.

  From 1 July 1999, this will be a matter for the Scottish Parliament.

  Primary Care Trusts
  Mrs. Laing
  To ask the Secretary of State for Scotland what estimate he has made of the cost(a) in total and (b) by health board area for the introduction of primary care trusts and local health care co-operatives. [74516]

  Mr. Galbraith
  The introduction of Primary Care Trusts is part of the overall reconfiguration of NHS Trusts in Scotland that is expected to yield net savings of £6 million per annum. With mergers taking place in all 12 mainland Health Board areas, the saving per Board area will be £500,000 on average.

  In 1998–99, just under £1 million was made available to mainland Health Boards to support the development of Local Healthcare Co-operatives.

  Individual Health Board allocations are detailed in the table.

  Health board

  Support for LHCCs 1998–99

  Argyll and Clyde

  100,000

  Ayrshire and Arran

  80,000

  Borders

  30,000

  Dumfries and Galloway

  70,000

  Fife

  70,000

  Forth Valley

  95,000

  Grampian

  90,000

  Greater Glasgow

  120,000

  Highland

  80,000

  Lanarkshire

  80,000

  Lothian

  101,500

  Tayside

  80,000

  Total

  996,500

  From 1 July 1999, this will be a matter for the Scottish Parliament. Scottish
  141

  Nursery Education
  Mrs. Laing
  To ask the Secretary of State for Scotland how many(a) free nursery school places, (b) hours of free nursery schooling per child and (c) children in the nursery school age group, there are in each local authority area. [74530]

  Mrs. Liddell
  Information on the number of free nursery school places available in each local authority area is not held centrally. Government grant funding covers up to 4121/2 hours of pre-school education for each eligible child over the school year. The Government's pledge to provide a free, quality, part-time education place for every child in their pre-school year, whose parents want one, has been met in Scotland: I announced this on 4 March. The estimated number of pre-school children in each local authority area eligible for pre-school education grant in the school year 1998–99 is in the table.

  Local authority

  Estimate of preschool year children1

  Aberdeen City

  2,433

  Aberdeenshire

  2,717

  Angus

  1,021

  Argyll and Bute

  1,296

  Clackmannanshire

  643

  Dumfries & Galloway

  1,708

  Dundee City

  1,637

  East Ayrshire

  1,487

  East Dunbartonshire

  1,380

  East Lothian

  1,245

  East Renfrewshire

  1,089

  City of Edinburgh

  5,039

  Eilean Siar

  290

  Falkirk

  1,758

  Fife

  4,129

  City of Glasgow

  5,863

  Highland

  2,506

  Inverclyde

  1,055

  Midlothian

  998

  Moray

  1,057

  North Ayrshire

  1,649

  North Lanarkshire

  4,168

  Orkney Islands

  232

  Perth and Kinross

  1,452

  Renfrewshire

  2,152

  Scottish Borders

  1,169

  Shetland Islands

  293

  South Ayrshire

  1,197

  South Lanarkshire

  3,711

  Stirling

  926

  West Dunbartonshire

  1,252

  West Lothian

  2,059

  Scotland

  59,611

  1 The estimated number of children in each local authority is based on information provided by GRO, incorporating information provided by authorities where appropriate.

  From 1 July 1999, this will be a matter for the Scottish Parliament.

  Ministerial Costs
  Mr. Malcolm Bruce
  To ask the Secretary of State for Scotland if he will estimate the total cost to his Department of all Ministers at the Scottish Office for each of the years(a) 1995–96, (b) 1996–97, (c) 1997–98, (d) 1998–99 and (e) 1999–2000 broken down by (i) salaries, (ii) travel and (iii) other costs; and if he will make a statement. [74497]
  142
  Mr. Dewar
  [holding answer 4 March 1999]: For information on 1996–97 to 1999–2000 I refer the hon. Member to the answer I gave him on 3 March, Official Report, column 753. Expenditure for 1995–96 is shown in the table. The table shows Ministerial pay and total non-pay expenditure for ministerial offices. This includes travel and subsistence, office services and general administration costs for both Ministers and the staff of their offices. It is not possible to disaggregate this amount into the categories requested.

  £

  Ministerial pay

  Ministerial office non-pay

  1995–96

  178,943

  766,483

  Victim Support
  Mr. Sarwar
  To ask the Secretary of State for Scotland if he will make a statement on Government measures for Victim Support in Scotland and its future plans for this work in Glasgow. [74884]

  Mr. McLeish
  Government measures for Victim Support Scotland include an increase in funding for 1999–2000 of £200,000 to £1.705 million. This is made up of £105,000 for general support and £95,000 to allow a roll-out of court-based witness support programmes beyond the current services at Ayr, Hamilton and Kirkcaldy.

  Victim Support Scotland has recently completed a reorganisation of local services from 77 to 32 to coincide with local authority boundaries. The level of funding for loam services is a matter for the organisation.

  From 1 July 1999, this will be a matter for the Scottish Parliament.

  New Deal (Costs)
  Mr. Swayne
  To ask the Secretary of State for Scotland what has been the total cost of implementing and running the New Deal in Scotland since January 1998. [74982]

  Mr. Dewar
  Expenditure to the end of January 1999 on the New Deal programmes for 18 to 24-year-olds and for those aged 25 and over was £12.97 million.

  Student Finance
  Mr. Malcolm Bruce
  To ask the Secretary of State for Scotland if he will estimate, for each of the next 10 years, the annual cost of abolishing tuition fees for Scottish students at all UK universities on(a) a cash accounting basis and (b) a resource accounting basis; and if he will make a statement. [74562]

  Mrs. Liddell
  [holding answer 5 March 1999]: No separate estimates have been made for tuition fee income from students at universities as requested. The table provides estimates for fees income from Scottish higher education students at higher education institutions and further education colleges for the years 1998–99 to 2001–02 only.
  143

  Scottish and EU1 students contribution to UK higher education institutions and further education colleges

  £ million

  1998–99

  18

  1999–2000

  29

  2000–01

  36

  2001–02

  38

  1 EU students are included as they have to be treated way as Scottish students

  Note:

  Figures are at current prices

  The figures show the estimated total cash transfer from Scottish (and EU) students to institutions in each year. If this cash transfer is not made each year, that funding would have to be met from central Government current resources. The figures for annual costs would be the same on a resource accounting basis as on a cash accounting basis. The estimates assume other student support remains unchanged.

  From 1 July 1999, this will be a matter for the Scottish Parliament.

  Public Appointments
  Mr. Moore
  To ask the Secretary of State for Scotland if he will list by region the number of appointments of which he has(a) made personally and (b) been consulted on; and if he will list for those appointments the political affiliations of the successful candidates. [74992]

  Mr. Dewar
  [holding answer 5 March 1999]: I have made some 550 appointments to public bodies in Scotland since May 1997 and am also consulted on an on-going basis about appointments to GB or UK bodies operating in Scotland. All appointments are made in accordance with Nolan principles involving selection on merit and independent scrutiny of candidates. Where bodies do not have purely local remits I make an effort to ensure as wide a geographical representation as possible. Candidates for public appointments are not required to state their political affiliation.

  From 1 July 1999, this will be a matter for the Scottish Parliament.

  Bed Blocking
  Mr. Moore
  To ask the Secretary of State for Scotland how many patients(a) in each health board area and (b) nationally were retained past their original discharge date in NHS beds before moving to social service beds in the last year for which figures are available; and if he will estimate the cost of the NHS of this delayed discharge. [75067]

  Mr. Galbraith
  [holding answer 5 March 1999]: Information to a consistent definition is not currently available. A Working Group of representatives from The Scottish Office, Health Boards, NHS Trusts and Local Authorities is developing arrangements to enable data to be recorded on a consistent basis. These arrangements will be piloted in Scotland from April 1999. Standardised information should be recorded throughout Scotland from April 2000.

  From 1 July 1999, this will be a matter for the Scottish Parliament.
  144

  Teachers (In-service Training)
  Mrs. Laing
  To ask the Secretary of State for Scotland how many days of in-service training are provided for(a) primary and (b) secondary school teachers in each local authority area per year. [74639]

  Mrs. Liddell
  Under the current Scheme of Salaries and Conditions of Service for teachers employed in education authority-controlled schools there is provision for a maximum of 5 working days out of the school year to be spent on planned activities such as in-service training. The timing and planning of such dates are drawn up by the headteacher in consultation with staff, and within guidelines provided by the local authority.

  As from 1 July 1999, this will be a matter for the Scottish Parliament.

  Right to Buy
  Mr. Russell Brown
  To ask the Secretary of State for Scotland when he will announce the results of the public consultation on proposed changes to the Right to Buy Cost Floor Rules in Scotland; and if he will make a statement. [76122]

  Mr. Macdonald
  We received 38 responses to the consultation paper which was issued in February 1998, the majority of which were broadly supportive of the proposals outlined in the paper. Having considered the comments received, I have today laid before Parliament a Statutory Instrument which will extend the cost floor period in Scotland from 5 to 10 years with effect from 1 April 1999. This change will protect for a longer period investment made by landlords in their housing stock.

  A separate Determination will also be issued which will set out in detail how landlords should calculate the cost floor in future. This will also introduce a new threshold, which will allow landlords to include significant repairs and maintenance costs within the calculation of the cost floor. The changes will affect both local authorities and other landlords whose tenants have a Preserved Right to Buy.

  From 1 July 1999, this will be a matter for the Scottish Parliament.

INTERNATIONAL DEVELOPMENT

  Zimbabwe
  Mrs. Gillan
  To ask the Secretary of State for International Development, pursuant to her answer of 26 February 1999,Official Report, column 456, how long she spent in Zimbabwe in January 1998; and if she will list the people she met. [75763]

  Clare Short
  The visit took less than a day. The purpose was to meet the staff of my Department in Harare. As I stated in my answer of 1 March 1999,Official Report, column 582, I also met the right hon. Herbert Murerwa, Zimbabwean Minister of Finance.

  Mrs. Gillan
  To ask the Secretary of State for International Development when the detailed country strategy paper on Zimbabwe will be published. [75764]
  145
  Clare Short
  We expect to publish our Country Strategy Paper for Zimbabwe next month.

  Biological Resources (Patents)
  Mr. Baker
  To ask the Secretary of State for International Development what assessment she has made of the implications for poorer countries of the patents granted within the United States on(a) quinoa, (b) the neem tree, (c) j'oublie and (d) basmati. [74847]

  Clare Short
  We have made no assessment of the implications for developing countries of the patents granted for quinoa, the neem tree, j'oublie and basmati by the United States.

  Patents can have only national effects and as such are effective only against acts within the jurisdiction concerned, in these cases the US. They have no power elsewhere. The owner of a patent can prevent the use of the protected material by others within the state concerned, including imports based on the protected technology.

  Patents can protect only new technology, not natural discoveries nor existing technology and can be challenged in the courts where they are invalid.

ENVIRONMENT, TRANSPORT AND THE REGIONS

  Integrated Transport Commission
  18. Mr. Walter
  To ask the Secretary of State for the Environment, Transport and the Regions when he will bring forward plans to implement his integrated transport policy; and if he will make a statement. [73430]

  Dr. Reid
  We are already implementing our integrated transport policy. We are investing an extra £1.8 billion in integrated transport, and local transport plans—the key tool for making it happen—will be in place this summer.

  Council Tax
  19. Mr. Gill
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the effect of the local government settlement for 1999–2000 on council tax levels. [73431]

  Ms Armstrong
  Decisions on the level of council tax are a matter for each authority. Our settlement provides that if local authorities increased their budgets in line with SSAs, council taxes would rise by 4.5 per cent. on average.

  33. Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement about council tax levels in 1999–2000. [73445]

  Ms Armstrong
  Decisions on the level of council tax are a matter for each authority.

  Mrs. Shephard
  To ask the Secretary of State for the Environment, Transport and the Regions if he will place in the Library a table showing for each notifiable authority in England, the band D council tax for 1999–2000; and the level of increase over 1998–99, expressed(a) in cash terms and (b) as a percentage. [75547]
  146
  Ms Armstrong
  I refer the right hon. Member to my reply given to the hon. Member for Croydon, South (Mr. Ottaway) on 3 March 1999,Official Report, column 733.

  Electric Cars
  20. Ms Blears
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to encourage the use of electric cars in urban areas. [73432]

  Ms Glenda Jackson
  Electric vehicle technology has the potential to offer significant environmental benefits, especially if used in urban areas. That is why the Government is undertaking research and development into this technology through the Foresight Vehicle programme, and providing grants to help cover the additional purchase costs of electric vehicles through the Powershift programme. The Cleaner Vehicles Task Force is also considering their longer-term role.

  Professional Drivers
  Mr. Clapham
  To ask the Secretary of State for the Environment, Transport and the Regions what representations he has received about managing road risk for professional drivers. [73433]

  Mr. Meale
  I receive representations from time to time from a number of organisations in the field of road safety including ROSPA and BRAKE, on the question of the management of occupational road risk.

  Road Congestion
  22. Mr. Syms
  To ask the Secretary of State for the Environment, Transport and the Regions when he last met representatives from the Automobile Association regarding his proposals to tackle road congestion. [73434]

  Dr. Reid
  Ministers from the Department meet representatives of the Automobile Association from time to time to discuss matters arising out of the Integrated Transport White Paper. A number of such meetings took place in October and November last year.

  Single Regeneration Budget
  23. Mr. Salter
  To ask the Secretary of State for the Environment, Transport and the Regions what the time scale is for consideration and implementation of regeneration schemes under the new single regeneration budget, SRB5. [73435]

  Mr. Caborn
  Final bids must be submitted to Regional Development Agencies (or in London, the Government Office) by 30 April. Decisions on which to support will be made in June.

  Mr. McDonnell
  To ask the Secretary of State for the Environment, Transport and the Regions if he will publish the names of those people serving as members of the local Single Regeneration Budget partnerships. [75158]

  Mr. Meale
  This information is not held centrally and can be obtained only at disproportionate cost.
  147
  Mr. McDonnell
  To ask the Secretary of State for the Environment, Transport and the Regions if hon. Members are eligible to serve as members of local Single Regeneration Budget partnerships. [75159]

  Mr. Meale
  I am not aware of any rules that prevent hon. Members, other than Ministers and Parliamentary Private Secretaries, from serving as members of local Single Regeneration Budget partnerships. Ministers and Parliamentary Private Secretaries are governed by the terms of the Ministerial Code.

  Community Forest Schemes
  24. Helen Jones
  To ask the Secretary of State for the Environment, Transport and the Regions what action he is taking to encourage companies to participate in community forest schemes; and if he will make a statement. [73436]

  Mr. Meacher
  This is for the Community Forest teams, who I am pleased to say are succeeding in attracting an increasing amount of support from the business community. The £7.7 million of support received in 1997–98 represented a 400 per cent. increase on the level in 1994–95.

  Climate Change Programme
  25. Mr. Barry Jones
  To ask the Secretary of State for the Environment, Transport and the Regions what estimate he has made of the contribution of business to meeting the targets in the UK climate change programme. [73437]

  Mr. Meacher
  The climate change consultation paper which we published last October set out the options on how we might meet our climate change targets. The paper looked at the potential contribution from all sectors. The consultation has now closed and we are in the process of analysing the responses. We are aiming to publish a draft UK programme later this year.

  Greater London Authority
  26. Sir Sydney Chapman
  To ask the Secretary of State for the Environment, Transport and the Regions what estimate he has made of the cost of the administration of the Greater London Authority in its first year of operation. [73438]

  Mr. Raynsford
  No estimate has yet been made specifically for the GLA's first year of operation. As noted in "A Mayor and Assembly for London" (Cm 3897), we estimate that the annual cost of entirely new administration costs—such as for the Mayor, the Assembly, their support staff and central services—will be about £20 million.

  Bus Services
  27. Mrs. Organ
  To ask the Secretary of State for the Environment, Transport and the Regions what measures he is taking to encourage the improvement of bus services. [73439]

  Ms Glenda Jackson
  We have made an additional £150 million available to local authorities over 3 years to support rural bus services and an additional £700 million 148
  of capital resources for local transport expenditure. Our policy proposals for buses were set out in the Transport White Paper last July.

  Regional Development Agencies
  Mr. Gray
  To ask the Secretary of State for the Environment, Transport and the Regions what factors were taken into account in appointing board members to regional development agencies. [73440]

  Mr. Caborn
  Our primary concern in appointing the Board members for the RDAs was to choose people who would make an effective contribution and represent the interests of the region as a whole. Board members have a wide range of experience, including business, local government, rural affairs, education, trade unions and the voluntary sectors.

  Housing Development
  29. Jackie Ballard
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the provision for housing development in structure plans currently under review. [73441]

  Mr. Raynsford
  Provision for housing development in structure plans is a matter for local planning authorities in the first instance. In determining provision, they must have regard to national policies (for example, "Panning for the Communities of the Future") and Regional Planning Guidance. Assessment of plans by the Secretary of State will include, amongst other things, the extent to which the local authority has had regard to these matters.

  Road Schemes
  30. Mr. Paterson
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on private finance initiative road schemes. [73442]

  Dr. Reid
  Using private finance for road construction and maintenance can offer good value for money to the taxpayer. Highway Authorities should consider what form of procurement is likely to offer best value for money after they have satisfied themselves on the transport need for a scheme.

  Animal Rendering Plants
  31. Mr. Dawson
  To ask the Secretary of State for the Environment, Transport and the Regions if he will ensure that local authorities continue to have the role of monitoring and setting environmental standards at animal rendering plants. [73443]

  Mr. Meale
  Animal rendering plants fall within the scope of EU directive 96/61 concerning integrated pollution prevention and control. My Department issued a third consultation paper on the implementation of this directive in December last year. Paragraph 52 of the paper specifically invited views on the proposal that animal rendering plants should be regulated by the Environment Agency rather than local authorities under the directive. The consultation period ended on 28 February. The Government will make a decision on future regulation of animal rendering plants thereafter.
  149

  Standard Spending Assessments
  Mr. Chaytor
  To ask the Secretary of State for the Environment, Transport and the Regions what discussions have taken place with the Local Government Association regarding the principles underpinning the review of SSAs. [73444]

  Ms Armstrong
  The principles of the review of revenue grant distribution were set out in the White Paper "Modern Local Government: In Touch with the People", which was presented to the House in July 1998. Officials from a number of Departments met representatives from local government, including the LGA, the Association for London Government and the Treasurers' Societies on 10 February to discuss the review. Further regular meetings with the LGA are planned during the course of the review.

  Workplace Health and Safety
  34. Mr. Olner
  To ask the Secretary of State for the Environment, Transport and the Regions what proposals he has to improve health and safety in the workplace. [R] [73446]

  Mr. Meale
  The Government are working with the Health and Safety Commission and Executive to improve health and safety in the workplace. The Health and Safety Commission will shortly be submitting a three-year strategic plan to the Government. My right hon. Friends the Deputy Prime Minister and Minister for the Environment met the Commission recently to discuss the Plan. It will be published in May and copies will be placed in the House Library. The Government are providing an extra £13 million in running costs to the Commission next year, and a further £23 million and £27 million for the following two years to enable the Commission and Executive to increase their efforts still further. This signals our strong commitment to improving health and safety standards.

  British Waterways
  Mr. Miller
  To ask the Secretary of State for the Environment, Transport and the Regions how the extra resources to British Waterways are planned to be allocated. [73447]

  Mr. Meale
  I refer my hon. Friend to the answer T gave earlier today to my hon. Friend the Member for Bristol, North-West (Mr. Naysmith).

  Thames Gateway
  Mr. Austin
  To ask the Secretary of State for the Environment, Transport and the Regions if he will set out his priorities for road improvements and public transport improvements to achieve the regeneration potential of the Thames Gateway. [73448]

  Mr. Caborn
  The main public transport priority to achieve the regeneration potential of the Thames Gateway remains the construction of the Channel Tunnel Rail Link. More localised public transport projects, in association with the major developments, should bring benefits throughout the Gateway.
  150
  Key priorities for roads are improvements to the A2, providing enhanced access to Kent Thames-side, one of the two main centres for development in the Thames Gateway, and a second Swale crossing to the Isle of Sheppey.

  Walking-to-school Initiative
  Ms Stuart
  To ask the Secretary of State for the Environment, Transport and the Regions what progress he has made with his walking-to-school initiative; and if he will make a statement. [73449]

  Ms Glenda Jackson
  We established the School Travel Advisory Group in December to identify practical action to reduce car use and improve safety on the journey to school, including ways of encouraging walking to school. Guidance for local authorities and schools is in preparation and will be published in late spring 1999.

  New Deal (Motorists)
  Ms Rosie Winterton
  To ask the Secretary of State for the Environment, Transport and the Regions what steps he is taking to implement the new deal for motorists. [73450]

  Dr. Reid
  My Department, along with other departments, is taking forward the "New deal for Motorists" in a number of ways. These include increasing funds for road maintenance on both trunk and local roads, focusing investment on making the best use of the current road system, improving road and car safety, bringing forward proposals to regulate the private security industry to control cowboy wheelclampers, encouraging alternatives to car travel so as to reduce pollution, and taking forward various initiatives such as the Vehicle Crime Reduction Action team to help deter and detect vehicle theft and fraud.

  BEST Bus Pensioners
  Mr. Bob Russell
  To ask the Secretary of State for the Environment, Transport and the Regions what progress has been made since 1 May 1997 in returning the outstanding pension money to the Bus Employees superannuation trust pension fund. [73451]

  s Glenda Jackson
  I refer the hon. Member to the answer I gave to him on 12 January 1999,Official Report, column 167.

  Genetically Modified Crops
  Mr. Alan Simpson
  To ask the Secretary of State for the Environment, Transport and the Regions if(a) the local community and (b) farmers living in the locality of the genetically modified crops that have marketing consent are required to be informed of the presence of those crops. [72173]

  Mr. Meacher
  Council Directive 90/220/EEC controls the deliberate release of genetically modified organisms (GMOs) in the European Community. Once a GM crop has marketing consent under the Directive, it applies across all member states and there is no automatic requirement to notify the authorities, local people or local farmers where the crop is grown or the area it covers.
  151
  Details of each marketing application, ACRE'S advice and the opinion of the UK Competent Authority are contained in the statutory public register held in the Department of the Environment, Transport and the Regions.

  Mr. Alan Simpson
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the sites and the area each covers which are proposed to be planted with each of the genetically modified crops that have marketing consent; and when they will be planted. [72171]

  Mr. Meacher
  Council Directive 90/220/EEC controls the deliberate release of genetically modified organisms (GMOs) in the European Community. Once a GM crop has marketing consent under the Directive, it applies across all member states and there is no automatic requirement to notify the authorities where the crop is grown or the area it covers. Therefore, this information is not available. However, the statutory public register

  Description of GM crop

  Company

  Scope of permitted use

  Tobacco modified for herbicide tolerance

  Societe National d'Exploitation des Tabacs et Allumettes

  Cultivation in European Community and use in tobacco industry

  Oilseed rape hybrid system with herbicide tolerance

  Plant Genetic Systems NV

  Cultivation in European Community for commercial seed production only

  Soybeans modified for herbicide tolerance

  Monsanto Europe

  Importation and processing. Not for cultivation in European Community

  Maize modified for insect resistance and herbicide tolerance

  Novartis

  Importation, processing and cultivation in the European Community

  Red-hearted chicory modified for altered fertility

  Bejo Zaden BV

  Cultivation in the European Community for commercial seed production only

  Maize modified for herbicide tolerance

  AgrEvo France

  Cultivation in European Community

  Maize modified for insect resistance

  Monsanto Europe

  Importation, processing and cultivation in the European Community

  Oilseed rape modified for herbicide tolerance

  AgrEvo UK Crop Protection

  Importation and processing. Not for cultivation in European Community

  Maize modified for insect resistance and herbicide tolerance

  Northrup King Company

  Importation and processing. Not for cultivation in European Community

  Carnations with modified flower colour

  Florigene Europe BV

  For production of cut flowers and horticulture

  Carnations modified for increased Vase-life

  Florigene Europe BV

  For production of cut flowers and horticulture

  Carnations with modified flower colour

  Florigene Europe BV

  For production of cut flowers and horticulture

  Details of each marketing application are contained in the statutory public register held in the Department of the Environment Transport and the Regions.

  Mr. Alan Simpson
  To ask the Secretary of State for the Environment, Transport and the Regions if the release of the genetically modified crops that have marketing consent will be recorded in the public register of GMO releases. [72172]
  152
  held in the Department of the Environment, Transport and the Regions contains details of each marketing application, ACRE'S advice and the opinion of the UK Competent Authority.

  The scope of the permitted use under the marketing consent does not in every case allow these crops to be cultivated commercially in the European Community.

  Mr. Alan Simpson
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the genetically modified crops which have received marketing consent; and to which company each belongs. [72170]

  Mr. Meacher
  Council Directive 90/220/EEC controls the deliberate release of genetically modified organisms (GMOs) in the European Community. Once a GM crop has marketing consent under the Directive, it applies across all member states. The GM crops which have received marketing consent under this Directive and the companies involved are listed below.

  Mr. Meacher
  The releases will not be recorded on the public register as none of the consents for marketing issued so far contains such a requirement.

  Once a GM crop has marketing consent under Part C of Council Directive 90/220/EEC it applies across all member states and there is no automatic requirement to notify the authorities where the crop is grown. Therefore, this information is not available.
  153
  However, the statutory public register held in the Department of the Environment, Transport and the Regions contains details of each marketing application, ACRE'S advice and the opinion of the UK Competent Authority. The register is open to public inspection.

  The scope of the permitted use of GM crops which have received marketing consent under Directive 90/220/EEC does not in every case allow them to be cultivated commercially in the European Community. There will be no commercial releases of GM crops in the UK before spring 2000 at the earliest.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the creation of a stakeholders' forum with respect to genetic modification issues. [75281]

  Mr. Meacher
  [holding answer8 March 1999]: The creation of a stakeholders' forum is one of the issues covered by the review of the framework for overseeing developments in biotechnology announced by my right hon. Friend the Minister for the Cabinet Office in December. No decision has yet been taken.

  Speed Cameras
  Mr. Maclean
  To ask the Secretary of State for the Environment, Transport and the Regions (1) what progress his Department has made on a comprehensive scheme for speed cameras throughout England and Wales; and if he will make a statement; [73661]

  (2) if he will estimate the potential reduction in road deaths if 7,000 speed cameras were installed in England and Wales. [73660]

  Dr. Reid
  The siting of speed enforcement cameras is an operational matter for chief officers of police and their local traffic authorities. My Department issues advice on the deployment of speed enforcement cameras in Circular Roads 4/90. That advice makes clear that, in order to maximise their benefit, cameras should be placed at sites with a history of speed-related accidents. Information about the number of cameras in use is not kept centrally. It is not possible, therefore, to estimate fatality reductions resulting from camera use.

  Fish Processing (Waste Water Charges)
  Mr. Mitchell
  To ask the Secretary of State for the Environment, Transport and the Regions what proposals he has for ensuring equality of treatment(a) between British ports and (b) between British and European ports in respect of waste water charges on fish processing. [74172]

  Mr. Meacher
  Every part of the United Kingdom and every European Union country is equally bound by the requirements of Directives including the Urban Waste Water Treatment Directive. It is for each Member state to ensure compliance with the implementation timetable for each Directive, and failures to implement are matters for the Commission to pursue. The Government expects other Member states and the Commission to fulfil these obligations.

  In the United Kingdom, the private sector water and sewerage undertakers in England and Wales and the public sector water authorities in Scotland and Northern Ireland are all undertaking investment programmes in treatment works to meet the requirements of the Urban
  154
  Waste Water Treatment Directive, which sets deadlines phased between 1998 and 2005 depending on the size of the discharge and sensitivity of the receiving waters. The costs falling on individual customers will depend on the costs incurred in meeting treatment requirements and the way in which such costs are apportioned between customers.

  The Government strongly supports investment to upgrade coastal discharges, which will make a major contribution to improving the environment.

  Mr. Mitchell
  To ask the Secretary of State for the Environment, Transport and the Regions what proposals he has for ensuring that waste water charges for fish market(a) merchants and (b) processors become operational at the same time and at the same amounts. [74173]

  Mr. Meacher
  The level of trade effluent charges depends on the volume and characteristics of the waste produced and the level of treatment. In some cases the level of treatment required is being increased under the Urban Waste Water Treatment Directive.

  It is not feasible to bring every new treatment works into operation on the same date. However, the Directive sets deadlines phased between 1998 and 2005.

  Mr. Mitchell
  To ask the Secretary of State for the Environment, Transport and the Regions if he will estimate how many effluent treatment plants have been built since the directive on waste water became operational in(a) Denmark, (b) Holland, (c) France, (d) Spain and (e) the United Kingdom to comply with the waste water directive; and to what extent the cost of these is charged to the fish processing industry. [74171]

  Mr. Meacher
  The Urban Waste Water Treatment Directive was adopted by EC Member States in May 1991. Under Article 17 of the Directive, Member States have reported on implementation programmes. A broad estimate of the number of larger plants to be built or upgraded can be obtained from the difference between the number of plants in each country which were estimated to be achieving compliance with the Directive's treatment requirements in 1992 (the baseline year used for the reports) and in 2000 (the first main deadline under Article 4 of the Directive).

  Denmark estimated 75 additional effluent treatment plants would be compliant with the standards of the Directive; Holland estimated 17 fewer plants (through rationalisation of treatment systems); France estimated 560 additional plants and Spain estimated 585 additional plants. The United Kingdom estimated an additional 503 plants would be compliant for the same period.

  The fish processing industry does not directly incur costs associated with the construction of effluent treatment plants. Costs to the fish processing industry, and other dischargers of trade effluent, arise from the treatment by sewerage undertakers of effluent discharged to sewers before final discharge to receiving waters. Costs levied by the sewerage undertakers are based on the volume and concentration of trade effluent.
  155

  Inland Waterways
  Mr. Maclean
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the effect on United Kingdom inland waterway transport tonnage of COM (98) 792. [74436]

  Dr. Reid
  The amended proposal for a Council Regulation on a Community fleet capacity policy to promote inland waterway transport contained in Commission document (1998) 792 does not apply to inland waterway tonnage in the United Kingdom.

  Task Forces
  Dr. Tony Wright
  To ask the Secretary of State for the Environment, Transport and the Regions if he will publish a list of (1) task forces and (2) policy reviews established by his Department since May 1997 which(a) had external members recruited by way of public advertisement, and details of any person so appointed and (b) engaged in public consultation exercises, and the form that these took. [74467]

  Mr. Meale
  I have today placed in the Library of the House a list of the task forces and reviews established by my Department since 1 May 1997 which engaged in public consultation exercises and details of the form that these took.

  My Department has no task forces or reviews which had external members recruited by way of public advertisement. Most task forces and reviews are short-term bodies established to give thorough consideration to important and difficult issues. External members are invited to sit on some reviews and task forces because they are able to contribute specific experience and expertise. In such cases, public advertising would be inappropriate and disproportionate.

  M42
  Mr. Jenkins
  To ask the Secretary of State for the Environment, Transport and the Regions when he expects measures to be put in place to alleviate traffic problems at junction 10 of the M42 motorway. [74553]

  Ms Glenda Jackson
  I have asked the Chief Executive of the Highways Agency, Mr. Lawrie Haynes, to write to my hon. Friend.

  Letter from Peter Nutt to Mr. Brian Jenkins, dated 9 March 1999:
  Glenda Jackson has asked Lawrie Haynes, the Chief Executive of the Highways Agency, to reply to your recent question about when measures may be put in place to alleviate traffic problems at junction 10 of the M42 motorway. I am replying in Lawrie's absence from the office.
  I understand the concern about the operation of junction 10. Traffic congestion at this large junction is a particular problem during peak periods. There are also problems with the high speed of circulating traffic on the roundabout. All this contributes to tailbacks on the M42 and A5.
  The installation of the traffic lights on the northbound exit slip road some time ago has improved operation of this part of junction 10. However, congestion on the slip road is still a problem with queues extending back on to the M42. We are therefore preparing a scheme to provide a dedicated lane to connect the slip road direct to the west bound carriageway of the A5. This should greatly reduce queuing on the slip road, improve operation of the roundabout and make the junction safer.
  156
  We are also preparing a scheme to improve the merging area between the southbound entry slip road and the M42. This should improve conditions for traffic joining the motorway, reducing congestion in the merge area and make conditions safer for all drivers.
  It is difficult to give firm timings for carrying out these improvements until the preparation work is further advanced but we are planning for site work to begin in early 2000.
  In addition to these improvements, the Highways Agency is currently pursuing an agreement with developers who have proposals to develop the Birch Coppice site adjacent to the A5 east of junction 10. These proposals would include installing traffic signals on all arms of the roundabout at junction 10 and widening the circulating carriageway, similar to the works nearing completion at junction 9 on the M42. This would improve operation of the whole junction, reducing traffic speeds on the roundabout and making it easier and safer to use.
  I anticipate that we will soon reach agreement with the developers about the extent of the improvements to junction 10. However, the site does not yet have planning permission and there is no guarantee that it will go ahead. Should it not go forward we will review the improvements needed to the junction.
  I hope this is helpful.

  Newbury Bypass
  Mr. Key
  To ask the Secretary of State for the Environment, Transport and the Regions what steps he is taking to monitor the effects of the A34(T) Newbury Bypass on traffic on(a) the A36/A46 from the M4 to Southampton and (b) the A338/A346 from the M4 to Bournemouth. [74721]

  Ms Glenda Jackson
  None, specifically in relation to the effects of the Newbury Bypass. The Highways Agency has standing arrangements for monitoring traffic on trunk roads, including the A36/A46 route. Monitoring on the A338 and the A346 is a matter for the relevant local highway authority.

  Migratory Birds
  Mr. Dismore
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the action his Department is taking to increase the protection of migratory birds(a) in United Kingdom and (b) internationally. [74816]

  Mr. Meale
  The protection of migratory birds within the European Union is covered by the EC Directive on the Conservation of Wild Birds (79/409/EEC). This Directive covers the protection, management and control of these species and lays out rules for their exploitation. It is the responsibility of the European Commission to ensure Member States comply with the Directive. The Commission has recently taken action against France for the failure of its national legislation on the hunting of migratory species to comply with the Directive.

  In Great Britain, the Directive on the Conservation of Wild Birds is implemented by the Wildlife and Countryside Act 1981. The provisions of this Act are consistent with the Directive. Northern Ireland has similar legislation.

  The UK has recently ratified the Agreement on the Conservation of African-Eurasian Migratory Waterbirds. The Agreement, which covers over 170 states, requires Parties to take co-ordinated measures to maintain migratory waterbird species in a favourable conservation

  157
  status or to restore them to such a status. The Agreement should help improve protection of migratory species at an international level.

  Sustainable Renewal
  Mr. McDonnell
  To ask the Secretary of State for the Environment, Transport and the Regions what plans the Government have to respond to the Joseph Rowntree Foundation's report, Sustainable Renewal of Suburban Areas. [75172]

  Mr. Meale
  The Report made a range of recommendations directed at the Government, local authorities and others. Many are relevant to the Urban Task Force, to the Urban Policy White Paper due later this year, and to the Policy Action Teams established by the Social Exclusion Unit carrying forward work on the Strategy for Neighbourhood Renewal, and they will be considered in those contexts.

  Jubilee Line Extension
  Mr. McDonnell
  To ask the Secretary of State for the Environment, Transport and the Regions if he will provide a breakdown of the accidents which have occurred to workers engaged in the construction of the Jubilee Line extension, by severity of the accident, in(a) 1996, (b) 1997, (c) 1998 and (d) 1999 to date. [75170]

  Mr. Meale
  The accident figures requested are set out in the table. These figures have been taken from HSEs live database and are, therefore, highly provisional and may be subject to change.

  Jubilee Line Extension Project (JLEP)Accidents to JLEP workers engaged in the construction of the Jubilee Line, reported to HE under the Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 1995 from 1 April 1996 to 3 March 1999

  Year

  Fatal

  Major

  Over 3 days

  1996–97

  0

  48

  116

  1997–98

  0

  24

  46

  1998 to 3 March 1999

  0

  5

  10

  Total

  0

  77

  172

  Mr. McDonnell
  To ask the Secretary of State for the Environment, Transport and the Regions how many accidents have occurred in the construction of the Jubilee Line extension. [75173]

  Mr. Meale
  I refer my hon. Friend to my answer above. HSE's live database currently does not go back before 1996–97. Any accident figures before this date could be obtained only at disproportionate cost.

  Mr. McDonnell
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the occasions when work has ceased on the construction of the Jubilee Line extension as a result of health and safety concerns in(a) 1996, (b)(c) 1998 and (d) 1999 to date. [75161]

  Mr. Meale
  The information is not available in the form requested.
  158
  Since 1996, the HSE has not served any Prohibition Notice requiring work to be stopped on the Jubilee Line Extension Project. However during visits across the project, numerous unsafe activities or situations have been dealt with by the work being stopped at the request of the HSE Inspector. In these cases work did not re-start until the relevant contractors took appropriate action. These would not necessarily be recorded on HSE's information recording system and therefore precise numbers cannot be given.

  Mr. McDonnell
  To ask the Secretary of State for the Environment, Transport and the Regions if he will place in the Library the reports of the Health and Safety Executive on the health and safety of the working practices pursued in the construction of the Jubilee Line extension. [75162]

  Mr. Meale
  Reports, compliant with current Government guidelines on disclosure of information, will be placed in the Library shortly.

  Mr. McDonnell
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the arrangements established to ensure the health and safety of the workers engaged in the construction of the Jubilee Line extension. [75169]

  Mr. Meale
  The main legal responsibility for ensuring the health and safety of the workers lies with the contractors involved in the construction of the Jubilee Line Extension. JLE, the client, also has duties to protect workers working on the project. HSE held meetings with the client prior to the project starting and subsequently frequent inspections across the Jubilee Line have been carried out by HSE inspectors and will continue until the project is completed.

  Hayes Railway Station Hub
  Mr. McDonnell
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the development of the Hayes railway station hub. [75160]

  Ms Glenda Jackson
  This is in the first instance a commercial matter for Railtrack. I understand that the company are currently working on proposals for a development at Hayes but that no formal application has been submitted to the local authority.

  Ships (Inspections)
  Mr. Prosser
  To ask the Secretary of State for the Environment, Transport and the Regions how many foreign ships have been inspected under port state control arrangements in United Kingdom ports; of those, how many and what proportion were detained; and what percentage of inspected ships were found to have deficiencies in each year since 1990. [74967]

  Ms Glenda Jackson
  The number of inspections and detentions, and the percentage of ships detained and with deficiencies from 1990 are given.
  159

  Port state control inspections in the UK

  Number of Inspections

  Number of Detentions

  Percentage detained

  Percentage with deficiencies

  1990

  2,118

  79

  3.7

  60.8

  1991

  2,500

  116

  4.6

  65.9

  1992

  2,133

  124

  5.8

  69.8

  1993

  2,271

  174

  7.7

  70.7

  April 1994 to March 1995

  2,153

  212

  9.8

  73.2

  April 1995 to March 1996

  2,098

  206

  9.8

  70.7

  April 1996 to March 1997

  1,880

  157

  8.4

  71.3

  April 1997 to March 1998

  1,890

  179

  9.5

  73.4

  Mr. Prosser
  To ask the Secretary of State for the Environment, Transport and the Regions how many professional ship surveyors and inspection staff have been employed by the Surveyor General's Organisation or Marine Safety Agency in each year since 1990. [74963]

  Ms Glenda Jackson
  Figures requested are given in the table below. The Marine Safety Agency merged with the Coastguard Agency to become the Maritime and Coastguard Agency on 1 April 1998.

  Staff in post figures as at 1 April 1998

  Number

  1 April 1990

  Surveyor General's Organisation

  188

  1 April 1991

  Surveyor General's Organisation

  193

  1 April 1992

  Surveyor General's Organisation

  187

  1 April 1993

  Surveyor General's Organisation

  185

  1 April 1994

  Marine Safety Agency

  189

  1 April 1995

  Marine Safety Agency

  189

  1 April 1996

  Marine Safety Agency

  166.5

  1 April 1997

  Marine Safety Agency

  159

  1 April 1998

  Maritime and Coastguard Agency

  160

  Freight Transport
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions if the Strategic Rail Authority will have a duty to promote the transfer of freight from road to rail. [74850]

  Dr. Reid
  [holding answer5 March 1999]: Subject to Parliament's consideration of the necessary legislation, the Strategic Rail Authority will have a duty to promote integrated transport and powers to promote the transfer of freight from road to rail by means of grants. One of the Strategic Rail Authority's most important tasks will be to address the needs of freight as well as passengers, and the balance between the demands of each.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions if the Strategic Rail Authority will have(a) a duty and (b) a power to influence matters outside the rail industry but which nevertheless affect it, with particular reference to maximum lorry weights. [74831]

  Dr. Reid
  [holding answer5 March 1999]: The Strategic Rail Authority will act as a champion for the railways, taking an overview of the industry and speaking for it, subject to Parliamentary consideration of the necessary legislation. The Strategic Rail Authority will be consulted by the Commission for Integrated Transport as part of its remit in advising the Government on lorry weights and the development of railfreight.
  160
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions if the Strategic Rail Authority will have a duty to require a minimum percentage of train paths to be available for freight traffic. [74851]

  Dr. Reid
  [holding answer5 March 1999]: Subject to Parliament's consideration of the necessary legislation, the Rail Regulator will remain responsible for approving track access agreements. The Strategic Rail Authority will, however, develop targets for both the passenger and the freight railway, and address the balance between the demands of passenger and freight services.

  English Partnerships
  Mrs. Ellman
  To ask the Secretary of State for the Environment, Transport and the Regions how much of the indicative budgets proposed to be passed to the regional development agencies from English Partnerships for 1999–2000 and future years is not committed(a) in contractual terms and (b) in principle for each of the regional development agencies. [74901]

  Mr. Meale
  [holding answer5 March 1999]: The indicative budgets have yet to be finalised. Based on the latest provisional budgets, the percentage not committed in contractual terms (defined in this context as projects which have reached the final internal appraisal stage within English Partnerships) is as follows:

  Percentage

  North East

  27

  North West

  1

  Yorkshire and Humberside

  2.5

  East Midlands

  12

  West Midlands

  51.5

  Eastern

  37

  South West

  22

  South East

  40

  The figures are still being reviewed.

  It will be for the RDAs themselves to consider how to handle in principle commitments within the overall resources available to them.

  Budgets for 2000–01 and 2001–02 will be determined taking into account the RDAs' corporate plans.

  Mrs. Ellman
  To ask the Secretary of State for the Environment, Transport and the Regions how much is being allocated to(a) the reclamation and development of the Greenwich site, (b) the setting up and running of databases on brown-field sites and (c) the managing of

  161
  the programme of millennium villages from the funding proposed to be retained centrally by English Partnerships in 1999–2000. [75743]

  Mr. Meale
  The Department will make an allocation to EP for the tasks it has been agreed the Agency should undertake. It is for EP to decide how to allocate those resources in accordance with proposals presented in their corporate plan.

  EP's proposed allocations for these projects for 1999–2000 are as follows:

  Allocation

  £ million

  (a) Greenwich

  18

  (b) Brownfield Sites

  0.5

  (c) Millennium Villages

  5.4

  Note:

  In addition to the funding at (a),EP have a separate ringfenced grant in aid budget of some £15m for the Greenwich Millennium Dome site 1999–2000 is the final year of this three-year programme.

  Planning Policy
  Mr. Waterson
  To ask the Secretary of State for the Environment, Transport and the Regions if he will offer additional guidance to local planning authorities seeking to promote re-use of buildings in their local development plans. [75500]

  Mr. Raynsford
  Guidance on the re-use of buildings for residential purposes will be included in the revised version of Planning Policy Guidance note 3: Housing, which will be issued for public consultation shortly.

  Mr. Waterson
  To ask the Secretary of State for the Environment, Transport and the Regions which planning policy guidance notes issued by the Planning Inspectorate are currently being reviewed. [75502]

  Mr. Raynsford
  I refer the hon. Member to the answer I gave him on 11 February 1999,Official Report, column 308. No Planning Policy Guidance notes are issued by the Planning Inspectorate.

  Monarch Butterfly
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions what steps he is taking to ensure the survival of the Monarch butterfly. [75102]

  Mr. Meale
  [holding answer8 March 1999]: There are no known wild populations of the Monarch butterfly in Britain. It is one of the most widely distributed butterflies in the warmer parts of the world, occurring throughout the Americas, Asia and Australasia, and is not considered to be threatened.

  Asbestos
  Mr. Frank Cook
  To ask the Secretary of State for the Environment, Transport and the Regions how many HSE inspectors by region are(a) qualified and (b) available to police the new regulations and codes of practice relating to the safe removal of asbestos. [74795]

  Mr. Meale
  [holding answer8 March 1999]: In 1999–2000, HSE's Field Operations Directorate plans to have the full-time equivalent of 530 fully trained
  162
  inspectors in operational groups; just over 500 are currently in post. Their regional distribution is shown in the following table.

  Inspector years

  Region

  Current number of qualified inspectors in operational groups

  Planned allocation of all operational inspections (including) trainees) for 1999–2000

  Planned allocation of qualified operational inspectors for 1999–2000

  Scotland

  52

  63

  53

  North West

  68

  79

  69

  Yorkshire and North East

  67

  83

  72

  Midlands

  67

  86

  76

  Wales and West

  93

  107

  96

  Home Counties

  82

  93

  84

  London and South East

  74

  93

  80

  All trained inspectors are able to deal with asbestos removal work which they encounter in the course of their work. They are familiar with the legal requirements, the hazard and the risk and can call on other colleagues in Regional Specialist Groups for assistance and support as necessary.

  In practice, however, the majority of asbestos removal work is carried out in specific types of premises eg those owned or controlled by local authorities, the health service and construction, particularly demolition sites.

  116 operational inspectors are allocated to the construction sector. Construction inspectors develop their knowledge and skills by attending a specific Asbestos Removal training course. Some of these inspectors are given additional training and assessment, including health surveillance, so that they can undertake higher-level inspection work inside asbestos removal enclosures.

  Currently, some 50 inspectors are trained to this higher level; most regions have 7, one has 8 in post. This number may fluctuate depending on staff movement.

  EC Environmental Councils
  Mr. Jenkin
  To ask the Secretary of State for the Environment, Transport and the Regions if he will publish agendas for the forthcoming EC environmental councils on(a) 11 to 12 March and (b) 24 to 25 June. [75194]

  Mr. Meale
  [holding answer8 March 1999]: The following is the agenda for the Environment Council 11 March:

  Community strategy on climate change

  Council conclusions

  Amended proposal for a Council Directive establishing a framework for Community action in the field of water policy

  Common position

  Proposal for a Council Directive on end-of-life vehicles

  Common position

  Community strategy to reduce C02 emissions from private cars. Commission Negotiations with car manufacturers which are not members of ACEA Council Conclusions

  Proposal for a Council regulation allowing voluntary participation by organisations in a community eco-management and audit system

  163

  Policy debate

  Proposal for a Council Directive amending Directive 88/609/EEC, on the limitation of emissions of certain pollutants into the air from large combustion plants.

  Policy debate

  Proposal for a Council Directive on the incineration of waste.

  Progress report.

  The agenda for the Council on the 24 to 25 June will not be decided until nearer the time.

  EC Transport Councils
  Mr. Jenkin
  To ask the Secretary of State for the Environment, Transport and the Regions if he will publish agendas for the forthcoming EC transport councils on(a) 29 March and (b) 17 to 18 June. [75195]

  Ms Glenda Jackson
  [holding answer8 March 1999]: At the Transport Council to be held on 29 March, the following topics are on the agenda: development of the Community's railways; combined transport; working time in road transport; operation of 15 metre buses; modernisation of the Warsaw system for airline liability; intermodal terminals; and satellite navigation systems. The agenda for the 17–18 June Transport Council will be known nearer the time.

  Chemical Emissions
  Mr. Laurence Robertson
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the procedures for monitoring the emission of dangerous chemicals into the atmosphere. [75011]

  Mr. Meale
  [holding answer8 March 1999]: Processes with the potential to emit dangerous substances to air are regulated under Part I of the Environmental Protection Act 1990, under which plant operators must obtain an authorisation and use the best available techniques not entailing excessive cost (BATNEEC) to prevent, minimise or render harmless such emissions. The authorisations issued by the Environment Agency or local authorities will include appropriate monitoring requirements and the results of such monitoring will appear on the public register.

  Grant-maintained Schools
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer of 4 March 1999,Official Report, column 838, on local authority councillors employed by grant-maintained schools, what estimate he has made of the numbers of staff likely to be so disqualified. [75746]

  Ms Armstrong
  We have made no estimate of the numbers of teachers who are likely to be so disqualified.

  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer of 4 March 1999,Official Report, column 838, concerning teachers employed by grant-maintained schools, what consultations his Department has undertaken on this matter; and what representations have been received. [75747]
  164
  Ms Armstrong
  I have undertaken no consultation about the continuation of the well-established policy that a person is disqualified from being a councillor of an authority of which they are an employee. However, officials from the Department for Education and Employment have met interested parties to discuss a range of staffing matters, including this issue of local authority councillors employed by grant-maintained schools, in the transition to the new framework.

  Black Cabs
  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions if currently licensed black cabs will be permitted to operate within the current Metropolitan Police District boundaries after the establishment of the Greater London Authority. [75734]

  Ms Glenda Jackson
  Once the Metropolitan Police District boundary has become aligned with that of Greater London, taxis licensed by the Public Carriage Office will be able to ply for hire only within the new boundary.

  Mr. Burstow
  To ask the Secretary of State for the Environment, Transport and the Regions what representations he has received concerning the impact of the Greater London Authority Bill's provisions for realigning the Metropolitan Police District with the Greater London administrative boundary on taxi cabs licensed to operate in outer London. [75735]

  Ms Glenda Jackson
  I have received representations from London suburban-licensed taxi drivers concerned about the implications of the boundary change for their customary operations, from local authorities seeking guidance on their new licensing responsibilities, and from applicants to the Public Carriage Office for suburban London taxi driver licences concerned about the processing of their applications whilst the Public Carriage Office reviewed the suburban licensing sectors in the light of the boundary change.

  Driving Test Centre, Crosby
  Mrs. Curtis-Thomas
  To ask the Secretary of State for the Environment, Transport and the Regions on what dates staff at Crosby Driving Test Centre were transferred temporarily to other locations after its closure; on what date such transfers were made permanent; and to what date the transfers were backdated. [74072]

  Ms Glenda Jackson
  The driving examiner staff at Crosby transferred to other test centres from 6 April 1998, when the Crosby centre was closed. Formal transfer letters were given during May 1998, advising that these transfers would be permanent. Transfers were dated from 6 April so that staff would receive appropriate allowances. This did not preclude the possibility of the staff being moved back to a centre in Crosby had the Driving Standards Agency opened a replacement centre there.

  Countryside Agency
  Mr. Drew
  To ask the Secretary of State for the Environment, Transport and the Regions when the appointment of the Chairman of the new Countryside Agency will be announced. [75198]
  165
  Mr. Meacher
  I refer my hon. Friend to the statement I made to the House on 8 March 1999,Official Report, columns 21–33, when I announced that Ewen Cameron would be appointed as the first Chairman of the Countryside Agency. I also announced that Pamela Warhurst would be appointed as Deputy Chair.

  Coalfields Portfolio
  Mrs. Ellman
  To ask the Secretary of State for the Environment, Transport and the Regions how much he expects each English region to receive from the coalfields portfolio in(a) 1999–2000 and (b) future years; and who will be taking the decision on these allocations. [75738]

  Mr. Meale
  Some £195 million is planned to be spent on the coalfields portfolio over the next three years.

  The regional allocation of the coalfields portfolio programme for 1999–2000 is expected to be as follows:

  £ million

  North East

  11

  North West

  3.8

  Yorkshire and Humberside

  15

  East Midlands

  17.1

  West Midlands

  1.5

  South East

  0.9

  South West

  0.3

  These figures have been agreed between English partnerships and the respective Regional Development Agencies. Regional allocations for future years will be determined in the same way.

  Mrs. Ellman
  To ask the Secretary of State for the Environment, Transport and the Regions how much each English region received from the coalfields portfolio in each of the past five years. [75739]

  Mr. Meale
  The coalfields portfolio did not transfer to English Partnerships until the end of 1996–97. The following chart sets out total spend by English partnerships in the five EP regions which contain coalfields over the past two years.

  £ million

  1997–98

  1998–99

  North East

  3.2

  1.7

  North West

  1.4

  0.7

  Yorkshire

  6.2

  12.2

  East Midlands (all Midlands, 1997–98)

  12.1

  3.9

  West Midlands

  —

  5.7

  Note:

  The expenditure includes both grant in aid and agency-generated receipts.

  India (Ministerial Visit)
  Mr. Hawkins
  To ask the Secretary of State for the Environment, Transport and the Regions which of his Ministers is deputising for him in respect of duties relating to the Budget Statement during his visit to India. [75544]

  Mr. Prescott
  My Ministerial colleagues will pursue their normal duties in relation to the Budget.
  166
  Mr. Hawkins
  To ask the Secretary of State for the Environment, Transport and the Regions how many days he spent(a) in India and (b) in the Maldives during his recent visit. [75542]

  Mr. Prescott
  I will spend eight days in India and three days in the Maldives during my visit.

  Mr. Hawkins
  To ask the Secretary of State for the Environment, Transport and the Regions what arrangements have been made in respect of the costs of transport for his visit(a) to India and (b) to the Maldives; and in what class he flew for each leg of the journey. [75546]

  Mr. Prescott
  All travel for this trip has been arranged in accordance with the Ministerial Code and long-standing Ministerial practice under this and previous administrations.

  Mr. Hawkins
  To ask the Secretary of State for the Environment, Transport and the Regions what role his Department played in setting up a satellite TV link-up from India to the United Kingdom to enable him to comment on the Budget Statement. [75545]

  Mr. Prescott
  None. There is no satellite TV link-up from India.

  Heavy Goods Vehicles
  Mr. Hoyle
  To ask the Secretary of State for the Environment, Transport and the Regions what regulations are in place to ensure that heavy goods vehicles operating in the United Kingdom from overseas meet British safety standards. [75758]

  Ms Glenda Jackson
  All such vehicles must comply with the standards of roadworthiness defined in the Road Vehicles (Construction and Use) Regulations 1986. Under the Road Traffic (Foreign Vehicles) Act 1972, a vehicle which fails to comply may be prohibited from continuing its journey and its driver may be liable to prosecution.

  Local Rail Heads
  Mr. Hoyle
  To ask the Secretary of State for the Environment, Transport and the Regions what(a) grants are and (b) support is available from his Department for the establishment of local rail heads by haulage companies. [75760]

  Ms Glenda Jackson
  Two grants are available from the Department to assist companies facing higher costs as a result of choosing to move freight by rail rather than road. Freight Facilities Grants assist with the capital costs often associated with rail movements (e.g. rail infrastructure and specialised loading/unloading equipment). Track Access Grants are paid to freight operators to help defray Railtrack charges for access to the rail network in respect of traffic which would otherwise move by road.

  During the last 12 months, the availability of these grants and the greatly increased annual budget, currently standing at £40 million, has been widely advertised in both the trade and national press.

  Workplace Parking Levy
  Mr. Ottaway
  To ask the Secretary of State for the Environment, Transport and the Regions what estimate he
  167
  has made of the amount which will be raised under the workplace parking levy from schools and hospitals in the Greater London Area. [75765]

  Ms Glenda Jackson
  None. Decisions on whether to introduce a scheme and, if so, on geographical extent, levels of charge and possible exemptions, will all be matters for the Mayor.

  Rail Vehicle Accessibility Regulations
  Mr. McNulty
  To ask the Secretary of State for the Environment, Transport and the Regions if he has any plans to exempt new rail vehicles from the provisions of the Rail Vehicle Accessibility Regulations 1998; and if he will make a statement. [76049]

  Ms Glenda Jackson
  The Rail Vehicle Accessibility Regulations 1998 apply to all new rail vehicles first brought into use after 31 December 1998. Operators who introduce new rail vehicles into service after this date which do not fully meet the regulations must apply to the Secretary of State for exemption.

  We are expecting to receive a number of exemption applications from rail operating companies whose design of rail vehicles was well advanced prior to the new regulations coming into force. We are required to consult our statutory disabled advisers, the Disabled Persons Transport Advisory Committee (DPTAC), in considering any such application.

  The first application was received for the tram for use on Line 1 of the Midland Metro System. Exemption regulations relating to those tram have been placed before Parliament today. DPTAC recommended that the exemptions should be granted subject to certain conditions being applied to them. The exemptions are mostly of a very minor nature and have been requested for a short time only. We have accepted DPTAC's recommendations. The exemptions will not prevent disabled people from using the new system and we believe the system will make a significant contribution to improving mobility opportunities for disabled people in the area.

  Spot-listed Buildings
  Mr. Waterson
  To ask the Secretary of State for the Environment, Transport and the Regions how many buildings have been spot-listed in Greater London in the past year. [75503]

  Mr. Alan Howarth
  I have been asked to reply.

  163 buildings and structures in Greater London were spot-listed between 1 March 1998 and 28 February 1999. A further 497 were listed as a result of reviews of the Camden and Southwark lists and 101 following thematic studies of particular building types.

PRIME MINISTER

  European Commissioners
  Mr. Maclean
  To ask the Prime Minister what regulations provide for political neutrality in speeches made by European Commissioners; and if he will make a statement. [75163]
  168
  The Prime Minister
  As has always been the case, Commissioners have a collective responsibility not publicly to oppose decisions made by the College of Commissioners.

  Foreign Media Articles
  Mr. Maclean
  To ask the Prime Minister if he will list those members of his office involved in the drafting and distribution of articles written by him for publication by the international media. [75644]

  The Prime Minister
  Depending on the subject matter, various civil servants and special advisers in my office assist me in drafting articles for publication by the international media. This is a practice adopted by successive Administrations.

  Ministerial Meetings
  Mr. Baker
  To ask the Prime Minister if he will set out the basis for his practice of not making information available regarding meetings with private individuals or companies. [75673]

  The Prime Minister
  Ministers and civil servants meet many people as part of the process of policy development and analysis. All such contacts are conducted in accordance with the Ministerial Code, the Civil Service Code and Guidance for Civil Servants: Contacts with Lobbyists. Some of these discussions take place on a confidential basis, and in order to preserve confidentiality, it is not the normal practice of Governments to release details of specific meetings with private individuals or companies.

  European Policy Discussions
  Mr. Howard
  To ask the Prime Minister on how many occasions and on which dates he has discussed matters of European policy with the Chancellor of the Exchequer and the Minister with responsibility for Europe, the right hon. Member for Gateshead, East and Washington, West (Ms Quin) in the absence of the Foreign Secretary. [75794]

  The Prime Minister
  I have regular meetings with Ministerial colleagues and others on a wide range of subjects, and will continue to do so. As with previous Governments, it is not my practice to provide details of confidential discussions.

  Sierra Leone
  Sir Brian Mawhinney
  To ask the Prime Minister, pursuant to his answer to the right hon. Member for North-West Cambridgeshire on 3 March 1999,Official Report, columns 773–74, on the Foreign Affairs Committee's report on Sierra Leone, if he was informed by his officials of the contents of the report before 10.00 a.m. on 9 February. [75767]

  The Prime Minister
  As I made clear in my answer to the hon. Member for Spelthorne (Mr. Wilshire) on 23 February 1999,Official Report, column 231, in accordance with normal convention my Office received advance embargoed copies of the report from the Foreign and Commonwealth Office at approximately 08.30 hours on Tuesday 9 February, the day the report was published.
  169

  Select Committees (Leaked Documents)
  Sir John Stanley
  To ask the Prime Minister if(a) he, (b) civil servants in his Department or (c) special advisers in his Department have (i) had sight of drafts of select committee reports, in whole or in part, or (ii) been informed of conclusions of select committee reports prior to their publication by the select committees. [75669]

  The Prime Minister
  I refer the right hon. Member to the answer I gave to the hon. Member for Spelthorne (Mr. Wilshire) on 1 March 1999,Official Report, column 531. There have been no instances of members of Select Committees giving me drafts of Select Committee reports, or of parts of reports including their conclusions, before publication. Nor to the best of my knowledge have there been any occasions on which members of Select Committees have given such material to civil servants or special advisers in my Office. This excludes embargoed copies issued under House of Commons Standing Order 116.

WALES

  Air Miles
  Mr. Maclean
  To ask the Secretary of State for Wales how many Air Miles have been earned by him and each of his Ministers; and how he proposes to use them. [73335]

  Mr. Michael
  None.

  Fish and Shellfish Cultivation
  Mr. Wigley
  To ask the Secretary of State for Wales what meetings have been held by officials of his Department with Mr. Richard J. Slaski, the Ministry of Agriculture, Fisheries and Food's independent assessor on fish and shellfish cultivation; and if he will make a statement. [73607]

  Mr. Jon Owen Jones
  None.

  Mr. Slaski was appointed, by the Ministry of Agriculture, Fisheries and Food in August 1998, as one of two Assessors for the forthcoming Review of Research and Development on Fish and Shellfish Cultivation and Health in England and Wales. He was selected from a number of candidates on the basis of his knowledge of the aquaculture industry and his experience in carrying out similar reviews for other Governments. His remit was to consult widely within the industry and academia and to produce a report that identified constraints to the further development of the industry, identified gaps in the current R&D programme and proposed priorities for R&D for the next five years. That report along with another which focuses on health matters, will form the basis for discussion as part of the Review; Welsh Office officials will be involved in those discussions.

  National Assembly
  Mr. Wigley
  To ask the Secretary of State for Wales what preliminary work his Department has undertaken on the establishment of cross-cutting committees on(a) equal opportunities and (b) Europe, in the National Assembly. [73776]
  170
  Mr. Michael
  The draft standing orders prepared by the Commissioners provide for Assembly committees for each of these matters. Following consultation on the Commissioners' report, I expect to make the standing orders in final form later this month.

  Schizophrenia
  Sir Alastair Goodlad
  To ask the Secretary of State for Wales how many current occupants of National Health Service hospital and unit beds in Wales have a main diagnosis of schizophrenia psychoses; and what these occupied beds represent as a percentage of(a) mental and (b) all beds in Wales. [74268]

  Mr. Jon Owen Jones
  It is not possible to say how many current occupants of National Health Service hospital and unit beds in Wales have a main diagnosis of schizophrenia psychoses. However, it is estimated that, in 1998, 10.2 per cent. of in-patients treated in the specialty of mental illness and 0.3 per cent. of patients treated in all specialties had a main diagnosis of schizophrenia psychoses.

  Following the transfer of functions, this issue will be a matter for the National Assembly.

  Sir Alastair Goodlad
  To ask the Secretary of State for Wales (1) how many people discharged from mental illness hospitals in Wales in the last year after a main diagnosis of schizophrenia psychoses, having been proved vulnerable boarders subsequently became voluntary boarders; [74273]

  (2) how many patients with a primary diagnosis of schizophrenia psychoses were discharged from mental illness hospitals in Wales in the last year; and how many were admitted for a hospital stay more than once during the year. [74390]

  Mr. Jon Owen Jones
  In 1998 there were 1,713 deaths and discharges from Welsh NHS trusts where the patient had a main diagnosis of schizophrenia psychoses. It is not known centrally how many of these, having been proved vulnerable boarders, subsequently became voluntary boarders. Reliable estimates of the number of people who were admitted for a hospital stay more than once during the year are not available centrally.

  Following the transfer of functions, this issue will be a matter for the National Assembly.

  Health Care (Flintshire)
  Mr. Barry Jones
  To ask the Secretary of State for Wales what recent measures he has initiated to ensure enhanced health care for Flintshire people; and if he will make a statement. [74184]

  Mr. Jon Owen Jones
  The provision of health care is a high priority and I am pleased to be able to report a number of significant developments for the people of Flintshire.

  The new North East Wales NHS Trust (to be established on 1 April) will integrate community health and acute services for the people of Flintshire. This will allow clinicians in both sectors to collaborate in providing a seamless service from the time a patient is referred to

  171
  the time they recover. I expect this to be of particular benefit to the elderly and other vulnerable groups whose care often extends across both sectors.

  The introduction of Local Health Groups (LHGs) will bring significant benefits in terms of inclusive local decision making on commissioning of health services responsive to local need, and developing the role of primary care. Flintshire LHG is on course to be operational as a sub committee of the Health Authority from 1 April.

  Since May 1996, three new NHS dental practices have been opened as a direct result of grant aid, totalling £100,000, from the Welsh Office dental initiative. Grant aid is still available to assist the Health Authority to attract new dentists to 2 further areas within Flintshire.

  £193k of Winter Pressure money funded a joint NHS/Social Services rapid response team covering the whole of Flintshire. Such joint working will be facilitated by the composition of LHGs and introduction of shared planning arrangements, notably Health Improvement Programmes.

  Following the transfer of functions, this will be a matter for the National Assembly.

  Task Forces
  Dr. Tony Wright
  To ask the Secretary of State for Wales if he will publish a list of (1) task forces and (2) policy reviews established by his Department since May 1997 which(a) had external members recruited by way of public advertisement, and details of any person so appointed and (b) engaged in public consultation exercises, and the form that these took. [74460]

  Mr. Michael
  I will write to my hon. Friend as soon as possible and place a copy of my reply in the Library of the House.

  Ministerial Visits (Primary Schools)
  Mr. Swayne
  To ask the Secretary of State for Wales if he will list the primary schools in the Cardiff, South and Penarth constituency he has visited in the last four months; and what plans he has for further visits to primary schools in that constituency. [74637]

  Mr. Michael
  During the last four months I have visited Evenlode Primary School and Grangetown Infants School in the constituency of Cardiff, South and Penarth.

  Average daily available beds in NHS hospitals 1

  Acute2

  Geriatric

  Mental Illness3

  Learning disability

  Maternity4

  Total

  North Wales

  1994–95

  1,865

  779

  469

  189

  212

  3,514

  1995–96

  1,843

  718

  431

  162

  163

  3,316

  1996–97

  1,872

  695

  396

  140

  161

  3,264

  1997–98

  1,842

  681

  395

  133

  151

  3,202

  172

  Dental Services
  Jackie Ballard
  To ask the Secretary of State for Wales if he will list for Wales by health authority(a) the number of dentists with an NHS list and (b) the average number of patients on each NHS list for each year since financial year 1995–96. [74258]

  Mr. Jon Owen Jones
  The information is given in the following table.

  1995–96

  1996–97

  1997–98

  Number of dentists in Wales treating at least some NHS patients1

  North Wales

  170

  185

  198

  Dyfed Powys

  128

  133

  136

  Morgannwg

  158

  161

  158

  Bro Taf

  198

  201

  205

  Gwent

  149

  167

  167

  Wales

  803

  847

  864

  Patients on each NHS list2

  North Wales

  1,848

  1,752

  1,660

  Dyfed Powys

  1,729

  1,674

  1,539

  Morgannwg

  1,946

  1,956

  1,915

  Bro Taf

  1,857

  1,678

  1,667

  Gwent

  1,811

  1,645

  1,633

  Wales

  1,927

  1,825

  1,764

  1 Principal dentists as at 31 March except for 1995–96 when data relate to 30 June 1996

  2 Average number of registrations per principal dentists at 31 March. Includes patients seen by assistants and vocational trainees working on contracts held by principals.

  Following the transfer of functions, this issue will be a matter for the National Assembly.

  Links Staff Newspaper
  Mr. Swayne
  To ask the Secretary of State for Wales what have been the production costs of the Links document in each year of its publication. [74633]

  Mr. Michael
  Production costs for Links—The Welsh Office staff newspaper:

  1997–98: £23,102

  1998–99: £31,020 to date.

  Following the transfer of functions, this issue will be a matter for the National Assembly.

  Hospital Beds
  Mr. Livsey
  To ask the Secretary of State for Wales how many(a) acute, (b) geriatric, (c) mental illness, (d) learning disability and (e) maternity beds there were in each health authority in Wales in each year since 1994-95. [74374]

  Mr. Jon Owen Jones
  The information is given in the following table.
  173

  Average daily available beds in NHS hospitals1

  Acute2

  Geriatric

  Mental Illness3

  Learning disability

  Maternity4

  Total

  Dyfed Powys

  1994–95

  1,173

  562

  532

  181

  119

  2,566

  1995–96

  1,189

  532

  476

  165

  119

  2,481

  1996–97

  1,207

  484

  430

  146

  121

  2,387

  1997–98

  1,217

  473

  421

  112

  117

  2,339

  Morgannwg

  1994–95

  1,753

  479

  844

  303

  141

  3,520

  1995–96

  1,797

  374

  711

  236

  132

  3,250

  1996–97

  1,849

  342

  670

  213

  130

  3,204

  1997–98

  1,815

  309

  645

  201

  114

  3,084

  Bro Taf

  1994–95

  2,404

  892

  823

  228

  195

  4,540

  1995–96

  2,400

  867

  769

  214

  174

  4,424

  1996–97

  2,449

  748

  749

  180

  164

  4,289

  1997–98

  2,603

  551

  756

  137

  162

  4,209

  Gwent

  1994–95

  1,331

  633

  490

  119

  121

  2,694

  1995–96

  1,211

  582

  444

  121

  122

  2,480

  1996–97

  1,243

  583

  404

  90

  120

  2,439

  1997–98

  1,343

  424

  383

  90

  123

  2,361

  Wales

  1994–95

  8,524

  3,345

  3,157

  1,020

  788

  16,834

  1995–96

  8,439

  3,073

  2,831

  899

  711

  15,951

  1996–97

  8,619

  2,852

  2,648

  768

  696

  15,583

  1997–98

  8,820

  2,438

  2,599

  673

  665

  15,194

  1 The average daily number of staffed beds in which in-patients are being or could be treated without any change in facilities or staff being made

  2 All specialities excluding geriatric, mental illness, learning disability and maternity

  3 Adult mental illness, child & adolescent psychiatry, forensic psychiatry and old age psychiatry

  4 Obstetrics and GP maternity

  Following the transfer of functions, this issue will be a matter for the National assembly.

  Nurses
  Mr. Livsey
  To ask the Secretary of State for Wales how many whole-time equivalent(a) bank, (b) agency and (c) contract nurses were employed and at what cost, by each health authority in Wales in each of the last 10 years. [74375]

  Mr. Jon Owen Jones
  The information requested is not collected routinely. However, a survey carried out by the Nurse Executives of NHS trusts in Wales estimated that there were 665 whole-time equivalent bank nurses and 173 whole-time equivalent agency nurses used between July 1997 and July 1998 in Wales. Information on costs is not available.

  Following the transfer of functions, this issue will be a matter for the National Assembly.

  Hospitals (Service Changes)
  Mr. Livsey
  To ask the Secretary of State for Wales if he will list the hospitals, by health authority region in Wales, that have consulted the local community health council on service reconfiguration in the last 10 years; and how many beds have been(a) gained and (b) lost under these reconfigurations. [74376]

  Mr. Jon Owen Jones
  This information is not held centrally. Responsibility for consulting local Community Health Councils on substantial service changes lies with health authorities. Such proposals are only referred to my
  174
  right hon. Friend for decision if, following formal public consultation, they cannot be agreed with the Community Health Council. At present, one such referral has been made and is under consideration.

  Following the transfer of functions, these issues will be a matter for the National Assembly for Wales.

  Health Authority Appointments
  Mr. Livsey
  To ask the Secretary of State for Wales how many appointments for each health authority in Wales he has(a) made personally and (b) been consulted on since 1 May 1997; and if he will list for those appointments the political affiliations of the successful candidates. [74377]

  Mr. Jon Owen Jones
  None. The Secretary of State's predecessor made the following appointments to health authorities in Wales during 1998.

  Health authorities

  Appointments

  Bro Taf

  1 Chair and 3 non-executive member appointments

  Dyfed Powys

  1 Chair and 2 non-executive member appointments

  Iechyd Morgannwg

  1 Chair and 3 non-executive member appointments

  Gwent

  1 Chair and 4 non-executive member appointments

  North Wales

  1 Chair and 3 non-executive member appointments

  Dyfed Powys Health Authority and the North Wales Health Authority are currently both carrying a non-executive director vacancy.
  175
  Of those mentioned, only one non-executive member has carried out any significant political activity in the last five years, being a Labour member of a local authority in the area of the health authority concerned.

  Following the transfer of functions, this issue will be a matter for the National Assembly.

  Health Authority Budgets
  Mr. Livsey
  To ask the Secretary of State for Wales if he will list the estimated surplus or deficit of each health authority in Wales in 1998-99. [74378]

  Mr. Jon Owen Jones
  The estimated surplus/(deficit) that health authorities and their Trusts will be incurring in 1998–99 is as follows:

  Health authority area

  £ million

  Bro Taf

  (5)

  Dyfed Powys

  (13)

  Gwent

  —

  Iechyd Morgannwg

  1

  North Wales

  (1)

  Wales

  (18)

  Note:

  These forecasts are based on health bodies' best estimates of their income and expenditure position and are subject to audit adjustment. The final position will be are reported in their 1998–99 annual accounts, which will be available in audited form at the end of July 1999.

  Following the transfer of functions, this issue will become a matter for the National Assembly.

  NHS Pay
  Mr. Livsey
  To ask the Secretary of State for Wales what was the average pay of chief executives of NHS trusts for each of the last 10 years; if he will list the pay of the five highest-paid chief executives of NHS trusts in Wales; what is the average pay for Grade D nurses; and which are the five NHS trusts in Wales that have the lowest pay awards for Grade D nurses. [74379]

  Mr. Jon Owen Jones
  The first NHS trust was established in Wales on 1 April 1992 and the information requested is as follows.

  Patients not re-admitted within one month of having an operation cancelled

  Quarter ending

  NHS Trust

  March 1997

  June 1997

  September 1997

  December 1997

  March 1998

  June 1998

  September 1998

  December 1998

  Bridgend and District

  8

  —

  >1

  —

  —

  —

  —

  —

  Cardiff Community Health Care

  —

  —

  —

  —

  —

  —

  —

  —

  Carmarthen and District

  12

  12

  11

  9

  8

  21

  18

  12

  Ceredigion and Mid Wales

  1

  3

  —

  1

  —

  3

  —

  —

  Clwydian Community Care

  —

  —

  —

  —

  —

  —

  —

  —

  East Glamorgan

  194

  —

  —

  —

  4

  4

  10

  4

  Glan Clwyd Hospital

  —

  —

  —

  —

  —

  —

  —

  —

  Glan Hafren

  8

  3

  12

  5

  11

  13

  15

  4

  Glan-y-Mor

  10

  5

  —

  1

  —

  —

  —

  2

  Gwent Community Health

  —

  —

  —

  —

  —

  —

  —

  —

  Gwynedd Community Health

  —

  —

  —

  —

  —

  —

  —

  —

  Gwynedd Hospitals

  —

  —

  —

  —

  —

  2

  2

  3

  Llandough Hospital and Community

  —

  —

  —

  —

  5

  1

  —

  —

  Llanelli Dinefwr

  —

  3

  —

  —

  8

  2

  3

  1

  Morriston Hospital

  5

  —

  —

  —

  1

  —

  6

  6

  176

  The average pay of Chief Executives of NHS trusts is:

  £ 000

  1992–93

  73

  1993–94

  64

  1994–95

  62

  1995–96

  65

  1996–97

  67

  1997–98

  72

  The highest paid Chief Executives in 1997–98 received:

  £ 000

  Glan Hafren

  103

  UHW

  96

  North Glamorgan

  88

  Llandough

  87

  Bridgend

  86

  The salary scale for a Grade D nurse ranges from £12,855 to £14,705. Nurses can earn more than their basic pay, due to enhancements for working nights, weekends and bank holidays.

  Taking all these factors into account, the average earnings of a Grade D nurse in Great Britain averaged across all 5 incremental points are estimated at £16,400 at December 1998 rates. Information is not held centrally on pay awards for nurses on Trust terms and conditions of service.

  Following the transfer of functions, this issue will be a matter for the National Assembly.

  Cancelled Operations
  Mr. Livsey
  To ask the Secretary of State for Wales if he will place in the Library figures for(a) each health authority, (b) each region and (c) Wales as a whole, of the number of operations cancelled on the day of, or the day after, admission to a hospital, and the numbers of those patients not readmitted within a month, by quarter for the last two years. [74380]

  Mr. Jon Owen Jones
  Information on the number of operations cancelled on the day of, or the day after, admission to a hospital is not collected centrally. Data are collected on the numbers of patients who were not re-admitted within a month of a cancelled operation, by NHS Trust, and these are shown in the following table.
  177

  Patients not re-admitted within one month of having an operation cancelled

  Quarter ending

  NHS trust

  March 1997

  June 1997

  September 1997

  December 1997

  March 1998

  June 1998

  September 1998

  December 1998

  Nevill Hall and District

  2

  —

  7

  21

  8

  1

  2

  —

  North Glamorgan

  1

  —

  —

  2

  2

  —

  2

  —

  Pembrokeshire and Derwen

  2

  —

  1

  —

  —

  —

  —

  —

  Powys Health Care

  —

  —

  —

  —

  —

  —

  —

  —

  Rhondda Health Care

  —

  —

  —

  —

  —

  —

  —

  —

  Swansea

  —

  —

  —

  —

  —

  —

  —

  —

  University Dental Hospital

  —

  —

  —

  —

  —

  —

  —

  —

  University Hospital of Wales

  170

  44

  83

  51

  113

  108

  151

  25

  Healthcare Velindre

  —

  —

  —

  —

  —

  —

  —

  —

  Wrexham Maelor Hospital

  —

  —

  12

  4

  18

  22

  7

  14

  Wales

  413

  70

  127

  94

  178

  177

  216

  71

  Following the transfer of functions, this issue will be a matter for the National Assembly.

  Hospital Reviews
  Mr. Livsey
  To ask the Secretary of State for Wales if he will list by health authority in Wales the number of hospitals whose future is currently under review. [74381]

  Mr. Jon Owen Jones
  Responsibility for reviewing and subsequently consulting upon substantial service changes lies with health authorities. Proposals to change the functions of a hospital or an individual service are referred to my right hon. Friend for decision only if, following formal public consultation, they cannot be agreed with the local community Health Council. At present, one such referral has been made and is under consideration.

  Following the transfer of functions, this issue will be a matter for the National Assembly.

  Waiting Lists
  Mr. Livsey
  To ask the Secretary of State for Wales if he will estimate(a) the number of people in each health authority region in Wales currently waiting for an appointment with a consultant following a referral by a general practitioner and (b) the length of time which those people (i) have already waited and (ii) are expected to wait. [74382]

  Mr. Jon Owen Jones
  The numbers of people in each health authority area in Wales waiting for an appointment with a consultant at 31 December 1998, and the numbers waiting over six months, were published in the statistical release "NHS Wales Hospital Waiting Lists: December 1998" (SDR 7/99), a copy of which has been placed in the Library of the House. Data are not collected centrally on the expected length of wait, which will depend on individual circumstances. However, information on the routine outpatient wait for hospital consultants in Wales is published in the bulletin "Hospital Waiting Times" produced by the Welsh Health Common Services Authority, a copy of which will be placed in the Library of the House as soon as possible.

  Following the transfer of functions, this issue will be a matter for the National Assembly.

  Mr. Livsey
  To ask the Secretary of State for Wales if he will list for each health authority region the waiting time for new entrants to the waiting list for(a) ear, nose
  178
  and throat, (b) trauma and orthopaedic, (c) general surgery, (d) ophthalmology and (e) gynaecology consultants. [74383]

  Mr. Jon Owen Jones
  The waiting times for new entrants to the lists to see NHS consultants will depend on individual circumstances. The proportions of patients seen within three months and six months of referral to consultants in these specialties in Welsh hospitals during the period 1 January 1998 to 31 March 1998 were published in "The Patient's Charter NHS Wales Performance Tables 1998", a copy of which has been placed in the Library of the House.

  Following the transfer of functions, this issue will be a matter for the National Assembly.

CABINET OFFICE

  GM Foods
  Mr. Baker
  To ask the Minister for the Cabinet Office by what means he proposes to quantify(a) the benefits and (b) the risks that might flow from the genetic modification of (i) crops and (ii) food. [74863]

  Dr. Jack Cunningham
  [holding answer5 March 1999]: The Government receive advice on these issues from their independent expert committees, including the Advisory Committee on Releases to the Environment and the Advisory Committee on Novel Foods and Processes.

FOREIGN AND COMMONWEALTH AFFAIRS

  Chevening House
  Mr. Soames
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) for what purposes Chevening House has been used by Her Majesty's Government, other than for Foreign and Commonwealth Office business, since 1 May 1997; [72965]

  (2) what discussions concerning genetically modified foods and crops have taken place at Chevening since 1 May 1997. [73515]

  Mr. Robin Cook
  [holding answers 25 and 26 February 1999]: Chevening House is available to members of Her Majesty's Government, senior officials and others for meetings and entertainment, with my permission.
  179
  As far as we are aware, no discussions about genetically modified food have taken place at Chevening.

  Former Yugoslavia
  Mr. Cohen
  To ask the Secretary of State for Foreign and Commonwealth Affairs what progress has been made in the investigation of the massacres in autumn 1998 at Gornje Obrinje and Vucitrn; what estimate has been made of the number of victims; and what steps have been taken to bring the perpetrators before the International Criminal Tribunal for the former Yugoslavia. [75137]

  Mr. Tony Lloyd
  HMG have been informed by the Tribunal that its investigations into the massacres at Gornje Orbinje and Vucitrn are ongoing but are being seriously hampered by the lack of cooperation and access from the Yugoslav authorities. HMG continue actively to support the work of the ICTY, including financing an additional courtroom which has helped speed up trial procedures and contributing more than £1.2 million to the Tribunal's Exhumations 1998 Programme.

  Common Foreign and Security Policy
  Mr. Maclean
  To ask the Secretary of State for Foreign and Commonwealth Affairs, pursuant to his answer of 25 February 1999,Official Report, columns 438–39, if he will place in the Library copies of the reports of the Common Foreign and Security Policy working groups since 1 May 1997. [75081]

  Ms Quin
  The Government are committed to ensuring more effective parliamentary scrutiny of, and greater openness in European Union business, including the European Union's Common Foreign and Security Policy. We introduced last year procedures for the parliamentary scrutiny of all Common Foreign and Security Policy Common Positions and Joint Actions, and other politically important documents. The Government do not, however, have discretion to disclose unilaterally documents which reveal the negotiating positions of individual European Union member states. They do not, therefore, propose to place the reports of Working Group discussion in the Library of the House.

  Mr. Bruce George
  To ask the Secretary of State for Foreign and Commonwealth Affairs, pursuant to the answer to the right hon. Member for Penrith and The Border (Mr. Maclean) of 25 February 1999,Official Report, columns 438–39, in what form the outcome of the deliberations of the Common Foreign and Security Policy working groups are made available to Parliament. [74569]

  Ms Quin
  [holding answer8 March 1999]: I refer my hon. Friend to the answer I gave the right hon. Member for Penrith and the Border (Mr. Maclean) today, Official Report, column 779.

  Prime Minister (Articles)
  Mr. Maclean
  To ask the Secretary of State for Foreign and Commonwealth Affairs what advice his Department has given to the Prime Minister's Office on the (i) style, (ii) substance and (iii) target audience of articles in the Prime Minister's name to be published in foreign newspapers and journals. [75048]
  180
  Mr. Fatchett
  The FCO offers the Prime Minister's Office informal advice on the style, substance, and target audience of articles in the Prime Minister's name whenever this is requested.

  Taiwan
  Mr. Nicholas Winterton
  To ask the Secretary of State for Foreign and Commonwealth Affairs what recent discussions he has had with the United States about the military threats to Taiwan by the People's Republic of China [75080]

  Mr. Fatchett
  Following the US Secretary of State's recent visit to Peking, my right hon. Friend the Foreign Secretary discussed China, including cross-straits relations with Taiwan, with Mrs. Albright on 6 March.

  Croatia
  Mr. Wareing
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the current human rights situation in Croatia. [75229]

  Mr. Tony Lloyd
  While improvements have been made, much remains to be done. In particular, the most recent OSCE report on Croatia has underlined a continuing lack of progress in bringing domestic legislation, eg on protection for minorities and press freedom, into line with Council of Europe and UN human rights instruments.

  Among the areas which still require government attention are:
  Constitutional amendments to remove the restrictions of certain rights which are currently enjoyed by citizens rather than individuals;
  Restoration of certain suspended provisions contained in the 1991 Constitutional Law on Human Rights, providing for the protection of political representation and social and cultural rights of minorities (applying above all to the Serb minority following Operations Flash and Storm in 1995);
  Croatia is a party to the 1951 Convention Relating to the Status of Refugees but no domestic legislation has yet been introduced to implement its principles, leaving Albanian asylum-seekers from Kosovo, for example, with treatment inconsistent with these principles;
  Equal application of the Law on Citizenship;
  Adoption of democratic standards regarding freedom of the media, information and expression, and public service broadcasting;
  Reform of electoral legislation in order to comply with the OSCE Copenhagen Document (Articles 7 and 8) and other international standards.

  We and our European partners take every opportunity to remind the Croatians that fulfilment of its international obligations is a necessary precursor to a closer relationship with Europe.

  Turkey
  Mr. Corbyn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what discussions have been held by British Embassy officials in Turkey with(a) Kurdish and (b) human rights groups; and if he will make a statement. [74871]

  Ms Quin
  [holding answer8 March 1999]: British Embassy officials in Ankara regularly meet representatives of Kurdish groups, including representatives of the

  181
  People's Democracy Party (HADEP). Our officials are also in constant contact with representatives of various human rights organisations in Turkey, including the Human Rights Association and the Human Rights Foundation.

  Human Rights
  Mr. Cox
  To ask the Secretary of State for Foreign and Commonwealth Affairs what funding was made available to his Department's Human Rights Fund in 1998; and what it will be in 1999. [75714]

  Mr. Tony Lloyd
  £5 million was allocated to the Human Rights Project Fund in FY 1998–99. We plan to maintain the current funding allocation in real terms for the next financial year, and will keep this funding under review to ensure that it remains at an appropriate level.

  UNSCOM
  Mr. Dalyell
  To ask the Secretary of State for Foreign and Commonwealth Affairs what discussions he has had with the USA about the recall of UNSCOM's Director of Operations, Colonel James Moore, to Washington. [75215]

  Mr. Tony Lloyd
  [holding answer8 March 1999]: None.

  Mr. Dalyell
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will set up an inquiry into misuse for intelligence purposes of the disarmament agency set up after the Gulf War to eliminate Iraq's chemical and biological weapons. [75214]

  Mr. Tony Lloyd
  [holding answer8 March 1999]: The UK government have repeatedly made it clear that all information exchanges between the UK and UNSCOM, and all activities by UK nationals assigned to UNSCOM, have been strictly in pursuit of UNSCOM's mandate to dismantle Iraq's Weapons of Mass Destruction (WMD) capability. The US has made similar statements. UNSCOM Executive Chairman Richard Butler has said that he has always insisted on all UNSCOM activity being carried out strictly in pursuit of its disarmament mandate, not to benefit any individual member state.

  Uganda
  Mrs. Gillan
  To ask the Secretary of State for Foreign and Commonwealth Affairs what warnings of a threat to British nationals in Uganda his Department received prior to 1 March. [75486]

  Mr. Tony Lloyd
  [holding answer8 March 1999]: This Department has received no warnings of threats to British nationals in Uganda from Rwandan Interahamwe rebels prior to 1 March 1999. FCO travel advice of 19 February did, however, draw attention to periodic rebel activity in the Uganda/Congo/Rwanda border areas around the Kisoro district, and mentioned that, although the situation was currently peaceful, it could change quickly.

  There have in the past been a number of threats to UK interests in Uganda from other sources, including the Lord's Resistance Army and the Alliance of Democratic Forces.

  Mrs. Gillan
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the reported killings of 15 Rwandan militiamen by Ugandan forces. [75770]
  182
  Mr. Tony Lloyd
  We are aware of reports originating in Uganda of the killing of a number of Rwandan militiamen by Ugandan and Rwandan Government forces operating in the Democratic Republic of the Congo. Given the difficulty in obtaining reliable information from this remote area, we are unable to confirm the reports.

  A three man UK Police Team arrived in Kampala on Friday 5 March to assist the Ugandan authorities in their investigation into the murders of the four British tourists in the Bwindi National Park. We expect the Government of Uganda's follow up to this incident and the investigation to take full account of international human rights standards.

  Kosovo
  Mr. Maclean
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the level of involvement of Islamic terrorist organisations in Kosovo. [75562]

  Mr. Tony Lloyd
  We are aware of press reporting about contacts between Islamic terrorist organisations and the Kosovo Liberation Army (UCK), but we have no evidence of systematic involvement.

  Mr. Howard
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the recent detention of OSCE monitors in Kosovo by Serbian forces and the rules of engagement for the extraction force in such circumstances. [75796]

  Mr. Tony Lloyd
  OSCE verifiers were detained by Yugoslav customs authorities during 25 and 26 February. This was a breach of the agreement setting up the OSCE Kosovo Verification Mission and official protests were made by the OSCE to the FRY authorities.

  The problem was resolved by peaceful negotiation. In the event of an emergency, an extraction force is available. For security reasons, the rules of engagement remain confidential.

  Ireland (Treaties)
  Mr. Nigel Griffiths
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he expects treaties with the Irish Government establishing (i) British- Irish Council, (ii) British-Irish Intergovernmental Conference, (iii) North/South Ministerial Council and (vi) implementation bodies to be signed. [76010]

  Ms Quin
  The treaties were signed on 8 March 1998 in Dublin. Copies of the Treaties are available from the vote office and have been placed in the Libraries of the Houses of Parliament. The Treaties will be published and laid in the normal way.

  Sri Lanka
  Mr. Gardiner
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has made to the Government of Sri Lanka calling for UNHCR observers to be present at the exhumations of bodies at the mass grave in Chemmani on 5 March. [75513]

  Mr. Fatchett
  We are deeply concerned about reports that several hundred bodies of people who "disappeared" in army custody in 1996–97 may be in a mass grave at
  183
  Chemmani in Jaffna. Our High Commissioner in Colombo has pressed on numerous occasions for a prompt and thorough investigation. I raised the issue when I visited Colombo on 10 November.

  While we have called for an impartial investigation, we have not specifically suggested that UNHCR observers be present. A preliminary examination was held on 5 March to establish whether the site had been tampered with. We hope that the investigation will now proceed without further delay.

  South Africa
  Mrs. Gillan
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will assess the impact on the South African elections of the Truth and Reconciliation Commission's rejection of the ANC leaders' application for a group amnesty for acts committed by ANC members. [75769]

  Mr. Tony Lloyd
  It is not for the UK Government to assess the impact of a ruling of a constitutional body in another country, such as South Africa's Truth and Reconciliation Commission (TRC). The TRC's ruling on the ANC leaders' application for a group amnesty is a legal matter for the applicants concerned.

  Khartoum
  Mrs. Gillan
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has made to the Sudanese Government concerning the attacks on Christian students at the University of Khartoum on 6 and 7 February. [75802]

  Mr. Fatchett
  We have followed up the reports that we have received of these attacks with the concerned authorities, including the University of Khartoum.

  Israel
  Mrs. Gillan
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will be supporting Israel's request to the EU for support for the desalination plant in Gaza. [75800]

  Mr. Fatchett
  Water is an issue to be resolved in the final status negotiations. We support the Wye Agreement which provides for the immediate resumption of final status negotiations. We also support an equitable division of water which will take into account the concerns of all parties including other countries in the region. The proposed desalination plant has to be considered in the context of the final status negotiations.

  Oman (Ministerial Visit)
  Mrs. Gillan
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement about the visit by the Minister of State to Oman. [75773]

  Mr. Fatchett
  I visited Oman on 2–4 March for discussions on regional and bilateral issues with His Majesty Sultan Qaboos and senior Omani Ministers. The visit enabled me to reaffirm the importance the United Kingdom places on existing political and commercial relations with Oman, and on the security of the Gulf region as a whole. Oman is one of our oldest friends in a184
  region of key interest to the United Kingdom. We are keen to maintain the long-standing ties which exist between our two countries.

  Falklands
  Mrs. Gillan
  To ask the Secretary of State for Foreign and Commonwealth Affairs if his Department has asked the Chilean Government to state its reasons for recommending to Lan Chile that it ceases flights between Santiago and the Falklands; and what other options for air links in the region his Department has been exploring for the Falklands. [75807]

  Mr. Tony Lloyd
  The Chilean Government have stated publicly that their action with Lan Chile was in response to my right hon. Friend the Home Secretary's decision to issue an Authority to Proceed in respect of the Spanish extradition request for Senator Pinochet. We have made it clear that we do no believe any such measures are justified. While we hope that Lan Chile will continue to fly to the Falklands, we are considering other options with the Falkland Islands Government, including flights to other countries, improved surface travel, and the possibility of the Falkland Islands Government leasing their own aircraft.

  Mrs. Gillan
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he made to the Chilean Government when the Presidents of Argentina and Chile signed the joint declaration ratifying Chile's support for Argentina's claim of sovereignty over the Falkland Islands on 15 December. [75805]

  Mr. Tony Lloyd
  None. Our position on the Falkland Islands has been made clear to the Government of Chile repeatedly in recent years.

  Ascension Islands
  Mr. Hoyle
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to charge the United States for the use of the Ascension Islands. [75757]

  Mr. Tony Lloyd
  We currently have no plans to charge the United States for the use of Ascension Island. The United States Base on Ascension is provided free from rent and charges under the terms of the Agreement between the UK and US Governments Concerning the Extension of the Bahamas Long Range Proving Ground by the Establishment of Additional Sites in Ascension Island signed in 1956, as amended.

  Wideawake Airfield, which forms part of the US Base, is a vital link in the RAF airbridge to the Falkland Islands. We are currently preparing for talks with the US Government to allow the use of Wideawake by civil charter flights. If these negotiations are successful, this will improve access to both Ascension and St. Helena, some 700 miles away.

SOCIAL SECURITY

  Housing Benefit (Wandsworth)
  Mr. Cox
  To ask the Secretary of State for Social Security what discussions he has had with the London
  185
  Borough of Wandsworth on the payment of housing benefit claims to residents; and if he will make a statement. [74296]

  Angela Eagle
  Following a large volume of complaints and work backlogs, the London Borough of Wandsworth approved new arrangements for the management of its benefits administration from 27 November 1998. The Authority has kept the Department informed of developments. Most of the problems experienced last year have been resolved and the Department has received assurances that the remaining issues are being addressed.

  Pensioners (Benefits)
  Mr. Webb
  To ask the Secretary of State for Social Security what information is provided by his Department's Family Revenues Survey about the proportion of pensioners aged 80 years or over living in multiple benefit unit households relative to that of all people over pensionable age. [75221]

  Mr. Timms
  According to the 1996–97 Family Resources Survey (GB) 21 per cent. of pensioners aged 80 years or over were living in multiple benefit unit households compared with 19 per cent. of other people over pensionable age.

  Notes:

  1. Estimates are subject to sampling error and to variability in non response.

  2. Percentages are rounded to nearest integer.

  National Insurance Contributions
  Mrs. Butler
  To ask the Secretary of State for Social Security what assessment he has made of the Social Security Advisory Committee's report and recommendations on the draft regulations to bring non-cash vouchers into line with the treatment of cash earnings for National Insurance contribution purposes; and if he will make a statement. [76089]

  Mr. Timms
  We have considered the Social Security Advisory Committee's report and their recommendations carefully. We are grateful to the Committee, and those interested parties who responded to the consultation exercises, for their consideration of the draft regulations and their comments on them.

  We have noted the Committee's view that it is right to close any loophole which allows an employer to avoid National Insurance liability and their general support for the principle of closer alignment of tax and NICs arrangements. However, the Committee are not convinced that our proposals for non-cash vouchers meet these criteria. In particular, they suggest that we defer implementation to assess the longer term implications or, alternatively, that we increase substantially the disregard for luncheon vouchers.

  We do not believe, in the light of the extensive consultation already undertaken, there would be anything to be gained by delaying the proposal beyond April 1999. It would perpetuate the unfairness of the current arrangements whereby employees who receive part of their pay in non-cash vouchers are not liable for NICs on that part, whilst other employees, who do not receive vouchers, are liable for NICs on the whole of their salary.
  186
  To increase the disregard for luncheon vouchers above the long-standing 15 pence a day level for tax would undermine the aims of closer alignment and the need to ensure fairness with those paid in cash.

  In addition to these proposals, my right hon. Friend the Chancellor of the Exchequer announced in last year's Budget a number of changes to the structure of the National Insurance scheme. These changes will be introduced in April 1999. The employee entry fee will be abolished, so that all employees, who pay contributions, will pay £1.32 per week less NICs. This will more than offset the increase in NICs paid by most employees on luncheon vouchers, which are the most common form of non-cash voucher.

  We will therefore table shortly the Social Security (Contributions) Amendment Regulations 1999. The regulations will bring non-cash vouchers into line with the treatment of cash earnings for National Insurance Contribution purposes. A copy of the Committee's report and my right hon. Friend the Secretary of State's reply will be published with the regulations. The regulations will come into force from 6 April 1999.

  National Insurance Reductions
  Mr. Jenkins
  To ask the Secretary of State for Social Security if he will estimate for each constituency in Staffordshire the number of people who will benefit from the reduction in national insurance scheduled for April 1999; and if he will make a statement. [75658]

  Mr. Timms
  The information is not available by Parliamentary constituency. However, throughout Great Britain, some 20 million people, 90 per cent. of all employees, will pay an average of nearly £70 a year less in National Insurance contributions as a result of the abolition of the employee entry fee in April 1999.

  Source:
  Autumn 1998 Labour Force Survey.

AGRICULTURE, FISHERIES AND FOOD

  Creutzfeldt-Jakob Disease
  Mr. Jack
  To ask the Minister of Agriculture, Fisheries and Food, pursuant to his answer of 22 February 1999,Official Report, columns 190–91, concerning nv CJD, at what level of risk it ceases to be possible to specify the statistical risk of dying from nv CJD as a result of eating beef-on-the-bone products. [73784]

  Mr. Rooker
  There is no scientific proof that BSE can be transmitted to man by beef, but this is seen by SEAC as the most likely explanation, and all our control measures are based on the assumption that it is. In those circumstances, before it will be possible to calculate with any degree of certainty the risk to an individual as a result of eating beef on the bone, we need the answers to a number of key scientific questions:how much infectivity is needed to cause disease in humans;
  whether repeated exposure to small amounts of infectivity over a period of time can cause disease or whether a single dose is sufficient to result in disease;

  187
  how susceptible man is to BSE compared with, for example, cattle or mice;
  whether there are factors such as genetic susceptibility, or the physiology of the human gut, that might affect susceptibility or incubation period in humans compared with other species.

  It is clearly not possible to conduct direct experiments to test these factors. As the BSE epidemic wanes, any risk declines along with the number of infected animals, but it is not possible to specify the statistical risk for an individual of dying from nvCJD as a result of eating beef on the bone products. In such uncertain circumstances we need to be very cautious about any decision to relax public health protection in this area.

  Bovine Tuberculosis
  Mr. Gray
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement on the current incidence of tuberculosis in badgers. [74689]

  Mr. Rooker
  We do not have information on the current incidence of TB in badgers across GB.

  Badger carcases from various sources have been examined by MAFF since 1974. These include carcases from badger removal operations carried out under the interim strategy between 1982 and 1997, taken from areas of high TB incidence in cattle herds, where badgers were thought to be implicated in the spread of bovine TB to cattle. There were also carcases examined following road traffic accidents.

  Summarised are the results of the badger carcases examined by the Ministry and the percentage found positive for TB following laboratory culture. As these badgers were collected from limited areas of the country they are not representative of the incidence of TB in the badger population as a whole.

  Year

  Total badger carcases examined

  Percentage of which found positive for TB

  1975

  100

  24.0

  1976

  203

  15.8

  1977

  184

  15.3

  1978

  221

  9.0

  1979

  489

  10.2

  1980

  513

  8.9

  1981

  260

  9.2

  1982

  691

  11.0

  1983

  995

  13.7

  1984

  1,265

  14.3

  1985

  1,120

  13.3

  1986

  785

  16.1

  1987

  733

  12.7

  1988

  778

  27.2

  1989

  727

  16.8

  1990

  810

  19.4

  1991

  990

  16.3

  1992

  1,054

  20.0

  1993

  1,093

  27.4

  1994

  1,683

  22.9

  1995

  1,509

  28.1

  1996

  1,911

  25.2

  1997

  2,447

  27.9

  Source:

  CVL(E) Wildlife Unit Badger Database

  MAFF is now removing badgers only in trial areas and the Independent Scientific Group overseeing the culling trial will need time to assess the results as they become
  188
  available. The results will give an indication of the level of TB in badgers but initially only in those areas where the trial takes place.

  The National Road Traffic Accident Survey ended in 1991. The Krebs Report recommended a limited reintroduction of the survey as it would give a good indication of the disease in the badgers sampled. We are considering how to take this forward.

  Mr. Gray
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement about progress in the implementation of the Krebs report. [74688]

  Mr. Rooker
  The strategy I announced last August is designed to provide an effective science-based approach to controlling TB in cattle. It was based on the recommendations published in the Krebs Report. Progress on implementation is as follows:to minimise the risk to humans and investigate potential links with human health. Quarterly meetings with the Department of Health and other public health interests have been established.
  the development of a vaccine. The Krebs report recognised that this is possibly the best long term solution which could take 10 to 15 years. There is not necessarily any guarantee of success. However, I fully support this development and MAFF will be spending more than £1.3 million on it per year.
  research initiative to improve our understanding of the disease and how it spreads. The MAFF research programme had been revised on line with Krebs' recommendations and the budget has been increased from £1.7 million to £3.1 million in 1999–2000. We will shortly announce details of the research projects being funded from 1999 for the next three years. We are looking at factors such as the diagnostic skin test, the possible use of blood tests and the reliability of laboratory culture to see if we can identify improvement in testing and diagnosis to enable us to detect the disease more quickly. In addition, we propose to introduce a new epidemiological questionnaire to gather information on a full range of factors which might affect the spread of TB. This includes wildlife, but also husbandry practices, nutrition and the local terrain and climate. The questionnaire was piloted last autumn and points arising from the pilot study are currently under consideration. It will shortly be made publicly available.
  the Government should work with the farming industry to improve husbandry methods to minimise contact between cattle and badgers. We are reviewing advice provided to farmers on husbandry and disease control. The epidemiological survey referred to above will enable us to identify best husbandry practice.
  a randomised culling trial designed to test the effectiveness of different strategies and to provide unambiguous evidence of the role of badgers in cattle TB. Three badger treatment strategies will be compared in 30 areas grouped into 10 triplets. The first two triplets have been identified: one in Devon/Cornwall and the other in Gloucester/Herefordshire. Badger culling has been carried out in the pro-active areas of the Devon Cornwall triplet. We had hoped to have both the Pro-active culled before the closed season, but the terrain in the Gloucestershire triplet proved to be difficult and it will not be possible to complete the pro-active cull here until after the closed season. However, additional funding has been made available and more staff are being recruited to deal with the increased workload for the coming year. The remaining triplets will be identified by the Independent Scientific Group using scientific criteria and will be located in areas of high TB risk.

  Farmers
  Mr. Gray
  To ask the Minister of Agriculture, Fisheries and Food what percentage of farmers he expects to leave agricultural production in the next five years. [74693]
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  Mr. Rooker
  Figures on the number of farmers leaving or coming into agriculture are not available. However, the number of farmers has been declining overall by 0.5 to 1 per cent. a year. Whether there will be any significant changes in the trend may also depend on the final conclusions on reform of the CAP and the impact of any implementing provisions, on which we are consulting the industry at present.

  Mr. Gray
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement about methods for the eradication of bovine tuberculosis. [74690]

  Mr. Rooker
  I refer the hon. Member to the reply given to my hon. Friend, the Member for Stroud (Mr. Drew) on 4 March 1999,Official Report, column 911.

  Meat (Labelling)
  Mr. Gray
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement about the labelling of country of origin of meat sold in Britain. [74694]

  Mr. Rooker
  Rules on the labelling of food products are harmonised by EC legislation. Generally, the place (but not necessarily the country) of origin of any food must be given if omitting it could mislead the purchaser about the true place of origin of that food. The place of origin may be taken as the place in which the food last underwent a substantial change.

  More specifically, the Beef Labelling Scheme requires that any beef labelled with country of origin information must derive from animals born, reared and slaughtered in that country. National origin labelling of beef is expected to become compulsory from the year 2000. The labels on pre-packaged poultrymeat must give an indication of its country of origin when it is imported from outside the Community and we are currently taking steps to require this information on labels, tickets or notices near where unpackaged poultry is offered for sale.

  Separately, in November last year, members of the British Retail Consortium gave a voluntary undertaking not to sell imported fresh meat, processed or packaged in the UK, under a British label. This is a welcome commitment, for UK producers and consumers alike.

  Food Labelling Regulations
  Mr. Paice
  To ask the Minister of Agriculture, Fisheries and Food what consultations he has had with local authorities about the proposed enforcement of food labelling regulations by the Food Standards Agency. [75190]

  Mr. Rooker
  [holding answer8 March 1999]: Under the Food Standards Agency food law enforcement will generally continue to be carried out at the local level. It is proposed, however, that the Agency will assume new responsibilities for monitoring and setting standards for local authority enforcement. The Government have maintained regular contact with local authorities over all enforcement matters, including the enforcement of labelling regulations and the future responsibilities of the Agency in this important area.

  Genetically Modified Food
  Mr. Paice
  To ask the Minister of Agriculture, Fisheries and Food if he will list which foods or food 190
  ingredients produced from genetically modified crops are available in the UK and have been labelled in accordance with the EC Novel Foods and Novel Food Ingredients Regulations. [75191]

  Mr. Rooker
  [holding answer8 March 1999]: Genetically modified (GM) tomato paste and foods containing GM soya and GM maize are currently available in the UK.

  The EC Novel Foods and Novel Food Ingredients Regulation (258/97) came into force in May 1997.

  Foods containing GM soya and maize, which were approved for marketing prior to this, are required to be labelled under EC Regulation 1139/98. The GM tomato paste has been clearly labelled on a voluntary basis by the manufacturer since its launch in February 1996.

  Mr. Baker
  To ask the Minister of Agriculture, Fisheries and Food what progress has been made in establishing a de minimis threshold for the presence of genetically modified material in food, below which labelling would not be necessary. [75103]

  Mr. Rooker
  [holding answer8 March 1999]: The European Commission has undertaken to come forward with proposals on this issue by the end of March. We will continue to press the European Commission to adhere to this timetable.

  Mr. Baker
  To ask the Minister of Agriculture, Fisheries and Food what percentage of farm animal feed presently on sale contains genetically modified material. [75107]

  Mr. Rooker
  [holding answer8 March 1999]: Farm animal feed made only from UK grown crops does not contain any genetically modified (GM) material, because none of the GM plants granted marketing consents under Council Directive 90/220 have been grown in the UK on a commercial scale. Imported materials, in particular maize, soya and their by-products, will contain a proportion of material derived from GM plants. However, in the absence of crop segregation and specific labelling requirements, it is not possible to determine the precise extent of this.

  Rabies
  Mr. Flynn
  To ask the Minister of Agriculture, Fisheries and Food what research projects his Department has commissioned(a) to anticipate and (b) to facilitate speedy and effective implementation of the changes in rabies control he expects to follow from the report of the Advisory Group on Quarantine; if this research specifically includes critical path planning; and what are the expected times for completion of each of these projects. [74794]

  Mr. Rooker
  [holding answer8 March 1999]: The Government are considering the outcome of the consultation on the report of the Advisory Group on Quarantine (AGQ), which recommended changes to the quarantine system. A dedicated team has been established in this Department which is able to call upon the services of a wider multi-disciplinary group of experts. They will employ recognised project management techniques which will include critical path analysis. The team has received project management training.
  191
  Projects commissioned by the team to date are as follows:

  A further study of the risk associated with animals imported from the USA and Canada. This is expected to be completed in April.

  proficiency test programme for laboratories carrying out blood tests. The earliest that a laboratory might be authorised would be autumn 1999.

  Consideration of the efficacy and security of microchip identification. A seminar was held in the Ministry's premises at Tolworth, Surrey, on 1 February. Work on animal identification is expected to be completed in a few months.

  Preparation of a list of zoonotic infections and infestations found in cats and dogs in the EU/EEA Member States and rabies free islands which are not found in the UK.

  Initial design work for potential port facilities.

  A programme of work to identify an ELISA test for rabies that might replace the existing virus neutralisation test.

  The advice of the Advisory Committee on Dangerous Pathogens (ACDP) has been obtained on the implications of the AGQ recommendations. A workshop is planned to be held by the ACDP on 12 April to consider this matter further.

  The Office International des Epizooties and the World Health Organisation have been requested to consider the designation of specified methods for a prescribed blood test(s). It is hoped that this will be concluded in May.

  Furthermore, the Chief Veterinary Officer wrote to counterparts in other EU Member States in November 1998 to ask them to confirm that they would be able to provide certification of cats and dogs to the standard recommended by the AGQ. Governments of islands that it is believed could be classified as rabies free are also being contacted. The replies are being evaluated. Work is also underway on designing an appropriate form of certificate for British cats and dogs taken out of the UK with the intention of their being re-imported.

  Mr. Flynn
  To ask the Minister of Agriculture, Fisheries and Food what were the principal project areas in which his Department commissioned research on rabies over the last 15 years; and what were the approximate costs incurred in respect of each of these projects. [74793]

  Mr. Rooker
  [holding answer8 March 1999]: Details of research on rabies between 1991 and 1999 together with the annual budget for each project is as follows:

  1991–92

  Rabies: Differentiation of strains using monoclonal antibodies— £21,000

  Development of alternative diagnostic systems for rabies: neuroblastoma culture—£37,000

  Development of rapid diagnostic tests for rabies: PCR—£31,000

  1992–93

  Rabies: Differentiation of strains using monoclonal antibodies— £21,000

  Development of alternative diagnostic systems for rabies: neuroblastoma culture—£37,000

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  Development of rapid diagnostic tests for rabies: PCR—£31,000

  Biology and control of mammalian vectors of rabies—£184,000

  1993–94

  Development of rapid diagnostic tests for rabies: PCR—£78,000

  Biology and control of mammalian vectors of rabies—£129,000 Development of ELISA methods for rabies diagnosis capable of dealing with samples received in the event of a UK outbreak— £64,000

  1994–95

  Biology and control of mammalian vectors of rabies—£162,000

  Development of an optimisation of rapid PCR methods for the diagnosis or rabies—£132,000

  Development of rabies contingency programmes—£50,000

  1995–96

  Biology and control of mammalian vectors of rabies—£183,000

  Development of an optimisation of rapid PCR methods for the diagnosis of rabies—£135,379

  Expression of rabies glycoprotein in baculovirus for use in a rapid diagnosis kit for antibody level determination—£116,778

  1996–97

  Development of an optimisation of rapid PCR methods for the diagnosis of rabies—£146,528

  Expression of rabies glycoprotein in baculovirus for use in a rapid diagnosis kit for antibody level determination—£119,113

  Differentiation of strains of rabies and rabies-related viruses using automated sequence analyses—£101,315

  Biology and control of mammalian vectors of rabies—£186,044

  1997–98

  Expression of rabies glycoprotein in baculovirus for use in a rapid diagnosis kit for antibody level determination—£85,370

  Differentiation of strains of rabies and rabies-related viruses using automated sequence analyses—£72,190

  Biology and control of mammalian vectors of rabies—£189,097

  Development of rapid PCR-based systems for the detection and differentiation of rabies and rabies-related viruses—£116,516

  Rabies defence measures in the Channel Tunnel—foxes and DNA fingerprinting—£5,645

  1998–99

  Differentiation of strains of rabies and rabies-related viruses using automated sequence analyses—£101,143

  Biology and control of mammalian vectors of rabies—£189,097

  Development of rapid PCR-based systems for the detection and differentiation of rabies and rabies-related viruses—£156,797

  Molecular detection techniques to investigate aspects of the pathogenesis of rabies—£133,757.

  Information on rabies research between 1984 and 1991 is not available in this format.

  During the 1980's MAFF research on rabies concentrated on answering the hypothetical question "If rabies entered the UK, where did it come from and what measures were needed to be taken to control/eradicate it". Research centred upon the collection of rabies viruses from all areas of the world where rabies was endemic and the production and use of monoclonal antibodies with which these viruses could be identified.

  Subsidiary work included vaccine potency testing for the European Pharmocopoeia, research in mince into the potential use of inactivated oral vaccines, and the development of a serological test to measure the neutralizing antibody levels in animal sera.
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  Meat Hygiene
  Mr. Paice
  To ask the Minister of Agriculture, Fisheries and Food, pursuant to his answer to the hon. Member for South Derbyshire (Mr. Todd) of 22 February 1999,Official Report, column 184, on meat hygiene, if he will place a copy of his letter to the hon. Member for South Derbyshire in the Library. [75189]

  Mr. Rooker
  [holding answer8 March 1999]: The exercise to collate and analyse information on the level of hygiene inspection charges levied on individual meat plants in other Member States is not yet complete.

  Once the exercise is complete, I will write to those hon. Members who have asked questions on this subject and place a copy of my letter in the Library of the House.

  Mr. Paice
  To ask the Minister of Agriculture, Fisheries and Food how many inspections have been carried out in the UK by the EU Commission's Food and Veterinary Office in each of the last 12 months as part of its enforcement of the Meat Hygiene Directive. [75192]

  Mr. Rooker
  [holding answer8 March 1999]: In the last 12 months the European Commission's Food and Veterinary Office carried out two inspections in the UK on controls in fresh (red) meat establishments under Directive 64/43 3/EEC in June and September 1998.

  Date-based Export Scheme
  Mr. Paice
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the reasons given by fresh meat wholesalers and abattoir owners for their reluctance to apply for the date-based export scheme; and what steps he is taking to address those difficulties. [75193]

  Mr. Rooker
  [holding answer8 March 1999]: The main concerns expressed about the Date-based Export Scheme (DBES) by trade organisations representing abattoirs are the requirement to dedicate plants to export eligible animals and meat, and the availability of eligible animals. A small number of plants have, however, expressed interest.

  I have placed in the Library of the House a copy of the response issued by the Department to comments made on the consultation on our implementation of the DBES, together with a summary of those comments. Our response document recognises the difficulties of complying with the DBES conditions and that the requirement for dedication is particularly onerous. However, this requirement and the rules on eligibility of animals are set down in the EC Commission Decision. I do not believe that we could have negotiated a more liberal scheme, or that Member States would be ready to consider any changes in the near future.

  Cattle Health Scheme
  Mr. Blizzard
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement on the future of the Cattle Health Scheme. [76120]
  194
  Mr. Rooker
  During the last UK Presidency of the EU Council, agreement was reached on changes to animal health trade rules. The new rules allow the UK to apply for official freedom from enzootic bovine leukosis for Great Britain, and we intend to do so. This will benefit farmers, and will reduce public expenditure.

  The Cattle Health Scheme attests herds as being individually free of enzootic bovine leukosis, so will not be needed once GB freedom is achieved. We will continue to run the Scheme for the time being and review its future in September. Officials are writing to all members of the Scheme to let them know the position.

  Abattoir Inspection Charges
  Mr. Blizzard
  To ask the Minister of Agriculture, Fisheries and Food what has been the response to his Department's consultation on the proposal to charge industry for the costs of enforcing controls on specified risk material; and if he will make a statement. [76121]

  Mr. Rooker
  We received 26 responses to the consultation document and we have also received other correspondence relating to these proposals. Almost all argued that the proposed charges should not be levied at a time when the livestock industry is still in great financial difficulties. Some argued that the charges would discriminate against small abattoirs in rural areas.

  I and my colleagues in Scotland and Wales have carefully considered these responses but concluded that, in the light of the Government's overall priorities, we should proceed as planned. I therefore yesterday laid the necessary Regulations before Parliament. A number of consultees commented that the charge should be based on throughput rather than an hourly rate. I recognise the benefits that this could bring to small, low throughput abattoirs and have therefore asked my officials to consider the feasibility of altering the basis of the SRM charge so as to lessen the severe impact on small, low throughput abattoirs. Any change would require a further consultation exercise and amending legislation.

  Copies of the responses to the consultation are available for public inspection at the main MAFF library in London.

HOUSE OF COMMONS

  Chamber Business
  Mr. Laurence Robertson
  To ask the President of the Council how much time in the last session of Parliament was devoted in the Chamber to(a) Scottish, (b) Welsh, (c) Northern Ireland, (d) European Union, (e) Commonwealth and other foreign and (f) other business. [75539]

  Mrs. Beckett
  Any figures given cannot be entirely objective, as it is not always clear in what category particular debates belong. Where this is unclear the figures have been included in the "other" category. Taking this into account, the figures are as follows:(a) 121 hours 50 minutes, (b) 96 hours 47 minutes, (c) 110 hours 25 minutes, (d) 124 hours 14 minutes, (e) 104 hours 16 minutes and (f) 1560 hours 4 minutes.
  195
  These figures do not take account of the occasions on which matters relating to territorial, European Union or foreign affairs were debated at the same times as matters relating to the United Kingdom as a whole. Questions relating to Foreign and Commonwealth Affairs have all been included in category (c), even though some of them may in fact have related to category (d). All time taken on the Floor of the House last Session has been included in the above figures.

CULTURE, MEDIA AND SPORT

  Select Committee Reports
  Mr. Peter Ainsworth
  To ask the Secretary of State for Culture, Media and Sport if he or his Ministers have received any advance copy, draft or briefing upon the contents of any report of the Culture, Media and Sport Committee prior to its due publication date and time; and if he will make a statement. [75775]

  Mr. Chris Smith
  I refer the hon. Member to the reply given by my right hon. Friend the Prime Minister to the hon. Member for Spelthorne (Mr. Wilshire) on 1 March 1999,Official Report, column 531. There have no instances of members of select committees giving me or my Ministerial colleagues drafts of select committee reports, or of parts of reports including their conclusions, before publication. Nor, to the best of my knowledge, have there been any occasions on which members of select committees have given such material to civil servants or special advisers in my Department. This excludes embargoed copies of reports issued under House of Commons Standing Order 116.

  Board of English Heritage
  Mr. Dismore
  To ask the Secretary of State for Culture, Media and Sport what are the names, qualifications and experience of the members of the Board of English Heritage; and how many of them, and which, have a disability. [74557]

  Mr. Alan Howarth
  The Commissioners of English Heritage are as listed, together with their qualifications and experience. None has divulged any information regarding disability.

  English Heritage Commissioners

  Chairman: Sir Jocelyn Stevens CVO: Term of office: 1/4/97— 31/3/2000

  Chairman of English Heritage since 1992. From 1955, background in journalism and newspaper publishing; Rector and Vice Provost of Royal College of Art 1984–92. Deputy Chairman of the Independent Television Commission 1991–96.

  Professor Richard Morris: Term of office: 16/7/96–15/7/99

  Director of the Council for British Archaeology since 1991; previously a lecturer in archaeology at York University.

  Loyd Grossman: Term of office: 16/9/97–15/9/2000

  Broadcaster and journalist. Chairman of The Campaign for Museums. Commissioner of the Museums and Galleries Commission since 1996.

  Sue Underwood: Term of office: 16/9/97–15/9/2000

  Director of the North of England Museums Service since 1990; previously its Deputy Director.

  196

  The right hon. the Lord Faringdon: Term of office: 16/9/98— 31/3/2000

  Chairman of the Royal Commission on the Historical Monuments of England (RCHME) since October 1994. Chairman of Witan Investments Co plc since 1980.

  Candida Lycett Green: Term of office: 9/6/98–8/6/2001

  Writer and broadcaster, specialising in architecture matters. Members of the Friends of Friendless Churches.

  Professor Eric Fernie: Term of office: 9/6/98–8/6/2001

  Director of Courtauld Institute since 1995; previously Professor of Fine Art at Edinburgh University. RCHME Commissioner since 1997.

  Lady Elizabeth Gass DL: Term of office: 9/6/98–8/6/2001

  Lord Lieutenant of Somerset since 1999 and a member of National Trust Wessex Regional Committee since 1994.

  Andrew Fane: Term of office: 9/6/98–8/6/2001

  Former councillor of Royal Borough of Kensington and Chelsea and a member of the National Trust East Anglia Regional Committee.

  Kirsty McLeod: Term of office: 9/7/98–8/7/2001

  Publishing Editor and journalist.

  HRH The Duke of Gloucester KG GCVO: Term of office: 1/10/98–30/9/2001

  Qualified architect. Also Trustee of the British Museum.

  Bridget Cherry: Term of office: 1/10/98–30/9/2001

  Editor, Pevsner's Buildings of England since 1983, and Buildings of Scotland, Ireland and Wales since 1991. Trustee of the Sir John Soane's Museum since 1994.

  Amanda Arrowsmith: Term of office: 16/9/98–30/9/2001

  RCHME Commissioner since 1994 and Local Authority Archivist. County Director of Libraries and Heritage, Suffolk County Council since 1990. President of the Society of Archivists.

  Philip Davis: Term of office: 14/1/99–17/1/2002

  Councillor (Labour) of Telford and Wrekin Council since 1979. Founder Chair, UK Local Authorities World Heritage Sites Forum since 1994.

HEALTH

  East Anglian Ambulance NHS Trust
  Mrs. Brinton
  To ask the Secretary of State for Health(1) when he expects to conclude his appraisal of the inquiry into the East Anglian Ambulance NHS Trust; [72303]

  (2) if the results of his appraisal of the inquiry into the East Anglian Ambulance NHS Trust will be made public. [72304]

  Mr. Denham
  The report of the inquiry into the East Anglian Ambulance NHS Trust was published on 2 March. Copies of the report are in the Library.

  Primary Care Group Boards
  Mr. Hesford
  To ask the Secretary of State for Health what requirements there are for members of primary care group boards to register outside interests. [72600]

  Mr. Denham
  Primary care group board members are required to disclose relevant interests and enter them in the Health Authority's register of interests in accordance with the Health Authority's standing orders and standing financial instructions.
  197

  Trainee Doctors (Monitoring)
  Mr. Wilshire
  To ask the Secretary of State for Health that arrangements exist for monitoring the continuing personal suitability of trainee doctors for their future rule throughout the full period of their training. [72307]

  Mr. Denham
  The responsibility for the health and conduct of medical students lies with the individual university medical schools and the General Medical Council has issued guidance on this topic. The GMC has a further responsibility to ensure that doctors who qualify continue to be fit to practise. Supervision of postgraduate training lies with the Specialist Training Authority of the Medical Royal Colleges and the Joint Committee on Postgraduate Training for General Practice.

  Dental Services
  Mr. Sheerman
  To ask the Secretary of State for Health how many patients were registered with (i) NHS and (ii) other dentists in(a) 1985, (b) 1990, (c) 1995 and (d) the last year for which figures are available. [72652]

  Mr. Denham
  The average number of patients registered with General Dental Service (National Health Service) dentists in England for the year 1995 is 27.1 million. For the year 1998, the average is 24.1 million. The figures are averages of the end of month registration numbers. The two figures are not comparable because the registration period was changed for new registrations from September 1996.

  Formal registration of patients was introduced on 1 October 1990, so figures for the years 1985 and 1990 are not available. Dentists who do not have NHS patients are not obliged to provide the Department with details of their patients and therefore we do not collect this information.

  Intensive Care
  Rev. Martin Smyth
  To ask the Secretary of State for Health if he will make a statement on the availability of intensive care in the United Kingdom. [72664]

  Mr. Denham
  There are about 1,500 adult and 250 paediatric intensive-care beds in England providing one-to-one nursing for critically ill patients. The health services in Scotland, Wales and Northern Ireland are matters for my right hon. Friends the Secretaries of State for Scotland, for Wales and for Northern Ireland.

  Pathology Recruitment
  Ms Keeble
  To ask the Secretary of State for Health what measures have been taken by his Department to attract graduates into careers as NHS biomedical scientists in pathology. [73101]

  Mr. Denham
  The Department has published a career leaflet entitled 'A career in the NHS for graduates in biomedical science', which is made available to all university and local careers offices.

  Ms Keeble
  To ask the Secretary of State for Health what assessment his Department has made of recruitment in the NHS for biomedical scientists in pathology. [73100]

  Mr. Denham
  Biomedical Scientists in pathology are recruited into the National Health Service in response to local need and accurate national statistics are not held. The 198
  National Advisory Group for Scientists and Technicians has been constituted to provide a national co-ordination mechanism for local work-force planning and education commissioning for the scientific and technical staff groups. It has met once with the relevant professional bodies, including that representing Biomedical Scientists, and has established a sub-group to develop data capture methods to obtain local work-force planning information.

  Ms Keeble
  To ask the Secretary of State for Health what is the starting salary for a graduate working in the NHS as a biomedical scientist in pathology. [73099]

  Mr. Denham
  'Biomedical Scientist' is another title for Medical Laboratory Scientific Officer.

  I refer my hon. Friend to the reply I gave my hon. Friend the Member for Erith and Thamesmead (Mr. Austin), on 16 February 1999, Official Report, columns 727–28.

  Ambulance Staff
  Dr. Tony Wright
  To ask the Secretary of State for Health what plans he has to review the pay structure of ambulance staff. [73109]

  Mr. Denham
  We published "Agenda for Change"— our proposals for modernising the National Health Service pay system for all NHS staff—on 15 February. We are opening talks with NHS professional and staff organisations on the basis of this agenda.

  Doctors' Training
  Mr. Mitchell
  To ask the Secretary of State for Health what consultations he has had with(a) nurses and (b) other healthcare practitioners on joint training for new doctors. [73755]

  Mr. Denham
  Individual university medical schools determine their own undergraduate medical curricula in the light of the recommendations from the General Medical Council's Education Committee, which has the statutory responsibility to determine the extent of knowledge and skill required for the granting of primary medical qualifications in the United Kingdom. The Committee's most recent recommendations were published in the 1993 report "Tomorrow's Doctors", which pointed out that during the undergraduate years, doctors should begin to develop an understanding of the roles, skill and responsibilities of the various caring professions and a capacity for teamwork. Medical schools are currently introducing new curricula in line with the recommendations of "Tomorrow's Doctors".

  Mepitel Dressings
  Mr. Bruce George
  To ask the Secretary of State for Health (1) what studies are being undertaken to assess the efficacy and value of mepitel dressings for treating skin conditions; and when he expects to receive the results of studies; [74450]

  (2) if he will add mepitel dressings to the drug tariff to allow for prescribing in the community; [74452]

  (3) what assessments his Department has undertaken of the efficacy and value of mepitel dressings in treating patients with (i) epidermolysis bullosa and (ii) other skin conditions. [74451]
  199
  Mr. Denham
  Listings of appliances in Part IX of the Drug Tariff are made only in response to, and after consideration of, applications from the manufacturers. We regard all matters concerning such applications to be confidential unless the company chooses to reveal them. We would expect companies to provide any evidence needed to support their application.

  Continence Services
  Dr. Stoate
  To ask the Secretary of State for Health (1) if the Government will respond formally to the report of the working party on the review of continence services; [74551]

  (2) when he expects to receive the report of the working party on continence services; [74542]

  (3) if he will publish the report of the review on continence services prior to making any decisions on its recommendations; [74541]

  (4) what is the timescale for implementation of the recommendations of the review of continence services. [74543]

  Mr. Hutton
  The purpose of the review of continence service policy is to produce updated guidance for health authorities, primary care groups and National Health Service trusts on NHS continence services. We expect to see proposals for the guidance, including its implementation, in time for publication in spring 1999.

  NHS Bureaucracy
  Mr. Syms
  To ask the Secretary of State for Health what progress is being made against the Government's target of saving £100 million from bureaucracy in the NHS. [74739]

  Mr. Denham
  On 22 May 1997, we announced plans to reduce National Health Service management costs by £100 million (£84 million in England) in 1997–98 and "The new NHS" White Paper announced that, over the five years from 1997–98, £1 billion which would otherwise have been spent on management and administration would be freed up for patient care. Details of reductions achieved in 1997–98 will be published shortly.

  Private Nursing Services
  Mr. Waterson
  To ask the Secretary of State for Health when Ministers in his Department last met representatives of(a) private nursing services and (b) those responsible for private sector care and nursing homes. [74537]

  Mr. Hutton
  Ministers regularly meet representatives of these groups in a variety of forums to discuss matters of mutual interest.

  Chemical Allergies
  Mr. Cotter
  To ask the Secretary of State for Health what research his Department has(a) commissioned and (b) evaluated into health problems (i) caused by chemical allergies and (ii) associated with the use of fire-retardant chemicals. [74959]
  200
  Ms Jowell
  The Department's policy research programme and the National Health Service research and development programmes are supporting a range of research on allergies and will continue to do so. Details of these projects can be found on the National Research Register, a copy of which is available in the Library on CD-Rom. The Department undertakes reviews of the health hazards of a wide range of specific chemicals and data on the potential allergenicity of a chemical would be evaluated as part of the review.

  During the inquiry by the Expert Group to Investigate Cot Death Theories (Toxic Gas Hypothesis), the Department commissioned research to a total cost of about £ 400,000 to investigate the hypothesis that antimony—or phosphorus—containing compounds used as fire retardants in PVC and other cot mattresses are a cause of Sudden Infant Death Syndrome. The Expert Group concluded in its Final Report, published in May 1998, that there was no reason to believe that chemicals used as fire retardants in cot mattress materials pose any health risk to infants.

  Mr. Cotter
  To ask the Secretary of State for Health (1) how many people have died in each of the last five years as a result of(a) a chemical allergy and (b) an allergic reaction to fire-retardant chemicals; [74955]

  (2) what estimate he has made of the number of people who have (a) a chemical allergy and (b) an allergic reaction to fire-retardant chemicals. [74957]

  Ms Jowell
  The information requested is not available.

  Mr. Cotter
  To ask the Secretary of State for Health what estimate he has made of the annual cost to the NHS of treating chemical allergies. [74958]

  Ms Jowell
  Information is not available centrally on the costs to the National Health Service of individual medical conditions.

  HIV
  Mr. Gerrard
  To ask the Secretary of State for Health when he expects to announce the allocations to health authorities for their(a) HIV treatment and care budgets and (b) HIV prevention work for the next financial year. [75131]

  Ms Jowell
  We are currently considering options on these budgets in the light both of the work undertaken by the HIV/AIDS Stocktake Group and the forthcoming HIV/AIDS Strategy. We will announce decisions on these issues shortly.

  Nurses' Pay
  Mr. Simon Hughes
  To ask the Secretary of State for Health if he will estimate the average pay for Grade D nurses; and if he will list the five NHS trusts that have the lowest pay for Grade D nurses for the year
  1998–99. [75026]

  Mr. Denham
  Average earnings of grade D nurses are estimated at £16,400, as at December 1998. The minimum point of the national grade D scale is set at £12,855, however, this will rise by 12 per cent, to £14,400 from 1 April. Information on earnings for individual trusts is held centrally only for the sample of 170 trusts used in the Department of Health earnings survey.
  201

  Patient Discharges
  Mr. Simon Hughes
  To ask the Secretary of State for Health if he will estimate(a) by health authority, (b) by region and (c) nationally the number of patients staying past their original discharge date in NHS beds before moving to social service beds; and if he will estimate the cost to the NHS of this delayed discharge. [75040]

  Mr. Hutton
  The specific information requested is not collected centrally. Information is collected quarterly on the total number of patients aged 75 and over ready for discharge, but still occupying an acute bed in hospital (excluding those under the care of a psychiatric consultant) because of the following principal reasons: assessment completed but awaiting local authority funding, or, care plan agreed but patient awaiting placement in a non National Health Service-funded nursing home or residential care home. This information for the quarter ending December 1998 has been placed in the Library.

  Information on the cost of delayed discharges is not reported. Nor is expenditure information available in sufficient detail to be able to estimate, with any accuracy, the cost of the delayed discharge to the NHS.

  Chief Executives (Pay)
  Mr. Simon Hughes
  To ask the Secretary of State for Health what was the average pay for chief executives of NHS trusts for each of the last 10 years; and if he will list the pay of the five highest paid chief executives of NHS trusts for the year 1998–99. [75025]

  Mr. Denham
  The remuneration of chief executives of National Health Service trusts in England has been separately identified in trusts' annual reports since the 1994–95 financial year. 1998–1999 information will be available this August, when trusts have published their annual reports. Information on the average pay for Chief Executives' posts for the years 1994–95 to 1997–98 is as follows.

  NHS Trusts (England)—Remuneration of Chief Executives

  Average remuneration

  Basic salary

  Total remuneration

  1994–95

  60,341

  65,844

  1995–96

  64,237

  69,757

  1996–97

  66,918

  72,417

  1997–98

  71,527

  76,621

  Notes:

  1.Information relating to the remuneration of NHS Trust Chief Executives was not collected centrally before 1994–95.

  2.Total Remuneration comprises: basic salary, benefits, and performance related bonuses.

  3.Remuneration relates to total remuneration of all office holders during year.

  4.Average values are based on the number of NHS Trusts in each year; i.e. 1994–95 419, 1995–96 433, 1996–97 429, 1997–98 425.

  5.In the years 1994–95, 1995–96 and 1997–98 reported figures were identified as both "Remuneration as Director" and as "Other Remuneration". To ensure consistency these figures have been aggregated as above.

  6.Information for 1998–99 will be available in August 1999.

  My right hon. Friend the Secretary of State wrote to NHS trusts and health authorities on 29 January 1998, stating that in-year pay rises of managerial staff should
  202
  not exceed 2.7 per cent, in 1998–99. On 1 February 1999, the NHS Executive Chief Executive wrote to trust chief executives indicating that
  "the Government does not expect to see senior managers being awarded increases out of line with the rest of the public service" in 1999–2000.

  Health Authority Budgets
  Mr. Simon Hughes
  To ask the Secretary of State for Health what estimate he has made of the surplus or deficit of each health authority in 1998–99. [75035]

  Mr. Denham
  The information requested will be placed in the Library.

  Service Reconfiguration
  Mr. Simon Hughes
  To ask the Secretary of State for Health if he will list by region the hospitals which have in the last 10 years consulted their local community health council on service reconfiguration; and how many beds have been gained or lost following each of these reconfigurations. [75037]

  Mr. Denham
  In line with the practice of previous administrations, this information is not collected centrally.

  Registered Homes Act 1984
  Mr. Quinn
  To ask the Secretary of State for Health if he will bring forward a proposal under the Deregulation and Contracting Out Act 1994 to amend the Registered Homes Act 1984 as recommended by the Better Regulation Task Force in its report on long-term care. [74961]

  Mr. Hutton
  No. Proposals for reforming the current regulatory system for social services are contained in our White Paper "Modernising Social Services".

  Telecommunications Masts
  Ms Walley
  To ask the Secretary of State for Health what representations he has received about the public health implications of the siting and use of telecommunications masts. [74973]

  Ms Jowell
  The expansion of the mobile phone network has been accompanied by inquiries to the Department, mainly from members of the public, about the alleged public health implications of mobile phone base stations. Representations have also been made by the mobile phone communications companies. A consultation document on "Land Use Planning and Electromagnetic Fields", was issued in December jointly with the Department of the Environment, Transport and the Regions. Responses were requested by 19 February and are currently being considered.

  Digital Signals
  Ms Walley
  To ask the Secretary of State for Health if he will make a statement on the non-thermal effects of digital signals.[74974]

  Ms Jowell
  The Government obtain advice on restricting human exposure to electromagnetic fields from the National Radiological Protection Board (NRPB) who have published guidelines which apply to both digital and analogue signals. For radio frequencies, these are based on well-established thermal effects. Both the NRPB and
  203
  the International Commission on Non-Ionizing Radiation Protection agree that there is no clear evidence of adverse non-thermal health effects from either digital or analogue signals to which the public are normally exposed. Thus, the alleged non-thermal health effects cannot provide a basis for setting exposure restrictions, however they are the subject of current research.

  Worcestershire (Grants)
  Mr. Lock
  To ask the Secretary of State for Health if he will list the grants to be provided by his Department to Worcestershire County Council in 1999–2000; and if he will state the amount and purpose of each grant. [75250]

  Mr. Hutton
  The table shows the grants being made available for Worcestershire County Council for 1999–2000.

  £

  Description

  Amount

  Training Support Programme (main programme)

  1267,657

  Mental Health Grant (core and partnership programmes)

  2768,085

  Promoting Independence: Prevention Grant

  3183,872

  Promoting Independence: Partnership Grant

  32,315,000

  Children's Social Services Grant

  3494,000

  1 This represents allocations of 81 per cent. of the tot: Authorities, including Worcestershire, will be required remaining 19 per cent.

  2 This represents allocations of 79 per cent. of the to remainder will be bid for and allocated later.

  3 Subject to Parliament's approval

  The allocations for the following grants have not yet been determined: AIDS/HIV Support Grant, Asylum-Seekers' Special Grant and Promoting Independence: Carers' Grant. Local Authorities will also be able to bid for the Alcohol and Drug Misusers Grant.

  Norvic Clinic, Norwich
  Dr. Gibson
  To ask the Secretary of State for Health, pursuant to his answer of 3 March 1999,Official Report, column 820, on Norvic Clinic, when he expects to receive the report on the death of a patient in the clinic. [75522]

  Mr. Hutton
  The Coroner's Inquest into the death of a patient who died at the Norvic Clinic was opened in November 1998 and immediately adjourned pending a report by the Home Office Pathologist as to the cause of death. The Coroner's Office has not yet set a date for the Inquest to be reconvened.

  Military District Hospitals
  Mr. Viggers
  To ask the Secretary of State for Health which health authorities are(a) paid and (b) compensated by the Ministry of Defence in respect of military district hospital units at (a) Derriford, (b) Frimley and (c) Peterborough; and how much such payments were in each year for which figures are available. [75210]

  Mr. Denham
  [holding answer 8 March 1999]: It is assumed the hon. Member is referring to Ministry of Defence Hospital Units (MDHUs). These are integrated into National Health Service hospitals and the Defence Medical Services provide medical, nursing and other staffing. There are no direct financial transactions between the Ministry of Defence and health authorities in respect of Ministry of Defence Hospital Units.
  204
  Those National Health Service trusts which host MDHUs are paid for the treatment of military personnel, abated to reflect the contribution of military personnel to the treatment of civilians.

  Mr. Viggers
  To ask the Secretary of State for Health what was the total capital expenditure for setting up military district hospital units; and from which Departmental budget this was paid. [75211]

  Mr. Denham
  [holding answer 8 March 1999]: It is assumed that the question refers to Ministry of Defence Hospital Units (MDHUs).

  The Ministry of Defence contributes to the capital cost of establishing MDHUs. The amount they contribute is negotiated on a scheme by scheme basis. The Ministry of Defence contributed a total of £7.2 million to the capital cost of establishing MDHUs at Plymouth Hospitals National Health Service Trust, Frimley Park Hospital NHS Trust, and Peterborough Hospitals NHS Trust. The total capital expenditure spent on setting up the MDHUs is a local matter for the NHS trusts concerned. The information is not held centrally.

  NHS Pension Scheme
  Mr. Dobbin
  To ask the Secretary of State for Health if he will make a statement on the report by the Government Actuary on the investigation of the National Health Service pension scheme in England and Wales 1989 to 1994. [76011]

  Mr. Denham
  I have accepted the report and today placed copies in the Library.

  The report concludes that it would be prudent to increase the rate of contribution required from employers to meet the scheme's future liabilities. The current rate is 4 per cent, of pensionable pay. The Government Actuary is content with our proposal that the rate should increase to 5 per cent, from 1 April 2000, with a further increase to 7 per cent, from 1 April 2001. Funding for these increases has been included in the Department's comprehensive spending review settlement.

  The cost of index-linking National Health Service pensions is currently met by the Exchequer. As the report notes, I have agreed with the Chief Secretary that, in principle, the Scheme should assume its Pensions Increase liabilities from 1 April 1994 under a financial restructuring. Our officials are discussing the basis of such changes and I will inform the House when final agreement is reached. In the meantime, the Government Actuary considers that the proposed increases in employer contribution rates are consistent with the nature of the changes likely to be required under the restructuring.

  Residential Allowance
  Mr. Burstow
  To ask the Secretary of State for Health when he expects to conclude his review of the Residential Allowance. [75736]

  Mr. Hutton
  We are examining the possible impact on costs and service patterns of transferring the Residential Allowance to local authorities, and hope to consult local government and independent providers on detailed proposals as soon as we have formed a view on that.
  205

  National Carers Strategy
  Mr. Burstow
  To ask the Secretary of State for Health, pursuant to the oral statement of 8 February 1999,Official Report, column 27, concerning the national carers strategy, when the London Borough of Sutton will receive the £496,000. [75745]

  Mr. Hutton
  The new special grant for carers runs from 1999–2000 until 2001–02. The allocation will be paid to local authorities as part of their overall revenue allocation. Details of the allocation for 1999–2000 will be published shortly in a special grant report, which is subject to Parliamentary approval. It will show an allocation for Sutton of £71,327. This represents Sutton's share of the first year's grant of £20 million.

  Long-term Care
  Mr. Burstow
  To ask the Secretary of State for Health, pursuant to his oral statement of 1 March 1999,Official Report, columns 741–43, concerning the royal commission on long-term care, if he will set out the timetable he plans to follow for the public debate on the recommendations; and if he will make a statement. [75749]

  Mr. Hutton
  As my right hon. Friend the Secretary of State outlined in his statement to Parliament, the royal commission has produced a very detailed report, in which the commissioners themselves call for an informed debate on their recommendations. We expect that debate, which has already begun, to be an on-going one and to inform decisions we take on the commission's recommendations.

  Select Committee Reports
  Mr. Duncan
  To ask the Secretary of State for Health if he or his Ministers have received any advance copy, draft or briefing upon the contents of any report of the Health Committee prior to its due publication date and time; and if he will make a statement. [75774]
  206
  Mr. Dobson
  I refer the hon. Gentleman to the reply given by my right hon. Friend the Prime Minister to the hon. Member for Spelthorne (Mr. Wilshire) on 1 March 1999,Official Report, column 531. There have been no instances of members of Select Committees giving me, or my ministerial colleagues, drafts of Select Committee reports, or of parts of reports including their conclusions, before publication. Nor to the best of my knowledge have there been any occasions on which members of Select Committees have given such material to civil servants or special advisers in my Department. This excludes embargoed copies of reports issued under House of Commons Standing Order 116.

  NHS Orthodontists
  Mrs. Ewing
  To ask the Secretary of State for Health what is the average waiting time for(a) an initial appointment with and (b) treatment by an NHS orthodontist. [74906]

  Mr. Denham
  Most orthodontic treatment is undertaken in general dental practice and information is not held centrally on waiting times for such treatment. Provisional figures for 1997–98 show that the average waiting time in the orthodontic specialty for those treated in National Health Service hospitals in England was 72.3 days for the 2,266 elective admissions in that year. In addition, the following data was collected from NHS trusts in England for the quarter ended 31 December 1998 on the time waited for first outpatient appointments with an NHS consultant orthodontist following general practitioner written referral.

  GP written referrals

  Percentage

  Within 4 weeks

  13

  Within 13 weeks

  50

  Within 26 weeks

  80

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Oxford.

NATO Operations: Authorisation
Lord Judd Lord Judd asked Her Majesty's Government:
What will be their position at the April 1999 NATO summit in Washington towards United Nations Security Council authorisation for all future NATO operational missions other than territorial defence of the alliance itself.
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, all NATO operations must have a basis in international law. Each case needs to be looked at on its own merits. In many cases a United Nations Security Council resolution would be needed to authorise the use of force. But force may be used also to defend a non-NATO state at its invitation or, in exceptional circumstances, to avert an immediate and overwhelming humanitarian catastrophe.
Lord Judd: My Lords, I thank my noble friend for that Answer. Does she not agree that until recently it has been held that for any operation by NATO, save for an operation dealing with a need within, or a threat to, the member countries of NATO, it would be necessary to have the explicit authorisation of the Security Council? Can she comment on the evolving doctrine that the situation is now changing to one in which NATO feels entitled to take action on its own authority when it feels that to be necessary, seeking, if possible, the support of the United Nations? Does she not agree that when the United States has such unchallenged ascendency in the world it has an unrivalled opportunity to build up global security institutions in the interests not only of its own future but also that of the world as a whole.
Baroness Symons of Vernham Dean: My Lords, cases have arisen, for example, in northern Iraq in 1991, when, in the light of all the circumstances, a limited use of force has been justifiable as the only means to avert an overwhelming humanitarian catastrophe in support of purposes laid down by the Security Council but without the Council's express authorisation. Such cases, by their very nature, must be exceptional and would depend on an objective assessment of the factual circumstances at the time and of the relevant decisions of the Security Council bearing on the situation. It is important to stress that all NATO decisions are taken by consensus. Not a single member of the alliance can force the other members to act if the allies are opposed. All our allies
116
would not agree a NATO operation, I believe, unless they considered it was in accordance with international law.
The Earl of Lauderdale: My Lords, does the Minister agree that we are in danger of becoming involved in spurious moral judgments which have no relation whatever to our national interests?
Baroness Symons of Vernham Dean: No, my Lords, I do not agree with that. The globe is becoming a smaller place and what happens in other countries has a direct effect on the United Kingdom and on our immediate allies.
Baroness Williams of Crosby: My Lords, can the Minister comment on the problem of China's attitude to Macedonia where a member of the Security Council has reason to try to interrupt what would otherwise be a peacekeeping operation for reasons that are entirely territorial? Is there any mileage in the possibility of working out a code whereby those taking part in a NATO operation would know that the operation fell within certain guidelines. Can she say whether that would mean acting in accordance with international law?
Baroness Symons of Vernham Dean: My Lords, a number of cases could probably be adduced where particular members of the Security Council have, for reasons of their own, sought to block what was believed to be a perfectly sensible Security Council resolution by other members of that body. For that reason it is important that we pursue some flexibility. I stress that that flexibility must be within the bounds of international law, which is understood not by a small group in NATO but by a full consensus. Currently, there are 16 members, and, as from Friday, there will be 19, who must believe that they are acting within international law. The Secretary General of NATO made that clear this morning when he addressed the NATO conference in London.
Lord Ponsonby of Shulbrede: My Lords, does my noble friend agree that central to the question of NATO's out-of-area activity is Europe's ability to act in crises which are on Europe's own doorstep? Does she therefore agree that it is extremely important that there should be a European chain of command within NATO to enable Europe to act, using NATO assets, where the situation demands?
Baroness Symons of Vernham Dean: My Lords, it is important that we recognise the vital element of a proper consensus within NATO. If the noble Lord is implying that somehow the European members of NATO could act without that consensus, we may have a difficulty. I have difficulty with his idea of a specific European chain of command that would be outside that consensus. However, we believe it right that Europe should have a unified and coherent voice in the world. As a leading European member of NATO, the EU and the WEU, the United Kingdom has a stake in improving

117
Europe's abilities to respond to crises. That is why my right honourable friend the Prime Minister raised certain ideas in St. Malo and why we are trying to develop those within NATO.
Lord Campbell of Croy: My Lords, will Her Majesty's Government bear in mind that Article 2, paragraph 7, of the United Nations Charter prevents the United Nations intervening in the domestic jurisdiction of states and that recent dangerous conflicts have been internal, within recognised individual states, so that the United Nations may not be able to act in such circumstances?
Baroness Symons of Vernham Dean: Yes, my Lords, that is why I pointed out in my initial Answer that on occasions non-NATO members may invite NATO in. I assume that the noble Lord is thinking of cases involving a degree of internal conflict which, sadly, we have seen all too recently and where the result of not taking any action would be an overwhelming humanitarian catastrophe. That is why it is so important that Her Majesty's Government and like-minded members continue to pursue the criterion of overwhelming humanitarian need.
Lord Jenkins of Putney: My Lords, does my noble friend agree that there is a difference between "authority to act" and "chain of command" and that whereas the authority to act must be reserved, in my view, to the United Nations, the chain of command can reasonably be devolved once the authority to act has been given?
Baroness Symons of Vernham Dean: My Lords, of course I agree that there is a difference. The authority to act must be taken by consensus. In case there is any misunderstanding between us, I was trying to point out to my noble friend Lord Ponsonby the importance of consensus in taking any decision to act.
Lord Burnham: My Lords, in the light of her replies, particularly to the noble Lord, Lord Judd, does the Minister agree that Article 5 of the NATO Treaty has no validity at all for the defence of NATO countries, particularly if the aggressor is another NATO country?
Baroness Symons of Vernham Dean: My Lords, operations under Article 5 of the NATO Treaty are in exercise of the inherent right of individual or collective self-defence, preserved under Article 51 of the UN Charter. Therefore, enforcement action by NATO under Article 53 of the UN Charter may require Security Council authorisation. I hope that I have been perfectly clear. I thought that the Question was about authorisation other than that relating to the territorial defence of the alliance and that the real question in my noble friend's mind related to out-of-area activity and to overwhelming humanitarian need, which your Lordships debated only last week. That was the point I was endeavouring to answer.

Higher Education: Quality Assurance
2.46 p.m.
Lord Wallace of Saltaire Lord Wallace of Saltaire asked Her Majesty's Government:
Whether they intend to expand or contract the network of quality controls on British institutions of higher education which they inherited from the previous government.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, the report by the noble Lord, Lord Dearing, and his colleagues in July 1997 proposed a range of new developments for quality assurance in higher education. We support the work of the Quality Assurance Agency in implementing the new arrangements.
Lord Wallace of Saltaire: My Lords, how much further does the Minister think that the new bureaucracy should go? The other week I saw a paper which proposed to apply to postgraduate education the same language of "key stages" and "levels of development" that was developed for the control of primary schools. That does not seem necessarily the best way to control or to examine PhDs. No doubt the Minister is fully familiar with all the jargon of QAA, QCA, TQAC, SACCA, SCQF, SCOTCAT, NICATS, InCCA and so on and so forth, which is rolling over us, but does she accept that the cost of imposing on universities all those new controls and procedures may become excessive?
Baroness Blackstone: My Lords, we need to strike a balance between ensuring value for the money spent on higher education—a great deal of public money is involved, as the noble Lord, Lord Wallace of Saltaire, well knows—and that the burden of scrutiny is as light as possible. It is also important that prospective students and employers have accurate information about the quality of the work carried out by universities with regard to both research and teaching. Perhaps I can reassure the noble Lord that the new arrangements that the QAA will be putting into place will allow universities and colleges of higher education to work jointly with the QAA to try to reduce that burden of scrutiny and to produce a programme which links in with an institution's internal scrutiny arrangements.
Lord Beloff: My Lords, does the Minister agree that one reason for the excessive bureaucracy to which the noble Lord, Lord Wallace, refers is that the standards of a number of institutions are so low that it is necessary to control them in great detail, but that the price that we pay for that is that perfectly respectable universities which, for decades or centuries, have managed to look after their own standards are penalised by their staff being engaged in unnecessary form-filling when they should be either teaching or engaged in research?
Baroness Blackstone: My Lords, I do not entirely agree with what the noble Lord, Lord Beloff, has just said. Indeed, I am sure that he will not be surprised to hear that. I am glad to say that the QAA has found that

119
the vast majority of universities, whether new ones or old-established ones, have very good quality teaching and are performing well in that respect. However, at the same time, I accept that there are differences in standard. We now have a much more diverse system of higher education, with nearly 35 per cent. of young people going to university at this time. This means that the intensity of scrutiny ought to vary according to the internal quality assessment procedures of universities, and any other evidence. So some universities will need only a very light touch in terms of such scrutiny, while others will need rather more careful attention.
Lord Peston: My Lords, I am surprised at the answer of my noble friend the Minister. Certainly my experience has been that all that such scrutiny does is impose a burden on academics who are trying to get on with their job. I know that one should not dwell on the past, but one cannot help but reflect on the time when an academic really engaged in academic work. Does my noble friend have any evidence about the amount of time that academics are now required to spend on filling in such forms? I have seen no evidence to suggest that it achieves anything, but I do know that it occupies a great deal of people's time when they could at the very least be doing some teaching.
Baroness Blackstone: My Lords, perhaps I may point out to my noble friend that my experience is slightly different to his. I actually believe that this sort of external scrutiny can be most helpful to institutions and, indeed, to academics who are working in them. However, at the same time, it should not be so burdensome and so onerous that it prevents them getting on with their work. There is a sensible balance to be obtained. I repeat what I said earlier: universities are in receipt of a great deal of public money and, like everyone else who is in receipt of such moneys, they have obligations to ensure that what they are doing is of the highest possible standard. They should welcome those who come in to check on this.
Lord Elton: My Lords, in the hope that the weight of inspection can be varied with the quality of the work being inspected, can the Minister say whether she accepts that the whole edifice of our education system—including higher and further education—depends on the quality of teaching in primary and secondary schools? Therefore, can the noble Baroness say with what weight and care inspection of the teacher training institutions, which are responsible for the level that that teaching eventually achieves, will be carried out?
Baroness Blackstone: My Lords, what happens in primary and secondary education is vital. It is primary and secondary schools which will deliver good students to our universities and to our colleges of further education. However, as the noble Lord, Lord Elton, is well aware, Ofsted is responsible for the inspection of the teacher training element of education courses. But the QAA—the Quality Assurance Agency—is responsible for other aspects of the work of education departments and their quality in terms of what they
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provide as far as concerns teaching and the nature of the courses that they offer. That partnership is a good one; indeed, they need to work collaboratively together.
Lord Glenamara: My Lords, does my noble friend the Minister agree that the quality control in British universities now is tougher and more stringent than it has ever been? Indeed, if nothing else, this has placed the University of Northumbria well up in the top section of "Division One" of all British universities.
Baroness Blackstone: My Lords, I entirely accept what my noble friend said about the University of Northumbria. Indeed, I am delighted to say that there are many new universities, which were formed recently following legislation earlier this decade, that are similarly performing extremely well in terms of the quality of their teaching.

Emphysema: Coal Miners' Compensation
2.54 p.m.
Lord Islwyn Lord Islwyn asked Her Majesty's Government:
What progress has been made in the payment of compensation to former miners in Wales suffering from emphysema and other diseases.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville): My Lords, to date the Government have made payments totalling £25 million to former coal miners and their widows and £6.5 million has gone to those living in Wales. We have tendered for a national spirometry testing programme, which will enable us to make further offers of interim payments and, in some cases, full and final settlements from April. We have also agreed with the plaintiffs solicitors the levels of compensation that will be payable and we are close to agreeing the medical assessment process.
Lord Islwyn: My Lords, I thank my noble friend the Minister for that reply. I am glad to hear that some progress is being made. However, does he appreciate that over 30 Welsh miners who were seeking compensation have died in recent weeks? Therefore, does that not indicate that a speedy settlement is vital? Will the Government now concede the principle that those miners who have had medical examinations and been awarded industrial injuries benefit should be given compensation without a further medical examination?
Lord Sainsbury of Turville: My Lords, clearly we are acutely aware of some of the tragedies regarding those people who have died while this complicated process has been going on. However, as it is an area of considerable uncertainty to many people, I must make clear the exact situation. The court settlement was solely concerned with chronic bronchitis and emphysema; it did not cover pneumoconiosis, which is a separate disease. In the case of those people who are receiving benefits under the Industrial Injuries Disablement

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Benefit Act for chronic bronchitis and emphysema and where we do have records which show that they had been working underground for 20 years, payments have been made.
However, for people who are receiving benefits under the Industrial Injuries Disablement Benefit Act we are not able to make payments because we do not know the extent of the chronic bronchitis and emphysema. Moreover, we have no records stating how long the miners worked underground. That is why we brought forward the spirometry testing programme to provide us with more information. In those cases we can make settlements as soon as possible.
Lord Clinton-Davis: My Lords, may I take it from the reply of my noble friend the Minister, which I found most encouraging as far as concerns those cases which are being dealt with, that the Government are fully implementing the pledge given by me from that Dispatch Box on the issue—namely, that the Government would, under no circumstances, act as if they were a company of insurers taking advantage of every weakness in a claimant's claim?
Lord Sainsbury of Turville: My Lords, I would certainly like to say that we are carrying out that pledge. Without wanting to cast any aspersions on insurance companies, our aim has always been to make payments as speedily as we can, subject to the need to do so fairly and in line with the very specific High Court settlement. Of course, we have to agree every step with the Plaintiffs' Solicitors Group. We are proceeding as fast as we can in this complicated case, though not as fast as we would like.
Lord Ezra: My Lords, having had to deal with the problems of pneumoconiosis during my time in the coal industry, and having witnessed now the problems associated with emphysema and related diseases, I believe that the Government have made good progress in dealing with a complicated situation. However, in view of the improvements made in mining technology, does the Minister think that such problems can be avoided in the future?
Lord Sainsbury of Turville: My Lords, the Government are always considering ways to improve health protection. The evidence of the British Coal health surveillance, especially its programme of X-ray screening, showed that the introduction of the Coal Mines (Respirable Dust) Regulations 1975 have brought substantial improvements. However, we are concerned to ensure that the prevalence of this disease, which has reduced dramatically, continues to decline further in the future.
Lord Hardy of Wath: My Lords, should not the House be appreciative of the compassionate and just arrangements that the Government have adopted in this matter? However, would it not be possible to extend such consideration by perhaps not separating emphysema and bronchitis victims from those suffering
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from pneumoconiosis? Does my noble friend accept that there still is a residual despair which was generated in the last Parliament when enormous resources appeared to be devoted to delaying this matter as much as possible? Can my noble friend tell the House how much was spent on combating and delaying the just and deserving case which this Government have accepted?
Lord Sainsbury of Turville: My Lords, we have moved with all speed since the High Court judgment. We have, of course, had to make a clear distinction between the different groups of people involved as considerable differences apply to them. Since we have been in power every step has been taken to rectify a situation which had gone on for far too long without corrective action being taken.
Lord Lofthouse of Pontefract: My Lords, I appreciate the present Government's efforts to assist in this problem. However, I cannot understand why the Government and Ministers cannot pay industrial injuries benefits to the men who have already been assessed. These men have undergone examinations and have been awarded industrial injuries benefits. For the life of me I cannot understand why the Government cannot accept that these men have no need to undergo further medical examinations with all the delays that that will cause. Also, some of them will die in the meantime. It seems to me that there is a simple way out; namely, to pay these men immediately. I cannot understand why the Government will not concede that request.
Lord Sainsbury of Turville: My Lords, the Government would like nothing better than to make immediate payments to these people. However, one has to appreciate that the High Court settlement is specific as to the conditions that have to be fulfilled with regard to this matter. We can see no way to conduct this matter fairly and in line with the requirements of the High Court without a medical assessment process. Until that is done we cannot reach a settlement without it being subject to further legal action, which I do not think would be in anyone's interests.

Public Library Services
3.1 p.m.
Lord Bragg Lord Bragg asked Her Majesty's Government:
What steps they are taking to ensure that local authorities fulfil their statutory duty to provide a comprehensive and efficient public library service.
Lord McIntosh of Haringey: My Lords, the Secretary of State for Culture, Media and Sport wrote to library authorities on 19th February 1999 emphasising the importance of annual library plans in helping him to exercise his statutory duties, and requiring 15 authorities that had produced poor plans to resubmit them. He emphasised that after the best local government settlement for seven years, unjustified cuts to library services are not acceptable, and that he would

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be taking immediate steps to investigate a number of authorities where significant cuts were being contemplated.
Lord Bragg: My Lords, I thank my noble friend the Minister for his reply. However, is he aware that for many people local libraries are not just a corner-shop university and not even just an educational source, but a vital asset inside a community? Is he aware that for many people they bind a community together—people from all generations and from all kinds of backgrounds? Is that taken sufficiently into consideration when the axe is swung—as it is being swung now—on so many local libraries? This is not just a matter of closing down local libraries but of helping to close down communities.
Lord McIntosh of Haringey: My Lords, my noble friend is entirely right about the importance of libraries. The Government are seized of that fact. The local authority financial settlement will add £2.6 billion to local authority finances in the forthcoming financial year. That is a 2.9 per cent. real increase. The real increase in the environmental protection and cultural services block which provides the funding for libraries is 3.8 per cent. Therefore there is no good justification for the kind of cuts which my noble friend rightly deplores.
Lord Alton of Liverpool: My Lords, in supporting the remarks of the noble Lord, Lord Bragg, to the Minister, I ask the Minister whether he is aware of the research that points to a link between those children who truant and subsequently become involved in crime and the high levels of illiteracy among those children, and the remarks of the Secretary of State for Education yesterday that 75 per cent. of those who are in our prisons today have a reading age of only 10. In those circumstances does not the Minister agree that the Government's initiatives in promoting, for instance, literacy hours in our schools—which I strongly welcome—are being undermined by those who make a mockery of such policies by promoting the closure of public libraries as part of their public expenditure cuts this year?
Lord McIntosh of Haringey: My Lords, I was not aware of the specific research to which the noble Lord refers. Indeed I should be grateful if he could point me towards it. Certainly the conclusions are not surprising. It is true that illiteracy and poor reading are closely associated with social exclusion and, of course, with crime. As I said in my previous answers, the Government are determined that library authorities should fulfil their statutory responsibilities. I hope that that determination has the support of the noble Lord.
Lord Renton: My Lords, I fully support the answers which the noble Lord has so far given, but can he assure
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the House that the Secretary of State has statutory power to compel local authorities to do what they are required to do in the event of default?
Lord McIntosh of Haringey: My Lords, the Secretary of State's powers are set out in Section 1 of the Public Libraries and Museums Act 1964. It requires the Secretary of State,
"to superintend, and promote the improvement of, the public library service … and to secure the proper discharge by local authorities of [their] functions".
That does not entitle the Secretary of State to take over their library services except in the most extreme circumstances. This Government and preceding governments have always taken the view that the precise way in which local authorities discharge their responsibilities should be a matter for local decision.
Viscount Falkland: My Lords, is not there a strong case for the statutory obligation to be more tightly focused? Furthermore, is the noble Lord aware that in Lambeth there is considerable public outcry at the moment about the closure of small libraries on the basis that they are uneconomic, whereas the facts appear to indicate that that council has neglected buildings, mismanaged book provision and messed around with opening hours? It appears to me to be a classic case of asset stripping.
Lord McIntosh of Haringey: My Lords, the position is not quite as simple as the noble Viscount suggests. There is a balance to be drawn between the statutory obligations on local authorities to fulfil certain functions and the need for local determination of priorities, which I hope those who are seized of local democracy and subsidiarity will support. I do not want to make any comments on Lambeth in particular. However, I caution against thinking that the closure of libraries is the only way to make cuts. Libraries must have a network, of course, but they also have to have decent opening hours, good book stocks and adequate staff for the purposes of information management which is what libraries are about.

Further and Higher Education (Scotland) (Amendment) Bill [H.L.]
3.7 p.m.
Lord Selkirk of Douglas: My Lords, I beg to introduce a Bill to amend the Further and Higher Education (Scotland) Act 1992 in respect of Scottish university fee arrangements and grants for Scottish students attending higher education institutions in the United Kingdom. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time. —(Lord Selkirk of Douglas.)
On Question, Bill read a first time, and to be printed.

Business of the House: Debate this Day
The Minister of State, Home Office (Lord Williams of Mostyn): My Lords, on behalf of my noble friend the Leader of the House I beg to move the Motion standing in her name on the Order Paper.
In moving this Motion I ought to take the opportunity to thank the usual channels for agreeing that this important piece of delegated legislation should be discussed today even though the Joint Committee has not yet reported on it. This is necessary given the timetable for the discussions arising out of the Belfast agreement. I recognise that Business Motions such as this are unusual but I hope that in the circumstances of this particular subject the House will feel able to approve the Business Motion today.
Moved, That Standing Order 70 (Affirmative Instruments) be dispensed with to enable the Motion to approve the draft North/South Co-operation (Implementation Bodies) (Northern Ireland) Order 1999 to be taken this day notwithstanding that no report from the Joint Committee on Statutory Instruments on the draft order has been laid before the House. —(Lord Williams of Mostyn.)
On Question, Motion agreed to.

Trustee Delegation Bill [H.L.]
Read a third time.
Clause 5 [Amendments of section 25 of the Trustee Act 1925]:
The Minister of State, Cabinet Office (Lord Falconer of Thoroton)The Minister of State, Cabinet Office (Lord Falconer of Thoroton) moved Amendment No. 1:
Leave out Clause 5 and insert the following new clause—
DELEGATION UNDER SECTION 25 OF THE TRUSTEE ACT 1925
(". — (1) For section 25 of the Trustee Act 1925 substitute—
Delegation of trustee's functions by power of attorney.
25. — (1) Notwithstanding any rule of law or equity to the contrary, a trustee may, by power of attorney, delegate the execution or exercise of all or any of the trusts, powers and discretions vested in him as trustee either alone or jointly with any other person or persons.
(2) A delegation under this section—

(a) commences as provided by the instrument creating the power or, if the instrument makes no provision as to the commencement of the delegation, with the date of the execution of the instrument by the donor; and

(b) continues for a period of twelve months or any shorter period provided by the instrument creating the power.

(3) The persons who may be donees of a power of attorney under this section include a trust corporation.
(4) Before or within seven days after giving a power of attorney under this section the donor shall give written notice of it (specifying the date on which the power comes into operation and its duration, the donee of the power, the reason why the power is given and,
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where some only are delegated, the trusts, powers and discretions delegated) to—

(a) each person (other than himself), if any, who under any instrument creating the trust has power (whether alone or jointly) to appoint a new trustee; and

(b) each of the other trustees, if any;

but failure to comply with this subsection shall not, in favour of a person dealing with the donee of the power, invalidate any act done or instrument executed by the donee.
(5) A power of attorney given under this section by a single donor—

(a) in the form set out in subsection (6) of this section; or

(b) in a form to the like effect but expressed to be made under this subsection,

shall operate to delegate to the person identified in the form as the single donee of the power the execution and exercise of all the trusts, powers and discretions vested in the donor as trustee (either alone or jointly with any other person or persons) under the single trust so identified.
(6) The form referred to in subsection (5) of this section is as follows—
"THIS GENERAL TRUSTEE POWER OF ATTORNEY
is made on [date] by [name of one donor] of [address of donor] as trustee of [name or details of one trust].
I appoint [name of one donee] of [address of donee] to be my attorney [if desired, the date on which the delegation commences or the period for which it continues (or both)] in accordance with section 25(5) of the Trustee Act 1925.
[To be executed as a deed]".
(7) The donor of a power of attorney given under this section shall be liable for the acts or defaults of the donee in the same manner as if they were the acts or defaults of the donor.
(8) For the purpose of executing or exercising the trusts or powers delegated to him, the donee may exercise any of the powers conferred on the donor as trustee by statute or by the instrument creating the trust, including power, for the purpose of the transfer of any inscribed stock, himself to delegate to an attorney power to transfer but not including the power of delegation conferred by this section.
(9) The fact that it appears from any power of attorney given under this section, or from any evidence required for the purposes of any such power of attorney or otherwise, that in dealing with any stock the donee of the power is acting in the execution of a trust shall not be deemed for any purpose to affect any person in whose books the stock is inscribed or registered with any notice of the trust.
(10) This section applies to a personal representative, tenant for life and statutory owner as it applies to a trustee except that subsection (4) shall apply as if it required the notice there mentioned to be given—

(a) in the case of a personal representative, to each of the other personal representatives, if any, except any executor who has renounced probate;

(b) in the case of a tenant for life, to the trustees of the settlement and to each person, if any, who together with the person giving the notice constitutes the tenant for life; and

(c) in the case of a statutory owner, to each of the persons, if any, who together with the person giving the notice constitute the statutory owner and, in the case of a statutory owner by virtue of section 23(1)(a) of the Settled Land Act 1925, to the trustees of the settlement. "

(2) Subsection (1) has effect in relation to powers of attorney created after the commencement of this Act.
(3) In section 34 (2)(b) of the Pensions Act 1995 (delegation by trustees of trustee scheme under section 25 of the Trustee Act 1925), for "during absence abroad" substitute "for period not exceeding twelve months". ").
The noble and learned Lord said: My Lords, I undertook at the Committee stage of the Bill to introduce a government amendment to meet what the noble and learned Lord, Lord Brightman, had sought to achieve by the addition of a Keeling Schedule, having explained, I hope to your Lordships' satisfaction, why it was that we preferred an alternative approach. Clause 5 in its amended form substitutes a new Section 25 of the Trustee Act 1925 for the present Section 25 in relation to powers of attorney granted after the Bill comes into force. In its present form, Section 25 allows the trustee to delegate by power of attorney, for a period of up to 12 months, the exercise of the trust's powers and discretions—that is, functions—vested in him or her as trustee.
This power to delegate is, however, subject to various safeguards intended to protect the interest of beneficiaries from excessive delegation. In brief, these are that the trustee may not delegate to a sole co-trustee, unless a trust corporation; must give notice of each appointment to specified persons; and remains liable for the acts and omissions of the attorney. The powers conferred by Section 25 may be excluded or restricted by the document, if any, creating the trust. That comes from Section 69(2) of the Trustee Act 1925.
I have spoken briefly to the noble and learned Lord, Lord Brightman, and I understand him to be satisfied with the effect of this amendment. I trust that on this occasion I have given him no cause to feel even slightly niggled. I think my undertaking was rather broader, and I have come back with an amendment before the Bill goes to the other place. I hope that he is satisfied. I beg to move.
Lord Brightman: My Lords, I should like to thank the Minister for this amendment to Clause 5 of the Bill, which I wholly support. It is a great improvement on my own amendment which I tabled at Committee stage in the form of a Keeling Schedule. The method of the noble and learned Lord in dealing with Clause 5 is, quite honestly, superior to a Keeling Schedule. I am certain that all lawyers and non-lawyers concerned with the administration of trusts will be grateful to the Minister for simplifying the effect of the amendment.
Lord Goodhart: My Lords, I support the noble and learned Lord, Lord Brightman, in welcoming the amendment. It will improve what is already a useful Bill. Perhaps I may just point out a most serious defect
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in the last line of the amendment, where the words "for period not exceeding twelve months" should surely read "for a period. "
Lord Falconer of Thoroton: My Lords, new Section 25(2)(b) in my draft says "continues for a period of twelve months". Is the noble Lord reading from a different part?
Lord Goodhart: My Lords, I am reading from subsection (3) of new Clause 5. It is on page: 3 of the Marshalled List, the last line of Amendment No. 1. It deals with Section 34 of the Pensions Act 1995.
Lord Falconer of Thoroton: My Lords, I have got it now. The noble Lord is right, it should read "for a period not exceeding twelve months".
On Question, amendment agreed to.
Schedule [Repeals]:
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 2:
Page 8, leave out lines 4 to 11 and insert—
("1971 c. 27. The Powers of Attorney Section 9. ") Act 1971.
The noble and learned Lord said: My Lords, I have spoken to the amendment. I beg to move.
On Question, amendment agreed to.
Lord Falconer of Thoroton: My Lords, I beg to move that this Bill do now pass. I hope that your Lordships agree that this is a worthwhile small Bill. As I said at Second Reading, it is one for which we must thank the Law Commission. Its thorough consultation and meticulous preparation generally make dealing with its Bills such a satisfactory process for your Lordships and for the Minister. I believe that the Bill leaves this House to begin its journey in another place in the polished form that the noble and learned Lord, Lord Brightman, hoped for at Committee stage.
Moved, That the Bill do now pass. —(Lord Falconer of Thoroton.)
Lord Goodhart: My Lords, I now make an intervention slightly more serious than my previous one. I welcome this minor but useful Bill. In doing so, I wonder whether the Government will be prepared to look again at the procedure for dealing with Bills of this kind. I understand that there are at least 20 Law Commission Bills waiting in the queue. A fast-track procedure for uncontroversial Bills could cut the backlog for the Law Commission. Furthermore, a fast-track procedure could be used for other purposes—such as the deregulation and pruning of redundant legislation and minor amendments to current legislation—thereby reducing excessive use of Henry VIII clauses. The Government have just published a discussion paper on the deregulation process. While

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these are procedural issues which are ultimately a matter for your Lordships' House, I hope that the Government will be prepared to give a lead on this one.
Lord Falconer of Thoroton: My Lords, I note what the noble Lord said. I particularly note what he said with reference to the deregulation consultation paper. We should take note of what he said and see whether there are means by which proposals could be made in relation to the sort of process he has in mind. I can give the noble Lord no guarantees, but I make it quite clear that I think it is worth while thinking about how one can improve the process.
On Question, Bill passed, and sent to the Commons.

Commonwealth Development Corporation Bill [H.L.]
3.16 p.m.
Read a third time.
Clause 27 [Short title and extent]:
Baroness Rawlings Baroness Rawlings moved Amendment No. 1:
Page 11, line 27, at end insert—
("(3) With the exception of this section this Act shall not come into force until the Secretary of State has laid in draft before the House of Commons an order contained in a statutory instrument making such provision relating to the tax liability of the CDC as will encourage private sector investment in it, and the order has been approved by resolution of that House. ").
The noble Baroness said: My Lords, we did not have the intention to speak at Third Reading as both the noble Lord, Lord Redesdale, and myself hoped that this amendment would be accepted at Report stage. Unfortunately this was not the case. We have therefore had to bring it back once again despite the Minister's welcome assurances that amendments to the Bill to include tax provisions would be introduced at a further stage. We, the Liberal Democrats, and I trust Her Majesty's Government, believe that a CDC PPP must be tax efficient to be successful. We would be failing in our duty as a revising and scrutinising Chamber if we let this Bill go through to the other place without this aspect on the face of the Bill.
I wish to make it absolutely clear that this is in no way meant to be a wrecking amendment. Without these essential tax provisions the CDC/PPP Bill is seriously flawed. We understand that the Minister argued at Report stage:
"we believe that secondary legislation would be the wrong way to make this kind of provision concerning tax". —[Official Report, 2/3/99; col. 1557.]
He argued that it should be done by primary legislation. If it is so important, why do the Government present a Bill without such crucial provisions already in place? I am afraid that if the Minister is unable to accept this amendment we will have no alternative but to test the will of the House. I beg to move.
Lord Redesdale: My Lords, we on these Benches would rather not use the procedure of testing the will of
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the House on Third Reading. However, the Minister made it clear at a previous stage that our amendment was unacceptable. This in no way detracts from our support of this worthy Bill. I look forward to the Minister's erudite comments on how the amendment is flawed, a subject upon which he waxes so lyrical. The House would be failing in its role as a scrutinising Chamber if it did not raise certain points.
The Bill is deficient in that without tax provision the CDC will not be able to operate in the private sector. The Minister may say that he has given a copper-bottomed guarantee on the Bill. However, it would be an act of faith for us to allow the Bill to go through all its stages in this House with the provision that the Government will have worked out the problems associated with the Bill by the time it reaches the House of Commons. At the moment, there may be a copper bottom, but there are severe holes in the shape of the Bill. I very much hope that the Minister will accept the amendment, but I fear that he will not.
Lord McIntosh of Haringey: My Lords, I will not follow the noble Lord's metallic arguments. However, I am afraid that I will have to repeat part of what I said at Second Reading because I have been asked, quite reasonably and properly, for the same assurances again. I can confirm that it is the Government's view that the CDC has to be tax efficient if it is to achieve its goal of investing in developing countries using private capital raised in the context of a competitive private investment market dominated by offshore funds. The Government have already agreed the broad principles for a tax solution that will provide the CDC public-private partnership with the required tax efficiency. Work is continuing on the details. However, I am sorry that such work has not been concluded to a sufficient extent to allow us to bring forward the necessary amendment to the Bill today. We intend to introduce the necessary amendments to the Bill at the appropriate time in the House of Commons.
I repeat what I said about the amendment. It would require the Secretary of State to lay before the House of Commons an order-making provision as to the tax liability of the CDC, such provision as will encourage private sector investment in it, and to have that order approved by the House of Commons. We certainly agree with the aim of the amendment but, as I have said before, we disagree with the approach in that the proper way to make the necessary provision about the CDC's tax is by amendment to the current Bill and not by secondary legislation. The amendment is also technically defective because the Secretary of State does not currently have power to make tax provision of this kind by secondary legislation. The amendment probably—I say "probably" because these are arcane and legal questions—does not give her any such power. Even if the amendment must be read as impliedly giving some power, the extent of that power is poorly defined.
I am sorry about this but I think we can come to a reasonable conclusion. I have made it clear that if the amendment is added to the Bill it would be the Government's intention to ask the House of Commons to remove it and to make the necessary substantive

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provision about tax by further amendment to the Bill. On that basis, if the noble Baroness wishes to put her amendment to the House, I would advise my noble friends not to oppose it.
Baroness Rawlings: My Lords, I understand that we are unable to have the details of the tax provisions at the moment and that should the amendment be accepted it might be removed in the other place. But, as I said, the intention should be on the face of the Bill as it leaves this House for the other place. I am very sorry that the Minister is unable to accept the amendment. I am afraid that I shall have to test the will of the House.
On Question, amendment agreed to.
An amendment (privilege) made.
Lord McIntosh of Haringey: My Lords, I beg to move that the Bill do now pass.
Moved, That the Bill be now pass. —(Lord McIntosh of Haringey.
On Question, Bill passed, and sent to the Commons.

Airline Competition: ECC Report
3.23 p.m.
Lord Geddes Lord Geddes rose to move, That this House take note of the Report of the European Communities Committee on Airline Competition (32nd Report, Session 1997–98, HL Paper 156).
The noble Lord said: My Lords, this inquiry into airline competition was carried out by Sub-Committee B of the European Communities Select Committee of your Lordships' House. The inquiry was prompted by the revival of the 1989 Commission proposal to extend the powers of the Commission to apply the EC competition rules, particularly Articles 85 and 86, to airline services between the European Union and third countries.
The sub-committee took evidence over the period May to July of last year, our report was published in November of last year and the Government replied, very comprehensively if I may say so, in a letter dated 22nd February of this year. I say "very comprehensively" because it was exactly that, but there are one or two items of the Government's reply on which I should like some answers. However, I should emphasise to your Lordships that the reply of 22nd February has not been discussed by Sub-Committee B, so any views that I express today are personal views and not those collectively of the sub-committee.
We were superbly advised throughout our inquiry by Dr. George Williams of Cranfield University. Perhaps I may express the committee's very real appreciation to him. We also had the excellent services of Miss Kate Ball as the Clerk to the sub-committee. Sadly, we do not have those any longer. She has been, I think it would be correct to say, promoted to the Public Bill Office, but I should also like to express our appreciation to her for the way, as a very new Clerk in your Lordships' House, she assisted in that inquiry.
The committee heard 10 sessions of oral evidence over the period I have described, including from the Competition Commissioner, Karel van Miert, and from
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Glenda Jackson MP, the Minister of State at the DETR. We also took evidence from five separate airlines— British Midland, Delta, Lufthansa, Virgin Atlantic and British Airways: they are put in strict chronological order. However, we did not—the report emphasises this and I wish to do so again—receive any reply to an invitation for evidence from Air France. It simply did not have the courtesy to bother to reply in any shape or form. That becomes quite indicative in a subsequent part of the report, to which I will refer.
Currently, competition rules with regard to airlines are applied by both the Commission and member states. If this was not your Lordships' House, I might describe it as a "something" muddle. The Commission's, proposal has three parts. First, it would give the Commission sole power to apply competition rules to flights between the European Union and third countries. Secondly, it would provide for consultation between European Union and third countries in cases of dispute. Thirdly, it would give the Commission further powers to grant block exemptions for certain activities by airlines.
In paragraph 2.1 of the Government's response the Government appear to be stating that block exemptions are given to agreements and practices which promote competition in the consumer interest. But I must say—I should be grateful if the Minister could comment on this—that my interpretation of Article 85 of the treaty is rather different from that of Dr. John Reid in that, as I read it, Article 85 states that,
"exemptions may be given to a category of agreements between undertakings which does not … afford such undertakings the possibility of eliminating competition in respect of a substantial part of the products in question".
We are getting into a slightly legalistic jungle here, but that is a very different interpretation from the one we received from the Government.
As the Government rightly point out in the third paragraph of the introduction of the reply of 22nd February, the committee found itself obliged to go much wider than the original narrow European brief in that—this is a truism—the airline industry is truly global and is characterised by a whole battery of alliances, which we summarise in appendix 3 to the report. Those alliances are in themselves potentially anti-competitive.
The thrust of our report—and we say it at least twice in bold type in our conclusions—is that consumer interest should be paramount in regulating airline competition. We found, and this is why we had to go wider than the apparently narrow initial brief, that much of the distortion in competition comes from the European Union/US airline market. That is the nub of the whole airline industry of the world.
In particular, we found the restrictions on ownership on either side of the Atlantic to be seriously anti-competitive, with the US not allowing more than a 25 per cent. non-US ownership interest; within the EU the equivalent figure is 49.9 per cent. Although we realise that it is perhaps some distance away, we recommend that as soon as possible those two restrictions should be lifted.
We emphasise, and I anticipate that this may evoke considerable opposition from one or two speakers in this debate, that responsibility for competition should lie at

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the highest practical level. In the context of the European Union that is with the Commission. Having heard very good evidence, we came to the conclusion that the Commission is better placed than member states to apply rules effectively and consistently. We also reached the unanimous decision that the committee would give less special treatment to member states' airlines than national governments have done or continue to do.
Historically, airlines have been accorded special treatment. There are very good reasons why that should have been so, not least strategic reasons. But we could not bring ourselves to say that that situation was any longer justified. The industry has moved on. In our opinion there is no further reason for such special treatment. Indeed, our report goes further, in stating that the industry should be treated like any other industry, ending current anti-competitive practices. We appreciated that that could possibly mean the demise of a number of what have previously been termed "national" airlines. However, we concluded that the necessity for such national airlines no longer stood up. If some of the smaller airlines have to go to the wall, so be it. We were of the firm conclusion that, while initially that might hurt or appear to hurt the airline industry within the United Kingdom, the airline industry in this country is by far the most "deregularised", if I may use that awful word, and therefore best equipped to take advantage of such deregularisation.
We then moved into the deep, thick jungle of "slots". The more we looked into the matter, the more complex it became. First and foremost, to our amazement, we could not find a single witness who could tell us who owned slots—being the right to take off from and land at an airport at a designated time. We even asked the Minister directly: "Who owns slots?"—to which he equally directly replied, "I have no idea". The same answer came from all the witnesses. We did, however, go deeper into what are known as "grandfather rights", which have grown historically. As I understand it, if Imperial Airways happened to have the right to take off at 0930 from what we now call Heathrow, the airline kept that slot in perpetuity. It did not matter whether that 0930 flight was originally destined for Paris, and the destination subsequently became Singapore, and after that Dallas; that 0930 slot remained with Imperial Airways, BOAC and now British Airways. My noble friend Lady O'Cathain may choose to comment on that.
We came to the firm conclusion that airlines that held grandfather rights had significant anti-competitive power over potential competitors. We were of the firm belief that no airline should be allowed to dominate at any particular airport. The Government have commented on that in their reply. They state that at the hub airports—specifically mention Heathrow and Gatwick—on causes the domination. We challenge that statement. We accept that it is partly due to congestion, but state that it is also caused by the stranglehold of grandfather rights.
As I have said, we did not like the linking of slots to routes. We wanted the two to be separated, so that if an airline dropped a route it therefore lost the slot. But so
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far as Brussels is concerned, we pressed strongly in our report for a reform of the slot allocation system. I underline that by pointing out that the system was due for revision in July 1997 and that that review has not yet seen the light of day.
In the long term, the committee supported an open and competitive bidding system for slots. I hope that speakers in the debate will comment on that. The question of slots is a very difficult one. We have produced an opinion; other members of this House may well put forward other opinions.
I am delighted that the speakers in this debate include five members, other than myself, of Sub-Committee B and two further members who have joined the sub-committee since our inquiry. From a list that effectively contains 15 speakers, that is extremely good representation.
I shall not bore your Lordships by attempting to go through the entire report. I hope that all present have read it. In conclusion, I wish to repeat the highlighted start to Conclusion 116. The committee states, shortly and to the point,
"The needs of the consumer should be paramount".
We believe that most strongly. We want competition rules to bring that about. I beg to move.
Moved, That this House take note of the report of the European Communities Committee on Airline Competition (32nd Report, Session 1997–98, HL Paper 156). —(Lord Geddes.)
3.37 p.m.
Lord Borrie: My Lords, the great value of this report is that it lays bare, in the clearest and most concise way that I have yet seen, the ways in which airlines, and the Governments that protect them, can operate against the public interest. The report goes much wider than the narrow matter of the proposed European Union regulations regarding air services between the European Union and third counties. I feel absolutely free to praise the merits of the report. Although I am a member of the Select Committee on the European Communities, I am not and was not a member of Sub-Committee B which produced the report and clearly was so ably chaired by the noble Lord, Lord Geddes.
At present, most governments in the developed world, not only in the European Union, are active in promoting competition between the providers of goods and services as the best way of ensuring that the public enjoy lower prices, a better quality of service and greater choice. But as this report so rightly concludes, the way in which this one particular industry, the airline industry, operates does not achieve those objectives.
For much too long national governments, though not all, within the European Union and elsewhere have promoted, protected and cosseted their own national so-called flag carriers, their own particular national "champions". As the noble Lord, Lord Geddes, indicated, some of those national airlines are not necessarily viable but are simply state-supported totems of national vanity, distorting competition. As a result, the consumers and, of course, taxpayers are

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disadvantaged. As the report rightly says, from the point of view of the public and the consumers' interests in competitive prices and quality of service the,
"maintenance of national airlines is irrelevant".
Airlines get special treatment in the national and European Union competition policies and, in my view and as the report indicates, it is time that that changed. There are so many ways in which an established airline is immunised and protected from competition. Take the system of taking off and landing slots at airports, to which the noble Lord, Lord Geddes, referred. It has become increasingly anti-competitive as demands for slots has increasingly outstripped supply at Europe's congested airports. The system of so-called "grandfather rights" and the way airlines can switch slots between routes give the established airlines powerful weapons against any upstart new entrant competitor.
As the noble Lord, Lord Geddes, said, the sub-committee had a problem in trying to discover who owned slots at airports. It is amazing that no one, not even the Government nor the European Commission, could answer that question. I was interested in British Airways' response. It rather cleverly said: "It's a metaphysical question", which probably cannot be answered. Perhaps I am being too cynical, and the next speaker will probably think I am in saying that it might be in the interests of British Airways that it is all so uncertain.
Most of the recommendations of the report follow naturally from its analysis. As it says, any continuance of the block exemptions granted by the European Union competition rules should be strictly justified—if they are to continue—in the interests of consumers and the promotion of competition. Normal competitive conditions should be the objective for further development of the airline industry and we should aim for an open and competitive slot allocation system. Again, I agree entirely with the noble Lord, Lord Geddes, and the report.
I suppose it also follows naturally from the report's analysis that the European Union Commission should apply the competition rules and it would apply them more effectively and consistently than member states have done to date.
However, I have one little quibble with the report. Perhaps I may remind your Lordships of the de Havilland merger case in 1991 when certain individual European commissioners seemed to cast their votes in that case more according to the national interests of their own countries than in accordance with the European Union's competition rules. I do not, therefore, share the report's dismissal in paragraph 112 of the idea of an independent European Union competition authority, perhaps on the lines of the German federal cartel office or the Bundeskartelamt.
Of course, it is a pity that the proposals of this excellent report seem to stand no chance whatever of acceptance by member states. In its response to the report, the United Kingdom—and I hope that the Minister will not think me too unkind in saying this—offers warm words about supporting in principle that normal competition law should apply to international scheduled aviation. The
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report states that at paragraph 8. But the Government emphasise several times in their response the strength of the traditional system of bilateral agreements and seem anxious to preserve the role of the individual member states. I should like to think—and the Government have a chance to consider this further and at greater leisure—that there will be greater support from the Government for the report's proposals in practice and not just in principle.
3.45 p.m.
Baroness O'Cathain: My Lords, I am delighted that the House has been given the opportunity to debate the report of the Select Committee. At the outset I have two declarations of interest to make. I am now a member of Sub-Committee B of the Select Committee, but was not a member at the time of the committee's deliberations, nor when it published its report. The second declaration seems superfluous as it has already been alluded to by the first two speakers: namely, I am a director of British Airways.
I welcome this wide-ranging and comprehensive report and see it as encapsulating three very positive points: first, the strong emphasis on the fact that the customer comes first. That was better put by the committee in Recommendation 12 in that,
"The needs of the consumer should be paramount".
My noble friend Lord Geddes stated that recommendation twice. The second positive point is the assertion that there should be no long-term special deals for airlines. Thirdly, there is the recognition that Europe is now central to aviation policy.
While I agree with many of the recommendations made by the committee, there are three areas which I feel need further elaboration or explanation to make it even more valuable to the non-technical but very interested reader. I hope that some brief comments from me might help in that regard.
First, I am somewhat disconcerted by the implication in the first recommendation that,
"a good deal for the consumer",
embodies as its first criterion the need,
"to offer the consumer lower prices".
Frankly, as a marketing person I have always asserted that the offer should be "good value for money". Good value for money does not always imply lower prices. I am sure that we have all experienced occasions in our lives when we wish we had spent a little more on particular goods or services which would have resulted in better overall value. A cheap washing machine that breaks down every year or so is not exactly good value for money compared with one which cost more initially but is reliable and offers greater flexibility.
So it is with all consumer goods and services. Air transport is no exception. It is the customer's choice whether he or she flies with a "no frills" airline with no meal on board and offering only one flight a day or prefers the more expensive option with greater flexibility of schedules and a higher level of cabin service.

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Just as an aside, noble Lords have probably noticed that I referred to the "customer", but the report refers to the "consumer". I have always differentiated between the words "consumer" and "customer", believing that the word "consumer" indicates the whole market but the word "customer" indicates specific individuals within that market. Some airlines try to make the consumer feel like a customer; that is, people who are individuals with individual needs and wants. That is also the choice which the passenger makes. It is competition at its most detailed level.
The second point I wish to make is that I feel that there could be some misunderstanding in the nomenclature used in describing airlines as "national" airlines. Over the years, rather as the noble Lord, Lord Borrie, suggested, that adjective has come to be used as shorthand for "state-financed and operated airline". We have no such airlines based in the UK, although my noble friend Lord Geddes said that if national airlines were forced to become regular, some British airlines would suffer. In my understanding of the terminology, they would not suffer because we do not have any British national airlines. What we have are airlines which have, if you like, British nationality. But we must not confuse them with the state-owned and operated airlines like Air France or Aer Lingus, to name but two of those located closest to this country.
The United Kingdom is particularly fortunate in having a very successful civil aviation industry. We have only approximately 4 per cent. of world GDP and some 5 per cent. of world trade, but we have a 9 per cent. share of the international aviation industry. Just a word of warning: any attempts to dismantle the UK industry would create a disproportionate disadvantage to UK airlines compared with their competitors in Europe.
The third and final area I would comment upon relates to the committee's recommendations on slots— Recommendations 15 to 23 inclusive. In my whole career in the civil aviation sector—as a young, innocent and raw economist in my first job, which happened to be with an airline, and many years later as a director of British Airways—it always seemed to me that the most complex area one deals with is slots. It is very complex and there is greater misunderstanding about this than about any other issue in the sector.
What are slots? Why do we have slots? Why does no other sector of industry have slots? Should slots be tradeable? Slots, as has already been said, are a direct result of congestion or the inability to provide sufficient airport space to accommodate the traffic required to satisfy consumer and customer demand. Slots are a problem world-wide but in some countries the problem is much more pressing than in others. In the US, for example, slots seriously come into play only in the highly congested airports of New York and Chicago. But the US, of course, has vast tracts of land in which airports can be accommodated and a huge market composed of people who take a flight to go from A to B within the country as the best way of gobbling up the miles.
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It is all so different in European countries and in particular in the UK. Congestion in the UK is due to government restrictions on expansion of airports. To define slots as national assets when government policy has constrained the infrastructure is tantamount to confiscating airlines' business and would be utterly wrong.
An airline using slots is analogous to a train using a track. The train company undertakes to provide a service and in the provision of that service it has to use a track. It negotiates the use of the track for certain times of the day and publishes its timetable. Passengers get to know the times of the trains and the company provides the services to them. If, however, experience shows that traffic from London to Plymouth has fallen off and that traffic from London to Bristol has taken off, the train company, in the interests of providing a service to all its passengers, will negotiate to run extra trains on the one line and to curtail services on the other. A similar situation exists with airline slots. This flexibility is required by the airline in order to provide services to its passengers.
The right to a slot was initially protected by conventions contained in the scheduling guides published by the International Air Transport Association, LATA. Slots are ranked according to priorities: regular scheduled services are in category 1, for example, and category 3 is air taxis or people with small private planes—or even large planes. This convention has been adopted by and large by EC Regulation 95/93, which is now enforceable as law in the UK, with the rights granted by it recognised and enforceable in UK courts. The regulation confers rights and UK airlines are entitled to use and deal with those rights in accordance with that regulation and with the general law.
The very structure of this situation has given stability to airlines to plan their schedules and to engage in fleet planning, leading in turn to huge advance orders for aircraft, which coincidentally help UK companies such as Rolls Royce or the joint UK-French consortium of Airbus. Without the security of the slots it is doubtful whether any serious long-term planning could be undertaken. Would the customer benefit? I very much doubt it.
Investment by airlines, persistent, determined and long-term commitment to route development, all depend on the security of slots; but slots should never be tied to specific frequency levels on specific routes. Here I disagree with my noble friend, Lord Geddes, because I believe that does not take into account changing patterns of market demand. We all know how fashion changes for holidays to various regions or countries. Similarly, economic developments in other countries could seriously affect demand for travel to those countries. There has been a recent example with the economic downturn in the Far East. It would be insane to suggest that, if an airline had X number of slots allocated only to a Far East route and Y number to a thriving route in Europe, it could not reschedule some of the Far East slots to provide for the extra supply to

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the European destinations. That would not be serving the customer and would be economic madness. Distorting market forces is not the best policy to adopt.
New routes are tested out and existing routes are given more or fewer frequencies, as economic factors drive changing market dynamics. Change is healthy and ensures that supply is put where the demand is, and we all know that demand is always changing. Tie slots to routes and we consciously distort those market forces. In my view, slots are as important as brands and I think we would agree that governments do not have the right to interfere with brands. Until the necessary infrastructure is in place to satisfy consumer demand, airlines will inevitably want to build up slot banks at airports.
A great deal of misunderstanding also exists with regard to the selling of slots. As slots are assets why cannot they be sold? They have a value based on the investment made in them and, like any other asset with an investment content, they should be tradable. Trade in slots does go on. Only last month I read of a part-exchange deal undertaken by a large British airline with a small airline. It involved swapping several less desirable slots for prime time ones and "parting with £2.5 million"—according to the Sunday Times of 21st February. It is naïve to think that this can or should be stopped.
The airline business is very competitive, nationally and internationally. Indeed, the UK airline industry is as competitive as any sector I know. The customer gets good value based on his or her preferences. It is a success story and has evolved strongly over many years. It is unsubsidised and, directly or indirectly, employs hundreds of thousands of people. The committee's report tends to disregard that and concentrates on what it sees as anti-competitive practices writ large. Believe me, those who strive to provide the best service to the customer do not see it that way, and I hope that I have given some grounds to consider that things may be different from what the report suggests.
3.56 p.m.
Lord Bridges: My Lords, I am glad to take part in this important debate. I should begin by explaining that I was a member of the Select Committee which approved this report, although I have since retired from the Select Committee on the expiry of my term. I then made it clear that I did not wholly agree with the conclusions of the report and would explain my reasons when the report was presented to the House. I do so now, except on the subject of slots, where I believe the noble Lord, Lord Geddes, has made a very strong case for suggesting that this matter needs to be looked at afresh. I must also admire the metaphysical skills which the noble Baroness, Lady O'Cathain, has just demonstrated to us.
I have been considerably involved in international civil aviation in the past, particularly as Minister (Commercial) in the British Embassy in Washington for the four years 1976 to 1979, which covered the period of the renegotiation of our bilateral civil aviation treaty with the United States, and I was a member of the
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British negotiating team led by Mr. Patrick Shovelton. I also had some continuing responsibility for civil aviation as the Deputy Secretary (Economic) at the Foreign Office for the three years following, 1979 to 1982.
In approaching this subject it is worth observing that our role in international civil aviation is very significant. This is partly for reasons of geography. We are, as it were, the Clapham Junction of international air travel. We also have a good record for air safety. What matters, however, is the geographical hub and the wide range of destinations to distant continents which are available in London. Thus I recall that when U Thant was Secretary-General of the United Nations and wished to revisit his native Burma he found it easiest to cross the Atlantic, to spend a night in an hotel at Heathrow and to take a direct flight to Rangoon the next day. Even 30 years on, when so much has changed in civil aviation, it is still the case that travellers in the eastern United States will locate the widest choice of flights to destinations in Africa, the Middle East and south Asia by travelling via London; and converse journeys produce the same result.
This explains the telling statistic in the report just quoted by the noble Baroness, that although we have only 4 per cent. of world GDP we have 8 per cent. of world aviation output. This share has been won by a combination of geography, competitive efficiency and dependability. There are many operators who want to gain market share, both in Europe and elsewhere, which would be at our expense.
My first concern, therefore, is that although the Commission's proposal is designed to improve the effectiveness of its competition policy—which is clearly a laudable objective—the main result I would expect to see from the proposals, at least in the short term, would be a reduction in our share of the market. The Commission may well be in agreement with that supposition. However, although the Commission is not concerned with that, it concerns us.
My next reason for doubting the conclusions of the report relates to the Commission's competition policy. That is the legal base for its initiative. The Commission's record in the area of competition policy does not exactly inspire confidence. In the past the Commission has been regrettably weak in taking action to curb state subsidies, notably over steel but also over state-owned airlines such as Air France and Sabena. I do not find its claim to be acting in the interests of the aviation consumer convincing. If that is its prime concern there are some other areas in which it can use its existing powers to help consumers.
For example, there is the ridiculous IATA rule that discounted fares are available only if the passenger stays over a Saturday night. The ostensible reason for this rule is to encourage tourism. Instead, it boosts airline revenues by millions of euros every year at the expense of the consumer. There is also the current method of off-loading block airline seats to tourist agencies and bucket shops and charging premium prices to those who have to travel for business or urgent family reasons. This means that those who have to travel subsidise those who

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do not and are going on holiday. That has always seemed to me to be very unfair. If the Commission can act in those areas it will help the consumer. It already has power to act if it chooses to do so.
It is clear that the Commission wants to assume these fresh powers in order to conclude new aviation agreements, in particular with the United States, that are binding on other member states. It is evident from its public activities that the Commission is sympathetic to the US desire for what the Americans call an open skies agreement. But this is a one-way street, as the Americans want the freedom to earn money in our skies without opening their own. They want the right to fly from a US airport to intermediate stops in Europe, with traffic rights here to an ultimate destination elsewhere in Europe or further afield. That one-sided arrangement prevailed under the first bilateral agreement, Bermuda I.
At that time Pan American had a fleet of small jets stationed in London which transported passengers arriving on its transatlantic flights to other destinations in Europe. In effect, Pan Am ran a European travel service. That right was removed under Bermuda II, and the Americans now want it back in spades to cover Europe as a whole without conceding reciprocal rights in the USA. Until the Commission shows signs that it will stand up for European rights—it has not done so up until now—I do not believe that we should concede the authority that it seeks for specific reasons of its own relating to the extension of its authority and competence. I therefore support the position of Her Majesty's Government and British Airways on this question.
The time may well come when it is appropriate to confer on the Commission the authority that it now seeks. The situation may change fundamentally if, for example, a second generation of supersonic airliners with a long intercontinental range—a successor to Concorde—were developed. That could significantly change the way in which civil aviation operates globally. Further, the improvement in the competitive position in Europe may endow the Commission with a broader attitude, which I believe that it lacks at the moment, and the experience and skill that enhance the position of the consumer and the Commission's own public standing. Attitudes may also change in the United States. As a result of deregulation in the US air ticket prices have risen and the choice of alternative routes has declined.
I recall a conversation in Washington in the 1970s that I had with Professor Fred Kahn of Ithaca, New York State, who had been brought in to advise the Carter Administration about deregulation of the aviation industry. He was a fascinating man and was the architect of deregulation in the United States. He had a bright and active mind and was a brilliantly clever advocate of his thesis. I was puzzled about where all this would lead. I invited him to lunch and asked him the following question, "But, Fred, if your policy actually works, surely the President of the United States could not allow Pan Am to file for bankruptcy?". Professor Kahn paused and replied, "He sure ought to". Yet, unbelievably, that was more or less what happened a few years later. Even
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in the separate world of aviation things may change in an unexpected way and facilitate desirable overall objectives in ways that we cannot predict.
For this reason I end, rather surprisingly, with a quotation from St. Augustine of Hippo who wrote in his celebrated Confessions, when speaking of his desire for chastity and abstinence:
"Yes, Lord, but do not give it yet".
My Lords, I rest my case.
4.5 p.m.
Lord Skelmersdale: My Lords, I shall not follow the noble Lord, Lord Bridges, entirely down the line to which he has diverted us in this debate. I begin by congratulating the chairman, my noble friend Lord Geddes, for getting a slot for this debate even at this late stage some three months after the publication of the report. In his speech my noble friend gave a masterly and concise introduction to this debate. Among the many points that he made, which have also been made by other noble Lords, was that the airline industry was different from any other. The airline industry is different in all kinds of ways: it is different because a firm in this country cannot take over another airline; it is different because of what I call a pseudo-cartel into which the thorny subject of competition inevitably comes; and it is different because of the regulatory regime that is applied. One cannot just buy or rent an aircraft, find two airports at different ends of the route one wants to fly and launch one's service. All kinds of hurdles have to be jumped.
The first hurdle is a bilateral agreement. The agreement may be extant or perhaps a new one is needed. In either event one must apply to one's own government for this purpose. That government may well own their own state airline or, in other cases, give preference to their former, now privatised, state airline. In another context, an example of this may be that Ministers and parliamentarians in this country are encouraged to fly by BA when on government or parliamentary business. Noble Lords may not regard that as a very competitive attitude.
However, having obtained permission from both governments under the bilateral agreement one then needs space at an airport at each end of the route. Alas, it may not be the airport that one wants to fly to because international airports are limited. Therefore, one may well have to find a local airline to transport the passengers to where they wish to go. In the jargon, one needs a code-sharing agreement. Lastly, one needs passengers. That is the only part of the operation over which one has complete control. At every previous stage one finds obstacles in one's way. The whole procedure up to the final stage is potentially anti-competitive.
Over the past five years the intra-EU industry has become substantially deregulated, bringing with it benefits to the consumer. An instance of this is the journey that I made with my family to Malaga over the new year. I was offered ticket prices from £69 to £400 depending on when I wanted to fly and with which airline. It is interesting to note that in some cases the earlier I booked the more expensive it would be. I can

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tell my noble friend Lady O'Cathain that I decided for myself which produced value for money. Incidentally, that was neither the lowest nor the highest priced tickets. It would not have been so easy had I wanted to fly to Bangkok or Bogota. I would not have had the range of options, although the Commission believes—probably rightly—that if a major trading block of nations became involved in the negotiations it would have more clout than national governments acting on their own to negotiate a better deal for passengers.
As the committee state in paragraph 3, it is certain that the policy should be to introduce normal competitive conditions and that this can be done effectively only at the highest practical level. I understand the criticism that has been made in this respect. Nonetheless, it is quite clear that we could have achieved a far better deal had we acted in blocks rather than as individual countries. It is for the Commission to ensure that third country deregulation is achieved fairly between member states, with strict application to such things as dominant positions of individual airlines, mergers and state aids. Code sharing—it is, after all, only a way of getting round the current ownership regulations and rules—should be negotiated away in the longer term. That cannot be done by national governments acting on their own. Nor, I believe, can we achieve a sensible, reciprocal agreement on slot allocations.
When all is said and done, if slots are freed up at the European end, and remain restricted in, say, America— my noble friend mentioned Chicago—or China (I accept that that is more unlikely), nothing much is achieved. However, slot allocation is an intra-European problem too and the Commission could and should do something about that first, and quickly. The most pernicious part is the so-called grandfather right. If one gains a slot on one route and decides that that route is uneconomic, one can keep that slot and use it to fly to another destination, provided one can find a slot at the other end. The result may well be that one freezes a competitor off the replacement route. That is anti-competitive in anyone's book.
I should like to see a scheme where such slots go into a pool and are reallocated. That could be for a monetary consideration. However, that method is far from ideal as the larger airlines potentially would be able to outbid the smaller ones. A fairer scheme would be for the relinquished slots to go into a hat, rather like the allocation of the monthly short debates in your Lordships' House. New routes would exist but not necessarily operated by the same airline. Airlines would hate that method. Indeed, it is more than possible that the BA/American Airlines deal foundered on the Commission's insistence that slots would have to be relinquished as a condition of allowing the deal to proceed. However, I must not be drawn into a conspiracy theory.
I turn from the particular to the general. What is without doubt is that a Commission ruling must occur if only because of an alarming admission by the Government in their original explanatory memorandum. Page 101 of the report refers to it. The explanatory memorandum stated
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that allowing the Commission greater enforcement powers would fetter the Government's power—I stress that—to conclude bilaterals which,
"often include requirements which limit competition, such as limiting the number of airlines operating and the airports served. Those may not be compatible with the competition rules in Article 85 and 86 of the treaty".;
Like the noble Lord, Lord Bridges, I rest my case.
4.12 p.m.
Lord Thomas of Macclesfield: My Lords, I, too, as a member of the Select Committee on airlines, do not propose to repeat what has been said by my colleagues. I wish only to underline their comments.
The DTI issued recently an excellent White Paper on competition. As chairman of the Regional Development Agency of England's North-West, I am well aware how important the issue is as we look towards the 21st century.
Much of the evidence before the inquiry demonstrated a very protected industry—a system aided and abetted by previous governments since the Second World War and now part of the culture within Whitehall. As the report states, that culture is entirely historical in terms of defence of the realm, opening up trade routes and national prestige. A previous government were enlightened in their decision to privatise British Airways. Seemingly, no one told Whitehall, and British Airways continues to enjoy comfort and support as though it were still a public sector vehicle. Worse still, the effect on regional or provincial airports is serious for the following reasons. (I refer to paragraph 121 of the report.) First, a thriving regional airport is the most effective economic driver for the development of the region. Secondly, at present British Airways effectively controls slots at Heathrow and Gatwick. Is it appropriate that a private sector company should control the development of regional airports and determine the economic opportunities for English regions without reference to government? That is what it effectively does.
The noble Baroness, Lady O'Cathain, spoke eloquently. Clearly, slots were the key issue for British Airways. I am not surprised because that is how it controls its competitive position. However, the rabbit is out of the bag. When British Airways attempted to negotiate some arrangements with American Airlines, the European Commission required both airlines to give up slots if they wished to achieve those arrangements. They did not do so because they did not wish to give up the slot. The airlines would not only have to give up transatlantic slots; their preference would be to give up regional slots. I can understand British Airways arguing that point, but it was not in the national interest, nor in the interest of the development of our English regions.
Thirdly, the effect on regional or provincial airports is serious because British Airways can, and some believe that it does, effectively block the international flights to regional airports because they affect its competitive position.
Fourthly, business passengers are being forced to fly to Heathrow or Gatwick to catch their international flights, when they could easily fly from one of our

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leading regional airports. Do we not have enough congestion already in London? At least one third, if not 50 per cent., of our business travellers could fly from a regional airport if allowed to do so.
This is a wonderful opportunity for my right honourable friend in the DTI to practise what we preach: that is, real competition and the transformation of our regional economies; and to stop British Airways and Whitehall (one could not tell the difference in the evidence between the two groups) hiding behind negotiations with the United States of America or the proposed authority of the European Union.
4.16 p.m.
Lord Haslam: My Lords, I, too, wish to express my thanks to my noble friend Lord Geddes for the commendable way in which he steered us through this complex competitive situation which surrounds the airline industry.
With the exception of the newly emerging small airlines, primarily operating from developing airports, competition in the mainstream airline industry is still constrained, particularly in relation to first-class and business fares, which have continued to rise despite sharp falls in fuel costs.
It is argued that the airline industry is unique. It is claimed to be still very new and too complex internationally to behave like other industries. However, industries such as telecommunications and computers are newer and equally international but clearly in competitive terms they are now responding like other global industries. It is highly significant that the US, which has the toughest reputation of any country for anti-trust legislation, and in particular for its vigorous application, has been willing to link uniquely its so-called open skies agreements with anti-trust immunity for international airline activities, which appears to underline that it is acceptable for the industry to pursue anti-competitive actions with relative impunity.
Having been exposed in my career to European and national regulatory authorities in such industries as chemicals, synthetic fibres, plastics, sugar and steel, I have seen dawn raids and company and personal fines for price collusion and price fixing. Regrettably, there has been little or no evidence of such activity in relation to the airline industry.
Another related worrying feature is the perception that there are still unhealthy continuing sweetheart relationships between some European governments and their respective national airlines. The growing development, too, of major alliances between airlines linked to code sharing clearly reinforces anti-competitive activities, and unfortunately this trend seems to be accelerating and widening.
Another major inhibiting factor to genuine competition, already referred to by a number of my colleagues, to genuine competition surrounds slot allocations at major European airports. For example, prior to 1982, British Airways controlled slot allocations at key UK airports. We were told, however, that Chinese
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walls were established between the airline operators and the slot allocators. I bow to no one in my admiration for the splendid role my noble friend Lord King played in building British Airways. If I had been in his shoes, I know I would have found these Chinese walls extremely frustrating!
Nevertheless, British Airways acquired a dominating number of "grandfather slots" in those early days which have proved anomalous and anti-competitive. Slots are now controlled by the Airport Co-ordinator Limited, owned by a consortium of 11 airlines. Even this appears not entirely unbiased in that it is still very difficult for emerging airlines to gain access to major airports. However, this approach compares well with Germany and Spain, where I believe the national airlines even now still control slot allocations.
I fully support our committee's recommendation that airline regulation, predominantly at the member state level, should not continue—as I have already indicated, that has not been very effective—and that hence it should become the European Commission's responsibility. Nevertheless, it must be accepted that a team of experts will quickly need to be assembled if the Commission is to deal effectively with the wide range of existing and emerging problems without protracted delays.
Such a change could produce a desirable improvement, but it will certainly not be the ultimate solution if the airline industry is to behave globally like other industries, which must be the final objective. The greatest stumbling block is the current ownership and control restrictions, primarily in the US and European Union. These restrictions prevent non-US carriers from acquiring more than 25 per cent. of a US airline, and, conversely, in the EU non-EU carriers cannot acquire more than 49 per cent. of an EU airline. If these restrictions were to be removed, it would provide the opportunity for airlines on a global scale to merge rather than rely on the ever-growing proliferation of alliances, which are very poor alternatives and which should then be phased out.
Recognising the vested interests involved, these fundamental changes will undoubtedly involve protracted negotiations and will clearly not happen overnight. However, once this long-term objective is established, the airline industry will be able to begin the process of restructuring and reshaping itself to behave like other global industries and thereby meet the needs of its wide range of consumers by providing lower prices, higher quality of service and greater choice.
4.23 p.m.
Lord Montague of Oxford: My Lords, I joined Sub-Committee B at the beginning of this year, so I was not a member of this inquiry. However, by chance, when I was chairman of the National Consumer Council in the late 1980s it carried out a similar inquiry. It was therefore natural that I should re-read its report and compare it with that of the Select Committee.
It is an encouraging experience. Of course there are a lot of problems and challenges ahead, also some very serious threats, but so there were nearly 15 years ago.

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We overcame many of those and with open minds and determination I have no doubt that we shall do the same again. Indeed, within Europe we are moving towards internal liberalisation, just as is the United States within America.
One major disappointment, however, must be the lack of an open skies agreement between our country and the United States. Some European Union countries do have agreements with the US.
Having been the beneficiary of a great deal of deregulation, it is ironic that we have been negotiating with America for very many years. We need to be reminded that the major hurdle lies with America, where its domestic market is virtually closed to external competition. Restrictions, as we have heard, on foreign ownership of airlines and an important example of an old-fashioned concept. Competitive fares and good service are what matter to consumers, not which flag is on the outside of the aircraft. Indeed, one wonders whether the role of government in the airline industry should go beyond ensuring safety and competition. All kinds of industries are consolidating internationally and, frankly, it is a little naive that governments should remain determined to promote their national carriers in the air.
There are some things that we can do now internally to show that we are not merely paying lip service to the benefit of competition. For example, why cannot we declare open skies to UK regional airports? There is spare capacity at airports such as Manchester and it is quite improper that opportunities to grow new routes from the regions, and the considerable number of jobs which that creates, appear so far to have been sacrificed to the interests of our national carriers and the national airports.
As we have heard and know, one of the great problems is now slots. The growth in passenger movements is remorseless and it is an issue that we continue to shirk in the name of history and the past. I refer to "grandfather" rights. They were appropriate in the past, but just as every other aspect of air travel is market oriented, so should be slots. In my opinion, these should become a market, based on 10-year leases, with leaseholders having the right to trade them during that period. This should be carried out as a phased reform so as to provide reasonable protection to the airlines, which currently seem to believe that they possess the slots in perpetuity. The income from this market activity should come to the state, which has spent and continues to spend substantial sums of money on aviation matters.
There are also some further short-term steps which should be taken while we untangle history. For example, there are nearly 4, 000 all-cargo aircraft using Heathrow airport annually, and it would seem sensible that these should be required to be routed to alternative airports, as should the non-scheduled private flights, including those which are chartered. I commend that for consideration.
I also wonder whether slots should be destination-specific, subject to seasonal and demand considerations, as against airline-specific, which they are at present. The deregulation which we have enjoyed during the past two
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decades has already been extremely beneficial in assisting into being the European Consortia Airbus Industries, which has broken Boeing's de facto monopoly and caused the price of the production of aeroplanes to be competitive and to keep this cost low.
Not all of our current problems arise from the past. The recent passenger tax, which I do not believe to be wrong in principle, has been implemented without sufficient thought to the totality of its outcome. I would remind the House that it is £10 on flights within the European Union and £20 on flights outside the Union. Therefore, Zurich, for example, is outside the Union and a £20 figure applies. Yet the lowest single easyJet fare from Luton to Zurich is £19. It can hardly be logical to have a tax which is greater than 100 per cent. of cost. I recognise that that is an anomaly, but it demonstrates dramatically how much wiser it could be to have a tax calculated as a percentage and not as a flat rate.
Furthermore, the tax is of a once-applicable nature, although it is on a return flight basis, but only one-third of passengers going on the very cheapest flights decide on their return airline or flight. So it means that those who are in that category have to pay the return tax twice. The anomaly which the flat rate tax produces can be seen in the latest British Airways return cut-price flight to New York. The cost of that flight is £143 and the tax is £51, which is nearly 40 per cent. That is clearly an unreasonable amount.
Finally, I turn to the new young airlines winch are playing such an important part in bringing down prices and helping consumers. Their influence is such that established airlines are having to be price competitive, which is very healthy. But some airlines which have got up to tricks in the past may be trying to damage unfairly their new young rivals.
When an existing airline starts what it claims to be a new airline offering price-competitive seats, it is extremely important that that competition is fair and not subsidised. We need to have totally transparent accounting in such situations so that we can be assured that there is no cross-subsidy by virtue of some of the expense of the parent not being charged to the subsidiary.
As I stated earlier, great steps have been made in improving air travel for passengers. We must be determined to ensure that none of that momentum is lost.
4.31 p.m.
Lord Lyell: My Lords, looking at the list of distinguished speakers, there are only two who are not members of the committee or not what I would describe as real transport experts. One of them has just sat down, but we heard a notable speech from the noble Lord, Lord Montague, to which I shall refer later. However, as one of the amateurs dipping his toes into this unbelievably complicated subject of fares and slots I should say first how grateful I am to my noble friend Lord Geddes and, above all, to his committee for producing this fascinating report.

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Secondly, I should declare an interest as one of that favoured group referred to by my noble friend Lord Geddes; namely, the consumer. My noble friend Lady O'Cathain would describe me as a customer and she is absolutely right in that. I shall speak as a customer.
My noble friend Lord Skelmersdale will attest to the fact that between 1984 and 1989 I made in the region of 1, 150 flights. That was just within the United Kingdom and was sometimes with the airline for which my noble friend Lady O'Cathain has spoken and sometimes with other airlines. Currently I am one of the more frequent flyers in your Lordships' House since once or twice a week I fly to my home airport of Edinburgh, usually travelling from Heathrow. Perhaps I may give just one example of how airline competition, which is the main thrust of our discussion this afternoon, has improved, certainly in the 28 years that I have been coming to your Lordships' House. Just before coming into the Chamber I examined the A-Z of air timetables. I found that on any week-day morning there are seven flights leaving Edinburgh Airport for London Heathrow, London Gatwick, London Stansted, Luton Airport and London City Airport. There are seven flights leaving between 6.30 and 8 a. m. in the morning and seven in the reverse direction. I have not been able to check the figures, but in 1971 there would have been two or three at the most in each direction. In addition to that, there are three trains leaving Edinburgh between 6 and 7 a. m. Each of those provides competition. It seems to me that, in the air, the customer is certainly king.
I declare an interest in that occasionally I fly the Atlantic, but that is normally only on parliamentary business. Once a year, with other Members of your Lordships' House and the other place, I fly to Zurich, which was mentioned by the noble Lord, Lord Montague. We do not necessarily fly to Mulhouse-Basle where one is flying to what I understand is technically Switzerland. However, one may obtain very valuable 50 per cent. discounts since that airport is considered to be within the European Union. But we fly to Zurich and I shall have more to say about that later.
I am particularly taken by paragraphs 103 and 116 of the report. I see that my noble friend Lady Seccombe is in her place. She also flies to Zurich with us. Paragraph 116 refers to competition providing a very good deal for the consumer. As my noble friend Lord Skelmersdale pointed out, occasionally the consumer may be wearing different hats at different times of the year. Occasionally one may be flying on a business flight and, occasionally, one flies with the family on a holiday flight. Indeed, those different aspects of the customer or consumer are catered for with increasing helpfulness by competition within the airlines.
My noble friend Lord Geddes spelt out the problem of slots, which are particularly crucial in the United Kingdom thanks to our geography; but they are affected also by environmental aspects as is shown in the ongoing inquiry in relation to the fifth terminal at Heathrow.
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I was fascinated by the discussions on the ownership of those slots. Indeed, I refer your Lordships also to paragraph 391 on page 100 in the evidence of the Minister and paragraph 418 on page 110, which was evidence given by the managing director of ACL. There are wonderful, disparate arguments as to who owns slots and who would control them. I found enormous encouragement in paragraph 415 as to the precise breakdown of the slots. I shall read that carefully as I sit in the aeroplane at Heathrow or Edinburgh being told that there is a 45-minute delay. I appreciated that in particular.
I was extremely interested in the proposals made by the noble Lord, Lord Montague, in relation to trading in slots. I have often read of that in my daily reading of the Financial Times which, perhaps among others, has some views on that complicated subject. I ask your Lordships to glance at paragraph 3.3 of the memorandum and the evidence which was given by Sir Michael Bishop of British Midland Airways Ltd, pointing out the enormous difficulty and importance of the various airports, and in particular competition, and allowing airlines to fly in the slots and the timing of that. Reference was made to the three major airports in Europe—Charles de Gaulle, Frankfurt and London Heathrow. But of particular interest to me was paragraph 2.3 of the evidence given by that airline which referred to a flight which is extremely well-known to my noble friends Lady Seccombe, Lord Geddes and myself when we fly to and from Zurich. Your Lordships will see from the evidence that that is apparently the sixth busiest air route in Europe and yet, according to one piece of evidence which is to be found at paragraph 27 on page 10, that has been turned into what has been called a duopoly.
I am careful in declaring an interest because when my noble friends come skiing with us once a year we are made to take part in a little ski race and we put on sexy little bibs. What do we find on them? It is Swissair. Therefore, I must be careful and I hope that they may forgive me in the year 2000. However, I hope that your Lordships will glance at the bottom of page three, which has a table detailing the cheapest available flexible business flights on some of those routes. What happens when there is competition? There was competition on the London to Zurich route. Your Lordships will see that in the three years from 1995 to 1997 the business fare went from £202 to £308. Evidently there were three airlines flying from London to Zurich. Now there are only two.
Thanks to a young lady in our transport office, whom I call "Kind Katie", I was advised this morning that the cheapest return business fare from London to Zurich is £464. That is not lira, not drachma, not Swiss francs but pounds sterling. That may be an extreme example, but it is a fairly tough, hard-hitting example of what can happen if some arms of competition are removed.
I am particularly pleased to see that I am to be followed by my noble friend Lord Mountevans. He is quoted in evidence as saying on 20th May last year that air travel prices have fallen so steeply that what once was the privilege of the few has become the facility of the many. I enjoyed his eloquent words then, as I do

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when I fly around the United Kingdom, wearing different hats, sometimes of necessity at peak times—travelling between your Lordships' House and home—and sometimes on a recreational or holiday flight.
I conclude by thanking my noble friend for the superb way in which he has set out the conclusions of his committee. I am not 100 per cent. sure that such views are a long-term solution, or that the Commission should have the final decision, but in the jungle of fares and slots I know that my noble friend and his colleagues will be my guide on any problems that I may have in the air or on the ground. I am most grateful to them for that.
4.41 p.m.
Lord Gladwyn: My Lords, long ago, in the mid-1960s, I was involved in international affairs on behalf of BOAC, dealing with bilateral treaties. So I suppose that my speech in today's debate could be described as the grandfather slot. It is true that, as a hereditary Peer, my slot tenure is precarious. But I suppose that Virgin Atlantic may consider British Airways itself to be a hereditary airline. After all, it is the heir of corporate generations with imperial origins.
The Select Committee, chaired by the noble Lord, Lord Geddes, has produced a most remarkable report which is extremely instructive. It focuses on two proposals concerning the role of the European Union Commission, which are supported by the committee. They would grant the Commission greater authority in regulating extra-EU air services. Those are generally seen as a further stage towards an ultimate goal, the replacement of national bilateral treaties with treaties negotiated by the Commission itself. The recent legal actions initiated by the Commission show an earnest of its intent to proceed in this direction. Several member states seem to be wavering from their previous opposition to such a development, especially if the terms of their existing US bilaterals can be preserved.
It must be the case that the EU would have greater clout if dealing directly with the US. Even then, with the US being the hive of global aviation, with an internal market many times larger than that of the EU and producing the greater part of the transatlantic traffic, it would never be a contest of equals. However, on several matters the Commission might expect success, one being the fly-America policy for all US government carriage and another the method of agency commissions.
Yet another matter is the issue of wet-leasing. That particularly affects the air cargo market. Air cargo is, in many ways, the Cinderella of air transport. Its interests often come at the bottom of the bilateral negotiating stance. The British air cargo industry is by far the largest in Europe, accounting for 70 per cent. of the business. Because the wet-leased operations almost always touch US points, the present rules prevent airlines of the British Cargo Alliance from competing in the global market with giant US cargo operators such as Atlas. In the world of air cargo, the trade is already going the way of shipping, with globalised freedom to trade.
Naturally, a European Union bilateral would enable all EU airlines to participate, which would be a great step forward. However, it is hard to believe that the US
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would ever drop domestic ownership restrictions in totality, although I suppose it might lower them to the minimal majority ownership which at present pertains in the EU. The committee points the finger at both the US and the EU for having them at all, but, so far as I know, no other developed country in the world outside these two areas has opened its domestic routes to foreign owners.
The committee's report emphasises that the prime criterion in the regulation of airline competition must be the needs of the consumer rather than the protection of the airlines. We would all agree with that. However, in the context of this debate, the customers whose needs we should be considering are those who want to make use specifically of UK points, in others words, our own actual and potential customers.
Of the total transatlantic passenger traffic, the UK share still stands at the surprisingly high level of 40 per cent. There is a danger that EU-negotiated treaties could have the effect of diminishing that share, as even Virgin Atlantic concedes. Traffic at present transitting UK points would tend to deviate to direct flights to continental points. Elsewhere in the world, if the EU were eventually to negotiate treaties with countries that do not accept open skies, the allocation of rights to specified EU points could further act against the total UK global share.
Dealing with the barriers to competition, the first identified by the committee is the system of airline alliances which have become such a dominant factor on the transatlantic routes. These enable US carriers to enjoy immunity from US anti-trust laws and so partake in collaboration on tariffs, timings, capacity allocations as well as code-sharing and so on. That would never have been permitted in my day, although it was commonplace on long-haul routes to destinations other than the US. On third and fourth freedom sectors those alliances tend to restrict direct competition. On the other hand, they tend to enhance competition on fifth and sixth freedom sectors by offering alternative routings.
Here again, surely we have to distinguish between our own customers and those of Europe as a whole. Faced with the realities of those alliances, and especially the Star Alliance built around Lufthansa in Europe, how can we reasonably expect to maintain our share unless British Airways can form its Oneworld Alliance with American Airlines as part of a renegotiated UK/US bilateral?
The second barrier is the method of slot allocation at saturated airports, particularly at Heathrow and Gatwick, but increasingly elsewhere. I understand the logic that has brought the committee to recommend a slot system which would be regulated by government, rather than self-regulated by airlines. All the same, there is a certain contradiction in a system which envisages de jure free competition in the air, but at the same time imposes strict de facto control of it on the ground.
I appreciate the great apprehension of the major airlines, particularly British Airways, that they will be fatally penalised by such a system in favour of new

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entrants when, at the same time, they are battling with so many existing competitors, large and small. Much would depend on how closely the new authority made the decisions. To link slots to routes would be draconian. I note that in the US, although the FAO governs slots, in practice it is left very much to the airlines to trade in them. Surely that would be the best way to proceed. As to the ownership of the slots, I feel that even the noble Baroness, Lady O'Cathain, would agree that the airlines who possess them can be described as tenants rather than owners. Perhaps the noble Baroness will remain in the Chamber until our debate on regulated tenancies, in which I shall speak.
The needs of the consumer must be paramount in airline competition. That is the message of the report. If that implies the provision of ever more convenient services at ever more attractive tariffs, there must be a qualification. The air transport industry will have to accept increasing concerns about environmental issues. These may well predicate future inhibition in airport construction and reduction in atmospheric pollution, and thus tend to restrict the capacity within which airlines are able to compete.
Generally, I cannot see that political considerations could ever be totally eliminated from air transport, even from bilaterals negotiated directly by the Commission. When it comes to the crunch, the Commission would be subject to heavy pressure among its members. Even if it was trying to protect the best interests of the EU as a whole, the interests of the airline consumer might sometimes have to take second place to some other interests, not necessarily those of aviation.
From all this I conclude that EU bilaterals are a desirable aim for the future, but that until and unless they are agreed by the Council of Ministers, it is better not to grant the Commission the greater regulatory powers it is seeking because of the duality that would impose on an extraordinarily complex issue, as is already apparent from the powers that it has already acquired.
4.50 p.m.
Lord Mountevans: My Lords, as I listened to the debate, I wondered what a noble Lord of 30 years ago would have thought if he had participated in a debate on aviation, as it then was, with IATA to no small extent controlling the frequencies, the fares, the sharing of revenue between two airlines which are flying in a common pool, and even controlling air mail. If one could look back that far and then consider what has been said today, one would realise how very far we have come and what great progress we have made in the past 25 or 30 years.
I, too, congratulate my noble friend Lord Geddes, his colleagues, advisers and officials on a most interesting report. The evidence and conclusions give much food for thought, but, in this context, I am not yet persuaded to eat from the proffered European menu.
I share the belief that we have one of the world's most successful airline industries. Several previous speakers have given us the figures which confirm that. It is an
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industry which we owe to the policies of the previous government and to those, our entrepreneurs, who seized their opportunity.
Sir Michael Bishop has quoted me, just as my noble friend Lord Lyell has just quoted me. When I made those remarks last May I had several points in mind. I had in mind the fact that in spite of inflation, politics, taxes and many other extraneous interferences, air travel has become genuinely more accessible. Indeed, for many of us, air travel is good value. As my noble friend Lady O'Cathain said, it is important that we judge not the cost but whether we are getting value for money.
Thinking further, I can see some of the reasons for that. We have had liberalisation and thus we have had lower fares and seat-only charters. Low-cost airlines are now emerging. We have vastly increased efficiency and greatly increased yield maximisation, with the airlines responding to the commercial reality that a seat that earns perhaps £150 is a far better proposition to them than a seat that earns nothing because an empty airline seat is one of the most wasteful commodities. We have also had technological change, with bigger and more efficient aircraft. Most important of all—I have already mentioned this—we have had the entrepreneurial skill which has capitalised on all those developments.
However, although our aviation industry is faced also with restraints, I feel that Britain's aviation industry has mastered many of them in what is almost a world-leading way. We may have lost the old empire, but we have done a lot to develop an empire in the air.
I find it interesting—I am sure that other noble Lords will find it similarly interesting—that KLM has seen fit to buy British in the form of what is now KLM-UK. More interesting still, I find it enchanting that a Greek shipping magnet, Mr. Iannanis, can choose to set up a low-cost airline here and can, as he announced last week, begin to extend his low-cost operations so that they are no longer Britain-centric. He is now setting up a base in Geneva and flying to other parts of Europe.
Looking at this from the consumer's point of view, I must admit that I was concerned 20 years ago that privatisation and liberalisation would restrict freedom of choice. At that time, there was considerable American and Australian evidence that choice would die. Of course, one would have a choice, but only in the rush hour when serious money was to be made. How wrong I was. Then, there were two airlines linking London and Stockholm perhaps four times a day and pooling much of the revenue; now, there are five or six airlines, with more than a dozen flights, and numberless fares tailored to suit both the operator's need to make a profit and the consumer's pursuit of value for money.
I have to ask myself if European—by which I mean Brussels—involvement would build on that success. I am not persuaded. Does a Eurocrat live in the profit-led commercial world? I doubt it. Our UK experience shows that civil servants can add value if, as gamekeepers, they turn poachers. The evidence given by Mr. David Holmes to the committee proves that, as does in another context John Welsly's contribution to the history of the railways in recent years. But I see no such

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personalities emerging from Brussels; rather I see penny packet interference in the railways and an attempt to gain irrelevant influence in aviation.
For Brussels to put itself forward as a serious influence in the latter industry beggars belief when one looks at the state aid which has been mentioned by many previous speakers. To date, Brussels has permitted specific aid to national carriers of perhaps £6 billion-plus. If I broadened the definitions—and why should I not, as Brussels keeps moving the goal posts, as we remember in the context of Air France last year?—I could generate a figure of perhaps £8 billion, which is a year's turnover for British Airways. What kind of a level playing field is that?
Looking further, I see Brussels becoming involved in the British Airways/American Airlines association and in other global alliances whereby airlines seek to enhance their strengths, their service to consumers, and thus their viability. I also see Brussels seeking to interfere in slot allocation.
None of those interferences gives me any cause for optimism; rather, I would like to see Brussels concentrating on its existing remit by levelling the European playing field. To quote Bob Ayling of British Airways:
"Freedom of the skies means nothing unless the frontiers of the state pull back from this [aviation] industry".
He was speaking of Europe, but he could have been referring to Brussels, the soi-disant umbrella organisation of European nations, or some of them. When Brussels has sorted out the internal market and levelled the playing field, it could start looking beyond. However, in looking beyond Europe, it must demonstrate its ability to add value not only for airlines and for nations but in particular for customers or consumers.
Banana wars are topical. On present evidence, I feel that European interference in aviation matters beyond the existing jurisdiction could be the biggest banana of all.
4.57 p.m.
Lord Berkeley: My Lords, as a member of Sub-Committee B of the Select Committee of the European Communities, which participated in the inquiry, I welcome the evidence and congratulate the noble Lord, Lord Geddes, not only on chairing the committee with a light hand but on the committee managing to reach a unanimous decision. As has been said, the evidence is absolutely fascinating. The whole report concentrates on medium-term issues. Nothing can be done this year, but I submit that many of recommendations need tackling now.
I should like to refer briefly to competition and the benefits for the customer because I believe that attention to the customer's needs has often been sadly lacking. Both throughout the evidence given to the committee and in this debate, competition is seen as a good thing because it reduces uncompetitive practices and is seen to lower fares and provide a better service. Many noble Lords have given examples. In theory, we already have open access and competition in Europe. Indeed, there
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have been some wonderful stories, including that from British Midland, about lower fares, but the last time that I tried to go to Vienna, the cheapest ticket that I could find cost £550 return; and if I wanted to change the return flight I would have to upgrade to club class. The noble Lord, Lord Mountevans, quite rightly said that air travel used to be the privilege of a few. However, if one is paying £550 and one is not able to change the return flight, I suggest that that does not make it very accessible to most of the people who would want to buy such a ticket.
I am pleased that the Government agree with the general view that competition is a good thing and that airlines should be treated "as any other industry"—that appears in paragraph 8 of their response—using UK and European competition law together. One of the criteria or constraints that the committee spent much time discussing, and which many speakers have mentioned this afternoon, is slots. The noble Lord, Lord Haslam, said that ACL was owned by British Airways until 1982. In fact, if the noble Lord looks at the evidence he will see that the year was in fact 1992. So, up to seven years ago British Airways controlled the slot allocating organisation at our major airports. The company is now owned by 11 airlines.
I was interested in the criteria that ACL used in allocating slots. On page 105 of the committee's report, many different primary criteria are listed. I shall not mention all of them, but the first one is, "Historical precedence". We then get:
"Schedule change, New Entrants, Introduction of Year-Round services, Effective period of Operation [and] Joint Operations".
We then move on to the secondary criteria. The: first is, "Size and Type of Market Served", the second "Competitive requirements", and the third,
"World-wide scheduling constraints e.g., curfews",
The penultimate refers to,
"Needs of the travelling public".
I do not think that I need say more. As many speakers have said, that is what needs changing; indeed, it needs changing fast.
The noble Lord, Lord Gladwyn, talked about the problem of predicting and providing. I am not persuaded that the UK's economic position would be adversely affected if we did not go ahead with continuing to predict and provide for time immemorial. As the Government say in their response, the constraints in capacity in the south east will stop us predicting and providing pretty soon.
I think that there is an argument for making airlines pay tax on their fuel because, after all, motorists do. Indeed, it all contributes to emissions in the same way. I believe that the revision of the European directive 95/93 on slot allocation on a European basis is urgently required. I suggest that that should include the removal of "grandfather rights" when you want to move routes. I believe that to be very important.
I turn now to the ownership restrictions which, again, have been mentioned by a number of speakers in the debate. The report recommends that all ownership restrictions should be removed as quickly as possible.

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I accept that the UK Government have made some progress in the matter. However, as has already been said, the 49 per cent. restriction in the EU and the 25 per cent. restriction in the US is a severe barrier. Very helpfully for those of us who are amateurs in transport, this report defines the eight freedoms of the air in paragraph 44 on page 12. Members of the committee started off thinking that there were only five, but then, when we received more evidence, we discovered that there were in fact eight. Surely the objective must be that all countries allow all eight freedoms of the air to be applied to flying to or from their countries.
The Commission has to sort out the continuing subsidies of certain EU airlines. I agree that the "bailing out" which has been going on has to stop. However, as the noble Lord, Lord Gladwyn, said, US protectionism goes rather further. He mentioned the "fly-America policy". I did not know whether that would be helpful. I understand that this requires all US personnel, post, mail, "government carriage", freight, and so on, to fly in US airlines to and from the United States. If Britain or the EU had the same legislation, nothing would fly between here and the US without changing planes in Iceland, Greenland or somewhere else. It is a farcical situation. I believe that we should negotiate across the Atlantic, as in so many other matters, from a position of strength. The EU has the greater capability of doing this in the long term, if it is given the tools to do it. As has been mentioned, the British Cargo Airline Alliance estimates that British airlines are probably losing £200 million worth of business a year because of the present situation.
I believe that the concept of British and "other" airlines is becoming very much out of date in this international situation. As the noble Lord, Lord Mountevans, said, there is no reason why any airline which lands here and brings in benefit to the country should not base its maintenance, its administration and, indeed, anything else here if it makes money. That is the key to the matter.
I conclude that the European Commission is better able in the long run to negotiate agreements with third party countries. I believe that it should be permitted to do so. It is more of an equal size compared with the US, which is one of the major markets but not the only one. There is always a risk of other countries playing individual member states off against one another. The Government say that they are in favour of a more liberal regime, so I hope that they will move forward to encourage other member states to agree with them. I also hope that the recommendation that the Commission should negotiate as one body in a robust way with third countries, especially with the US, will be supported. The target should be full and open access with no ownership restrictions, and that should apply equally on both sides of the Atlantic.
5.6 p.m.
Lord Methuen: My Lords, I, too, should like to thank the noble Lord, Lord Geddes, for introducing this debate on the Airline Competition report. It is always a pleasure to take part in these inquiries by
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Sub-Committee B, which the noble Lord so ably chairs. From these Benches we are in general agreement with the thrust of the report. We think it sensible that the responsibility for anti-competition regulation should be transferred to the Commission. It is a matter of international trade as well as competition and, therefore, falls naturally within the remit of the Commission. We also believe that the Commission will have more clout in negotiating international deals, as mentioned by the noble Lord, Lord Skelmersdale.
Many of the present conditions in the airlines come about due to the historic tradition of a national flag-carrying airline, supported by government subsidies. Though this may have been a good thing historically on grounds of security, finance and air safety, it is not now true. Other speakers commented on the fact that certain state airlines are still subsidised and mentioned the committee's inability to gain evidence from one of those in particular.
I find it amazing—as indeed we say in the report—that in these days of global international companies there are, almost uniquely, such severe restrictions on the foreign ownership of airlines: 25 per cent. in the US and 49.9 per cent. for non-EU holdings in EU airlines. The result has been the alliances which have proliferated between international airlines. Whether those alliances are always of benefit to the customer is a very moot point. I wonder to what extent they will actually last because there has certainly been an indication of a relatively short life for some of them.
Our report highlights our concerns about putting the customer first. But there are numerous aspects to that, depending on who the customer is. The needs of a business traveller, a tourist or holidaymaker or, indeed, a backpacker are quite different. The business traveller is probably the least price sensitive, but is driven by the constraints of time and comfort. He may well be influenced by frequent flyer programmes if he has any influence over the booking of his flight, though that would probably be done for him by his company. The backpacker is concerned with getting the cheapest possible flight and will put up with awkward schedules and dates to gain that advantage.
Another impediment which has not been mentioned so far in the debate is the design of computerised reservations systems. There are some 10 major systems shared by the various airlines. Those systems offer the ticketing agent a series of computer screens showing the various airlines and their flight offerings. Research shows that about 80 per cent. of flights are chosen from the first screen displayed, to the detriment of those airlines appearing on later screens. The agent may well have a financial incentive in selling flights on those earlier screens. Hence it is essential for any new airline entering the market to be able to counter that problem, perhaps with the system having some degree of randomness designed into it as regards what appears on the first screen. Eighteen months ago the Commission proposed a code of conduct for these systems to tackle those problems.
A further factor mentioned by the noble Lord, Lord Bridges, which affects ticket sales, is the load factor of the aircraft. As I understand it, after a certain

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proportion of the seats have been sold and the flight date approaches, the remaining seats may be sold at marginal cost as all the fixed overheads of the flight will have been met.
I wish to comment on the vexed question of airport slots. As our inquiry progressed we became more and more embroiled in this subject. The question of who owned the slots was uppermost in our minds. I wish to quote from a recent Consumers Association report on airline competition which has already been mentioned. The USA rule allowing slot trading states,
"Slots do not represent a property right but an operating privilege subject to absolute FAA control. Slots may be withdrawn at any time to fulfil the Department's operational needs".
A Conservative transport Minister in the previous government said,
"No airline has a legal right to a … slot. Rather airlines have permission to use a slot and this must be subject to the public interest".
It is interesting to compare this situation with the use of slots on the railways. Perhaps we should also consider the goodwill involved in this matter, although we accept that this is a far less tangible factor. This would seem to me to indicate a dubious case for the holding of grandfather rights for slots. As has already been said, the airport co-ordination committees which allocate these slots are made up of the incumbent airlines. One cannot help but think that they will tend to distribute largely in their own interest, and hence those co-ordination committees should be seen to be truly independent. As regards bidding for slots, as has already been said, I am concerned that if an auction is held, the wealthiest airlines will outbid the new starters. There does not seem to be any magic formula to solve the slot allocation problem. I shall await the outcome of the Commission's revised slot allocation procedure with interest.
Finally, I wish to discuss regional air services. The operational value of a slot to the incumbent airline is dependent on the route. We must resist attempts to separate regional and international services to different airports. Both Heathrow and Gatwick should operate as hubs for the convenience of the customer. As the noble Lord, Lord Thomas of Macclesfield, said, we should have more regional hubs with both international and regional traffic. That would alleviate some of the environmental considerations mentioned by the noble Lord, Lord Gladwyn.
The noble Lord, Lord Berkeley, mentioned tax on fuel. I cannot help feeling that that would merely result in airlines buying fuel at the place in Europe with the lowest tax load, obviously having regard to safety considerations. However, we generally support this report and I have found this a most interesting debate.
5.13 p.m.
Lord Brabazon of Tara: My Lords, I begin, as usual, by declaring an interest as a director of a small airline in the Channel Islands, which so far as I am aware is completely unaffected by any of the recommendations in the report or any of the proposals put forward by the Commission. However, I shall wait to see whether that is the case.
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This debate brings back happy memories for me of being a member of Sub-Committee B, latterly under the able chairmanship of my noble friend Lord Geddes. I join other noble Lords in congratulating him on his introduction to the debate this afternoon. The debate also brings back happy memories of my time as Minister for aviation for four-and-a-half years between 1987 and 1992. I am glad to see that some of the issues that were around then are still around now!
I believe it is important to look closely at the situation we are now in, and how we got there, before we consider any changes to it. As has been made clear in the report and indeed in the debate this afternoon, civil aviation is something we in this country are particularly good at. It is one of the jewels in the crown. British Airways in its evidence points out that the UK has 1 per cent. of the world's population, 4 per cent. of the world's GDP and 8 per cent. of world output of air transport services. We have 40 per cent. of the total US/Europe air transport market. I understand that as UK airlines have over half of that, that means our airlines have nearly a quarter of the world's busiest intercontinental market. Heathrow is the world's busiest international airport, Gatwick is high up the list, as is Manchester, and Stansted is growing fast, as are many of the other regional airports. Employment in aviation and related sectors is enormous and growing.
Aviation is one of this country's great success stories and we should therefore be very, very careful before we agree to any proposals that may affect our position. One has only to look at the current threats to the position of the City with talk of withholding taxes, and to the art market by other proposals emanating from Brussels to know that we have to be on our guard.
So, how did we get to this pre-eminent position? We did so because the government throughout the 1980s and 1990s pursued a policy of encouraging competition that has been of great benefit to the consumer and to the industry itself. First, we allowed competition on domestic routes. We then privatised British Airways. We were impatient at the proposals for liberalisation coming from Brussels, so we began negotiating liberal bilateral agreements with other like-minded European governments such as Holland until the rest of Europe caught up. It is interesting, but not at all surprising, that those countries that pursued liberal policies now have the most successful airlines, while those countries that were eventually dragged kicking and screaming to liberalisation have the least successful, in some cases near bankrupt, airlines. The biggest threat to competition recently has been state subsidies to just those airlines. One hopes that this is now over, but I cannot help mentioning that it was the commissioner who would now like to expand his empire with these proposals who was responsible in a previous role for allowing these subsidies to go on for much longer than they should have done. The report is incidentally strangely silent on the issue of state subsidy.
The effects of competition on fares can be clearly seen in the figures provided by British Midland in its evidence. It clearly shows that when there are three or more airlines on a route, fares fall. Take Frankfurt to Heathrow for example: between 1986 and 1992 fares

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rose by 61 per cent. When British Midland came on the route as the third airline in 1992, they fell by 12 per cent. between then and 1997. Where there has not been a third airline on a route, fares have gone on going up, by as much as 46 per cent. in the example of Munich given by British Midland. However, I believe that just looking at fares can be misleading. As airports such as Heathrow get busier and busier, there is likely to be an increasing premium charged for the convenience of travelling from the most popular airports, particularly at peak times. What is important for the passenger is that there is a choice of price at all levels. Zurich seems to be a classic case mentioned this afternoon by a number of noble Lords. I, too, shall mention it. My wife came back from Zurich only last Friday on a scheduled Easyjet flight to Luton for just 46 Swiss francs, or just over £20, which I think is a remarkable fare. Easyjet is now of course patronised by distinguished members of the present Government and they must be pleased with it, although I gather, like my wife, they only fly one way on the airline.
I congratulate the low cost carriers such as Easyjet, Debonair, Ryanair and British Airways' Go on what they are doing for the passenger. I thought Mr. van Miert was somewhat dismissive in his evidence of the low cost carriers. He may be right about the rest of Europe but in this country they are thriving. It is vital that the competition authorities keep a watchful and benevolent eye on their activities, or rather on the activities of their larger rivals.
So we have arrived at a fairly good situation in this country. In my view the role of government in this is to facilitate competition when they can, for example by negotiating liberal bilaterals, and otherwise generally regulating with a fairly light touch. Government should certainly not get involved with those activities that are properly the role of commercial airlines or airports and on the whole should let market forces play their full part.
Turning to some of the recommendations in the report, I note that there are no fewer than nine dealing with the old chestnut of slots. It has been a subject which has occupied nearly every speaker in the debate. It is worth remembering that slots only have a value when there are not enough of them to go around. This is obvious, but sometimes it seems to be forgotten in some of the wilder comments about the alleged iniquities of the present system. They are also only part of the equation when it comes to operating a route. There is the enormous cost of buying or leasing an aircraft, ground handling, ticketing sales, marketing and so on. An incumbent with all these things already in place is bound to have an advantage over a newcomer in all these areas long before slots become an issue. That is true of any business.
Since time immemorial, the way to deal with an excessive demand over supply, and where supply cannot easily be increased, has been to have an open market. I believe that the time has now come for that with slots. It is time to get away from the pretence that slots do not get bought and sold and to legitimise this trade. The report is somewhat scathing of grandfather rights and
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seems to believe that slots should and could change hands more easily. I believe, to some extent, that that ignores the enormous investment that airlines have put into their routes. It is also true that even though slots are hard to come by at Heathrow, there are airlines that were newcomers a few years ago which have, with patience and determination, managed to build up the necessary portfolio of slots to operate the routes that they wish. Obviously they would have wished to do this quicker. A legitimate trade in slots would facilitate this, but even under the present system it is possible.
If there were a market in slots, the issue of ownership would arise. As the report points out—and noble Lords have referred to this—no one seems to know who, if anyone, owns them at the moment. The reason for this is quite straightforward: it is because when the majority of slots came into use they had no value because supply was sufficient, and so the issue of ownership did not arise. In my view, on the old premise that possession is nine-tenths of the law, the user should own the slot. It is, after all, the airlines that have built up the business at the airport to the point where the slots have acquired any value. If new slots were created, by either the airport operator or air traffic control, they could be sold on the market, with the proceeds going to whoever created the extra capacity. Another advantage of a market in slots might be that an existing operator who really did not have to operate at the peak could transfer to a less valuable time of the day, or even transfer his service to another, less busy, airport.
If one believes, as I do, that the operation of market forces has been one of the main factors in the success of British aviation, then one would have to disagree with two of the recommendations in the report. The first is the proposal to allocate slots specifically to regional air services. During my time as Minister, I think it was British Midland which transferred its Liverpool- Heathrow service to a European destination. If I remember right, this was not done just to release the slot; it was done because the Liverpool route was losing money and the aircraft could be better employed on the European route. The decision naturally caused some concern locally, but I do not believe that there are many who would now argue that the decision was not the best one for UK plc overall.
It is also everyone's wish to expand direct overseas routes from regional airports, and Manchester has in particular been most successful at this. It is, after all, only a few miles from Liverpool. It is also common policy to encourage better surface transport, particularly rail, not least for environmental reasons. It is much better for UK plc to allow market forces to transfer a 50-seat commuter aircraft from the regions to a jumbo with 400 passengers from Tokyo, while improving rail links in this country, with, for example, a westbound rail connection at Heathrow. But that is perhaps a subject for tomorrow's debate rather than today's.
Another recommendation I cannot agree with is the linking of slots with routes and requiring an airline wishing to transfer a slot to a different route to put it in a pool to be reallocated. That would almost certainly result in a complete freeze on all movement. What airline is going to risk a transfer if it might lose the slot

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to a competitor and end up with a 100 million US dollar aircraft idle on the ground? Surely it is precisely because airlines have been able to make their own commercial decisions in these matters that we have the success that we now have. The report is also silent about who, in both these matters, should actually decide these things. Are we going to have a whole new bureaucracy developing—no doubt subject to political interference—which will decide which regions should be served and which should not, and whether airline A is better than airline B to serve a certain destination? That would be a return to the type of licensing which we spent so many painful years negotiating to end in Europe. Much better to leave these things to those who really understand them—that is the airlines—which have to live with their commercial decisions day in, day out.
I am also somewhat concerned by what appears to be a proposal in paragraph 129 to nationalise the ownership of slots. I am sure that given half a chance the Government would like to get their hands on some more money from the travelling public—and I have no doubt that while I have been listening to the debate they have already done so in another place this afternoon. But I am glad that the Minister at least was very clear that the Government do not own slots.
Turning now to the negotiation of bilaterals with third countries, I note that the report concludes that, although the proposals do not provide the Commission with the mandate, most witnesses accepted that the proposals would have the effect of increasing, at least de facto, the Commission's competence to act on such issues. This is another subject that gives me some concern: because of our very strong position in aviation in Europe we have potentially the most to lose. As witnesses have said, if the Commission is unable to negotiate a truly liberal and unrestricted deal with a third country—and that will, I feel, generally be the case—then there will be winners and losers in Europe. For example, it would not be much use to British aviation if an American airline was given an extra route to this country in exchange for, say, a Greek airline getting an extra route to the States from Athens.
The Air Transport Users Council in its evidence said, at paragraph 17 on page 30:
"The UK is an extremely powerful player in the world aviation scene and, with most third countries, is likely to be able to negotiate an Air Service Agreement that is beneficial to UK industry, the economy and consumers. While the Community is likely to be in an even stronger negotiating position, any benefits that it wins will be spread more evenly among Community Member States and there is no guarantee that the net outcome for UK consumers would be better".
Curiously it goes on to say in the next paragraphs that despite this it still favours the Community being involved in aviation relations with third countries. I believe that the Community making agreements with Switzerland and central and eastern European countries should be as far as we go at the moment. I also dispute the assertion made by some witnesses that the Commission is likely to be in a stronger negotiating position with, for example, the United States than this country is on its own. Where is the evidence for this? It certainly does not seem to be happening with bananas at the moment.
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The committee rightly stresses the importance of ownership and control as the real issue affecting airline competition world-wide, particularly in the European Community and the United States, and that removing ownership and control restrictions is a vital step towards a truly competitive global airline industry. I agree with that, but I would go further. I have already referred to the sorry saga of state subsidy, but while we still have state owned airlines operating in Europe there is always the danger of state subsidy. Those airlines also have an advantage over their private sector competitors in that the state is standing behind their borrowings, etc. Ideally I would like to see all European airlines in the private sector so that they compete on equal terms and all have to stand on their own two feet.
I appreciate that this ambition may take some: time to achieve, as will, I fear, the wish of the committee that we negotiate with the US on relaxing and eventually removing ownership and control restrictions on US airlines. If my memory serves me right, this is not an issue we can negotiate anyway with the United States Government as it is a matter for Congress, which shows no inclination to change the law. Meanwhile in Europe we have to accept that some airlines—some so-called national flag carriers—may not survive the new competitive market, and that will be painful for some. Incidentally, while we do want to see ownership and control restrictions lifted, we do not want to see the emergence of flags of convenience, given their history in the maritime world.
In conclusion, I thank the committee for its report. I am conscious that in the time available to me I have not covered all the issues. I shall leave code sharing for another day. I also note that the Commission's proposals have met with little support from member stales and were not taken up when we held the presidency in the first half of last year. I wonder whether the Minister can let us know the present position so far as these proposals are concerned.
I also note that Sir Michael Bishop, in his evidence, spoke of the learning curve and said that the point in the process by which the Commission should take over all responsibility is a long way away. It could be, he said, five, 10, 15 or even 20 years away, and that the proposals the Commission would like to see enacted are very premature for the airline industry.
Any student of airline competition in this country, or indeed in Europe as a whole, will recognise that Sir Michael and British Midland have done more for competition than almost anyone else, so his words deserve particular attention; and I would certainly not disagree with them.
5.30 p.m.
Lord Whitty: My Lords, I thank the Select Committee, and the noble Lord, Lord Geddes, in particular, for a cogent report. This is not the most accessible area of policy within my department and I have gone through a fairly rapid learning curve myself in preparation for the debate. I congratulate the committee on illuminating some of these areas in relation to both aviation policy and competition policy.

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I have the dual task of putting on the record the Government's response to the Select Committee report and of touching on as many of your Lordships' comments as I can in the process.
Perhaps I may start by focusing on the specific Commission proposals which originally prompted the Select Committee report. Clearly, the Select Committee has understandably and helpfully gone much wider than that. The committee's inquiry was prompted by the European Commission's proposals to amend regulations which apply the Community's competition rules to aviation. In brief, the Commission's proposals would extend the scope of the two regulations to cover services outside the EU. At present they apply only to intra-EU services. In the interests of simplification, I shall use the term "EU" although in some cases it would be more strictly accurate to refer to the EEA.
As far as concerns the political status of the original proposals and in response to the question asked by the noble Lord, Lord Brabazon, I should say that there has been no progress on these proposals in that they were not supported by member states. They were not considered during the Luxembourg, UK or Austrian presidencies and, at present at least, we have no indication that the German presidency is likely to table them for discussion. Nevertheless, they raise some important issues.
As to the present situation, the noble Lord, Lord Geddes, referred to a "something" muddle and others have been even less polite. However, there is a certain clarity about the present position. The Commission already has sole competence for applying the EC competition rules to airline services within the Community. As the example given by my noble friend Lord Berkeley of the flight to Vienna indicates, there is still some way to go in that area. Outside the Community, competence is shared between the Commission and the member states under the transitional arrangements in Articles 88 and 89 of the EC treaty. On cases affecting extra-EU routes, member states have the sole power to grant exemptions under Article 85.3. But even there the Commission has a power of investigation and it may authorise member states to take measures to end any infringements it finds. An example of this shared competence is the continuing investigation into the proposed British Airways- American Airlines alliance which is being conducted both in London and in Brussels.
The full effect of the Commission's proposals would be to confer full powers of investigation and enforcement on the Commission, including the sole power to grant exemptions. As a result, the Commission would investigate and rule on all significant aviation competition cases regardless of what market was concerned. The member state most closely involved would therefore lose its locus except for participation in an advisory committee in which all the other member states would also participate.
The Government believe that competence for the application of the Community's competition rules to aviation should move in parallel with competence to negotiate traffic rights. That is actually what has
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happened historically. The two regulations were originally adopted when a single aviation market in Europe began to emerge and their scope was extended to cover domestic services when such internal services were opened to competition. The principle of parallelism has also applied in dealing with third countries. The Commission has already obtained a mandate to extend the single market to 10 central and eastern European countries. As part of this process it will assume responsibility for applying the EC competition rules on service to these countries. This is entirely logical. The same will apply when the EU-Switzerland aviation agreement is concluded.
There is a clear logic in that parallelism, as a number of noble Lords have implied. However, the Commission's proposals would break that link. As noble Lords have said, for a long time the Commission has tried to persuade member states that it should negotiate on their behalf with third countries. In reality, we are principally talking about the United States. The Council of the member states has declined to give the Commission that mandate.
The UK has been one of the member states resisting the Commission's request because in our view we can best serve the interests of the UK and of the UK aviation industry by negotiating with the US on our own account. Since member states retain the right to negotiate bilaterals with third countries, there is therefore no case for giving the Commission at this stage exclusive competence to apply the competition rules on routes outside the Community. If and when the Commission obtains a mandate and concludes a Community-level agreement with the US, the case for extending competition rules would be much stronger. The Government do not rule out that situation in the longer term. However, we do not believe that it is applicable at this stage. In other words, like the noble Lord, Lord Bridges, we adopt the St Augustine position on this matter. We need to think long term but for the moment we stick to the traditional position, which is supported by many other member states.
If we adopted the regulations as they stand they would extend Community competence into the area of external aviation relations. They include provisions which would mean that bilateral talks would be subject to oversight by the Commission. In effect, the Commission would be achieving some degree of negotiating authority, indirect and secondary though it may be, by the back door when we have not been prepared to grant that by the front door. That is the view of other member states—not just of the UK—and would include some of those member states which have been more sympathetic than us to such a mandate. The committee concluded that it would not support the Commission in negotiating bilateral agreements without a political mandate from the Council of Ministers. The Government very much endorse that view.
Perhaps I may look in a little more detail at the whole question of the EC-US negotiations. The noble Lord, Lord Brabazon, said, probably in relation to this, that things have not changed much since his time as an aviation Minister. The noble Lord, Lord Bridges,

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referred to occasions some time ago when the UK-US negotiations were going on. Although the noble Lord, Lord Mountevans, is correct to say that there have been massive changes in the aviation industry, some principles do not change. It has been our aim for some considerable time to liberalise the UK-US aviation market. The question is whether bilateral or Community-level negotiations are most likely to achieve those aims.
As things stand, we believe that the UK has the chance in the near future to conclude a liberal bilateral agreement with the US, one which delivers the consumer benefits and preserves a framework of fair competition, balance and commercial opportunities for airlines in both countries. By contrast, whatever the theoretical or long-term benefits, a Community-level agreement would take some considerable time to achieve. One reason why several EU member states have so far declined to give the permission a mandate is that there is no agreement on the form that that mandate would take. While some countries, like ourselves, would support a liberal mandate, others would not be ready for their carriers to compete freely in business with the US and other EU airlines.
I agree with what several noble Lords have said that the US's own record is not exactly lily-white in these circumstances. The US has not pursued the pure milk of free competition in relation to aviation and in relation to the protection of their own airlines in regard to slots, landing rights, open skies and ownership. The Commission's present proposal, however, would envisage a dual process in which some countries would negotiate their own transitional arrangements with the US whereas the Commission would negotiate a long-term agreement. Whatever the long-term situation, that would seem impractical and would weaken member states' negotiating position. For example, in our own self-interest, the UK might have to hand over to the Commission our prime negotiating power—namely, access to Heathrow and Gatwick—for the purchase of restrictions or safeguards that would benefit other EU countries. Moreover, throwing our weight behind Community level action would not guarantee an acceptably liberal agreement. In these circumstances we prefer to continue to pursue actively our bilateral negotiations with the US.
I wish to make one further point in relation to competition. I mentioned the scrutiny of the BA/American Airlines alliance. At present, both the Commission and the member states have a role in applying competition laws on extra EU routes. I shall not attempt to deny that the current arrangements are potentially cumbersome. A one-stop shop would remove the need for co-ordination between two sets of competition authorities and the possibility of conflicting decisions. It might also reduce administrative burdens on undertakings seeking competition clearance. I certainly do not question the Commission's ability to take independent consistent decisions. But for as long as member states continue to negotiate bilateral arrangements with third countries they have an important role to play, and their role must be safeguarded. Their knowledge and understanding of the
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relevant markets are crucial for robust analysis leading to defensible competition decisions that are fair to all parties concerned.
I now turn to the wider questions of airline competition which the Select Committee addressed. It is clear, as the noble Lord, Lord Skelmersdale, and others indicated, that airlines are different from other areas to which competition rules apply. It is also true, as the noble Baroness, Lady O'Cathain, indicated, that lower prices are not the only measure of the benefits to the consumer. As the noble Lord, Lord Methuen, indicated, there are in any case different kinds of consumer. It is also the case that consumer benefit is not the only interest that the Government have to pursue. There are environmental and planning considerations which also have their role to play.
In the EU, the UK has played a leading role in the establishment and development of the single European aviation market. Outside the EU, we are now seeking to liberalise our arrangements with other countries. However, we are inevitably constrained in some cases by the speed with which our bilateral partners are prepared to open markets. Last year, the CAA published a major report on the first five years of the single aviation market in Europe. While acknowledging that there was substantial room for improvement, the CAA concluded that on many routes competition had led to substantial price reductions for business as well as for leisure travellers. A number of major EU airlines have been privatised. Even among those that have not, there seems to be a growing recognition that a more commercial approach is needed. Those are benefits.
On the global front, major airlines are increasingly seeking to compete more effectively by forming alliances so as to reduce costs and be able to offer improved network services to passengers. As part of that process major airlines develop services at their "hub" airports, and operate an extensive range and frequency of services. Effective competition between airlines may take place nowadays, either head-to-head on specific routes or between alliances offering competing indirect services out of different hubs.
A number of noble Lords referred to the strong competitive position of the UK aviation sector. BA is obviously our major carrier, competing effectively with the largest airlines worldwide. But, uniquely in the EU, the UK is fortunate to have a substantial number of successful competitor airlines operating in the short haul markets, such as British Midland, and in the long haul markets such as Virgin. We also have an energetic and innovative low-cost airline sector, as the noble Lord, Lord Brabazon, and others have said. We will continue to seek to open aviation markets wherever possible, to promote the interests of consumers and at the same time to maximise commercial opportunities for all UK airlines.
At this point perhaps I should respond briefly to the committee's points in relation to block exemptions. The committee was concerned that the continuance or any immunity of block exemptions from competition law should be strictly justified and in the interests of the consumer. The Government fully agree with the

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committee that any continuance of those block exemptions should be strictly justified in the interests of the consumer and the promotion of competition. The Government therefore support the Commission in its moves to withdraw block exemptions where they are no longer justified.
The other aspect of competition is the ownership and control of airlines. There are anti-competitive situations on both sides of the Atlantic. The Government agree in principle with the committee that the airline industry should ultimately be subject to the same competitive conditions as other industries. We agree that the traditional restrictions on ownership and control of airlines hinder the development of competition. Although within the EU national ownership restrictions have been broken down, as Community carriers may be owned by nationals of any member state, at the wider international level such changes can only be addressed on a reciprocal basis. We in the UK urge all our bilateral partners to adopt more liberal arrangements. However, progress can be achieved only by consent. That will mean that the break-down of ownership restrictions is likely to take some considerable time. Nevertheless, some bilateral agreements have been reached with other states.
I now move tentatively into the area of slots—the "thick jungle" referred to by the noble Lord, Lord Geddes. The availability of take-off and landing slots and their related services is an important constraint on airline competition at any airport where demand is greater than supply. That applies particularly in the UK at Heathrow and Gatwick, where there are virtually no free slots at peak times. The process for allocating slots at congested airports is prescribed by European regulations.
The committee expressed concerns over the current system of slot allocation and a number of noble Lords have repeated those concerns today. This is a pretty complex area. On the one hand, grandfather rights have their benefits. They enable airlines to plan ahead and to invest in route development with confidence. However, the time may well have come to question whether that is outweighed by the anti-competitive effect at congested airports.
It has been suggested that slots should be auctioned or traded between airlines as a means of supporting competition. Others believe that that would tend to favour the larger carriers with the greatest financial clout. Clearly there is an element of truth in that. Much would depend upon the overall package and the constraints that governments in the EU placed on the ability of airlines to buy and sell or acquire slots in that way. The Government believe that further consideration needs to be given to the implications of different regimes before they can reach a view on the desirability or otherwise of introducing some form of market mechanism into the slot allocation process.
A recommendation of the committee was that the Government should consider allocating a number of slots at major airports to maintain regional air services. The UK has already made proposals to the Commission that priority in the allocation of slots not
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claimed under historic precedence should be given to airlines that wish to use the slots for services to regional airports. The House will know that the Government are committed to developing regional airports and have made substantial moves to provide open access to all regional airports to bilateral partners on a reciprocal basis, and have relaxed controls, for example, on local authority owned airport borrowing powers so that we can develop airports such as Manchester and elsewhere.
My noble friend Lord Montague raised a separate question, although it has some bearing on the competition area. It relates to air passenger duty. I am not aware of what has gone on in another place while we have been here. However, the situation prior to today was clear. The aviation industry is subject to relatively little indirect tax. The fuel used in international air travel is free of excise duty, unlike the fuel used in other modes of transport. As my noble friend Lord Berkeley implied, this is a slightly bizarre situation. Nevertheless, air passenger duty helps to offset that lack of taxation on aviation fuel and therefore broadens the national tax base.
In supporting APD, the Government do not believe that it indicates a disproportionate burden on air transport, nor do we believe that it is unfair to passengers. APD is payable on all departures from UK airports. It is different if we are travelling to EU or EEA countries where the APD is levied at £10 or £20 for other destinations. There is therefore a distinction between Zurich and Geneva in that passengers at Geneva, as at Basel, can disembark in France. Therefore, the EU/EEA rules apply, whereas in Zurich one is wholly in Switzerland and does not have the choice.
A number of other issues were raised in the course of the debate. Those matters raised by the committee give rise to serious questions in relation to the immediate period of competition policy in the UK and at EU level. They also raise issues of what the long-term position should be throughout the EU. As several noble Lords said, central to it is the fact that the aviation industry is one of which the UK can be proud. It is an industry whose development over recent years has put it in a position of considerable strength. We should make no changes which reduce that strength. We agree with the committee that airlines in the UK are well placed to cope with the challenges of the future. As noble Lords said, the increased competition has brought benefits to consumers and to Britain as a whole, as well as to British-based airlines.
There are existing restrictions which we need to change and dismantle. We shall look at ways in which to do so, but it will not happen overnight. We are committed to further liberalisation but we must be realistic that it will be harder to establish liberalisation more broadly than in the EU with countries with which we have less in common and many of which have national carriers to defend.
The European Commission will rightly continue to exercise an important role in regulating airline competition. But as my honourable friend

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Glenda Jackson explained in her evidence to the committee, we believe that those particular proposals from the Commission which gave rise to the report are premature. The Government, like the committee, cannot support proposals to extend the Commission's power to apply competition rules at this stage to extra EU services while member states continue to negotiate bilaterally with third countries. But we agree with many of the recommendations contained in the committee's report. I am grateful to the committee and to your Lordships for your contributions this afternoon. I have no doubt that the debate will continue.
5.53 p.m.
Lord Geddes: My Lords, following the correct statement by my noble friend Lord Brabazon, I too should have declared an interest and now do so as a non-executive director and very small shareholder in two small regional airports, one at Biggin Hill and one at Southend. I hasten to add that we have no slot problems at either airport so I cannot conceive that there is any conflict of interest, but I apologise to the House for not mentioning it at the beginning.
It would be invidious for me to try to comment on all noble Lords' speeches, other than to thank them most sincerely. The debate can best be summed up by my noble friend Lord Brabazon who succeeded in speaking from my own Front Bench for three minutes longer than I did in introducing the debate. That must show some degree of the interest that the subject provoked. If I may be a little naughty, I hope it may also show that on this side of the House we do not always speak with the same voice. So to say that we are all of one political persuasion in the broader context is not correct.
I thank most sincerely all noble Lords who have spoken, not least the Minister. His was an interesting and comprehensive reply which I wish to read at leisure and perhaps pick up points with him, if appropriate. I also specifically thank the noble Lord, Lord Berkeley, who sat in for me in Sub-Committee B on a number of occasions at the end of last year when I was unable to chair it. I was and still am extremely grateful to him for taking that role on his shoulders.
I can best sum up the position on which the committee found themselves unanimous by quoting from three paragraphs of our conclusions. Perversely, I start with paragraph 132 where we said that:
"Airlines have been afforded special treatment in the European Community's competition policy for historical reasons. We believe that these reasons are just that—historic. While we fully recognise the importance of safety standards and controls in the airline industry these should not inhibit the creation of a more competitive airline industry worldwide".
I then, curiously, go backwards to paragraph 131:
"The true negative effects on competition within the European Community do not come from geographical Europe but from distorted competition between the European Community and other large airline markets, notably the United States".
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Finally, I go back to paragraph 106 where we said—and we had no doubt at all, despite the wide spread of theoretical political opinion within the committee—
"We consider that the responsibility for regulation of airline competition should lie at the highest practical international level. In the case of these proposals, this means the European Commission".
We stated that. We believed that. I commend the report to the House.
On Question, Motion agreed to.

Births and Deaths Registration (Amendment) Bill [H.L.]
5.56 p.m.
Lord Elis-Thomas: My Lords, I beg to move that this Bill be now read a second time.
There has been provision since 1969 for births, still births and deaths to be registered in both Welsh and English where the event takes places in Wales and where a qualified informant is able to give the information in Welsh to a registrar who can speak and understand Welsh. That arose from the context of the Welsh Language Act 1967.
This proposed Bill is an extension of those rights already in the statute. The Bill appears in the context of the Welsh Language Act 1993. As I have told the House on a number of occasions when dealing with issues of this kind, I was privileged until the end of last month to be chair of the statutory Welsh Language Board. I wish to acknowledge the assistance of the board and of ONS in the discussions that brought about the Bill.
The purpose of the Bill is to extend the provision to events taking place in England where the informant wishes to give details in Welsh. Under the original Births and Deaths (Registration) Act 1953, it is required that an event is registered by the registrar of the sub-district where it takes place. The facility to register an event bilingually obviously has not been available to Welsh residents. That has been a particular cause of concern for parents where births take place in England and also where the family of elderly persons and persons suffering death in England are unable to register the event bilingually.
The Bill overcomes the difficulty that might occur where the local authorities that administer the service in England require to do so bilingually by establishing a central register of births, still births and deaths occurring in England where Welsh speakers would seek bilingual certificates on payment of a prescribed fee. Welsh speakers will be able to make a declaration of the particulars to be registered before a registrar in Wales; the registrar will then send the declaration to the registrar for the district in England where the birth or death occurred and it will be registered in the normal way. The declaration would then be forwarded to the Registrar General who would record the details in the central register in both Welsh and English. That is the main effect of the Bill.
There are two further aspects which I must mention. The first is to allow for certificates to be issued in Welsh or English. That is not possible at present. The Bill

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provides for the issue of certified copies containing the Welsh-only or the English-only particulars from any bilingual entry of birth, still birth or death. Bilingual certificates will continue to be available, but the English and Welsh languages will now be placed on a basis of equality as far as this legislation is concerned.
I also take advantage of this opportunity to put into effect the provision for short certificates of death. There is currently provision for short certificates of birth containing prescribed information extracted from the birth entry. There is no similar provision for still birth and death certificates. That is made available in the Bill.
This Bill is a small piece of legislation which extends the existing statutory rights available bilingually. The ONS already has experience of central registers which are operated bilingually, in relation to surrogacy, abandoned children, adopted children and so forth.
I hope therefore that the Whole House can support this Bill, which operates within the spirit of the existing Welsh language legislation. I beg to move.
Moved, That the Bill be now read a second time. —(Lord Elis-Thomas.)
6.1 p.m.
Lord Teviot: My Lords, it is a great pleasure to speak in support of the noble Lord, Lord Elis-Thomas, as I have been connected for a very long time with the registration service.
This short Bill will add lustre to the service. Thankfully, most of the original 1836 Registration Act remains in force. I think I am right in saying that certificates of births, marriages and deaths issued in Wales have always been issued in the two languages without any problem. The legislators in the 1830s were surprisingly enlightened and introduced various social measures, including this one.
Can the noble Lord tell me whether he has any news about the progress of the registration review which is now taking place? Especially, is there any news of the original 75 or 100 year-old registers being made public? Unfortunately, these records were not classed as public records in the Public Records Act 1958. I myself introduced no fewer than three Bills in the late 1970s and early 1980s for these records to be transferred from the Registrar General to the Public Records Office. The last time was in 1983 when the Bill, suitably drafted, was passed in this House, only to fail in the other place due to the dissolution of Parliament before the general election of that year.
This point is of particular importance to Welsh people because of the large number who have patronymic surnames. Genealogy and family history are of great interest and a hobby for many, but it is difficult to identify particular people from indexes. For example, in trying to find a John Jones or a William Jones living in a certain quarter of Merthyr Tydfil in the 1850s, one would probably find five or six in that registration alone. Open access to the original registers should make it much easier for people to trace their ancestors.
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As we are on this point, and not wishing to miss an opportunity of this kind, I should like to point out to the noble Lord, and to the noble Lord, Lord McIntosh of Haringey, who will be speaking later, that many of the original indexes in the local registry offices, as well the registers, are in a bad state of preservation due to age, storage and use, although it is now understood that such records should be kept in a proper repository. I am sure that for one reason or another this is very difficult. But do the Government have any plans for how to deal with this problem?
To return to this Bill, it will be important for Welsh people living in England to record an event in their own language. It is important that people retain their own identity, and this Bill will help to fulfill that aim.
Finally, I hope that I have nothing to fear on the outcome of the registration review and that nothing radical will happen. The registration service rightly has a proud history. Please let it remain. A little tweaking is perhaps needed, but a major upheaval is not.
6.5 p.m.
Lord Prys-Davies: My Lords, I was delighted to see this very useful Bill in the legislative machine. I am grateful to the noble Lord, Lord Elis-Thomas, for that achievement.
The Bill deals with what may appear to be a small issue, but it is an issue of great significance to a growing number of our Welsh citizens who wish to preserve their identity. The Bill confers a right and at the same time removes a grievance. As the noble Lord mentioned, he has recently left his distinguished position as the first chair of the Welsh Language Board. During his tenure of office one of his aims was to seek to remove obstacles and barriers to the use of Welsh in transacting official business. The Bill which he has introduced this evening will, if enacted, secure one additional reform.
The noble Lord has described the background to the Bill and has explained with clarity what it proposes to do. I believe that Clause 1 is the right way out of the problem which he illustrated and with which we are familiar. I am grateful that he has also explained Clause 2, which had baffled me at first reading.
I believe that the Bill is based on consultations with the appropriate bodies in Wales and that there is consensus on it in Wales. I am also grateful that the noble Lord, Lord Teviot, spoke in support of its contents. I therefore trust that the Bill will be acceptable to the House.
May I say in passing that, since the Welsh Language Act 1967 and particularly since the Welsh Language Act 1993, we have seen a remarkable growth in the use of Welsh in official transactions and documents, and I warmly welcome this development. I believe, however, that we have to address our minds to what authoritative body there should be recourse in order to validate new Welsh terminology which is rapidly coming on stream. What is the place to which translators should go for advice? This question was first posed by Sir David Hughes Parry in his report on the status of the Welsh language which he produced in about in 1965. The question remains unanswered.

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I have been hesitant in raising the matter because it could be misunderstood. However, I receive letters on this issue from time to time from skilled translators of Welsh who think it is important that there should be a centre to which they can go for and obtain prompt guidance. I believe that this is also a concern of Cymdeithas Cyfieithwyr Cymru, the professional body that represents the interests of translators who work through the medium of the Welsh language.
These observations are not addressed to the noble Lord, Lord Elis-Thomas; rather, they are urged upon the Welsh Office. I believe that there are many in Wales who would consider it a major contribution to the Welsh language if the Welsh Office put its weight behind the case for such a language centre. That is a case which has been developed elsewhere in detail. I would be grateful if my noble friend Lord McIntosh would convey that plea to his ministerial colleagues in the Welsh Office. If the case for such a centre still has no appeal, I fear that we may find ourselves worse off one day.
To revert to the Bill, I again thank the noble Lord, Lord Elis-Thomas, for introducing this Bill, which is a contribution. I hope that my noble friend Lord McIntosh will be able to confirm that the Bill is supported by the Government, that the House will give it a Second Reading and that it will have a speedy passage through your Lordships' House and another place.
6.11 p.m.
Lord Geraint: My Lords, my colleagues and I on the Liberal Democrat Benches wholeheartedly support the Bill so ably introduced by the noble Lord, Lord Elis-Thomas. I remind the House that the noble Lord and I were elected to the other place in 1974. We both took the Oath in Welsh in March of that year. In October 1992 we were both elevated to your Lordships' House on the same day and took the Oath in Welsh. We are both Welsh to the core, and proud of it. We both believe in the politics of persuasion, not confrontation. That is our intent today in seeking to persuade the Minister to accept this Bill.
In the 1980s many politicians persuaded the then Conservative government to give the people of Wales their own Welsh television channel, S4C, which has now turned out to be a great success under the chairmanship of Mrs. Elan Closs Stephens of Aberystwyth. The people of Wales owe a great debt of gratitude to the noble Lord, Lord Cledwyn of Penrhos, for his uncompromising stand during the passage through this House of the S4C Bill. The noble Lord is well respected both in your Lordships' House and in his native Wales. We can only say thank you to him today for his endeavours.
We are also indebted to the previous Conservative government, especially the noble Lord, Lord Roberts of Conwy, for introducing the Welsh Language Act 1993 which I believe is the cornerstone of the Welsh language for generations to come. I congratulate the noble Lord, Lord Elis-Thomas, on having chaired the Welsh Language Board with distinction over the past four or five years. Finally, I thank the present Government for giving the people of Wales the right to govern
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themselves. But what the people of Wales really need is their own parliament, with the same powers as those that have been given to our Celtic friends in Scotland. The noble Lord, Lord Elis-Thomas, I and many other politicians in Wales are determined to see their dream come true one day. I wish the Births and Deaths Registration (Amendment) Bill well, and it is worth supporting.
6.15 p.m.
Lord Cope of Berkeley: My Lords, this Bill also seems to me to be a useful reform. I echo the thanks of the House to the noble Lord, Lord Elis-Thomas. I took the Oath in another place in the same month as the noble Lords, Lord Elis-Thomas and Lord Geraint, but in English. I took rather longer to cross the Central Lobby and take that Oath in English at this end, but I did so hand in hand, as it were, with my noble friend Lord Roberts of Conwy, who unfortunately is not well at the present time. The Welsh aspect of the Bill has been fully covered and appears to be satisfactory to the Welsh-speaking residents of England. I live in the Marches. We try to get along with our neighbours as well as possible.
The other provisions have received a little less attention this afternoon, for example those relating to short certificates. I believe that they will be of equal assistance. People want to register a death, for example, when the deceased was a shareholder with the company concerned. On such occasions the cause of death is immaterial to either the relative of the deceased or the company. I believe that this is therefore one field in which freedom of information, otherwise supported by the Government, can be curtailed and less information given on the certificate. I support the Bill.
6.16p.m.
Lord McIntosh of Haringey: My Lords, I am grateful to the noble Lord, Lord Elis-Thomas, for bringing forward and explaining the Bill. It will be welcomed by those members of the public who are unable to avail themselves of the facility to have a birth, still birth or death which takes place in England registered in both the Welsh and English languages. It also extends the principle of equality of treatment of the Welsh and English languages, as promoted by the Welsh Language Act 1993. We understand the importance of being able to have a record in Welsh as well as in English of the significant milestones in family life, and we are pleased that the Bill extends the circumstances in which the Welsh language may be used.
The registration service has always been in the forefront when it comes to providing Welsh language facilities. It began to provide bilingual registration in Wales as soon as possible after the Welsh Language Act 1967 came into force. In 1999, when the people of Wales acquire their own Assembly, we are pleased that these new language rights can be provided. Before I leave this point, I should say to my noble friend Lord Prys-Davies that officials of the Office for National Statistics will consult the Welsh Language Board and the Welsh Office about the translations. My noble friend's comments on the translation will be

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welcome at the drafting stage. I shall ensure that both bodies are aware of his wider concerns about the quality of translation generally.
In addition to the very welcome extensions that this Bill makes to facilities for Welsh language registration, there are benefits, such as those referred to by the noble Lord, Lord Cope, for others who use registration services throughout England and Wales. Currently, with the exception of a shortened form of birth certificate, any certificate that is issued must include all the information that is registered, together with the details of any correction. The Bill contains order-making powers that will be used to make available other shortened forms of certificates, for example where the cause of death or correction to the information recorded in a register entry may be distressing to the family or the individual. We are aware of cases currently where families are concerned that death certificates containing intimate details of a loved one's last illness must be provided to banks or building societies when closing an account. We can understand the embarrassment that arises where details of a child's father have been struck out of the birth register and a full certificate highlights that alteration. I am sure that noble Lords will agree that any measure that helps to ease distress in such circumstances is to be applauded.
The Government therefore support the Bill which has cross-party support and seeks to implement one of the recommendations of the White Paper Registration: Proposals for Change published in 1990. That White Paper recommended a number of largely technical reforms of the registration service in England and Wales. Although some of the recommendations contained in the White Paper have been implemented, many remain outstanding. The fact that this route has been sought to implement one of the recommendations is welcomed by the Government.
This Government are committed to the reform and modernising of the Civil Registration Service. The service has its roots firmly embedded in early Victorian legislation. The prescriptive nature of that legislation is impeding its development in the wake of social and technological change. The Economic Secretary to the Treasury has commissioned a review of the civil registration service in England and Wales by the Registrar General. The aim of the review will be the establishment of a framework for the service which is more responsive to the needs of modern society without compromising its fundamental purpose and integrity. I can say to the noble Lord, Lord Teviot, that it will include options about access to records and to the conservation of older records to which he referred.
The Government are pleased that there will be no charge to members of the public wishing to have events recorded in the central register. The cost to the public purse is likely to be minimal because there are already facilities—forms in Welsh and software—for registration in Welsh and English. There are also other centrally held registers which are already administered by the Registrar General.
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There is no obligation to make any declaration about human rights compatibility for this Private Member's Bill. However, I can confirm that the Bill is compatible with the European Convention of Human Rights. This is a Bill which is in line with the best principles of the Government's initiatives in service choice for the citizen and support for families. I hope that your Lordships will give it swift passage.
6.20 p.m.
Lord Elis-Thomas: My Lords, I am grateful to the Minister for his response to what has been a wide-ranging debate and for indicating the government welcome for this route, implementing proposals on the short certificate as set out in the White Paper, Registration: Proposals for Change. As the noble Lord emphasised, the measure will bring much comfort to families in bereavement.
We received support from the noble Lord, Lord Cope. It is always welcome in the Principality to receive support from the Marches. I am pleased at the cross-party consensus in this House on linguistic matters. It does not seem always to be the case outside the House. However I shall not go into that issue today; there will be other opportunities.
I was also grateful to the Minister for referring to the Registrar General's review of the registration service. No doubt it will reflect discussions on the issue raised by the noble Lord, Lord Teviot, to whom I am grateful. It is somewhat late to do anything about the Welsh patronymic issue at this stage. It is always possible to hyphenate names, but that sometimes complicates matters.
I am grateful to the noble Lord, Lord Geraint, for his wide-ranging discourse on Welsh history and politics. I have always appreciated his lead for consensus on important issues. I do not wish to digress to the powers of the National Assembly. However, the way in which we deal with primary legislation affecting Wales specifically will be a matter for some reflection in the future. I look forward to a developing relationship, through concordats or other means, between the Office for National Statistics and other arms of government and the Treasury and the National Assembly.
I am also grateful to the noble Lord, Lord Prys-Davies, for his intervention and expression of good wishes on my term with the Welsh Language Board. He was a strong supporter and advocate of bilingual registration for many years. I share his interest and concern in terminology and effective translation. Indeed, three years ago the noble Lord was responsible for preparing a detailed report on the subject for the Welsh Language Board. The Minister indicated that he will convey to the Welsh Office that it is a matter for consideration as it approaches transformation into the new Assembly.
I shall also convey points raised in the debate to my successor at the board, Mr. Rhodri Williams. I extend my good wishes to him. I am sure that he will wish to respond to the noble Lord, Lord Prys-Davies.
I again thank the ONS for its assistance in the preparation of the Bill and for the way in which it has pursued the issue of bilingual registration with such care

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and concern. I again thank my former colleagues on the Welsh Language Board for their assistance. I hope that the House will give the Bill a Second Reading.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Obscenity Bill [H.L.]
6.25 p.m.
The Earl of Halsbury: My Lords, I beg to move that the Bill be now read a second time. I do so somewhat nostalgically as I feel that this may be my swan song. Aged 91, I cannot believe that I shall be included among the 91 hereditary Peers on whom the axe will not fall in October, or whenever.
I begin by explaining how I became involved in this unsavoury subject. In about 1994, the noble Baroness, Lady Cox, finding herself overcommitted in the field of good works, asked me to take over a commitment that she had made which she found herself unable to fulfil. It was to chair a committee of inquiry into pornography, violence and the media. Being a member of the family child protection group whose chairman was the noble Baroness, Lady Knight, (then Dame Jill Knight), I felt that I could not take this matter on without her agreement. However, she decided to absorb that activity into the activities of her committee. So that was done. The noble Baroness was succeeded by the noble Lord, Lord Ashbourne, whom I am glad to see in his place. In due course we published the report.
It is no good publishing a report and leaving it at that. I felt that I was under some obligation to incorporate the recommendations of the report into a Bill which received its Second Reading in your Lordships' House in December 1996. It was overtaken in subsequent months by the impending general election which brought all business between the two Houses more or less to a standstill. During 1997–98, I was to some extent left on a free rein because I promised the incoming Government that I would not embarrass them with a controversial Bill during their first year of office; but that unless a measure was in the Queen's Speech preceding their second year of office I would resume my freedom of movement.
Accordingly, I embarked on a piece of research which had been on my mind for quite some time. Your Lordships may remember that a number of years ago an exhibition was put on by the police, I think in the Grand Committee Room, to instruct your Lordships and another place on the real bestialities which go on in the world of commercial pornography. In the course of discussions with a senior member of the vice squad—I cannot remember whether that expression applies to this country or America—I asked why he did not attempt an ostensive definition of pornography. The word ostensive is a linguistic expression derived from the Latin ostentare, to show. One teaches children the meaning of nouns by showing them what they stand for. One says "dog" and points to a dog; and one says "daffodil" and points to a daffodil. That is how children learn their basic vocabulary. So I asked, "Why don't
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you make an ostensive list of all pornographic items which will appear in legislation?". He shook his head at me and said, "You would never come to the end of it. It simply could not be done".
Being at a standstill in 1997 and 1998, I decided to find out whether it could be done. I made friends with the secretary and the librarian at the Royal College of Psychiatry, which has a prestige address in Belgrave Square. On my way to the House for Questions each day, I called in at the Royal College and did some homework in the library. Shelves full of books went through my hands. I turned to the indices and read them through until I came across a familiar term. I then turned to the text to see what it was. If it was what I wanted, I wrote it down. That is the origin of the schedule to the Bill. I commend it to your Lordships as at least a piece of research which will be useful on a future occasion, even if your Lordships do not like the shape of the Bill.
I included in the Bill a preamble which, on the advice of friends, the Public Bill Office and the parliamentary draftsmen who advised, I have instead included in the text of the Bill. It may sound obscure, but I wrote as a preamble:
"Whereas the young or the innocent at any age may by chance or through curiosity or seduction be led to peruse matter listed in the schedule to this Act, habitual recourse to which for the purpose of enjoyment may lead to corruption and depravity and their harmful consequences … Be it enacted",
and so forth. The essence of that appears in the middle of the Bill. If one ties the legislation only to corruption and depravity, defence counsel will turn to the jury and say, "You have read it. Do you feel corrupted and depraved?". Of course, no one feels corrupted and depraved by reading something for the first time. It is corrupting and depraving when one has habitual recourse to it for the purpose of enjoyment.
I used two terms; "the young" and "the innocent at any age". By "the innocent at any age" I had in mind, for instance, a young priest or a novice nun who might be of full legal age but has never seen the evil side of life and might come across it by accident; left behind in, say, the dentist's waiting room.
Having defined the Act, I had to make a list of activities, which appears in the Bill, engaged in circulating the obscenities. It can be imported; it can be manufactured in this country; it can be reproduced by some photographic process after it has been manufactured; and so forth. It is another list.
In the context of those lists, I came across a legal doctrine which needs a little understanding because it is in Latin. It is, citatio unius exclusio alterius, which means that in mentioning one thing one excludes the other. It applies particularly to the relationship between species and the members which constitute that species. If you want to make a selection of members, you just recite that phrase. If you want to have the whole species, you just recite that phrase. If you try to mix the; two and include the species and some of its members, you exclude all the others. I did not invent the doctrine; it is a legal doctrine about which I needed a great deal of help. By the time my advisers had finished with the Bill it was in a different state.

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I have referred to this occasion as my swan song and I am reminded of a little jingle I heard when I was young:
"The swan, the poets say, before it dies doth sing,
T' would be a better thing
If some performers die before they sing".
I hope that my exposition will not make your Lordships believe that the Bill were better dead! I beg to move.
Moved, That the Bill be now read a second time. —(The Earl of Halsbury.)
6.35 p.m.
Viscount Brentford: My Lords, I congratulate the noble Earl on his tenacity in returning to this subject once again and bringing it before your Lordships. He has been working on it for many years. I congratulate him also on his research enabling him to list in the Bill some 40 nouns and phrases. I further congratulate him on his opening speech and hope that the swan will continue to sing on many occasions, at least during the coming year.
The noble Earl said that, for him, the subject went back to 1994. I can claim that, for me, the subject goes back to the 1950s when my father, as a Member of another place, was a member of a committee which led to the Obscene Publications Act 1959. I have memories of travelling in our car to London with my parents. My father read some documents out aloud and my mother became highly emotive as we drove along the road, such was the language that was being read. Therefore, I have a remote interest to declare.
That legislation produced as a test "that which is likely to deprave and corrupt". The jury would be asked whether they felt depraved and corrupted by the material and counsel could wheel in sex therapists and sexologists to prove to them that the pornography could be helpful to impotent people and assist them in their sexual exploits. They would argue that it certainly did not deprave and corrupt.
Today, we must ask ourselves what values we wish to see permeated through the media and publications generally. Last night I watched a few minutes of a programme on sex education. It showed some teenage children who had indulged in sexual activity. Their parents were horrified by the fact that their son or daughter had met the person of the opposite sex only half an hour or so before engaging in sexual activity. Are our teenagers learning such values and, if so, from where? A television series about homosexuals tells a story of an adult male indulging in sexual activity with a 15 year-old (under-age) boy. I believe that that promulgates two values: first, that it is all right and positive to break the law; and, secondly, that sexual activity without a relationship is also positive and good.
What are the values that we wish to inculcate? Is pornography in any way contributing to our values? I believe that it is. It is a serious problem. Therefore, I welcome attempts to look again at this subject to see whether or not we can bring about some restrictions
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which will enable publications to produce positive values and not what I believe are extremely negative ones.
We have the highest rate of teenage pregnancy in the world. Is that a fact of which Parliament can be proud? We should be tackling this subject again. Your Lordships' House is perhaps the best place to begin that work. Whether this skilful Bill is the best way in which to carry forward that work is a question open to mind. I can see great advantages in it because if any charges are brought under it, it will be necessary to determine questions of fact rather than of opinion.
In the past few years there has been mooted an alternative phrase—that which is offensive to a reasonable person. Should a phrase along those lines be the basis in law rather than having an all-embracing schedule of activities? I was under the impression that the Home Office felt quite warmly towards that phrase as an alternative method of trying to tackle the subject again. I shall be interested to know whether the Minister has any views on that. An ideal way to tackle the subject of obscenity today would be for the Government to include a new definition, one way or the other, in law.
The phrase "that which is offensive to a reasonable person" leaves the issue clearly before the jury as to what would be offensive to them. It takes away the role of the expert sexologists who say that no pornography depraves or corrupts. It is purely left to the jury to decide. I prefer that.
However, it is important to tackle the subject of obscenity one way or another to try to restrict it so that it is possible to stop the ever-increasing wave of obscenity which is hitting us from every direction. If our civilisation is to survive, we need to tackle the subject and curtail it so that we do not become one of the most depraved and corrupt nations in the world, which is the direction in which we are moving.
Therefore, I support the principle of the Bill. I look forward to hearing whether any noble Lord has other ideas as to the best way to tackle the subject. I warmly welcome the fact that the noble Earl has drawn attention to it.
6.43 p.m.
Lord Annan: My Lords, I must congratulate the noble Earl on the charm with which he introduced the Bill. Anyone in his 90s, like the noble Earl, or even someone in his 80s, such as myself, has seen an enormous change in the nation's response to sexual morality. Things which were unmentionable in public, and just as unmentionable in the bosom of the family, are now bandied about in the media.
At the moment, it seems that we are a nation obsessed by sex. How did that come about? It is the result of 150 years or more of sexual repression. Towards the end of the 18th century, the influence of evangelical religion began to change public opinion. Restoration comedy, which was itself a reaction against Oliver Cromwell's diktats of closing the theatres, gave way to Sheridan's polite comedies; Fanny Hill gave way to Fanny Burney's novels. And then came the good Queen Victoria, who was repelled by the example of

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her loose-living uncles and presided over an age of sexual repression. We all know of Thackeray's complaint that in his novels it was impossible any longer to depict a man. We all remembered Dickens's great characters—Mr. Podsnap and Mr. Pecksniff.
Things relaxed a little in the 1920s, but right up to the Second World War the details of sexual behaviour were still taboo. Even then, books were prosecuted, films censored to a degree unbelievable today and the visual arts were policed for obscenity.
Then came the Wolfenden Report and the passage of the Obscene Publications Act 1959. The dam burst. Prosecutions of novels like Lady Chatterley's Lover were thrown out by juries and the new game was to outdo one's rivals in shocking the public. After nearly two centuries of repression, is it any wonder that there has been such a violent reaction? Is it any wonder that all sorts of people revel in the fact that now they can see or read about things for so long forbidden?
I turn to the Bill. I was delighted by the noble Earl's account of the research that he had done, but I wondered whether he had read the report of the committee on obscenity and film censorship of 1979, Cmd No. 772. I ask because the Williams Report recognised, just like the noble Earl, that the present law is in a mess. Obscenity is not covered solely by the 1959 Act. A dozen or more Acts are involved—some prior to and some post 1959. In eight appendices, the workings of the present law were put under the microscope and the laws of other countries were examined. The report itself ran to 166 pages.
That committee considered that the terms "obscene", "indecent" and "depraved and corrupt" had outlived their usefulness in legislation. The law should be drafted on the basis of harm caused by the existence of the material in question. The public has a legitimate right and interest in not being offended, but harm alone can justify prohibition.
That means that only a small class of material should be forbidden to those who want it because it is not likely to cause harm. Moreover, the printed word should neither be restricted nor prohibited. It is not immediately offensive.
More important, the report argued that it would be an error to treat all the media uniformly. At paragraph 12.7 it stated:
"No one can dispute that reading a magazine, watching a live show and watching a film are three very different experiences".
That was why, for example, the committee wanted a special board of film censorship to be set up.
The items to be banned were similar to those which the noble Earl cites in the schedule to his Bill; namely, sexual, faecal or urinary functions and genital organs and, in addition, scenes of violence, cruelty and horror. The restrictions should apply to matter or to a performance which is easily available. It shall no longer be a defence to say that an item had an intrinsic merit. As I read new Section 2A(4)(a) in the Bill, it still permits that kind of defence.
The Williams Committee went on to reiterate that the principal object of the law should be to prevent material
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causing offence to reasonable people. Only a small class of material should be forbidden to those who want it. To carry prohibition further would be to go against the principle that an assessment must be made of the likely harm to people of an article that some may well dislike.
I hasten to reassure the House that I do not intend to summarise further the arguments and recommendations of the Williams Report. I merely wish to emphasise that to change the law relating to obscenity is a very complicated matter. The noble Earl's method of changing the law seems to be like detonating a landmine and blowing up everything. The Williams Committee preferred to identify targets and pick off those offending practices with a rifle.
I shall take one example from the Bill. New Section 2A cites certain exceptions to the kind of events that the Bill would criminalise. Among those is one provision that states that no offence would be committed if the article is published or publicly exhibited,
"in the interests of art, literature or science".
These days the defence could argue that everything that the noble Earl deplores could be slotted under one of those three headings. Who has not seen pornography purporting to be a part of a sociological scientific study of certain practices? It is not only Lady Chatterley's Lover that would survive the accusation of praising anal intercourse. We have seen that juries will not convict simply because a book describes the kind of practices that the noble Earl cites in the schedule.
Finally, I cannot find in the Bill whether it would be illegal to simulate some of the acts in the schedule. We do not see coitus practised in films shown at the cinema, but we see it simulated all too often. If simulation is to be an offence, I believe that the noble Earl will achieve something far greater than Oliver Cromwell achieved, in that all cinemas would be closed and a good deal of television banned.
Of course, I do not intend to vote against the Second Reading of the Bill, nor will I oppose it in Committee or on Report unless the Government decide to endorse the Bill in another place. I await the Government's view with considerable interest.
The Earl of Longford: My Lords, before the noble Lord sits down, may I ask him where he got the extraordinary idea that Queen Victoria was repelled by her loose-living husband?
Lord Annan: My Lords, did the noble Earl say "loose-living husband"?
The Earl of Longford: My Lords, yes.
Lord Annan: My Lords, I said "uncles"—not the Prince Consort!
6.54 p.m.
Lord Ashbourne: My Lords, I shall not detain your Lordships long. I want to commend the noble Earl, Lord Halsbury, for his perseverance in bringing this matter to our attention for a second time. Many of us in this House and in the wider public are astonished that

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the law does not have more teeth with which to deal with the horrific material that some of us have had the misfortune to come across. This is the first debate on the subject in this Parliament, so I hope that there will be a full range of views heard.
The noble Earl, Lord Halsbury, has given us food for thought with this Bill. How can we successfully regulate the sensitive issue of pornography as we head rapidly towards the next century and when global technology allows hard-core pornography to be transmitted around the world in a matter of seconds?
I am encouraged that so much attention in recent years has focused on child pornography and making sure that something is done about that particularly distasteful material. However, I am sure that noble Lords will agree that there is no room for complacency. It is a sad fact that pornography impacts upon relationships. It is stories of relationships damaged by this insidious material that convinces me that we cannot ignore the issue of what is and is not considered legally obscene.
The noble Earl, Lord Halsbury, has adopted a list approach—favoured in principle by the police—for defining what should be obscene. I commend the noble Earl on the tremendous industry he has put into compiling this lengthy schedule. I shall be interested to hear what the Minister has to say on that approach and the position taken by the Government on the Obscene Publications Act. I am sure that the House will have suggestions for refining the test proposed by the noble Earl and I shall watch with interest developments in Committee. Perhaps we shall conclude that a wide review of this issue is needed just as the Government has done for sex offences.
On a related subject, I am still concerned about the content of teenage magazines and the possibility of them falling into the wrong hands. It was brought to my attention that a 12-year-old girl purchased a copy of a recent issue of More. I understand that that magazine is aimed at 19 to 25-year-olds and falls outside the guidelines agreed several years ago for teenage magazines. That issue of the magazine contains explicit information which concerned the family of the young girl. Perhaps the Minister will write to me following this debate on how the teenage magazine guidelines are working and how to prevent younger girls from being sold magazines that are clearly inappropriate. Of course, it is not only girls' magazines that fall into the wrong hands. Men's magazines, such as Loaded, can also be bought by young teenage boys, which is as much of a concern.
I return to the main theme of the debate. I hope that we shall see some firm steps taken to reduce the amount of pornography legally available in this country.
6.57 p.m.
Lord Northbourne: My Lords, I apologise for detaining the House by speaking in the gap. Your Lordships can console yourselves that if I had been in time to put down my name for the debate I would probably have spoken for longer.
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I wish to make two points. First, I congratulate the noble Earl on an enormously innovative approach to the issue. He confounds those who say that there should be a retirement age for your Lordships.
Secondly, the substantive point that I make is that censorship of obscenity or pornography is often regarded and presented as a restriction of liberty. It is equally true that the results of the promotion and publication of obscenity and pornography can be a limitation of liberty. It can be a limitation of the liberty of women to walk dark streets in safety; a limitation of the liberty of parents to be confident that their children will not be the subject of a paedophile attack, induced into child pornography or seduced in other ways; and a limitation of the liberty of the taxman who has to pay for the cost of policing and punishing sexual crime and violence.
There is absolutely no doubt from the evidence in America over the past couple of decades that there are strong links between pornography, sex crimes and violence. After a while soft pornography ceases to give the thrills that it did at first and people move on to hard pornography and from hard pornography they move on to acting out their fantasies. That has been proved again and again, and the evidence is now incontrovertible.
The noble Lord, Lord Annan, made great play with the 1959 Act. Things have moved on since then. In 1970 the US Commission on Pornography concluded that pornographic material has its cathartic value. By 1986 a great many members of that commission had decided that they were wrong and the Attorney-General's Commission on Pornography in the United States concluded that,
"exposure to pornography produces an enhanced interest in deviant sexuality".
The process is referred to as "escalation". It results from the concept of normalisation—that is, the more you read about these things happening, the more you begin to believe that they may not be so awful after all and to say, "Lots of other people are doing them, so why shouldn't I?". One thus becomes desensitised. In any consideration of this subject, let us remember those who are today suffering from the crimes which arise out of pornography.
6.59 p.m.
Lord Cope of Berkeley: My Lords, the noble Earl, Lord Halsbury, has once again done the House a service in placing this Bill before us and in his great efforts of research and preparation. Personally, I should like him to remain eligible to take part in debates in your Lordships' House but, sadly, he is likely to be proved right about what is perhaps his swan song.
No Chief Whip would make suggestions about how one should vote on a matter such as this, even if this were not a Private Member's Bill but perhaps I should make it clear at the outset that the opinions I express are my own.
As has already been said, over my lifetime, which is only two-thirds of that of the noble Earl so far (in both cases), values have deteriorated out of all recognition, to the great detriment, I believe, of national life. As has

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been demonstrated in the past few minutes, this House is very long-sighted, even if few of us can look back as far as the noble Earl and even if we can no longer see our collective future as clearly as we should like. It sometimes seems as if it will be impossible ever to reverse the process of decline and to raise standards once again. It must have seemed like that to many people in the last quarter of the 18th century but, by the last quarter of the 19th century, the pendulum had swung fully across, as the noble Lord, Lord Annan, reminded us. It was essentially public opinion, led by Queen Victoria and others, which reversed that pendulum swing. I believe that the time is coming when that will happen again.
However, the legal problems which have been discussed remain. Part of the reason for the decline in standards and values is that the limits were not fixed objectively but in terms of "tending to deprave and corrupt". As has already been said, the views of juries on that have altered as, notch by notch, the standards to which we have all become used have themselves declined. Competitive pressures on newspapers and magazines have led their proprietors and editors and, for that matter, television controllers to titillate audiences by ever more risque material both of a sexual and of an increasingly violent nature. The television authorities have proved reluctant to control that effectively, so that the boundaries have been pushed back and back, and juries have responded accordingly.
Sooner or later, however, that process must stop—and it will take a change in the law to do it. As far as I can see, the best legal way of doing it is by something along the lines of this Bill. If the law specifically defines obscene acts by a list such as is provided in the schedule, it will be possible to enforce it. One can attempt either to pick out all those acts at once, in a long list such as is provided in the current Bill or, by the rifle-shot method of a short list, to pick off only a few items to start with. Obviously, that is a matter for consideration in Committee.
At present, enforcement is very difficult. For a time, I was Paymaster General in the Treasury. I remember discussing this matter on a number of occasions with Customs officers and being shown magazines which had been confiscated at ports and airports. They were quite appalling. Customs and Excise had the advantage that the law on importation prevents the importation of indecent or obscene books or articles—that is not the whole of it, but it is the nub of that law—and that made it a little easier for Customs and Excise than for the police in comparable circumstances. However, enforcement is still difficult. Indeed, it is made more difficult by a European court ruling that anything which can legally be printed here cannot be refused importation because that is against free trade. The 1959 Act thus came into play even in Customs and Excise cases. It is therefore difficult for Customs and Excise also to draw a line and to know which confiscations by its officers at a port would be supported by a court. That is why I think that legislation such as this, and a list of the type contained in this Bill, will be necessary.
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As I have said, it is a most difficult matter, but the principle of this approach has much to commend it. We should all be grateful to the noble Earl for putting this Bill before us and for restarting the debate in this form at this time.
7.5 p.m.
Lord Williams of Mostyn: My Lords, I too am grateful to the noble Earl. Lord Halsbury, for returning this subject to us. The issue of obscenity and the extent of the controls which it is appropriate for society to exercise over the availability of certain types of material induce strongly held views, as we have heard. As the noble Lord, Lord Cope of Berkeley, indicated, this subject raises the difficult issues of morality and public decency. It relates to the relationship between individual interests and those of society at large. It involves difficult questions about the role and effectiveness of the criminal law in a society which all noble Lords who have spoken have described as changing rapidly.
The noble Viscount, Lord Brentford, asked me whether we were thinking of a test of what reasonable people would consider offensive. No; the definition of "reasonable people" is very difficult and we believe that "offensiveness" is a lower test than "harm" and that that test would therefore have the reverse effect to that intended.
The noble Lord, Lord Ashbourne, asked me to write to him about a particular aspect, and I shall, of course, do so.
Perhaps I may turn to the faults of this Bill. I am not critical at all of the enormous amount of research and effort which the noble Earl has put into his Bill, but we have not yet considered the Bill. Most of the: speeches have described a conceptual approach to the reform of the law, but we cannot look at law reform on a conceptual basis; we must look at the nuts and bolts, as I shall in a moment. However, perhaps I may first describe how the present law works.
As your Lordships know, that legislation is the Obscene Publications Act 1959. The test of obscenity in Section 1 is whether an article, if taken as a whole, is such as to tend to deprave and corrupt persons who are likely, having regard to all the relevant circumstances, to read, hear or see the material embodied in it. Section 4 of that Act—I think we should bear in mind that the noble Earl's Bill specifically seeks to delete that provision—gives a defence of public good. Such a defence is absent from the noble Earl's Bill. I am certain in my own mind that that is a deliberate absence because the noble Earl wants to strike out the defence. I am not criticising the noble Earl; he has done that deliberately; I am simply pointing out the consequences of the Bill.
One needs to bear in mind also—this has not yet been touched on—the extensive powers of search, seizure and forfeiture that are available to magistrates by virtue of the Obscene Publications Act 1959. Several noble Lords have said that it is difficult to get juries to convict. That has been recited to me at first hand by senior officers in the obscene publications squad. Perhaps I may give the figures. In 1997–98, there were 275 prosecutions and

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189 convictions under the Act. However, that relates to proceedings before a jury. The powers of search and seizure are quite wide and extensive. If a magistrate is,
"satisfied by information on oath that there are reasonable grounds for suspicion that, in any premises within the relevant area"—
that is his petty-sessional area—
"on any stall or vehicle, premises or stall specified in the information, obscene articles are kept for publication or gain",
then a warrant may be executed, the material may be seized and an order for forfeiture may be made, with, of course, the power of appeal. So one can strike the commercial pornographer in that way. We should bear that fact in mind.
I promised to deal briefly with the scheme of the Bill and to indicate the view that I outlined earlier; namely, that it simply is not workable in any circumstance. Perhaps I may invite your Lordships to consider the detail of it. I do not apologise for so doing because we have not looked at the detail at all. I have in mind Section 2 of the 1959 Act which covers the prohibition of the publication of obscene matter in the way that the Act defined it and in the way that I have already cited.
Clause 2 of the Bill says:
"For Section 2 of the 1959 Act there is substituted"—
and then the rubric of "Offences" appears in the margin—
"Subject to section 2A below, any person who knowingly, whether for gain or not—

(a) publishes,

(b) distributes, transports or delivers,

(c) provides for the public or private viewing of,

(d) advertises the availability of, or

(e) contributes financially towards the publication, distribution,

public viewing or advertisement of, any obscene article shall be guilty of an offence".
I shall return to Section 2(1)(e) in a few moments to illustrate the dangers involved. However, we need to find out what "obscene" means by virtue of the noble Earl's definition in the Bill. We find the definition of "obscenity" as being that which is,
"set out in the Schedule".
But no one has yet looked at the schedule in any detail. I must confess my own innocent ignorance in that many of the words in the schedule were not immediately familiar to me; indeed, they are not presently familiar to me. Nevertheless, I recognised one or two of them. The title refers to:
"ACTIVITIES RELEVANT TO THE DEFINITION OF OBSCENITY";
we need to be quite careful about this. One of the activities relevant to that definition is:
"Display of human genital organs".
So Michelangelo's productions and drawings in life classes are obscene. Moreover, to take the matter a little further, a vast body of Italian painting is obscene. As we know, large numbers of paintings which are on display in both private and public collections do display human genital organs.
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The schedule goes way beyond the normal definition of obscenity that one would expect; for example, in the list we find:
"Human urinary or excretory functions".
These are remarkable propositions which need to be scrutinised with great care. I say that because I had not myself encountered the proposition in the past that urinary or excretory functions of the male species would be regarded as obscene if they were described or spoken about. There is much more damage here. However, there is something which is rather more lighthearted—namely, "Interlingual kissing". I am sorry to tell your Lordships that I had to seek assistance from my private office in that respect. I can safely say that apparently it is something which is as innocent as French kissing. But I am subject to correction from the noble Earl.
Let us move on to something more important:
"Mutilation, torture or other acts of gross violence towards humans or animals, whether real or simulated".
Let us focus on that for a moment or two because it is serious. Would this apply—it undoubtedly would on this test—to any sober, scholarly work about the monstrous tortures inflicted in Nazi Germany upon 6 million Jews, gypsies and homosexuals? Let us consider it again:
"Mutilation, torture or other acts of gross violence towards humans or animals, whether real or simulated".
Does that mean that a scholarly work about the Holocaust is obscene? I repudiate that. Does it mean that photographs which show the monstrous bestiality of the Nazi regime are obscene? Again, I refuse to accept that. Further, does it mean that descriptions in works like the Bible are to fall within the category of obscenity because masturbation or gross violence is mentioned in that work?
Perhaps I may put to your Lordships a deeply sober and solemn thought. Does that wording mean that descriptions whether by word in the Bible or in the Gospels or in religious artifacts, paintings and so forth of the Crucifixion of our Lord are obscene? They would fall within that definition. I repeat it yet again:
"Mutilation, torture or other acts of gross violence towards humans".
That is not a blasphemous observation that I make; indeed, it is a deeply serious one.
There is a poet and playwright who is our national genius. I do not know where that definition would leave his productions—namely, "Othello", "King Lear" or "Coriolanus". Need I stop, or need I go on? The grossest violence, almost the most unimaginable violence, is portrayed in those plays. It is idle to say that it was a long time ago and that children can safely watch them.
Perhaps I may be a little more lighthearted. Nymphomania is described as obscene and, therefore, any work of history—I believe that I am safe here—about Empress Catherine the Great would be in extreme difficulty. There is no reference to male over-indulgence—in other words, the male equivalent of nymphomania—so I shall not say anything about any possible records of current political life that one might or one might not be thinking about.

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Some of the points are serious, while others tend to be a little more frivolous. However, the point that I am seeking to make is exactly the one that the noble Lords, Lord Cope of Berkeley and Lord Annan made; namely, that it is not easy to get definitions right. If one has such an extensive list, which was certainly an eye-opener to me in the way I outlined, it simply is not workable.
The noble Earl was kind enough to indicate his assent by nodding his head when I put forward the proposition that he had deliberately, as his act of policy, so to speak, taken out the defence of the "public good". He does put defences in the legislation; but, similarly, they do not work. I shall spend a few moments explaining why that is so. The defence in fact is found in what are called "exceptions" in new Section 2A which says:
"No offence is committed under section 2"—
that is, the offence-creating section which I read out earlier—
"if any of the conditions described in sub-sections (2) to (4) is satisfied".
The exceptions, or defences, are as follows:
"The article is made for public viewing for education in matters concerning health, hygiene or medicine, and has been certified by the Secretary of State".
So, far from reducing the power of the Home Office—and I see the noble Lord, Lord Baker, sitting in the Chamber, no doubt remembering the complaints regularly made about the Home Office wanting to interfere too much in people's lives—the Bill would require the Home Secretary to certify matter which is for public viewing for education regarding health, hygiene or medicine. That is simply not workable.
Subsection (3) of new Section 2A continues:
"The article consists of a publication of a report of judicial proceedings or of any evidence admitted in such proceedings";
one can understand that. But then the overarching exemption follows:
"The article is published or publicly exhibited—
(a) in the interests of art, literature or science"—
with no mention of religion, and—
"(b) in whole or in part at public expense".
I shall spend a few moments on this analysis because it leads us to a position of unworkability, and really—I say this as gently as I can—to a position which is nonsensical in this sort of analysis. It would mean that I could publish something in the interests of art, literature or science which would otherwise contravene the very wide obscenity test contained in the schedule. If I published it at public expense "in whole or in part", I would have a saver; but if I am a private patron and I am not funded by the public, I would have no saver. That is no way to litigate—or rather to legislate! It certainly would be a way to litigate. In fact my former colleagues at the Bar Council would regard this as a long running pension indeed! In the absence of the noble and learned Lord the Lord Chancellor, "fat catterie" might well return to our land.
The provision simply will not work. I simply cannot understand why, if you publish in the interests of art, literature or science but not religion, and in whole or in part at public expense, you are saved, whereas if you
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are a public philanthropist and are not funded at public expense you are not saved. Therefore the great private collections of the 19th century philanthropists would not be exempt from the measure, but the collections funded at public expense by the equivalent of the alderman in Beachcomber would be safe.
It is worth thinking about the following point. I am perfectly happy for it to be suggested that I am wrong in my analysis, but I do not think I am. If the Bible offends against the definitions of obscenity—I hope I do not need to repeat them, as I hope that noble Lords attended Sunday school and can remember them perfectly well—anyone who, in the propiosed new subsection 2(1)(e),
"contributes financially towards the publication, distribution … or advertisement",
of the Bible (for example, the Society for Promoting Christian Knowledge) is committing a criminal offence. As I said, I am perfectly happy to have my analysis destroyed but I do not think it is capable of being destroyed.
I recognise that one or two of the remarks I have made have been rather lighthearted. However, there is something much more fundamental at issue here. The mere fact that some people behave differently to what your Lordships desire is not sufficient to make that criminal. There are many people who have different views on sexuality to what may be considered the norm, whatever the norm is. There are homosexuals, bisexuals and transsexuals who produce perfectly legitimate, respectable works of art or literature—I am not being patronising in the slightest—and who deal with their problems, their desires and their views in a perfectly legitimate way. It is not right to use the law to silence them. However, that is what this Bill would do.
I refer to the point raised by the noble Lord, Lord Annan, about the obsession—as it sometimes appears in this country—with purely sexual matters. There are many offences against mankind which are not related to sex. I repeat that I am grateful to the noble Earl for the enormous amount of research which he has done. That has rightly been applauded. I wish to be able to read accounts of the First World War, or of the conflict in Vietnam, or accounts of slavery in the southern states, or Lincoln's noble work before 1865. However, they are all obscene on the definition we have before us.
7.23 p.m.
The Earl of Halsbury: My Lords, first of all I thank everyone who has taken part in this debate. In so far as many of their remarks have been kindly disposed towards me, I thank them for that. It would be a mistake to think that I am at too deep an issue with the noble Lord, Lord Annan. He is a friend of mine and he has done the next best thing to what I would have liked, which is what I predicted he would do. Therefore I am grateful to him for showing me right on that score.
I can give the noble Lord, Lord Williams of Mostyn, a name for the male equivalent of nymphomania. It is known as satyriasis. How it escaped inclusion in my list I do not know. However, I am grateful to the noble Lord

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for the correction. Clearly this Bill needs a Committee stage and therefore I must proceed with it on the assumption that it will receive a Committee stage. But what kind of a Committee stage will it receive? What I have done, as it were, to "keep the game going", is to write to the Chairman of Committees, the noble Lord, Lord Boston of Faversham, to ask him to refer this whole matter to the Liaison Committee which is to meet at the end of the month to ask that committee how it thinks the Bill may best be dealt with; namely, whether it should be dealt with by a Select Committee of the House, or by a committee of inquiry, or something of that kind. In the meantime I wish the Bill to stand at this stage. I shall bring it back with a later proposal, either to refer it to a committee, or some alternative. On that basis, I hope that your Lordships will give it a Second Reading.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

North/South Co-operation (Implementation Bodies) (Northern Ireland) Order 1999
7.25 p.m.
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Dubs)The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Dubs) rose to move, That the draft order laid before the House on 8th March be approved.
The noble Lord said: My Lords, this order provides the statutory underpinning for the six implementation bodies which the Fist and Deputy First Ministers agreed on 18th December and which were reported to the Assembly on 18th January and 15th February. The bodies relate to inland waterways, food safety, trade and business development, special EU programmes, language, and aquaculture and marine matters. They will be established by treaty made between the British and Irish Governments. The treaty was signed in Dublin yesterday by my right honourable friend the Secretary of State and the Irish Foreign Minister. It will take effect when my right honourable friend authorises the transfer of powers to the new Assembly. A copy of the treaty is at Schedule 1 to the order.
Your Lordships will recall that under the terms of the Good Friday agreement the two governments were required to make all the necessary legislative and other enabling preparations to ensure that the initial implementation bodies function at the time of the inception of the British-Irish agreement and the transfer of powers. This order, and the treaty, will allow the Government to meet that commitment.
The House will also be aware that in January my right honourable friend the Secretary of State announced her intention to ensure that all the necessary legislative and other preparations for devolution were completed by 10th March. Again, this legislation is timed to allow the Government to deliver on that commitment.
On the issue of timing, I should like to apologise to the House for the uncertainty surrounding the bringing forward of this order. I am aware that your Lordships
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have had less time than usual to prepare for tonight's debate. As I hope the House will understand, however, the timing was dependent on negotiations which were only brought to a conclusion over the weekend.
I do not want to take up too much of the House's time with my introductory remarks. In particular, I do not think I need trouble the House with lengthy explanations about the various implementation bodies, details of which are contained in the articles and schedules to the order. Instead, I have arranged for an explanatory note to be placed in the Library of the House. Otherwise I would explain only that the order and its associated schedules deal with important matters as to how the various bodies will be structured and how they will operate, including their functions, annual reports and accounts, grants, accountability, finance and staffing.
There are two other points that I wish to emphasise. First, the order reflects the agreement reached between the First Minister and Deputy First Minister and the Irish Government about how the bodies should operate. The order and the treaty are the outcome of detailed discussions over recent weeks and represent the practical way forward for the agreement reached on 18th December. After devolution the British Government will, of course, have no role in the day-to-day operation of these bodies.
Secondly, I have already mentioned the timing of today's debate; it will allow the Government to meet their commitment to complete the necessary legislative preparations for devolution by tomorrow, 10th March. This was an important target date. This date was set back in January so as to ensure that we maintained maximum momentum behind the agreement. If your Lordships approve the order today, the legislative preparations for devolution will be complete. This will therefore be an important part of the process, as was recognised by the Front Bench spokesman for the official Opposition during yesterday's debate in another place.
The leader of the Ulster Unionists also described the order as,
"a significant step forward in the implementation of the agreement".
My right honourable friend the Secretary of State had also hoped that 10th March could be the day when she would authorise the transfer of powers to the Assembly. Under Section 3 of the Northern Ireland Act 1988 she is empowered to do that if it appears to her that,
"sufficient progress has been made in implementing the Belfast Agreement".
Regrettably, she concluded yesterday that that was not the case. As your Lordships will be aware, my right honourable friend announced that 10th March would not be the best time to run d'Hondt and thus appoint the executive.
During recent consultations with the parties, she had heard differing views: some wanted the running of d'Hondt to be delayed; others wanted it to go ahead immediately. All those who support the agreement remain committed to achieving full implementation of all its aspects as quickly as possible. All said they wanted to move forward on an inclusive basis. But, in the light of the differing views expressed, my right

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honourable friend concluded that if the d'Hondt procedure were to be run tomorrow it would not produce an effective Executive on which both communities would be represented. Some parties feared that running d'Hondt at that time might collapse the process.
In announcing her judgment, the Secretary of State also said that the decision could not be put off indefinitely. She therefore announced that she would be calling a meeting of the Assembly for the purposes of running the d'Hondt procedure no later than the week beginning 29th March; that is the week of Good Friday. This will give the parties the time and space to find a way forward. Many will be visiting the United States. There will be opportunities to build confidence and talk informally together, ready for an intensive round of discussions when they return to Belfast.
As my right honourable friend acknowledged, yesterday's announcement was disappointing. But, at the same time, with determination and courage on all sides, it is still possible to take the next steps to bring the agreement to fruition. We will be working closely with the Irish Government and all other supporters of the agreement to find a constructive way forward.
It is against this background that we are considering this order today. It will complete the legislative preparations for the new institutions under the agreement. The implementation bodies will, of course, operate fully in accordance with the terms of the agreement. This is spelt out in the treaty. Ministers in the North/South Ministerial Council responsible for the various bodies—or any additional bodies that they may decide to establish by agreement in future—will be fully accountable to the Assembly and Oireachtas.
Mechanisms to ensure proper accountability and transparency were included in the Northern Ireland Act last year. These include the requirement that the Executive Committee and the Assembly should be notified of the dates and agendas for meetings of the North/South Ministerial Council. And, of course, Northern Ireland Ministers will be accountable to the Assembly for their actions in the North/South Ministerial Council in the same way as they will be for their other responsibilities. By law, Assembly Ministers participating in the North/South Ministerial Council will be required to act in accordance with decisions of the Assembly or the Executive Committee.
Northern Ireland Ministers will also require Assembly approval of any decisions that go beyond their defined authority; and any agreement in the North/South Ministerial Council which requires new legislation will require the support of the Assembly. Also, no agreement to establish a new implementation body can come into operation without the specific approval of the Assembly.
What we have here, therefore, is a balanced package of measures to enhance North/South co-operation. The bodies will operate in a clear framework of democratic accountability, as defined in the agreement, supporting legislation and the procedures of the Assembly. These bodies, and any further bodies that may be agreed in the North/South Ministerial Council, will provide a foundation for close co-operation between the Northern Ireland administration and the Irish Government.
This order provides the statutory basis for the six agreed implementation bodies and is an important part of the path to peace in Northern Ireland. I commend it to the House.
Moved, That the draft order laid before the House on 8th March be approved. —(Lord Dubs.)
Lord Mayhew of Twysden: My Lords, I wish to congratulate the Government, Ministers and their officials on what must have been an extremely intense period of work which was very detailed, very delicate and very sensitive. It was carried out, as we learn, during negotiations, or reflecting negotiations, that extended even to two days ago. The First Minister designate and the Deputy First Minister—who, as we have just heard from the Minister, played an important part in the negotiations with the Irish Government—also deserve our congratulations. In consequence, they have all met the deadline established in the agreement for putting in place the legislative framework that underpins or supports devolution.
It was important that they should do that. It was important that the governments should show that they left nothing for later completion, not least so that Republicans should have no arguable case for claiming that either government had dragged their feet in implementing their part of the agreement.
Whatever one may think about the influence of mutilation or so-called "punishment attacks"—one is glad to note that they at least appear to have abated—by common consent one overwhelming element of the agreement remains unimplemented; that is, of course, the obligation on the paramilitaries to decommission. In the context of the Assembly we are concerned notably with Sinn Fein and the IRA. In that regard there has been a failure to decommission arms and explosives, and a failure even to commence the process. The argument is well understood—too well understood—and rehearsed and needs no lengthy exposition. I notice that in another place someone vividly encapsulated it yesterday by saying that one cannot claim to be a legislator in a democracy during the day and a field marshal at night. The reason is surely this: people cannot be expected to sit down and share legislative tasks and risk being told that they only yielded a point in an argument out of a fear that carefully retained weapons may be used. Indeed, there may well be a temptation to yield to such a threat. The Assembly must be rooted in confidence. The Assembly would not hold the confidence of the public were there to be any weakening on that point.
Out of one's intense desire to see the agreement fully implemented and put in place and to see things moving on to completion, there is a risk of feeling that, because this is a single point—it may be described as a small point in volume terms—the issue can be fudged. I suggest that is not the way in which this issue should be regarded. Its importance is not proportionate to the text that it takes up in the agreement.
Although the Secretary of State put back the deadline for summoning the Assembly for the implementation of the running of the d'Hondt procedure until the week

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beginning 29th March and one must respect her judgment, Republicans must know—not least because of the stand taken and stuck to by the Taoiseach—that on this there is no more "give" to be had. There is no more movement—and, my goodness, there has been plenty—to be had from those representing Unionists in Northern Ireland. Nor, I judge, is there any movement from the two governments.
I look back over the years and note in particular the extraordinary progress of a political character that has been made in Northern Ireland and pay full tribute to the present Government's substantial part in it. However, I feel that it has been progress of greater political value to nationalists than to Unionists. It seems not only astonishing but also, I fear, deeply suspicious that it can be put to the hazard in this way. We all share in the intense hope to which the Minister referred that, in the breathing space the Secretary of State has accorded to the parties, the Republicans will do what from all sides—east, west and internationally—they are being urged to do.
Meanwhile, when we are looking at the provenance of these new bodies, it is proper to recall not just the courage of Mr. Trimble and Mr. Mallon but also the earlier far-sightedness of the noble Lord, Lord Molyneaux of Killead, who saw the value of Dublin and Belfast making common cause in areas of common interest—there are so many of them. He also saw the soothing value, if I may put it in that way, of putting north-south co-operation in the context of a geographically wider British-Irish relationship and the importance of making any new co-operative bodies accountable both to an assembly in the north and to the Oireachtas in the south. The noble Lord—it is only because of the shortage of notice that he is not in his place—and in part the previous administration were perhaps before their time in that regard. But I believe that we can all take much satisfaction from the arrangements that are before us today.
Earl Attlee: My Lords, I am grateful to the Minister for his explanation of the order and also for the background to it that he gave the House. I am extremely glad that it has been made possible to complete all the necessary arrangements by the required date. I accept the Minister's apologies and I agree that it was necessary to move quickly. The order certainly has been on or off. The disadvantage of moving quickly is that it is difficult to have full consultation on matters such as the lighthouse authorities which Mr. Trimble mentioned in another place last night. However, we need to strike a balance between the need to consult and the need to have the order in place today. I note that page 39 of the order, which covers lighthouses, refers to the need for further legislation. I hope that it will be possible to have full consultation beforehand.
Noble Lords will recognise that the order very nearly completes the jigsaw of implementing the Belfast agreement in full. We should leave no excuse for paramilitaries not to decommission. I am grateful for the comments of my noble and learned friend Lord Mayhew on that point. Almost all parties to the agreement have
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met their obligations. They have all acted in good faith and the Secretary of State has bent over backwards to accommodate them. All parties have worked tirelessly, as my noble and learned friend Lord Mayhew observed, but one piece of the jigsaw is missing. I refer to decommissioning. It has to happen and it has to happen soon.
I agree with the Minister's comments about starting the d'Hondt process. There would be no point in starting the process if we knew that it could not work.
We welcome the order. The Minister mentioned the need to maintain momentum. I totally agree with that. I hope that we can get the last piece of the Belfast agreement in place, and quickly.
Baroness Sharp of Guildford: My Lords, our new Front Bench spokesman, my noble friend Lord Redesdale, had, unfortunately, when the debate was announced, already arranged to be in the Province. While that might seem to be a good illustration of the pulling power of the soon-to-be-devolved responsibilities envisaged in the order and the diminishing power of Westminster, I can assure your Lordships that that is not the case. It was merely the unfortunate shortness of time in the announcement of the debate. It has fallen to me to present the Liberal Democrat response to the order.
I reaffirm that we on these Benches remain fully committed to the Good Friday agreement. Although the process of implementing the agreement was never going to be easy, implementing it remains by far and away the best hope for continued progress in Northern Ireland. Like the noble and learned Lord, Lord Mayhew, we regret that so little has been done on the decommissioning issue and that it has been necessary to postpone the calling day for the new Assembly. Nevertheless, we wholly endorse the actions of the Secretary of State and hope that they may prove to be fruitful in this respect. Likewise, we wholeheartedly support the order, which descends directly from the Good Friday agreement.
I should like to pay tribute to the First Minister and the Deputy First Minister of Northern Ireland for managing to reach agreement on the number and form of the six new bodies described in the order. Given the political pressures they have been under, and continue to be under, that was no mean feat. Coming as it did just before Christmas, its announcement was inevitably lost in the celebration of Christmas. That was a shame. The British and Irish governments also deserve praise for their part in facilitating the agreement, and in particular for fleshing out of what was a broad accord into the detailed proposals we have before us today. It is testimony to the diligence of those who have sought to detail every part of the agreement on the six bodies that we have such a volume of paper to support the order. However, it is the details that will determine the success or otherwise of the arrangements.
I should like to raise two small points relating to the bodies established by the order. First, with regard to the funding of the bodies, the order empowers the new Northern Ireland assembly to determine how much

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money it wishes to allocate to the new bodies. That is subject to the constraint set out on page 11 of the order that the bodies shall be funded in accordance with the provisions of the Good Friday agreement on the basis that they constitute a necessary public function. While that constraint is encouraging, it does not close off the possibility that funding for one or more of these bodies could become lopsided, with more coming from the government of the Republic than from the Assembly in Belfast, or vice versa. If funding were to become uneven in that way, it could influence the way in which the bodies operate and, perhaps more to the point, raise fears that it might do so. That, in turn, could retard seriously the effectiveness of the bodies. The best way to avoid that potential problem would be for the Belfast Assembly and the Dublin Government to agree that funding for the bodies should be split evenly between them. I welcome any comments on that suggestion that the Minister might have or any thoughts on his part as to how it is envisaged that the burden of funding the new bodies should fall between the two authorities.
Secondly, I have a specific point about the new body set up to deal with the special EU programmes. The United Kingdom has a relatively poor record within Europe of taking up what is ours as of right. Opportunities to make the best of EU funding programmes have frequently been lost because the British Government have been unwilling to put up matching funds. These matching funds are often necessary before European moneys can be allocated. Consequently, no investment has occurred. With the role of procuring special funds from Europe being devolved to this all-Ireland body, it may be that the problem could get worse as the London Government are distanced further from the process. The further away they are in bureaucratic terms, the less committed London may become.
If that were to happen, it could be very unfortunate indeed. I do not need to explain how vital some of the EU special funding programmes are to Northern Ireland. I should therefore welcome an assurance from the Minister that every effort will be made to ensure that, where matching funds are required before a programme can commence, they will be made available when necessary.
The order before the House is testimony to the fine working relationship that has developed between the British and Irish governments. I hope that the new bodies established by the order will benefit similarly from such a happy working relationship, both between the Belfast executive and the Irish Government and in themselves. They are an important beginning in establishing new relationships between North and South. From these Benches we wish them well.
Lord Dubs: My Lords, I am grateful for the support that has come from the speakers in this debate. The Government welcome the positive comments made.
Perhaps I may make a few brief observations. I very much agree with many of the remarks made by the noble and learned Lord, Lord Mayhew. In so far as the Government have been successful in our policies in Northern Ireland, we have built on foundations to which
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the noble and learned Lord himself made a significant contribution. That has to be acknowledged. When we took office, much of the groundwork had already been prepared; the noble and learned Lord had been assiduous in doing that.
I understand and sympathise with the noble and learned Lord's comments about the need to meet deadlines. The experience of the Good Friday agreement and the various negotiations that took place indicated that setting Northern Ireland politicians deadlines means that they are more likely to reach agreement than if one gives them all the time in the world to negotiate. It was with that type of discipline in mind that the Secretary of State set one deadline—that was not possible; but that is why she set another deadline of about three weeks' time. It clears the mind and is a helpful way of encouraging local politicians in Northern Ireland to move forward from the position in which they now find themselves.
I very much agree with the noble and learned Lord about the enormous contribution made to the process by both the First Minister designate and the Deputy First Minister designate, and over many years by the noble Lord, Lord Molyneaux. I am sorry that the noble Lord was not able to be present this evening. I also agree that fudging is not a helpful way forward. It will be very much up to the local parties in Northern Ireland to move forward. However, I believe that they understand the need to do so in a clear-cut manner.
I wish to comment about paramilitary attacks and beatings. Such attacks are appalling. The noble and learned Lord said that they had abated somewhat, and I believe that they have. However, as I said on an earlier occasion, one paramilitary beating, shooting or mutilation is one too many. None of us can be relaxed, and I know that the noble and learned Lord certainly is not while there are any such incidents at all, even though some abatement is clearly to be welcomed.
The noble Earl, Lord Attlee, asked about the Commissioners of Irish Lights. It is a matter in which I understand the noble Lord, Lord Glentoran, is also interested. Perhaps I may briefly explain the position. First, I warmly acknowledge the work that the Commissioners of Irish Lights have put in over the years. They have put in a great deal of work, and it has been very successful. I pay tribute to them.
The new Foyle, Carlingford and Irish Lights Commission will become the general lighthouse authority for the whole of the island of Ireland. The change will require changes to the Merchant Shipping Act to make the body the lights authority. The lights function of the new body will continue to be funded by the General Lighthouse Fund. It will, however, take some time to prepare the necessary new financial arrangements and to consult the various interests before bringing forward legislation. The commissioners will be fully consulted and their experience will be invaluable in developing the new arrangements.
The treaty and the draft order provide for enabling arrangements to be drawn up before the date of devolution or as soon as possible thereafter. I should like to say that that can be done within a week or two, but it is likely to

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take some months for these steps to be taken and the Commissioners of Irish Lights will remain the lights authority in the meantime. The new body will have two agencies; one for loughs, dealing with Lough Foyle and Carlingford Lough, and one for lights. The existing staff of the Commissioners of Irish Lights will transfer to the new body and all their rights will be protected. The chief executive at the time of the transfer will be the chief executive of the lights agency. None of this, however, will happen until the Merchant Shipping Act is amended by primary legislation at Westminster. Clearly, there will then be an opportunity for consultation in the process of reaching that legislative stage. I hope that the noble Lord is reasonably reassured by that.
Lord Glentoran: My Lords, I am reassured. I thank the Minister.
Lord Dubs: My Lords, perhaps I may now turn to the comments made by the noble Baroness, Lady Sharp. She asked two specific questions. The first related to the funding of the implementation bodies. In the end it will be a matter for the two governments. It could be unbalanced as between the Northern Ireland and the Republic administrations. It may be that the best way, as the noble Baroness suggested, is that the funding should be split equally.
Initial funding for the first year will be a matter for the British and Irish Governments. Thereafter it will be a matter for the Northern Ireland administration, on the one hand, and the Irish Government, on the other, to decide on the amount and split of the funding. I hope that the various parties concerned will take note of the points made by the noble Baroness. It is clearly important that these bodies should have a sound and equitable funding basis.
The noble Baroness also asked about EU funding. She made one or two points which go rather wide of the order regarding the Government's approach to funding. I am not sure that I agree with her; however, perhaps we may leave that debate for another day. As regards EU funding in the context of this debate, it is essentially a matter for the two national governments. Both Governments, and the First Minister and Deputy First Minister, are presently negotiating with Europe to obtain the best deal for Northern Ireland. Additionality will therefore depend on the shape of the final programme. I could throw in words such as "Objective 1", "peace and reconciliation money" and so on. We do not know what will be the outcome of the negotiations. However, I take the noble Baroness's point that it is important for Northern Ireland, as indeed it is for the UK as a whole, that maximum benefit is gained from EU money. Indeed, the fact that an implementation body has been set up on this particular point makes it clear that both Northern Ireland politicians and politicians in the Republic regard the issue as important.
I repeat my thanks for the support that we have received. This is an important step on the way to long-term and permanent peace in Northern Ireland. I commend the order to the House.
On Question, Motion agreed to.

Fair Rent Increases
7.58 p.m.
The Earl of Lytton The Earl of Lytton rose to ask Her Majesty's Government whether they will reconsider their proposals to limit fair rent increases following the Rent Acts (Maximum Fair Rent) Order 1999 (S. I. 1999/6) so that, in addition to necessary protection for tenants, private landlords will be able to obtain a fair return on property subject to regulated rents.
The noble Earl said: My Lords, I am grateful to noble Lords who put their names down for this debate. First, I should declare some interests. I am joint landlord of some shorthold lettings and have two Rent Act protected tenants in properties that have been in my family for generations. I am also a shorthold tenant myself, paying, as all tenants think, an outrageously high rent. I must declare an interest as the unpaid non-executive chairman of an advisory service which mainly advises long leasehold tenants. However, I speak not from those interests but as a practising chartered surveyor.
The issue I raise relates to the capping of fair rents under the order referred to in the Question. I thank the Minister for allowing me to come to see him the other day. I hope he recognises that my concerns are not personal or political but technical.
I know that there are some bad abuses in the private rented sector. However, I wish to concentrate on the philosophy and technicalities relating to fair rents. Also, knowing the problems of inner-city areas, I want to draw away from that somewhat because in the wider world of the counties outside fair rent situations also arise.
I am sure that the House is well aware of the provisions relating to fair rents as set out in Section 70 of the Rent Act 1977 and the role of the rent officer in fixing and registering those rents. I am also certain that the House is aware that fair rents are not defined but are supposed to be fixed,
"having regard to all the circumstances",
of which the market must be one. There is an assumption that scarcity is to be eliminated or, put another way, the system assumes that demand does not materially exceed supply. That does not mean demand or supply at any price.
For many years, rent officers after 1965 had little evidence to go on beyond their own previously determined rents. The effects of rent control on security of tenure had largely destroyed the private rented sector. That remained the case for about 23 years until 1988 when, under new legislation, landlords could once again let properties at market rates.
It became clear, as time went on after 1988, that fair rents and market rents were often far apart. So much so that fair rents were frequently criticised. In the fullness of time, fair rents went up and were felt most acutely in some of the urban sectors where market values had increased most.
More recently, there have been court cases such as the Spath Holme case that reaffirmed what was understood in some areas as being market rent less a percentage, compared with the previous basis adopted

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by rent officers of previous registered rent plus a bit, if I may paraphrase it that way. Arguably, the increases resulting were very severe in some cases. But, equally arguably, it was a process of readjustment caused by years of control of the market. It is interesting to note that rental increases seem now to be tailing off, but perhaps it is too early to draw a firm conclusion.
Rent regulation has had the effect of wiping off significant amounts of freehold value. The Government's own figures suggest 40 per cent. Interestingly, security of tenure alone in the commercial sector never did that. Fair rents are reckoned to be about 55 per cent. of open-market rents or, in other words, a 45 per cent. discount. Again, I have drawn on the Government's figures for that. This is quite high, given that in many parts of the country—and I am talking particularly about the counties rather than the metropolitan areas—there seems to be no shortage of residential properties to let, as evidenced by the large number of residential letting agents that seem to be springing up everywhere.
Accordingly, we have the anomalous situation where a category of tenant with a large measure of protection pays in general a very substantially lower rent than the unprotected tenant of a similar property is willing to pay in the open market. I find that rather curious.
As well as protecting tenants from excessive rent levels, fair rents need to produce a proper return to ensure that the property is adequately cared for. This has to cover not only the recurring costs of maintenance and outgoings but also periodic upgrading and improvement; at least, that must be the case if the accommodation is not to become obsolescent. If in some cases we are dealing with a number of ageing tenants, it seems to me to be right that the general condition and standards of a dwelling have to be kept up for that reason alone.
However, the reality is unfortunately that rent officers often attach very little importance in rental terms to such things as double-glazing, insulation, central heating, kitchen modernisation and so on, but are inclined to consider those as being a normal service of the landlord, to be paid for out of the normal rent; that is despite the specific provisions of Section 70(4) of the Rent Act 1977.
I have received information relating to the upgrading of flats, for example, where only tiny increases have been awarded after significant expense. My concern is that it does not reward the care and maintenance of the property or respect the interests of the tenants.
As the Minister knows, I had some concerns about the terminology used in the consultation paper that preceded the order being laid. First, it implied that the freeholds of fair rented property had in general been acquired by speculators with the aim of a capital gain. But certainly I could not find any evidence that that was generally the case.
Secondly, it identified the problems of fair rent increase as being principally the responsibility of private landlords rather than a complex and interactive web of causes, including the broader economic issues and, not
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least, the mismatch between the regulated and free market rents. So I felt that the situation had not been presented fairly.
Thirdly—and this goes to the substance of the operation of the order itself—it was suggested that under the proposals fair rents would,
"continue to move closer to market rent levels where appropriate".
However, I could not see that that would happen in practice.
On the first point, I feel that the Government need to present the evidence. If there is none, then the claims made are wrong. But if there is the evidence, let us have it. I cannot find it. But if speculative activity is frowned on, then it cannot be used as it has been to justify low returns on the ground that there will be a capital gain when the tenant dies or moves. It is impossible to have it both ways.
For a true investor, realisable vacant value may have little to do with the current account return on the investment, especially if there is no intention to sell anyway. Not all regulated tenants are that old either; many, thankfully, have 30 or 40 years left to look forward to.
So the need is for a long-term sustainable situation that covers both sides. I felt that only one side had been presented. Clearly, when the market is interfered with there will be problems of adjustment later on. The small size of the sector does not make it a legitimate target, nor does it alter the need for balance, fairness and justice when presenting the issues.
I shall deal briefly with some of the effects, but as noble Lords will know, the proposals in the order would take the increase in fair rents to a maximum figure initially, on re-registration of existing registered rent, of retail prices index plus 7½per cent., and thereafter RPI plus 5 per cent. on any subsequent re-registration. Obviously, if the fair rent comes out at lower than that figure, it will be the rent that is registered. But if it is the cap, then it is the cap that is registered. Rents can be re-registered every two years. Taking in the longer term a 5 per cent. cap plus RPI, we are talking about RPI plus about 2½per cent. a year.
My concern is that after the 5 per cent. is applied and if the cap applies, that forms the benchmark for future calculations as to whether the cap should apply thereafter. So the effects are cumulative, unless I have misunderstood the situation.
It must be obvious that the proposals are incapable of converging fair rents and market rents, as suggested in the consultation paper. The British Property Federation, for example, worked out that on the most optimistic count it would take 24 years for convergence to be achieved, assuming inflation only and no real growth in property values. On any other assessment there would be divergence.
Increases in rent due to landlords' expenditure on improvements are to be allowed, but it has to be said that they must make more than a 15 per cent. difference in rent. But there must be a great deal of improvement to get any increase in fair rent at all, quite apart from the usual arguments about what constitutes improvement, as

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I have already suggested. I find it difficult to think of any organisation that will invest seriously on those low levels in something as complex as a dwelling house. It is too chancy with the cost of repairs, renewals, insurance and other factors.
That means that if there is a need to invest in a rundown area, it will simply not be worth the while of the private landlord to do it. I must warn that that risks a return to a downward spiral of unwillingness to invest, in other words de facto disinvestment. That is one of my great fears.
All that imports into the fixing of fair rents the concept of affordability. The Minister may dispute that, but it is the essence of the phrase in paragraph 2.4 in the consultation paper which states—and I paraphrase— that many tenants are elderly and on fixed incomes. They have planned their affairs on the basis that they would be able to remain in their present homes.
I do not doubt the sincerity of the Government's views on social justice. But they seem to be doing that by overriding the principle that the maximum a landlord can receive is a fair rent fixed by the duly authorised officer. They do so by secondary legislation on grounds which specifically override the provisions of the 1977 Act, even to the point of dictating what goes on the rent register. The grounds clearly include some notion of personal circumstances relating to tenants—something that the same Act specifically excludes from consideration.
There are very good reasons to converge the fair rents and the market rents, not necessarily to make them meet as one but at least to remove some of the discriminatory effects and the divergence which particularly affects classes of property owner and creates anomalies. There are certainly good reasons to insist on higher standards of conduct from landlords, but I think that the effect of the order will, if anything, be to drive the conscientious from the market. If there is no hope of a proper return, then the conscientious move out and the speculators move in, for some entirely improper purpose: they always seem to do so. The matters of which the consultation paper complains will become more rather than less likely.
Whatever one's views on fair rents—and I happen to think that they and the rent officer service command a lot of respect—it is curious to have a category of tenure that relies on the professional and statutory fixing of a rent that is fair but then for the Government to decide that the rent is not fair enough or that it ought to be attuned to the means of a financially disadvantaged class of tenant. I did say to the Minister when I went to see him that it looked uncommonly like a housing benefit limitation measure, but I am sure that he will refute it.
If the Government believe in intervening in the market for social reasons, they need to explain the rules of engagement for doing so. If a social policy is the objective, they need to explain the justification for that and why the burden should be placed on a particular group of property owners, as opposed, for instance, to the taxpayer at large.
If we are not careful, rental fairness—and there is no definition beyond the normal dictionary version— becomes an entirely movable feast. I think that a balance has to be struck here.
In opposition, the Labour Party said that it would not legislate to interfere with the private rented sector. The consultation paper at paragraph 4.1 uses the term, "changing the legislative framework". It is an interesting shift of language, but this will not impress investors; it just switches people off. What is happening here is that the understandings upon which investment in the regulated tenancy sector has started to get going again, after years of neglect, may be frustrated once again. Investors may feel that this is a prelude to the Government interfering in other ways, on the claim that they are not interfering at all but just using regulatory corrections. Property owners are asking themselves "What next?", and this doubt as to whether a return can be made will affect willingness to invest.
Most of Europe seems to have a regulated but fair renting arrangement which operates well in both the short and the long term. Other Europeans cannot understand our predilection for the baggage of a mortgage. It puts lending institutions in a monopoly situation, and a few years ago they seemed just as keen on repossession as some rogue landlords were on dispossession beforehand.
If we are to build 4.5 million houses by 2016, as is proposed, and as I perceive that there is a rising interest in renting as an alternative to ownership, it is in the public interest that there should be a good-quality private rented sector to provide mobility in the workforce and to provide a direct competitor to the mortgage lenders. It is therefore a grave mistake to send out the signal to the market-place that the limitation on fair rents now does, because the message is going beyond the sector to which it is said to apply.
In conclusion, there is a comment in the consultation paper on the subject of expectations: that tenants and landlords could never have expected these high increases in fair rent. I do not think anyone thought, however, that fair rents would trail the market to the tune of 45 per cent. In so far as there are legitimate expectations, they must include, first, that the rent is fixed by an independent officer; secondly, that it will be based on all factors, including the open market, adjusted to take out the scarcity factor—I have no difficulty with that; thirdly, that landlords will be able to charge that rent so fixed and that tenants should expect to pay it; and fourthly, that personal circumstances should be ignored.
I applaud much of the position on residential leasehold matters which the Labour Party took in opposition and which, in power, this Government have continued—much to their credit. There was a strong vein of the moral and practical imperative. I can see the force of the arguments. In this measure, however, the arguments have not been substantiated. I see an arguably unfair and partial proposal, and I feel duty bound to point that out, along with its potentially damaging consequences.
8.14 p.m.
Lord Gladwyn: My Lords, I am grateful to the noble Earl, Lord Lytton, for raising this subject but I am bound to say that I see the issue from the opposite end of the spectrum from him, living as I do in a flat in Westminster under a regulated tenancy. In my view, the order in question is the least that the Government could decently do under the circumstances.
I was not a Member of your Lordships' House when the Housing Act 1988 went through Parliament. At the time, however, it was widely reported in the media that this major reform of the rental system was of no concern to existing regulated tenants because they would continue to enjoy the full protection of the 1977 Rent Act. I remember being deeply impressed by the assurances given on television by William Waldegrave, the Minister in charge of housing, in that regard. It may be that some of the Conservative leadership were unhappy at that exception to their reforms, but they accepted it in the interests of social equity as well as political common sense. The noble Earl who raised this debate today, however, was one of those who disapproved. In the Committee stage he complained that the Bill would create a two-tier system—one for lettings before it comes into force and another thereafter. He said that he could imagine nothing more divisive. The then Minister—the noble Earl, Lord Caithness—said in respect of the noble Earl, Lord Lytton, that he wished to go very much further than the Government had done.
Introducing the Bill in another place, Nicholas Ridley himself emphasised the difference between market rents and so-called "fair" rents, which were not fair to the landlord in relation to giving him a return on his investment. It was on the interpretation of this word "fair" that the rent protection for regulated tenancies broke down. In July 1994 Mr. Justice Harrison delivered his judgment in the Spath Holme case, in which he ruled that a fair rent does not mean a reasonable rent but it merely denotes the market rent, adjusted for the scarcity element.
This is very different from what had generally been supposed before, even by Nicholas Ridley. It reminds me of another recent judgment about the interpretation of a single simple word that likewise had immense implications for many private individuals. This was the American ruling that the word "sudden", which qualified many of the Lloyd's insurances respecting chemical pollution, did not mean something that happened quickly but something that was unexpected, even if occurring very slowly.
Had the parliamentary scrutiny of the Housing Act been sharper, this anomaly might have been recognised and the wording of the previous Rent Act could have been adjusted. It was altogether ignored on all sides, however, and the result has been an explosive effect on registered rents awarded by the rent officers and the rent assessment committees. That has been particularly marked in the case of private tenants in central London, where property and rental values have escalated so dramatically, boosted by the demand for so-called assured or short-hold tenancies by businesses for the use of their directors or employees, often foreign. The
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protection provided by the 1988 Act for the regulated tenants has largely evaporated in respect of rents; it remains solid only in respect of tenure.
The social equity which impelled that protection in the first place is all the more needful now, 11 years later. This is because many private tenants, being effectively misled about the implications of the 1988 Act. decided to stay on rather than move and perhaps buy freeholds or leases elsewhere. They are now all 11 years older and far less able to alter their arrangements. The explanatory text of this present order reveals that in 1996–97 over 60 per cent. of the regulated private tenants were retired, so I dare say that that will have risen to over two-thirds by now. All of them, whatever their private circumstances, will have been faced with rents which have upset their financial calculations, in many cases causing acute personal distress.
The main trouble with the order which the noble Earl would like to have annulled is not that it mitigates this plight but that it has been so slow in coming. During the course of last year particularly registered rents shot up still further, following the Curtis case of 1997. In many instances, therefore, it is shutting the stable door after the horse has bolted. Those fortunate enough to be on rental timescales which involved no review last year will be more likely to derive greater benefit from this capping order. That in itself seems grossly unfair. If the Government had tackled the issue immediately on coming in to office in 1997 the order could have been in place at least six months earlier. I feel that they have dragged their feet. The issue had been aired for some years in another place, specifically in 1992 by Dudley Fishburn, the Member for Kensington; but in 1993 Sir George Young declined to act.
The regulated tenants are constantly declining in numbers as they leave or die. If their rents are lower than market rents, that was the price that landlords were obliged to pay under the terms of the deregulation of the rental market in 1988. It is a price that diminishes every year with the reducing number of protected tenants and the easing upwards of the capping. The press release announcing the order specifically states that the Government have no intention of imposing any such future restriction on assured or shorthold tenancies under the Housing Act 1988. I cannot see how landlord interests can complain about it, and I trust that the noble Earl will reconsider his Question.
8.20 p.m.
Baroness Maddock: My Lords, I am very grateful to the noble Earl, Lord Lytton, for giving the House this opportunity to debate housing matters once again. It is a matter that is very dear to my heart. The two speeches that we have heard so far come from opposite directions. That highlights the whole problem of the present issue.
This is a good opportunity to ask the Government to get to grips with how they view the private rented sector. There are two sides. Landlords need to be able to make their businesses a success but tenants also need good quality accommodation at a price that they can afford. To get the balance right between protecting those

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who cannot afford large rent increases and assisting the private rented sector to flourish is not an easy task. As we heard from the noble Lord, Lord Gladwyn, if we add to it the history of rent regulation we see just how difficult is that task.
If we look at some of the views expressed, those who represent landlords tell us that intervention in market rents deters investment, that existing businesses may well be damaged, that there will be an ever-growing gap between market and regulated rents and that perhaps the recent confidence in the private rented sector will be reversed. It has also been said that during the consultation period the Government discounted all of the arguments put forward by the supply side. But if one considers the views of organisations concerned with tenants, particularly elderly people on low incomes, the response is rather different. I am aware that Shelter and Age Concern welcome these regulations because they believe they will help those people about whom they are concerned and stop very high rent increases. Shelter had asked for an even lower limit to be set. Nevertheless, it is pleased that the Government have reduced the original limit.
As we have heard this evening, the majority of tenants with fair rents are retired and on low fixed incomes. I understand that, before housing costs, the mean net income of pensioner households in this group living in regulated tenancies in the private sector is little more than £120 per week. That gives us some idea of what we must deal with. If rent increases for that group are not restricted there is a view—I have sympathy with it— that there could be many more elderly tenants who will end up losing their homes and facing financial hardship. That is the dilemma facing both sides in this debate. That has been clearly set out this evening by the two earlier contributions.
There are two particular statements that I believe emphasise the conflict between the two sides. The British Property Federation states that this will damage businesses that have set their investment strategies and business plans on the assumption of continued rental growth. On the other hand, Shelter uses a similar argument to suggest that elderly tenants on low incomes would have planned their affairs on the basis that they could remain in their homes and could not have foreseen that the levels of fair rent increases would be as high as some have been. One can see that there is a dreadful dilemma.
In mitigation—we have heard the argument put forward by the noble Earl—landlords say that because of previous rent regulation there were some large increases when landlords tried to catch up, but that it is unlikely to happen again. But we are where we are. We are talking about tenants who are particularly elderly, but also about landlords who are running businesses. I believe that tonight the Government should at least tell the House that they understand the importance of the private rented sector. Perhaps they should look at other ways to help that sector. I would very much have liked to see in the Budget today tax incentives to help landlords in the private rented sector business,
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particularly in relation to the repair and upkeep of properties and, in the area of energy efficiency—the insulation of properties.
Obviously, too much regulation will not help businesses. The housing sector business by its very nature is very different. Therefore, this is a matter that we should look at very carefully as part of the much wider picture. If we want a flexible housing market and flourishing rented sector we must take care to strike a balance between our desire to protect the community and our desire to help landlords. We need a variety of affordable housing. I believe that over recent years we have had a real problem because of the difficulty in moving in and out of sectors. It is difficult to provide affordable housing where people want it. With the ever-changing jobs market and the insecurity of income it is important to expand the private rented sector to enhance flexibility.
I believe that tonight we deserve from the Government a little explanation as to how they view the whole area, whether they want a thriving private rented sector and, if so, how they can assist it. I believe that the Government would gain a little more sympathy from private sector landlords if at the same time as they restricted rents in certain sectors they introduced fiscal measures to assist in raising standards in the private rented sector and the running of successful private rented sector businesses. In failing to do so the Government lay themselves open to the further charge referred to by the noble Earl, Lord Lytton; namely, the suspicion that this is much more to do with the worry about the housing benefit bill than looking at how to deal with the various housing sectors. I end on that note in the hope that the Government will give an indication of their stance on this important issue. This order has highlighted the dilemma that faces us in the provision of affordable housing and where it comes from, and achieving a flexible housing market.
8.28 p.m.
The Earl of Courtown: My Lords, first I thank the noble Earl, Lord Lytton, for giving the House this opportunity to debate the consequences of the Rent Acts (Maximum Fair Rent) Order 1999 which will have a wide-ranging effect on the residential and letting sector. We heard one view from the noble Earl and another from the noble Lord, Lord Gladwyn. The dilemma described by the noble Baroness, Lady Maddock, is quite correct. My experience in this industry is limited largely to the residential lettings sector in rural areas. From my past professional capacity I know that trying to make tenants accept rent increases that they are unable to pay is in nobody's interest. Bad relations between landlord and tenant are counterproductive. Increased costs and valuable time are always the consequence; and at the last resort litigation between parties, although sometimes inevitable, is never satisfactory.
The impact of the order on the industry has to be considered. It has been said that the court judgments which led to the introduction of the order corrected the system of fair rent increases that were intended by the original legislation and, to quote the Institute of Rent

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Officers and Rental Valuers, to cap increases now appears to be shutting the stable door after the horse has bolted, as the noble Lord, Lord Gladwyn, said.
I have also been informed that some tenants have been faced by earlier rent reviews to beat the deadline that allowed a period of three weeks between the introduction of this order and its coming into force. Why was this period agreed to, particularly after consultation had already taken place? With reference to the consultation period, how many responses were received and how many had concerns about the order?
My contacts in the industry tell me that the capping of the rents under the new formula will deter future investment in the area, as the noble Baroness said. I have spoken to a property company with a large portfolio which tells me that confidence in the industry is being badly hit. I know that the Government have stated on a number of occasions that there is no intention to change the legislative framework of the Housing Act 1988; but those suspicions remain.
I understand that the order involves changing primary legislation by secondary legislation. From my brief experience of your Lordships' House, I think that this is a relatively rare occurrence. Should not this change have been carried out by primary legislation, which would have enabled debate in both Houses of Parliament? If nothing more, it would demonstrate open government in practice.
This is a crucial time for the private rented sector. There is increased demand for housing and there are problems over the development of greenfield sites. Surely the Government should see this occasion as an opportunity to seize.
The consultation paper states that the effect of the order would enable the Exchequer to benefit only from small short-term housing benefit savings. How long is short term; and how much would the benefit amount to? Have Her Majesty's Government any intention to review the effect of the order over the next year?
I am of course aware that some people need help and protection. But, taking account of the ever-decreasing numbers of these tenancies, are there not other agencies available to help those who need it most? I look forward to hearing the responses of the Minister.
8.32 p.m.
Lord Whitty: My Lords, I thank the noble Earl, Lord Lytton, for initiating the debate, for coming to talk to me and my officials about what lay behind his concern and for being co-operative in not moving the Prayer due to other business at an earlier stage when the order was before the House. It is important that the Government explain their position on the order. Clear concerns were expressed by noble Lords in the debate. However, I need to nail one myth immediately. The noble Earl, Lord Lytton, the noble Baroness and, by implication, the noble Earl, Lord Courtown, expressed fears that our measures under the order would be seen as a prelude to wider rent controls traversing the whole of the private rented market. That is not the case. Let me lay those fears to rest.
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Our measures are intended to address a transitional problem in a small and declining part of the rental market sector. They apply to the tenants within that sector who have different rights from other tenants by definition. It does not affect unregulated, unregistered tenants. The limits that we are introducing under the order will not apply in any circumstances to 90 per cent. of private lettings because the factors that led us to introduce them simply do not apply in the deregulated sector. Landlords and tenants were aware in other parts of the private rented market that when the Housing Act 1988 was introduced market rents would be charged for new lettings and that rent increases would follow market trends. The order in no sense alters that change. We have given repeated assurances that we have no plans to change the wider legal framework for deregulated private tenancies. I am able to repeat emphatically those assurances today.
The noble Baroness, Lady Maddock, tempted me into discussing a range of housing policy issues; to some extent, the noble Earl, Lord Courtown, sought to do the same. It would be proper in the debate to concentrate on what the order provides rather than going into the wider areas. Therefore I move to the proposals under the order.
When the Housing Act 1988 introduced market rents for all new lettings, the right of existing regulated tenants to a fair rent was not changed by the government at that time. These tenants and their landlords may still apply to have a fair rent registered for the tenancy every two years by an independent rent officer. They can appeal against the rent officer's decision to a rent assessment committee.
When setting fair rents under these procedures, rent officers and committees are required by the Rent Act 1977 to take into account the age, character, locality and state of repair of the property but to disregard, as the noble Earl said, any premium resulting from a scarcity of similar accommodation in the locality. That principle was first established long before that—in 1965.
In the past, rent officers tended to decide rents by referring to fair rents previously determined for other comparable properties in the locality. Before 1989, when there was little evidence of market rents, this was the only practicable approach. As the noble Earl indicated, more recently a number of landmark court cases have held that rents officers and committees should give more weight to market rents for comparable properties now that there is a growing volume of open market evidence. The starting point should generally be the comparable market rent which is then adjusted to take account of scarcity.
However, changing to this method has caused fair rents to rise very steeply in recent years. Fair rent increases have been well above increases in the retail prices index over the same period. There are specific problems in particular areas; but, on average, there is a problem. In Merseyside, the average increase on re-registration has recently been around 45 per cent. In London, as the noble Lord, Lord Gladwyn, indicates, some tenants have faced substantial rent increases of 60 per cent. or more in two years. For example, a tenant in Hammersmith and Fulham faced an increase in rent

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of 65 per cent. in 1998, taking the rent to £7, 750 per annum from £4, 700 per annum only two years previously.
The noble Lord, Lord Gladwyn, drew attention to the particular vulnerability in areas of scarcity in central London. Indeed, the noble Earl, Lord Courtown, acknowledged that. This evening I have been told of substantially higher increases in rent than had been mentioned in my original briefing.
When the previous government introduced market rents for new lettings in 1989 they deliberately left the fair rent provisions for existing tenants intact. We do not believe that at that time anyone could reasonably have expected rent increases of the magnitude to which I now refer under a fair rent system.
That is as true of landlords as it is of tenants. The existence of fair rent controls has not prevented a brisk trade from taking place in the freeholds of properties occupied by fair rent tenants. Investors have paid a price reflecting the expectation that there would be little or no real growth in rental income. For their profit, they have looked forward to the prospect of sales when the tenancies come to an end at a much higher price reflecting vacant possession value. For them, the recent explosion in fair rents has thus been an unlooked-for bonus.
The noble Earl made the reasonable point that many landlords did not acquire their tenanted properties as speculative investments or indeed in some cases for investment reasons at all. They may have inherited the property, built it or acquired it to house employees, or purchased it as part of a much wider property portfolio. That is all very true, but none of it alters the fact that the original acquisition, and the assumption when the 1988 Act was coming in, will have taken place against the background of the fair rent controls as they were understood by landlords and tenants and expected to work at the time. The idea that growth in rental income might massively exceed the rate of inflation will not have entered the heads of any of these landlords at the point of acquisition or at the point of those tenancies being confirmed.
When we were faced with the increase in rents and the concern expressed by tenants and other operators in the property market, we considered that there was a strong case for the Government to intervene to moderate increases for the small and declining number of tenants with existing fair rents. I have to stress that the number of tenancies affected is small; some 120, 000 private tenancies in the sector as a whole, not all of which will be affected, plus 235, 000 secured tenancies of registered social landlords. Many of those tenants are elderly, as noble Lords have indicated. They have made assumptions about the rents that they will be paying for the rest of their lives.
That is not the central issue. The order does not change the way in which fair rents are determined under the 1977 Act; it simply limits the exceptionally high fair rent increases under the Act. By linking rent increases to the change in the retail prices index, they will follow the trend of market rents. But additionally, in
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recognition of the fact that fair rent increases were artificially low in the early 1990s, we have allowed a further premium; that is, an uplift of 7.5 per cent. for the first application made after the order came into force and 5 per cent. for subsequent applications. Therefore, contrary to what the noble Earl suggests, that will ultimately, except in the most extreme cases, allow fair rents to reach the level they would have done if we had not introduced the premium—but at a slower rate and depending on the future pattern of market rents. The convergence will exist and, except in extremely unlikely circumstances, there will be a large and growing divergence between market rents and the rate of inflation.
The limit will not apply to a substantial number of regulated tenancies where no fair rent is registered because the landlord and tenant have agreed a rent that has not been registered. We also felt that there should be an incentive for landlords to carry out major works to the property. The order therefore exempts landlords from the limit where a substantial rent increase of more than 15 per cent. is due because of an improvement in the condition of the property as a result of repairs or improvements by the landlord.
In formulating that exemption, we had on the one hand to provide an incentive to landlords to carry out major works, as described by the noble Earl, which would benefit tenants but, on the other hand, to ensure that the exemption would not allow landlords to circumvent the limit simply by carrying out running repairs and minor improvements. Minor works should be included in the annual management and maintenance plans.
As the noble Baroness, Lady Maddock, indicated, we must balance the objectives, providing incentives to landlords to make improvements and providing a fair return to the landlord, given the expectations on which such properties have been acquired or continued and a reasonable protection for the tenant. We believe that we have come up with a reasonable balance in both parties' interests.
The noble Earl objects in part to the tone of the consultation paper. Whatever his views on its tone, our proposals were clear. I cannot give precise figures, but we received a number of responses from landlords' and tenants' organisations, individual landlords and others. In the light of responses, we considered that there was some support for the approach. We decided that the case had been made for a small change to our original proposal. The initial uplift to the rent limit formula was reduced from our original proposal of 10 per cent. for the first term to 7.5 per cent. That was as a result of representations made from tenants' organisations that many landlords had already benefited from large increases.
I say to the noble Earl, Lord Courtown, that the provisions we are introducing do not alter primary legislation. We have the power, but it has not frequently been used, to provide limits. Modification already exists within the primary legislation and we are simply utilising that power. Clearly, some landlords have taken advantage of the timescale it has taken us to introduce

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the order to increase their rents. Of course, they were entitled to do so under existing legislation. All legislation takes a little time. Most legislation, once introduced, has a timetable for its coming into effect. I understand that there are a few examples of people taking advantage of that. It is a natural consequence of the parliamentary process and we cannot do much about it.
I do not accept the noble Earl's point that we were overriding the principle of a fair rent. Most landlords and tenants could never have anticipated increases of the size which have been imposed in certain areas. The noble Earl suggested that we had introduced an element of affordability into the fair rent system. We have done no such thing. We have referred to the situation of tenants on the basis of something under which they and the landlords were operating when the previous legislation was passed. The fair rent will continue to be determined on exactly the same criteria as under the original Rent Act principles. It is only in cases where the increases in fair rent would have outstripped inflation by a very generous margin that the order will slow the increase to a level which is manageable for the tenants and is consistent with what would until recently have been the high point of the landlords' reasonable expectations.
The noble Baroness and others raised the ignoble theory that this is all in order to save housing benefit. I can assure your Lordships that there is no such motivation for the change. Compared to the bill for housing benefit, any such benefit would have been extremely small, unpredictable and short term. I cannot give noble Lords the precise figures, but we are talking
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minuscule amounts compared with the problems of expenditure on the housing benefit front. I ask noble Lords to discount that as our motivation.
I hope that what I have said will reassure the noble Earl and noble Lords that the order we have laid is designed simply to ensure that the protection which has long been afforded to regulated tenants works as it was intended to. This is a limited measure and has no implications for other parts of the housing market. It is to address a small and transitional problem; it is not the prelude to wider rent control. We seek to extend the area of housing choice and do not believe that the measure will in any sense restrict that.
I suppose that, strictly speaking, the answer to the noble Earl's question could have been put shortly with a simple "No". Nevertheless, I believe that the House deserved a full explanation of the reasoning behind the order. It is to protect a group of tenants who have been protected from excessive increases by successive governments. The noble Lord, Lord Gladwyn, referred to the late Nicholas Ridley, who was not normally seen as an opponent to the free market. Like successive governments, he clearly saw the need to continue the protection and expectations held by tenants in various circumstances of this type of tenure. I believe that the measure will be appreciated by those tenants. It is fair and it continues to provide a reasonable return for landlords and a reasonable incentive for them to improve their properties.
I hope that in view of that explanation the noble Earl will feel it appropriate not to press his Question further tonight. If he wishes to raise any other points, no doubt we can deal with them in writing.
House adjourned at thirteen minutes before nine o'clock.

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