Sitting of 18 July 2000

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
PRIVATE BUSINESS

  CITY OF NEWCASTLE UPON TYNE BILL [LORDS] (BY ORDER)
  Order for Third Reading read.
  To be read the Third time on Tuesday 25 July.

  ALLIANCE & LEICESTER GROUP TREASURY PLC (TRANSFER) BILL [LORDS] (BY ORDER)
  Order for Second Reading read.
  To be read a Second time on Tuesday 25 July.

Oral Answers to Questions
  FOREIGN AND COMMONWEALTH AFFAIRS
  The Secretary of State was asked—
  FOREIGN AND COMMONWEALTH AFFAIRS

    Iran
    Mr. Frank Roy: If he will make a statement on the verdict of the trial of the Jews from Shiraz in Iran. [129540]
    The Minister of State, Foreign and Commonwealth Office (Mr. Peter Hain): We have expressed our deep concern to the Iranian authorities about the sentences. We and our European Union partners have consistently raised our concerns about the conduct of the trial—in particular, its closed nature despite earlier assurances to the contrary.
    Mr. Roy: Does my hon. Friend agree that, at a time when the Israelis and the Palestinians are moving that extra mile for peace, Iran remains a bastion of religious intolerance? Will he express to the Iranians the British Government's deep concern about their sham trial of Jewish teachers, rabbis, schoolboys, shopkeepers and cemetery attendants who are guilty of no more than being Jewish?
    Mr. Hain: I agree that the trial was deeply flawed. Indeed, we have consistently made our concerns about it clear to Iranian Ministers.
    It is, perhaps, something of a mercy, given that 17 Iranian Jews have been executed since 1979, that at least these were not death sentences; but they were nevertheless very heavy. In the context of a flawed trial, we hope that the appeals process will address that. It should be seen against the wider background of a reform
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    agenda in Iran which we welcome, in which we are engaged, and which has improved human rights in many other respects—although, sadly, it has not yet improved human rights for the Iranian Jewish community.
    Mr. Richard Spring: The Minister will be aware that the 10 Iranian Jews were held for months without charge, and were denied the right to appoint their own lawyers. Will he remind the Iranian Government, given the pending appeals process, that Iran is a signatory to the international charter of human rights, which enshrines the right to a just trial?
    Mr. Hain: I agree with the hon. Gentleman. My hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford), the Minister for Housing and Planning, is in Iran now. He has raised our concerns about the trial yet again, and has pressed for the sentences to be reviewed in a favourable way that addresses precisely the points that the hon. Gentleman has raised.
    Mrs. Gwyneth Dunwoody: Will my hon. Friend nevertheless insist that if there is really a serious programme to bring Iran into the circle of nations that believe in democracy, and if Iran really wishes once more to be an important player in world politics, Iran must recognise that show trials are not acceptable, that democratic countries will not support them, and that unless there is a very rapid move towards at least lightening the sentences there will be total opposition to allowing Iran to regain the role that it sees for itself?
    Mr. Hain: I agree that the eyes of the world will be on this case, and particularly on the way in which the appeals process proceeds. As my hon. Friend says, the trial was deeply flawed, and an injustice has been done. We continue to believe, however, that our policy of critical engagement with the reforming Iranian Government of President Khatami is the best way both to protect human rights in Iran and to engage the Iranian people directly with the objective of achieving an Iran that returns to what my hon. Friend rightly described as the circle of nations, so that it can play an honourable and peaceful role in the establishment of justice in the region and internationally.

    EU Reform
    Mr. Desmond Swayne: When he next plans to meet the French Foreign Minister to discuss EU institutional reform; and if he will make a statement. [129541]
    The Secretary of State for Foreign and Commonwealth Affairs (Mr. Robin Cook): I have a high regard for the French Foreign Minister, whom I meet regularly to discuss institutional reform. The hon. Gentleman will no doubt warmly welcome Mr. Vedrine's statement of last week that he was a pragmatist rather than a federalist.
    Mr. Swayne: Does the Foreign Secretary agree with the French Foreign Minister that a constitution for Europe is an aspiration?
    Mr. Cook: I read with interest the whole text of Mr. Vedrine's statement last week. He made it clear that

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    it was difficult to conceive of a constitution for Europe, because it would require a people of Europe. There is therefore no proposal from the French Foreign Minister for such a constitution.
    Mr. Bill Rammell: Does the Foreign Secretary agree that there is no consensus among EU Governments in favour of either the French or the German long-term view of the European Union, and that therefore—much though the Conservative party might wish it—the federalist nightmare is not upon us? Does he also agree that if the European Union enlarges there will need to be change, and that that change should focus on, as much as anything, the need to reconnect national Parliaments with decision making in the European Union?
    Mr. Cook: The proposal for a pioneer group of European member states has encountered criticism from various countries, from Finland to Italy. The Prime Minister of Italy has said:
    Federalism is the model of the past.
    Although Opposition Members may wish to scare us with the bogey of federalism on the march, the fact is that most member states agree with us that there is no case for a federal superpower, and that this is not a debate from which we should run away as Opposition Members wish us to.
    Mr. Mark Oaten: In his discussions with the French, will the Foreign Secretary still call for swift progress on enlargement, as promised in the Government's annual report, or does he now accept that there has been a cooling off on the issue, with 2006 being the earliest date at which countries will be able to join?
    Mr. Cook: I assure the hon. Gentleman that there is no cooling off on the part of the Government of Britain on that issue. We remain firmly committed to enlargement, and enlargement as soon as possible. Indeed, when this morning in Berlin, I met the German Foreign Minister, I repeated Britain's conviction that we should stick with the timetable that we set out recently at Helsinki, which is that the European Union should be ready for new members by the end of 2002. There are countries in central Europe that are making major strides, very painfully, towards membership. We should encourage, not discourage, them.
    Mr. John Redwood: When the Foreign Secretary prepares for his meeting with his French opposite number, he will have to read the draft treaty of Nice. Does he understand that, in that draft treaty, it is proposed that a large number of powers should transfer from our elected Parliament to an unelected European Government, including powers to tax? Will he now tell the House if he will rule out transfer of such powers under that treaty?
    Mr. Cook: I have repeatedly told the House—I am happy to say to it again for the right hon. Gentleman's benefit—that the Government will not agree to qualified majority voting on tax; but I notice that he is credited with having introduced Mr. Paul Sykes to the Conservative party. Perhaps, therefore, he can shed light on why it is that he belongs to a party—and was in a Government—which went into the European Community without a
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    referendum, which signed the Maastricht treaty without a referendum, and which would deny us a vote on the single currency if it were ever in power again; and explain why he has suddenly decided that a referendum on the treaty of Nice would be appropriate. The answer is that it has nothing to do with what might be in the treaty of Nice and everything to do with Paul Sykes and what he might put into Tory party bank accounts.
    Ms Rachel Squire: Does my right hon. Friend agree that there would be little or no benefit to Britain if our approach was to stand and whinge on the sidelines like the Tory party? Does he further agree that the best place for Britain to be is at the centre of the European stage, working for reform and enlargement to build a more democratic and accountable European Union?
    Mr. Cook: I absolutely agree with my hon. Friend. It is important for Britain to be at the centre of Europe and to be a leading partner in Europe. We will be a leading partner only if we retain the support that we have received from the countries that are seeking to be the new members of Europe. I believe that it is very important for Britain to champion enlargement and to be regarded by those countries as their ally and friend. That is why I view with bewilderment the Conservative party's decision to campaign strongly against the treaty that is necessary for enlargement and to throw away that support from central and eastern Europe.
    Mr. Richard Spring: Does the right hon. Gentleman agree that EU enlargement through membership of the former communist states of central and eastern Europe is a political and, indeed, moral imperative? Can he, despite his assurances, therefore comment on recent reports that the enlargement process is being delayed to 2005 or 2006 because of the EU' s unwillingness to carry through the necessary reforms? Does he agree that, for enlargement to succeed, the EU will have to reform itself as well as the candidate countries?
    Mr. Cook: Absolutely—of course Europe must reform itself. That is precisely what we are doing in the enlargement intergovernmental conference, which will culminate in the treaty of Nice. It is the hon. Gentleman and his party who are proposing to campaign against the treaty of Nice. If it is a moral imperative to enlarge the European Union, perhaps he can explain why the Tories will oppose the very reforms necessary for it. The reality is that he represents a party that, far from enlarging the European Union, frequently sounds as if it would rather shrink the European Union by taking Britain out of it.
    Mr. Spring: But is not the real barrier to enlargement the unreformed common agricultural policy? Why are the British Government not leading demands at the intergovernmental conference to tackle that? Is not their failure to engage seriously in the debate raging on the continent about the future shape of the EU yet another example of Britain being, to use the Prime Minister's own

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    self-description, "insufficiently assertive"? Why is it that the Government have no vision whatever of what the enlarged European Union should look like?
    Mr. Cook: I appreciate that the hon. Gentleman has recently joined us as his party's European spokesman. He may, therefore, have forgotten—or not noticed—that, at the Berlin summit, Britain did lead the campaign to reform the common agricultural policy. [Interruption.] The hon. Gentleman asks what that got us. It has got every household in Britain £64 off its food bill compared with the food bill when he was last in office and the previous Government were in power.
    The hon. Gentleman has totally failed to answer the question that I put to him. If Conservative Members really believe that it is important for Europe to be enlarged and for these countries to be encouraged, why are they proposing to oppose the treaty of Nice? Is it not that they would rather have Paul Sykes in their party than 13 more countries inside the European Union?

    Cyprus
    Mr. Andrew Love: If he will make a statement on recent bilateral contacts with Cyprus. [129542]
    The Minister of State, Foreign and Commonwealth Office (Mr. Keith Vaz): Recent bilateral contact with Cyprus has been both regular and valuable. My right hon. Friend the Prime Minister met President Clerides in April, and my right hon. Friend the Foreign Secretary met Foreign Minister Kasoulides in May. The meetings focused on the current United Nations Cyprus settlement process and the United Kingdom's continuing interest in and support for that process. Sir David Hannay, the UK special representative for Cyprus, is in regular contact with all those in Cyprus who are involved in the settlement process.
    Mr. Love: This week sees the 26th anniversary of the invasion of the island, and they have been long, frustrating years for Cypriots waiting for a solution. I welcome resumption of the proximity talks in Switzerland. Can my hon. Friend reassure the House that the Government continue to support a comprehensive solution to the problems in Cyprus that will reunite the island? Can he also confirm that the action that he is taking will lead to those talks being productive?
    Mr. Vaz: First, I congratulate my hon. Friend on all the work that he has done on the issue and on behalf of his many Cypriot constituents. I can reassure him that the Government are doing everything that we possibly can to support the proximity talks. As he knows, the talks will resume next Monday. As I said, Sir David Hannay is our representative. He has visited twice this year to talk to both sides. Our ambition, as set out in the Prime Minister's statement on 23 September 1998, is that there should be a just and lasting settlement. We would like to see a united Cyprus entering the European Union, but that is not a precondition to accession. We shall continue to do everything that we can to propose and support that settlement.
    Sir David Madel: Can Turkey become a full member of the European Union and yet still keep its army in northern Cyprus?
    Mr. Vaz: The issue of Turkey's candidacy is quite separate from the issues in Cyprus. Turkey has only just become a candidate for inclusion in the Helsinki accession process, and Turkey will be judged on whether it meets the Copenhagen criteria and on the state of its negotiations. No third country has a veto over the accession of another country into the European Union. We will, of course, be carefully monitoring the situation. We will ensure that we are fully aware of all the negotiation processes.
    Mr. Andrew Dismore: Will my hon. Friend take the opportunity of confirming that the Government will stick to their position that Cyprus's accession to the European Union will not be vetoed by Turkey or by any other country, and that settlement of the Cyprus issue is not a condition for Cyprus to join the European Union? Will he also make it clear to Turkey, in negotiations on its entry, that there can be no prospect of Turkey's joining the European Union unless and until it gets its troops out of Cyprus?
    Mr. Vaz: As I have just made clear, and as the Foreign Secretary made it clear on 14 February, we would like to see a united Cyprus entering the European Union. However, that is not a precondition for accession. Cyprus has done extremely well in the negotiations—it has opened 29 of 31 chapters of the acquis, and closed 16 chapters. Turkey does not have a veto over the accession of Cyprus. The issue for Turkey is quite separate: it will have to meet all the criteria. As we have said on many occasions, Turkey is a long way off. It will have to meet the Copenhagen criteria, and it will have to be part of its own negotiation procedures.
    Sir Sydney Chapman: In relation to Cyprus's application to join the European Union, will the Minister confirm that the main issues still to be resolved centre mainly on banking and ship registration? Will the Minister further confirm that there is no reason why those and a few other remaining matters cannot be cleared up in, say, six months' time? If so, why should Cyprus have to wait another two years for the sake of diplomatic convenience so that other successful applicants can join at the same time?
    Mr. Vaz: We would like Cyprus to join as soon as possible. It has made excellent progress and has opened 29 of the 31 chapters. There are a number of outstanding chapters and difficult negotiations, including banking. We would like Cyprus to join as soon as possible. It is up to the European Union to ensure that the IGC is completed as at the end of this year. Once that is done and the various treaties have been ratified, it will then be for Cyprus to set its own timetable. We are doing everything that we possibly can to help Cyprus as want to see it in the European Union.

    Portugal
    Ms Debra Shipley: What recent assessment he has made of bilateral relations between the UK and Portugal; and if he will make a statement. [129543]
    The Minister of State, Foreign and Commonwealth Office (Mr. Keith Vaz): Relations between Britain and Portugal have always been close, both bilaterally and as partners within the EU and allies within NATO. The relationship is stronger than it has ever been, following the intensive contacts we have had with Portugal in the run-up to and during its presidency of the EU. I pay tribute to the work of our ambassador to Portugal, Sir John Holmes.
    There has been considerable ministerial contact in the run-up to the Portuguese presidency and during the presidency itself. Since November 1999, 10 senior Cabinet Ministers have visited Portugal and 12 other Ministers have also been there.
    Ms Shipley: I thank my hon. Friend for that answer. Can he confirm whether or not the historic British-led agreement on the EU economic reform at Lisbon is now paying off in terms of real jobs and growth creation in the EU? Is that not the right way forward for Britain and Portugal, by contrast with the suggestion by the Opposition, who would have Britain out of the EU and working in partnership with Mexico in the North American Free Trade Agreement area?
    Mr. Vaz: My hon. Friend is absolutely right: Lisbon was an enormous success. It was a watershed in terms of the economic reform of the European Union and a tribute to the negotiating skills of my right hon. Friends the Prime Minister and the Foreign Secretary. The importance of the Lisbon summit is that it was preceded by a number of bilateral agreements between the United Kingdom and other countries. Of course our future is in the European Union—not in NAFTA, as has been barmily claimed by some Opposition Members.
    Mr. William Cash: The Minister will recall that the murderer of my constituent Isabelle Peake escaped to Portugal from France and thereby escaped justice in France. Will he confirm both that progress is being made in establishing how that person managed to evade justice and extradition by committing suicide in his cell, and the circumstances in which that happened? Apparently, the guards were watching football rather than guarding the prisoner. Finally, will he confirm that we will resist all attempts to pay compensation through Portugal to the person who committed the murder rather than to the victim and her parents?
    Mr. Vaz: I know that these must be painful matters for the family of Isabelle Peake, the hon. Gentleman's constituents. May I suggest that he come to see me about this matter with her parents so that we can take these matters forward? We will certainly do everything that we possibly can to assist the family and the hon. Gentleman in getting justice for his constituents.

    British Council
    Ann Keen: If he will make a statement on the funding of the British Council. [129544]
    The Minister of State, Foreign and Commonwealth Office (Mr. Peter Hain): The British Council is receiving grant-in-aid of some £136 million this financial year as
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    part of the three-year comprehensive spending review settlement. This represents a 2 per cent. increase in real terms over the 1998–99 level.
    Ann Keen: I thank my hon. Friend for that reply. I am sure that he and all right hon. and hon. Members will agree that the British Council does excellent and supportive work. I should particularly like to highlight its current work in the Punjab in relation to human rights and encouraging women there to stand as local government representatives. Will he confirm his support for higher funding for the British Council, in line with the opinion of the Select Committee on Foreign Affairs?
    Mr. Hain: I agree with my hon. Friend that the British Council is doing an excellent job in the Punjab. It has, for example, a library that is a showcase for Britain there, as it has in many other parts of the world. Wherever I go on overseas ministerial visits, I make a point of visiting the British Council if I can. As for funding, we shall have to wait for the Chancellor's statement, but 10 years ago under the Tories, spending on the British Council was 8 per cent. of the budget of the Foreign Office, whereas now it is 12 per cent. That shows our commitment to the British Council, and we shall continue to give it.
    Miss Anne McIntosh: I declare an interest. I received a British Council grant to study at a Danish university. I also received a grant from Rentokil. How many postgraduate students are now able to benefit from British Council funds to study at a European Union university, as I did in my early 20s?
    Mr. Hain: I am not sure whether the hon. Lady can spray a bit of Rentokil around the Conservative Benches, thereby enhancing the quality of the House. We are committed to the British Council's getting as much support as possible in respect both of the issue that she raises and of other issues. When I have visited posts, I have seen the excellent work of the council and the way in which it encourages students to come to Britain by providing all sorts of support, from IT support and English language training to assistance with visas and university placements. That is another excellent mark to its credit.
    Mr. Derek Wyatt: May I join the fan club of the British Council and express the hope that in the next hour it will receive an increase in its three-year funding? Will my hon. Friend use his best endeavours to support the council? As he knows, it deals with the English language, which is the world's premier language. Would it not be great if we could use some of the money in the next three years to link the British Council with the British library so that we could offer the best service in the world through British Council offices?
    Mr. Hain: I will certainly consider that. I agree with my hon. Friend that the council's commitment to English language teaching, much of it now self-financed, is extremely important. When I travel in francophone or lusophone African countries, it is clear that their leaders want to see their people and their countries engage increasingly with the English language and the anglophone world, not least because English is the language of IT and international business. For that reason,

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    the council's work will continue to have support from the Foreign Office, and I am sure that it will have support from the Chancellor later.

    Zimbabwe
    Mr. John Bercow: What plans he has to meet the President of Zimbabwe; and if he will make a statement. [129545]
    The Secretary of State for Foreign and Commonwealth Affairs (Mr. Robin Cook): Meetings with President Mugabe are always memorable, but at present I have no immediate plans for another such meeting. The recent elections in Zimbabwe were a triumph of the democratic spirit over attempts to suppress it. Despite two months of intimidation and gerrymandering, almost as many citizens of Zimbabwe voted for the Opposition as for the Government. I have urged President Mugabe to respond positively to the Opposition offer to work together and to accept the mood for change demonstrated by the people of Zimbabwe.
    Mr. Bercow: I am grateful to the Foreign Secretary for that reply. Given the appalling violence in the recent Zimbabwean elections, the call by Morgan Tsvangirai for the impeachment of President Mugabe, and the Prime Minister's acknowledgement that the Government are seen to be "insufficiently assertive" on this issue, why does the right hon. Gentleman not make President Mugabe a pariah by pressing internationally for the freezing of his assets and the immediate imposition of a ban on his foreign travel?
    Mr. Cook: I have the advantage over the hon. Gentleman, in that I spoke to Morgan Tsvangirai earlier today. He made it clear that the Opposition would be seeking ways of working together—[Interruption.] The hon. Gentleman quoted Morgan Tsvangirai; he should allow me the courtesy of sharing with the House what Morgan Tsvangirai shared with me this morning. He made it clear that, as the Opposition were seeking to work with the Government in the Parliament, which sits for the first time on Thursday, and as he had invited the Government to respond to that call for national reconciliation, he did not believe that penal sanctions would be helpful. The matter of impeachment is in the hands of the Parliament of Zimbabwe, not this Parliament.
    President Mugabe faces inflation of 60 per cent. and has just announced a budget deficit of 15 per cent. He faces food shortages, power cuts and business failures. No measure that we could take would impose more hardship on the people of Zimbabwe than what President Mugabe is already doing.
    Mr. David Taylor: Would my right hon. Friend the Foreign Secretary be astonished to hear that the hon. Member for Buckingham (Mr. Bercow) was once the secretary of the immigration and repatriation committee of the Monday club? Does not that show the nature of the remarks that we are hearing
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    from the Opposition Benches? Is not the mask being peeled away, to show the racism and xenophobia that have always been endemic in the Conservative party?
    Mr. Cook: I was unaware of that episode in the career of the hon. Member for Buckingham (Mr. Bercow). I have obviously failed to follow it with the attention that it deserves.
    Both sides of the House have praised the courage of Morgan Tsvangirai and the Opposition and their determination to put their case with dignity and without violence at the election. If we respect their courage and determination, we should respect also their advice when they ask us not to take sanctions against Zimbabwe.
    Mrs. Cheryl Gillan: The Foreign Secretary has been remarkably slow to condemn what has happened in Zimbabwe in the past. Given the universal condemnation of the elections as a travesty of democracy and the remarkable success of an extremely brave Opposition, operating with all the odds stacked against them; and given the fact that the Mugabe regime seems to have changed its behaviour not one iota since the elections, does the right hon. Gentleman agree that it is time now for Britain to use its position at the centre of the Commonwealth to mobilise some serious international action? Such action would show Mr. Mugabe that he is being watched, that he and his thuggish cronies will not be permitted the type of conduct that they have engaged in to date, and that it belongs firmly in the past? If he fails to do so, will he not be receiving another memo from the Prime Minister demanding to know why, on issues like Zimbabwe, the Government are seen to be "insufficiently assertive"?
    Mr. Cook: Far from our being slow on the question of Zimbabwe, there were 400 election observers towards the close of the election campaign, solely because Britain mobilised the international community and obtained observers from both the Commonwealth and the European Union—action which was warmly welcomed by the Opposition and the Opposition candidates. I have already discussed the report of the Commonwealth observers with the chair of the Commonwealth ministerial action group. We are inviting the comments of President Mugabe and the Government of Zimbabwe in response to it. We shall be ascertaining what steps we can take to ensure that when the people of Zimbabwe next have the opportunity of an election to fill the presidential post in two years' time, they can take it without fear of violence, intimidation and gerrymandering.

    Burma
    Mr. Jim Fitzpatrick: If the Burmese regime has responded to the recommendations made by the International Labour Organisation following its recent mission to the country. [129546]
    The Minister of State, Foreign and Commonwealth Office (Mr. John Battle): We are deeply concerned about the brutality of the military in Burma, the use of forced labour and the displacement of ethnic minorities.

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    Sadly, the Burmese regime has done nothing to implement ILO recommendations dating from 1998 that relate to forced labour, including women, children and the elderly, despite the recent ILO mission to Rangoon in May.
    Mr. Fitzpatrick: Will my hon. Friend continue to make it clear to investors in Burma that the military regime is in breach of ILO and other international conventions and that they should not be helping this outlawed country by doing business with its rulers?
    Mr. Battle: Yes. We announced on 17 June 1997 that we do not encourage trade with or investment in Burma. We have suspended financial support for trade missions and trade promotions. In March, I told Premier Oil, the largest UK investor in Burma, that we would welcome its moving out. Any British companies that inquire about trade with Burma are informed of the dire political situation and its appalling human rights record.
    We discourage tourism as well. It is not possible to ban people going to Burma, particularly from other countries, but every British tourist who goes to Burma should realise that he or she must exchange about US $300 on arrival, and every one of those dollars will be propping up that murderous regime.
    Mr. David Heath: Given the abuses that the Minister has already described, will he continue to stress that message to British companies, including Premier Oil? Will he seek also to persuade the Governments of eastern Asia, especially the Japanese, that the policy of constructive engagement with Burma is not working and that stronger measures are now needed?
    Mr. Battle: The answer is yes, we are doing that, and we will continue to do so. We have put pressure on the ILO, and, I think for the first time in its history, it has adopted exceptional measures which, if there is no change, will come into force in November. We have made representations, and we have proposed measures to strengthen the EU position. We have co-sponsored UN resolutions, and, with countries in the Association of South-East Asian Nations, we have also made the point forcefully that we will keep up pressure on Burma until it respects the democratic tights of all its people.
    Mr. Owen Paterson: Why does the ethical foreign policy apply to Burma but not to China?
    Mr. Battle: It does apply to China. The small difference is that Burma does not accept that there is even a question of its denying human rights, despite the fact that it is estimated that between 500,000 and 2 million people are refugees within that country. Burma will not enter into a dialogue at all. At least China is prepared to discuss the question of human rights. With Burma it is a shut door.

    World Service
    Mr. Paul Keetch: What assessment he has made of the BBC World Service's role in conflict prevention in third-world countries; and if he will make a statement. [129547]
    The Minister of State, Foreign and Commonwealth Office (Mr. Peter Hain): The objectivity that is the hallmark of BBC World Service broadcasts plays a crucial role in areas of tension and conflict. The BBC World Service also plays an important role in carrying out media training predominantly funded by the Government, where local media bias may be a contributing factor to conflict.
    Mr. Keetch: Does the Minister agree that the BBC remains the premier and most impartial international news organisation? Will he pay tribute to the World Service, not just at Bush house and elsewhere in Britain, but to its training programmes in places such as the Balkans, Indonesia, Sierra Leone and Afghanistan? Will he assure the House that, in the Chancellor's announcement which is to follow this Question Time, the World Service will be given the additional resources that it needs to upgrade its transmitters and relay stations and keep pace with modern technology?
    Mr. Hain: The hon. Gentleman will not expect me to respond to his request to anticipate the Chancellor. The Government are strongly committed to the BBC World Service, which is booming. Since last year, the number of its listeners has risen by 8 million to a record 151 million, and we have put in an additional £44 million during the current three-year period. That is a sign of our commitment. We want to see the BBC World Service and BBC world television extend their coverage throughout the world.
    Mr. Tom Clarke: Does my hon. Friend accept that many of us welcome the positive comments that he has just made about BBC radio and television internationally? Will he take this opportunity to congratulate it on its balanced coverage in a difficult situation during the recent elections in Peru?
    Mr. Hain: I agree with my hon. Friend that the coverage was very good, as it almost always—if not always—is throughout the world. Travelling throughout the world as my colleagues and I do, we continually hear praise heaped upon the BBC World Service, as one of the few objective sources of information in far too many countries.
    Mr. Martin Bell: Does the Minister share my view that the BBC World Service in radio and television is Britain's greatest diplomatic asset?
    Mr. Hain: Yes, probably, apart from the present team of Foreign Office Ministers.

    Colombia
    Mr. Paul Goggins: What recent representations he has made on behalf of kidnap victims in Colombia. [129548]
    The Minister of State, Foreign and Commonwealth Office (Mr. John Battle): The British ambassador in Bogota delivered a clear message to the guerrillas that they must end their involvement in kidnappings, forced disappearances and extortion, prior to an international meeting in Colombia on 29–30 June. A statement subsequently issued by all 23 countries and organisations

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    represented—including our EU partners—also called for an end to extortion, kidnappings and other serious violations of human rights.
    Mr. Goggins: As my hon. Friend is aware, kidnapping for political and financial advantage is an all too common occurrence in Colombia. I draw my hon. Friend's attention to the five remaining hostages of the Avianca hijacking in April last, one of whom is Juan Manuel Corzo, a member of the Colombian Parliament. Will the Minister use every means at his disposal to urge all armed groups in Colombia, including the FARC and the ELN to grant an early release to all hostages as a genuine and sincere indication of their desire for peace?
    Mr. Battle: Yes. We regularly discuss human rights with the Colombian authorities. Those discussions include the subject of kidnapping and hostage taking. My right hon. Friend the Prime Minister raised our concerns over the continuing violence in Colombia when he met President Pastrana during the President's visit to London on 13 April. We also stress the need for further progress on human rights. When my right hon. Friend the Minister for the Cabinet Office visited Colombia, she also urged the Government to tackle the problem of the paramilitaries.
    Of course, the best way to end kidnapping is to help the Colombian Government to advance the peace process. More encouragingly, on 10 July President Pastrana signed legislation making forced disappearances a criminal act under Colombian law. What we now want the Colombian Government to do is to introduce the instruments to enforce that legislation.
    Mr. John Wilkinson: I associate myself from the Conservative Benches with the remarks of the hon. Member for Wythenshawe and Sale, East (Mr. Goggins). Is not the fact that President Pastrana has sent his former high commissioner for peace to this country as ambassador a sign of the importance that the Colombian Government attach to the United Kingdom in advancing reconciliation and the restoration of security within that country? Can Her Majesty's Government now make resources available to Plan Colombia to reconstruct the country, and not necessarily wait for the European Union to do it?
    Mr. Battle: In relation to Plan Colombia, we are playing a full part in the international and EU discussions. We convened a conference in London to engage the non-governmental organisations in that process. The recent conference in Madrid took the process further. I believe that no country is discussing contributions at this stage, because we want the structure of our contributions to the plan to be right, which includes improving the human rights situation in Colombia. Our aim is to work constructively to ensure that the peace process is properly supported and that the horrific accounts by Amnesty International of some 24,000 murders that it has catalogued become a thing of the past.
    Dr. Jenny Tonge: I understand that the Minister for the Cabinet Office has recently had meetings about Plan Colombia in Colombia and in the
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    United States. Can the Minister tell us something about those meetings and whether the British Government are mindful of the need to modify the military aspect of Plan Colombia, which would do so much damage to the people there? Will the Minister also comment on the fumigation of crops that is proposed by the United States Government?
    Mr. Battle: The fact that my right hon. Friend was engaged in the process both during her visit and at the meeting in Madrid was a clear indication that we certainly attach importance to supporting the peace process. That not only means including alternative crops rather than spraying, but involves a wider social and economic agenda than has been suggested by others: it means tackling illegal drug production and trafficking, and we insist on an emphasis on human rights. Our intention has been to broaden and deepen the agenda so that it is not a single instrument; that would be in no one's interests. We want to ensure that in the long term Colombia has a peaceful way of ensuring the development of the people and not a dependency on drug cultivation.
    Mr. Tony Lloyd: My hon. Friend is right to say that the best long-term guarantee against kidnapping is to move on the peace process. But will he also make sure that the message from our Government is clear: we expect the Colombian Government to prioritise the problem of hostages and hostage taking and make sure that that is a part of their own peace dialogue; and that there is also an expectation that the ELN and the FARC will make sure that hostage taking becomes a thing of the past, as a measure of their sincerity in moving towards the process of peace?
    Mr. Battle: I can only re-emphasise that in all our meetings at every level we tackle that agenda and keep insisting on it. The British embassy maintains a regular dialogue with human rights bodies and other NGOs in Colombia and has facilitated meetings between NGOs and representatives of the Colombian armed forces in order to encourage confidence building. In addition, the ambassador and officials often visit trouble spots, both at the invitation of interested parties and on their own initiative, to try to bring people together around the peace process, which is the way forward.

    Middle East
    Mr. James Clappison: What recent representations he has received about the middle eastern peace process. [129549]
    The Secretary of State for Foreign and Commonwealth Affairs (Mr. Robin Cook): We warmly welcome the initiative of President Clinton in bringing Israel and the Palestinian Authority together in a summit. My right hon. Friend the Prime Minister and I met Prime Minister Barak on the eve of the summit and my right hon. Friend the Prime Minister has sent a message of support to President Arafat. There remain formidable differences to be bridged on the territory of the west bank, on the status of Jerusalem and on the rights of refugees.

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    Both sides must show courage and compromise if they are to secure for their peoples the great prize of a permanent peace.
    Mr. Clappison: Does the Foreign Secretary agree that, in their response to President Clinton's initiative, both Prime Minister Barak and President Arafat are making it abundantly clear that they are committed to the peace process and are doing everything in their power to bring about a lasting settlement in the face of substantial internal opposition? Can the Foreign Secretary tell us what practical steps the Government are taking to support them and, in particular, to help gain the acceptance of the Israeli and Palestinian people for the peace process?
    Mr. Cook: I agree absolutely with the hon. Gentleman about the courage being shown by both those leading the delegations. I stress that peace is a far greater advantage to both sides than the price of any compromise necessary to secure that permanent peace. The hon. Gentleman asked what we are doing to be helpful. Only yesterday, I spoke to Madeleine Albright and assured her that, if there is a peace settlement, Britain, and Britain in the European Union, will be willing to ensure that we take every possible step to see that it is bedded down and that the people of Israel and Palestine can see that there are real and concrete advantages from it.
    Mr. Michael Clapham: I welcome the fact that my right hon. Friend has played an important part in bringing together President Arafat and Prime Minister Barak. Does he agree that one of the major keys to peace in the area is to persuade and encourage the Syrians to support the peace deal? Will he step up his efforts, possibly working with one of the Arab leaders, such as Egypt, to persuade the Syrians to accept peace with Israel?
    Mr. Cook: Britain's position has always been to favour a comprehensive peace settlement. Only with a comprehensive peace settlement and all its tracks can we have security for the region. I met new President Bashar al-Assad at the state funeral in Damascus and assured him that we will wish to continue our dialogue and would wish to encourage both sides to find a solution to the Golan Heights and the Syrian track, which will bring stability and security to the region.

    EU Enlargement
    Mr. Peter Luff: If he will make a statement on the agenda for the current IGC as it relates to enlargement. [129550]
    The Secretary of State for Foreign and Commonwealth Affairs (Mr. Robin Cook): The central purpose of the intergovernmental conference is to prepare the European Union for enlarged membership. The applicant countries will measure Europe's commitment to enlargement by our resolve to complete these reforms on schedule. Britain's positive role in the IGC reflects the Government's position that Britain must be the champion of enlargement.
    Mr. Luff: Notwithstanding the Foreign Secretary's platitudes, does he agree with recent authoritative
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    estimates that enlargement could cost the EU budget £24 billion because of a failure to achieve fundamental reform of the common agricultural policy? Does the Foreign Secretary regret his Prime Minister's failure to secure such reforms at Berlin last year?
    Mr. Cook: At Berlin we secured reform of the structural funds and the common agricultural policy, which has provided—[Interruption.] We did indeed. Every household in Britain will see its bill decrease by £64 as a result. We created room in the budget to afford enlargement in the current financial perspective until the year 2006.
    The hon. Gentleman and his hon. Friends cannot pose as supporters of enlargement if they constantly harp on the cost of enlargement. There will be benefits. For Britain, those benefits could result in almost an additional £2 billion-worth of trade. We will benefit from that as an existing member; it is not just the new applicants that will benefit.
    Mr. Harry Barnes: Is there not a paradox in that many of the new applicants are newly emerging democracies? If they are accepted, they will be joining an organisation that is bureaucratic and centralised and will be giving up some of the democracy that has just been established? Should not the European Union enhance its democracy and help them to share in its operation?
    Mr. Cook: Whether those countries should join is a decision for their own democracies. I do not know any of those Governments who are not enthusiastic about joining the European Union. I agree with my hon. Friend that we must make the European Union more transparent, democratic and accountable and that is precisely why we are pressing at the IGC for reform of the Commission and the Council of Ministers, and for votes that will fairly reflect the size of population in the larger countries such as Britain.

    Africa
    Mr. Damian Green: What steps he has taken to put into practice his ethical foreign policy with regard to Africa; and if he will make a statement. [129551]
    The Minister of State, Foreign and Commonwealth Office (Mr. Peter Hain): We back positive change in Africa by supporting those Governments who promote democracy, respect for human rights and the rule of law. We are helping Africa in the fight against poverty, AIDS, corruption and conflict. I am focusing on activities that fuel conflict and break sanctions, especially the illegal diamond trade. Yesterday, I spoke at an international diamond trader conference in Antwerp to press for action to block diamonds that fund wars in Angola, Sierra Leone and the Congo.
    Mr. Green: I am grateful to the Minister for his words, but when he contemplated the sight of child soldiers in Sierra Leone carrying British weapons, did he consider the devastating candour of his own analysis in the New Statesman that the phrase "ethical dimension" in relation to Britain's foreign policy was just
    a hook on which we found ourselves … ?

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    Will he now acknowledge that the so-called ethical foreign policy is the Foreign Secretary's personal contribution to the Government's most pervasive failing—the desire at all times for spin rather than substance?
    Mr. Hain: That was a well rehearsed little contribution, wasn't it? The fact is that this Government have taken a stronger stand on human rights and social justice than any previous Government in Britain, and certainly the previous Tory Government of 18 years. What action did they take against the diamond traders who fuel conflict in Sierra Leone, Angola and the Congo? They did nothing. Yesterday, I represented the Government and my right hon. Friend the Foreign Secretary in Antwerp in seeking an agreement with the International Diamond Manufacturers Association, the producer countries and the importer countries, and the trading centres in Tel Aviv, Bombay and Antwerp, to put on the agenda for the first time a proper certification scheme to stop the illicit export and import of the diamonds which fuels war rather than prosperity. That is a great blow for human rights in Africa and elsewhere.
    Mr. Donald Anderson: My hon. Friend has made a significant personal contribution to human rights, especially in southern Africa. Does he agree that when apartheid reigned in South Africa, when the Group Areas and Registrations Act was on the statute book and when Nelson Mandela was in prison, there was no ethical foreign policy from the then British Government? One of the most significant things that we can do now to promote an ethical foreign policy is to help the South African Government with good governance and to relate to them in every way so that they can be a beacon in the region.
    Mr. Hain: Absolutely. As my hon. Friend points out, it was Conservative Members and their former leader who condemned Nelson Mandela as a terrorist. It was some of them and their supporters who went round universities in Britain with badges saying "Hang Nelson Mandela." Where was the ethics and the commitment to human rights in that? Our commitment on those issues was strong in opposition and continues to be driven forward in government.
    Mrs. Cheryl Gillan: Has the Minister had the opportunity to see yesterday's report that five people collecting relief items were killed in an ambush by Sudanese Government forces in the Nuba mountains? Is he aware that in recent months the Sudanese Government have bombed schools and medical centres in their country? Given that the United Nations Security Council and the United States have both condemned strongly the atrocities committed by the Sudanese Government, will not many people be appalled and dismayed by the tactless move of this Government in granting a visa to and laying out the red carpet for the Sudanese Foreign Minister today? When it comes to foreign policy, can the Minister tell us where hypocrisy ends and ethics begin?
    Mr. Hain: I shall take no lessons in hypocrisy from the hon. Lady, or from Conservatives generally. Is she saying that the Foreign Minister of the Sudan, who met me this morning to discuss the peace process and how to take that
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    forward and who will meet my right hon. Friend the Foreign Secretary this afternoon, should not come to visit the Archbishop of Canterbury either—because he is to meet the Archbishop too? To take forward the agenda for peace in that war-stricken country, the hon. Lady should support the Intergovernmental Authority on Drought and Development peace process and all the initiatives that we are taking and discussing with the Sudanese Government to end the misery and atrocities. I agree with her that those atrocities and miseries should be ended as soon as possible, which is why we are taking decisive action.

    Estonia
    Dr. Alan Whitehead: If he will make a statement on recent bilateral contacts with Estonia. [129552]
    The Minister of State, Foreign and Commonwealth Office (Mr. Keith Vaz): Bilateral contacts with Estonia are in excellent shape. In July 1999, my right hon. Friend the Foreign Secretary visited Tallinn on the occasion of the formal opening of the new British embassy building and held talks with senior members of the Estonian Government. President Meri called on my right hon. Friend the Foreign Secretary during his visit to the UK in March this year. I plan to visit Estonia in the autumn.
    Dr. Whitehead: I thank my hon. Friend for that reply. Does he accept that the passing of language laws in Estonia on 14 June was a genuine step forward in the protection of minorities there? Will he assure me that as enlargement takes place in the EU, applicant states will be closely monitored on their dealings with minorities and on good governance?
    Mr. Vaz: I agree that the passing of that law was extremely important. I assure my hon. Friend that, working through the High Commissioner for Ethnic Minorities at the Organisation for Security and Co-operation in Europe, we are doing our best to monitor the situation. Estonia is doing extremely well in its application to join the European Union and has opened 29 of the 31 chapters of the acquis, having closed 13 of them. Relations with our country are excellent and I believe that there is even an Estonian football player who plays for Derby County.
    Mr. Ian Bruce: I am sure that the Minister will acknowledge that Estonia is close to being ready for accession, as are a number of states. Can he tell the House when he expects accession to take place, as all the applicant countries keep telling us that they are getting extremely frustrated at the way in which Europe is holding them back?
    Mr. Vaz: As I told the House earlier, it is not for the European Union to set admission dates for applicant countries. It is for us to get our house in order, which the Foreign Secretary says we will have done with the conclusion of the IGC by the end of this year. We obviously want Estonia to join as quickly as possible, but it must set its own timetables and will only join once we have completed institutional reform. It will set its own timetables, and we want to see it in as quickly as possible.

    Vatican
    Mr. Andrew Mackinlay: If he will make a statement on the UK's relations with the Holy See. [129554]
    The Minister of State, Foreign and Commonwealth Office (Mr. Keith Vaz): We have very good relations with the Holy See. During my visit to Rome in January this year, I had a meeting at the Vatican with Monsignor Migliore, and also met Cardinal Etchegaray, Archbishop Van Thaun and Bishops Martin and Fitzgerald. Her Majesty the Queen will meet Pope John Paul II when she visits Rome between 16 and 19 October.
    Mr. Mackinlay: Does the Minister recall that the Foreign and Commonwealth Office, along with the American Department of State, considered it appropriate to give unsolicited advice to the Vatican on what it deemed to be the imprudence of the Holy Father making a visit to Iraq. Bearing in mind the fact that the Pope's travel arrangements are deemed to be appropriate business for the FCO, as well as our residual duties and obligations to promote human rights and religious liberties in Hong Kong, can the Minister tell us what representations have been, or will be, made to the Chinese authorities in the light of the fact that they refused the Pope permission to visit the 250,000 Catholics in Hong Kong on a pastoral visit?
    Mr. Vaz: If our embassy in the Holy See is consulted on these matters, we will be part of the discussions. There is no question of our telling the Pope or the Vatican where they should go or whom they should visit. However, if those matters are raised as part of the bilateral discussions and negotiations, the UK Government will put their views forward.

    Cyprus
    Mr. Eddie O'Hara: If he will make a statement on the resumption of the Cyprus proximity talks. [R][129555]
    Mr. Tom Cox: If he will make a statement on the resumption of the Cyprus proximity talks between the President of the Republic of Cyprus and Mr. Denktash. [129558]
    The Minister of State, Foreign and Commonwealth Office (Mr. Keith Vaz): We welcomed the resumption of
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    the UN proximity talks on 5 July in Geneva, which have adjourned but will resume on 24 July and proceed until around 4 August. There will then be a further recess, after which talks will resume on 12 September in New York. UN Assistant Secretary-General De Soto has stated that he is happy that a calendar for the talks has been established but is unwilling to characterise their state of play.
    Mr. O'Hara: On behalf of the British Government, will my hon. Friend condemn the recent advance of the Turkish army across 200 m of neutral ground at Strovilia, which is not only an act of aggression but an insult to the UN and, indeed, calculated not to facilitate the success of the negotiations? Further, will he confirm that the recognition of a Turkish republic of northern Cyprus as a legal entity can be neither the starting point nor the end point of negotiations, as that would legalise the armed occupation of a sovereign state?
    Mr. Vaz: My hon. Friend is clearly a friend of Cyprus and has raised these issues on a number of occasions. The Government do not want anything to interfere with the success of the proximity talks, which as he knows will begin on Monday. I shall certainly take on board the points that he has made and pass them to Sir David Hannay. [Interruption.]
    Madam Speaker: Order. I should be obliged if the House would come to order. It is still Question Time.
    Mr. Cox: Although I note my hon. Friend's reply, is he aware of the crucial importance of the present round of talks? Over the 26 years since the brutal invasion of the Republic of Cyprus, which I remind my hon. Friend is a Commonwealth country, we have seen countless similar talks, only for them to fail. I hope that my hon. Friend will propose that the United Nations resolutions on Cyprus form the basis of the talks and that Mr. Denktash and his advisers will at long last be asked to enter meaningful discussion and not engage in the spoiling tactics that have been used repeatedly over the years since the invasion of the Republic of Cyprus.
    Mr. Vaz: I pay tribute to my hon. Friend's work on the Cyprus issue. He will recall the Prime Minister's statement on 23 December 1998 and the progress that we have made in the past two years. He will know of the importance of the proximity talks, and that they resume on 24 July—next Monday. We will do everything that we can to ensure a just and lasting settlement to this sorry issue.

Spending Review
3.31 pm
The Chancellor of the Exchequer (Mr. Gordon Brown): With permission, Madam Speaker, I should like to make a statement.
The public spending allocations for 2001–04 that I am announcing today are possible because, having eliminated the £28 billion deficit that we inherited and having reduced the national debt, the state of our public finances is strong. In the economic cycles of the past 30 years, the current budget deficits averaged £109 billion. The national debt doubled and by 1997 had risen to 44 per cent. of national income. Stop-go in the economy meant stop-go in the public finances.
Our first task was to create stability and sustainable public finances and, having set clear fiscal rules over the economic cycle, a current budget in balance, borrowing only to invest within prudent and cautious limits. Today, we have not only low inflation and stable growth but year-on-year current budget surpluses and debt falling below 40 per cent. of national income—indeed, debt being repaid this year and next. It is this sustained and sustainable improvement in public finances that makes possible a sustained and sustainable improvement in our public services.
Our second task was to encourage the work ethic and secure rising employment. Today, with the assistance of the new deal, unemployment is at its lowest for 20 years, and almost 28 million people—more people than ever before—are in work in our country. Now, building on that foundation of stability and strengthened economic fundamentals, we can move to the next stage in creating a better future: to make good the damage done by the legacy of decades of underinvestment across our public services, and to realise long-term national goals that we have set for a decade. They are to close the productivity gap with our competitors, to deliver and sustain full employment, to secure higher education for a majority of our young people, to halve and then abolish child poverty and to build strong public services as we create a Britain where there is security and opportunity not just for some people but for everyone.
The first conclusion of this year's spending review is that prudent, targeted, long-term investment is not only a social good but, in a changing and often insecure world, an economic necessity. It is only by investing in education, science and the future of our children that we can equip ourselves for future economic success and ensure opportunity for all. It is only by investing in health, transport, the environment and law and order that we can ensure a more productive economy and security for all.
Just as stability and economic strength make possible new investment, so too new investment will reinforce stability and create longer-term economic strength. So, while we will raise current expenditure only in line with our neutral view of trend growth by 2½ per cent. a year, we propose to tackle the long-term neglect of investment in our country with a step change in capital investment for education, science, health, policing and transport and infrastructure.
As I announced in the Budget, net capital investment will more than double, rising from £7 billion this year to £18 billion by 2004, within a ceiling for public investment of 1.8 per cent. of national income as we renew our public services.
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The second conclusion of our spending review is that it is by tying new resources to reform and to results and by locking in incentives, penalties, inspection and information that we ensure that new investment goes to the front-line services: in secondary as well as primary schools, new targets for literacy, numeracy and IT; in hospitals, new systems of inspection; in law and order, reforms of criminal justice; in defence, the next stage of the strategic defence review; in local government, new public service agreements; and in transport, the new partnership between public and private sector. At every stage, money will be tied to output and to performance.
Let me give the full details of the financial background. In the Budget, I confirmed that the current surpluses from 2000 would be £14 billion, £16 billion, £13 billion, £8 billion and £8 billion in the succeeding years. I also confirmed that net borrowing would be minus £6·5 billion, minus £5 billion, plus £3 billion, plus £11 billion and plus £13 billion—lower borrowing in every year than in any year of the previous Parliament. I said that, as a share of national income, debt will be 35, 34, 33, 33 and 33 per cent. Thus, even with our programme of public investment, we meet both our fiscal rules, and we do so even on the most cautious case and even on the most cautious view of trend growth at 2.25 per cent.
In accordance with the code of fiscal stability, I will publish the second set of fiscal forecasts of the year in the autumn, but I can already report to the House that, since the Budget, the fiscal position has further strengthened. For the year ending March 2000, the current surplus is healthier than originally forecast at the time of the Budget. [Interruption.] The Opposition are not used to these announcements. The current surplus is not £17.1 billion, but £20.4 billion. Debt as a share of GDP has been reduced from 37.1 to 36.8 per cent.
Indeed, I will use a further underspend of £2.5 billion in annually managed expenditure to repay more debt. Two billion pounds in departmental expenditure can be carried forward. However, on grounds of prudence, I have decided to allow a carry forward of only £1.5 billion and to allow spending of only half of that this year and half next year, and to allocate the remaining sum to repay more debt.
It is only because we have put the public finances on a sustainable footing that I can raise spending today. That same discipline allows me to inform the House that, this year, we have repaid £6.2 billion more debt than the £11.9 billion originally planned—in total, a debit repayment this year of £18.1 billion. That is the largest repayment of debt in any year since the war.
We have not, and will not, relax that discipline. So I have three policy announcements to underspin—[Laughted]—underpin the strength of our public finances. Further limited sales of spectrum will take place by the end of 2001. We will not repeat the mistakes of the North sea oil windfall. We will not repeat the mistakes of the privatisation sales, where receipts were immediately used up in current spending. I can confirm that all the capital proceeds will, as with the £22 billion from the first sale of spectrum, go to further reducing the burden of debt.
As debt is reduced, so too are debt interest payments. The first spectrum sale alone will save the bill for debt interest by a further £1 billion a year by 2003–04. As I will confirm later this afternoon, that money will go, year after year, directly to improve our public services.

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Secondly, Departments and authorities will make asset and property sales of £4 billion a year over the next three years. That makes £4 billion a year released by realising unproductive assets that we do not need to fund service improvements that we do need. Because money is tied to modernisation, the new public service agreements signed with Departments, and now signed for the first time with local government, will specify not only agreed outcomes, but precise timetables for making necessary reforms.
I can tell the House that as a result of the fall in the share of administration costs in total government spending, new money makes possible a substantial shift in spending to front-line services to recruit more nurses, doctors, teachers, classroom assistants and police—more staff for our front-line services. With the success of the new deal, the bills for social and economic failure are £3½ billion lower, enabling us to transfer £3½ billion every year from paying unemployment benefits to funding public services.
With that improvement comes a radical shift in the composition of public spending in our country. Our promise was to reduce the costs of failure—the bills for unemployment and debt interest—in order to reallocate money to key public services. In the two decades from 1979 to 1997, rising debt interest and unemployment and social security accounted for 42 per cent. of all extra public spending. That meant that 42p in every additional pound was not available to the key public services.
In the coming three years, unemployment, social security and debt interest payments will account not for 42 per cent., but for only 17 per cent. of extra public spending—even as we direct more money to child benefit and the minimum income guarantee. That leaves 80 per cent. of new money for health, education, transport, policing and other public services. The extra resources are available to us not at the expense of prudence, but because of our prudence.
Within our fiscal rules and within the envelope that I set in the Budget, and have strictly adhered to, I can announce that spending on public services—what is called the departmental expenditure limit—is able to rise from £195 billion this year and from our previously planned £203 billion next year to £212.1 billion, then £229 billion, then £246 billion in 2003–04. By 2004, an extra £43 billion a year will be allocated to front-line services in our country. Sustained improvements in public services are now made possible because, with stability and strengthened economic fundamentals, lower debt interest and lower unemployment, we have sustained improvements in our public finances.
I turn now to the departmental allocations. In recent years, in addition to their conventional responsibilities, Britain's defence forces have taken on a new and valued role in international peacekeeping and in conflict prevention, promoting human rights and peace throughout the world, including in Sierra Leone and Kosovo. To complete the restructuring agreed in the strategic defence review, and to fund new equipment and increase the mobility of our front-line forces, defence spending, which has fallen in real terms every year since the end of the cold war, will now increase in real terms. The allocations are £23.6 billion next year, rising to £25 billion in cash in 2003–04.
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The rise in the Foreign Office budget from £1.2 billion next year to £1.32 billion in 2003–04 will not only finance the proper representation and promotion of Britain abroad. My right hon. Friend the Foreign Secretary will also announce today that the British Council will receive extra funds, and the budget for the BBC World Service will rise substantially from £174 million this year to £180 million next year and £210 million by the end of the period in order to achieve our new target of 153 million World Service listeners by 2002.
Because we take seriously our international responsibilities to the environment, the Government are also announcing today a special £85 million fund to assist with the nuclear clean-up at Chernobyl.
The international community's clearest duty and greatest challenge is to halve world poverty by 2015 and to make primary education universal for every child. Our international aid budget will therefore rise from £2.8 billion this year to £3.1 billion next year, then £3.3 billion and £3.6 billion by 2004—a real-terms rise of 6.2 per cent. a year, in contrast to the falling share of national income devoted to overseas aid from 1979 to 1997, now a rising share of national income today and in the future, as we honour in full our commitment to debt relief, which is our obligation to the poorest countries of the world.
I turn to our second set of decisions—new investment to build stronger communities. The Home Office budget will rise from £8.2 billion this year to £9.6 billion next year, to £10.3 billion the year after and £10.6 billion in 2003–04, an annual rise in real terms averaging 6.4 per cent. a year. And tomorrow the Home Secretary will set out both his targets and how this allocation will be spent.
To implement fully the Good Friday agreement, an extra £316 million over three years will help fund the modernisation of policing and criminal justice in Northern Ireland, and in this way help underpin peace and future prosperity.
Every community in the land is weakened by the evil of drugs. In return for challenging new targets to cut drug-related reoffending by 50 per cent. over the decade and to treat twice as many addicts through the new National Treatment Agency, the new anti-drugs budget will be set at £870 million in 2002 and rise to £931 million and £996 million by 2004, an average annual real growth rate of 10 per cent.
Strengthening our local communities involves a new partnership with local government based on increased investment and new targets. The three-year settlement for local government—an annual real-terms rise of 3 per cent. over and above inflation—will be set out in full by the Minister for Local Government and the Regions, and Ministers in Scotland, Wales and Northern Ireland will make related announcements.
Local and national Government need to work ever more closely in a new partnership for reform and for improvement, particularly in our poorest areas. For decades, our whole country has been scarred by deep and persistent deprivation and underachievement in high-unemployment communities. While much previous spending has been directed to dealing with the consequences of economic and social failure, it is time now to invest in tackling the causes—poor school results, poorer standards of public health and low levels of economic activity.

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Today, our poorest council estates suffer unemployment four times and burglary rates three times the national average, and mortality rates are 30 per cent. higher. These unjustifiable and divisive inequalities cannot any longer be tolerated. Both Government and communities must raise their sights, with a new target to raise up the poorest areas and thereby narrow the gap between these areas and the rest of the country.
So we will not only extend the new deal for communities but strengthen the institutions—from our schools to our health centres—on which these communities depend. In return for local service agreements that require new minimum standards in school attainment, public health, law and order and job creation, a new neighbourhood renewal fund will provide, by 2004, new resources worth £400 million.
In this spending round, housing—and our objective of decent affordable housing for all—will receive the priority it deserves and the resources it needs: an additional £1.6 billion of new investment by 2004, a real-terms rise averaging in this round 12 per cent. a year.
Across the social sector, we will ensure that half a million more houses will be modernised or repaired. This is part of a 10-year plan to eliminate all substandard housing; and, as we implement key recommendations of the Rogers report, reclaimed brownfield sites will account for 60 per cent. of new housing, creating thousands of new construction jobs.
Investment in the future must mean also investment in a cleaner environment. To meet our climate change commitments, the Minister for the Environment will announce how new resources will promote emissions trading and energy efficiency in Britain's homes. Further announcements will be made on the use of renewable energy and recycling by local authorities.
In rural communities, the new rural transport fund has extended the rural network, with 2,000 new or improved bus services. The rural transport fund will now be increased from an annual allocation of £60 million to £95 million; and there will be an announcement later of new finance available for maintaining the post office network in both rural and urban areas.
As farming restructures, deals with BSE and meets challenging targets to move from the old farm production subsidies to the new environmental improvement payments, the agricultural budget—including the Intervention Board—will increase from £1 billion this year to £1.35 billion by 2004, an average annual real-terms increase of 6 per cent. The Food Standards Agency will see its budget for its important work rise from £87 million this year to £111 million by 2004.
Extending access, particularly for our young people, to the arts and to sport will strengthen every community. With a 4.3 per cent. annual real-terms rise in the budget of the Department for Culture, Media and Sport, there will be significant improvement in funding for the arts. My right hon. Friend the Secretary of State for Culture, Media and Sport will give details of new funding to encourage children to use our libraries, museums and arts and to encourage sports, especially in schools and throughout our communities.
Strengthening communities of course involves strengthening our social services and our health service. The NHS plan will be announced next week. There will also be a major package of investment in services for
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elderly people, including the Government's response to the royal commission on long-term care. My right hon. Friend the Secretary of State for Health will announce the detail of this and other allocations from the health and social services budget next week.
I can also confirm that, in the autumn, the Government will publish our proposed plans for a new pensioner credit, with a view to further announcements on a Budget timetable.
The strong civic society that we seek is built not by rights alone, but by rights and responsibilities. So we will match our Budget tax reliefs to encourage the giving of money with new measures today to encourage the giving of time. Extra resources of £60 million pounds by 2003–04 will have the clear aim of encouraging 1 million more of our citizens to be volunteers in community service.
I turn now to the investment that we must make in our economic future. Britain has great strengths. It is the best place in Europe to do business, with world-class companies in science and technology, but to build for the future we must put in place the long-term investment that is the precondition of a strong economy and of bridging the productivity gap with our competitors. We must avoid the short-termism of the past.
Working with business, the role of Government in the modern world is not to subsidise loss makers or to attempt to pick winners. The new role of Government is to invest in science and innovation, to promote competition and small business development, to encourage balanced regional development, to meet the pressing needs of transport and infrastructure and, most of all, to invest in those great drivers of prosperity—education and skills.
I deal first with investment in science. With our investment in a £1 billion public-private partnership with the Wellcome Trust to re-equip university science, and extra resources to support pioneering medical research that will be announced later, we will raise the science budget by 5.4 per cent. a year in real terms.
To ensure that invention in Britain leads to manufacturing in Britain and jobs in Britain, my right hon. Friend the Secretary of State for Trade and Industry will also announce new resources for a university challenge fund that commercialises inventions, and for university-based regional enterprise centres.
Britain's small businesses are the backbone of local economies. To offer the new services that businesses have themselves requested, the budget of the new Small Business Service will rise substantially, from just under £200 million this year to £277 million by 2004. That will include a national internet service offering comprehensive business advice and a consultancy service for start-ups. It will be worth up to £2,000 for start-ups in high-unemployment areas. As a result, the numbers of small businesses that employ people, which have already risen from 1.2 million in 1997 to 1.3 million now—a rise of 10 per cent. under this Government—can expand in every area of the country.
The newest and most decisive challenge in the new century, demanding higher levels of investment, is to master and lead in the new information technologies. To make Britain best for electronic trading and to bridge the growing digital divide, we have agreed a three-year programme of rapidly rising investment in our

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communities and a new fund, which my right hon. Friend the Prime Minister will announce, to ensure that by 2005 Britain will have all Government services offered online.
Investment in innovation, infrastructure and skills is essential in every region if there are to be high levels of productivity in Britain and full employment throughout our country. To secure that balanced regional development, regional development agencies will receive additional resources, and their budgets will be increased by £500 million a year by 2003–04.
There will not only be new funds but new flexibilities, so that local people can promote local priorities and meet local needs they have identified. In the north-west, there is the regional plan to promote innovation and research; in the north-east, increasing entrepreneurship; in Yorkshire and Humberside, funds for small business development; in the east midlands, information and communications technology; in the west midlands, modern manufacturing; and in the south-east and south-west, as in Scotland, Wales and Northern Ireland, the promotion of clusters of growth. In every region there is new support for skills, for employment and for schools and colleges to promote enterprise open to all.
The overall settlement for Scotland provides for an increase of £3.4 billion a year by 2003–04, which is an annual real-terms rise of 4.4 per cent. A separate announcement will be made by the Scottish Executive.
For objective 1 areas in the United Kingdom—in Wales, Cornwall, Merseyside and South Yorkshire—and for objective 2 and 3 areas, I am today announcing a new approach that will raise their levels of investment. Within our departmental allocations that we are making today, the Government will ensure funding for the European share of objective 1, 2 and 3 projects. For European Union structural funds, that is estimated to total £4.2 billion over three years, including an estimated total of £600 million for new objective 1 programmes in English regions.
The settlement also increases funding for Wales by a total of 5.4 per cent. a year in real terms, and allows for match funding. It includes a special allocation to ensure funding of the European share of Wales's objective 1 needs—an allocation to Wales of £80 million, £90 million and £102 million over the next three years. I am also transferring management of the European social fund allocations of £149 million for Wales over the next three years to the Welsh Assembly.
It is because of the importance to all regions of modern transport and infrastructure that we will now make a step change in investment in public transport. In the Budget, we removed the automatic fuel escalator, and extra money was allocated to roads and public transport this year. Now we are able to raise spending on roads and public transport by significant extra sums to meet the needs of business and the public, from £4.9 billion this year to £6 billion next year, then to £7.4 billion and £9.1 billion in 2003–04, which is a real-terms rise of 20 per cent. a year to 2004. Details of the targets to improve bus and rail services and to cut road congestion, and of the allocation of funds, will be set out in the 10-year plan to be published by the Deputy Prime Minister on Thursday this week.
The modern economy can succeed only when it uses all the talent of all its people. Any potential squandered is a resource denied to this country's future. In this
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review, we allocate new funds to advance our goal of full employment. For 70,000 employers, nearly 500,000 young people and for Britain, which has seen long-term youth unemployment fall by 70 per cent., the new deal has been succeeding and is a central building block for our policy of full employment. Long-term youth unemployment, which rose to 500,000 in the 1980s, is 50,000 today.
The windfall levy raised more than £5 billion, with £1.6 billion allocated to investment in our schools, and £3.5 billion to employment creation. Because the new deal has been even more successful than forecast, with more people getting back to work more quickly, there is an underspend that enables us to fund the new deal well into the next Parliament, and to transform what started as the new deal for the young unemployed into a permanent deal for all long-term unemployed.
Having helped 500,000 on the new deal, we now set plans to help the next 500,000. Next year and until 2003, I expect £1.7 billion to be available from the windfall levy to do more to coach the hard-to-employ young unemployed and systematically to create new opportunities for our long-term unemployed, nearly 1 million single parents and thousands of disabled men and women who want to work.
To bring both child care and employment within the reach of more parents, child care investment will rise from £66 million this year to £200 million by 2003–4, as we deliver, as we promised, our national child care strategy.
Because of our success in cutting unemployment, social security spending, which grew by 4 per cent. a year in the previous Parliament, is growing by 1½ per cent. a year this year and over the next three years, and the budget for unemployment-related benefits is falling.
To make further social security savings by tackling fraud and error, we are announcing new investment in staff and technology. Having cut errors in income support claims by half, we now plan to cut fraud and error in the jobseeker's allowance and in income support payments, first by 25 per cent. by 2004, and then by 50 per cent. Some, including the Leader of the Opposition, have proposed savings of £1 billion from social security fraud in the next Parliament. Our proposals achieve savings in excess of £1 billion.
I turn now to investment to ensure that all children have the best start in life. Today's children will be tomorrow's doctors, scientists, engineers and nurses—our future work force in every area. By investing in children, we are investing in our country's future. We have invested £7 billion a year more in families during this Parliament, raising child benefit by 35 per cent. and guaranteeing a minimum family income under the working families tax credit; and from next April, the new children's credit will be worth £442 a year to the typical family.
It is now time to take further steps. The war against child poverty requires not only additional cash but the support and encouragement of all forces of care and compassion in every community. It can be won only by the combined efforts of parents and the private, voluntary, charitable and public sectors working together. In a unique initiative, after consultation with charities and voluntary organisations, we will create a national children's fund with a budget over three years totalling £450 million, to help children and young people at risk.

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The children's fund will work with national children's charities and local community organisations, secular and faith based, and will support those dedicated staff and committed volunteers who offer one-to-one help to young people and to parents at risk, and £70 million will be allocated to a network of local and regional children's funds.
I turn to investment in education. With the funds that my right hon. Friend the Secretary of State for Education and Employment allocated from the first spending review, he has made major reforms in education, ensuring nursery education for every four-year-old; cutting class sizes for five to seven-year-olds; raising literacy and numeracy standards for 11-year-olds by 6 and 10 percentage points; and reforming and expanding higher and further education.
Education qualifications are, in the modern world, the surest route to opportunity and security for all. All children should be ready to learn when they reach school. From the first spending review came sure start, which is now lifting 50,000 children and their parents out of poverty.
In the second review, and tied to targets for improving child development and parental responsibility, we will by 2004, with a budget of £500 million, expand the number of children helped in our country to 345,000. With nursery places already increasing from 200,000 in 1997 to 400,000 in 2002, my right hon. Friend the Secretary of State for Education and Employment will announce funds for the next stage in our expansion of nursery education.
Having improved standards in our primary schools, the next task is to raise standards as decisively in the secondary schools, so the expansion of resources that my right hon. Friend will announce for all schools is designed to back up reform and to bring radical improvement in the comprehensive system to ensure that opportunity for all means the highest standards of education for all.
My right hon. Friend will consult on and fund a new target for our secondary schools: by 2007, not today's 60 per cent., but 85 per cent. of 14-year-olds must meet literacy, numeracy and computer standards. To raise Britain's appallingly low staying-on rate at school, we are setting aside £150 million a year for education maintenance allowances worth up to £40 a week. Our new and challenging target is: by 2004, 80,000 more 16 to 18-year-olds in education and nearly 60 per cent. of young people having left school or college with A-levels or their equivalent by age 21.
Under the new deal for schools, 17,000 of our schools will have had some improvement, modernisation or renovation by 2002, and every one of our schools—32,000 of them—will be linked to the internet by that date. Our objective by 2004 is 500,000 more computers in our schools. By 2010, we want the majority of young people to be going on to higher education. My right hon. Friend is allocating £100 million extra to higher education in 2001–02, a 4.6 per cent. real terms increase in total. The review provides further finance that will raise the numbers in part-time and full-time higher and further education towards that goal of 50 per cent.
State pupils secure two thirds of the top A-level qualifications, but only half the places in some of our leading universities. To bridge that gap, the Secretary of State for Education and Employment is today setting a new objective to improve access. The Higher Education
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Funding Council for England will provide financial help for universities submitting plans for year-on-year improvements in the widening of access.
Two million adults have a reading age of seven or lower. Adult illiteracy is not just a failure of our society, but—as business leaders around the country have told me—an economic inefficiency that the country cannot tolerate. In the coming weeks, the Secretary of State will announce the provision of new resources to tackle those barriers to opportunity and earnings.
The best education for all, from early learning to lifelong learning, is not only a time-honoured social ideal but, in today's world, an absolute economic necessity. That is why we have decided to make increased investment in education the priority of this year's review, and to back sustained long-term reform with a sustained increase in resources.
In the Budget I was able to allocate new resources to the national health service, amounting to a rise of 6.1 per cent. a year in real terms over the four years to 2004. I was also able to allocate an additional £1 billion to United Kingdom education for this year. Today, in return for the new targets for improved standards, we can allocate further resources for UK education for the next three years.
Under the last Government, UK education spending rose by an average of only 1.5 per cent. a year in real terms. Over the next three years, it will rise by 5.4 per cent. in real terms. Spending will rise from last year's £40.6 billion and this year's £45.8 billion to £49.5 billion, £53.4 billion, then £57.7 billion. The money that I have announced in the Budget and today will deliver, over the four years from now until 2004, an average annual increase of 6.6 per cent. in real terms—an annual rate of growth far in excess of the 1.5 per cent. achieved from 1979 to 1997.
I have one further and final announcement to make. In March, the Secretary of State for Education and Employment made special payments direct to head teachers for books and equipment. They ranged from £3,000 to £9,000 for primary schools, and from £30,000 to £50,000 for secondary schools. A total of £290 million went direct to head teachers, to be spent by schools for use in the classroom.
The Government have decided to continue that innovation, but next April the Secretary of State will allocate to our head teachers not £290 million but £540 million. As a result, head teachers in every one of our smaller primary schools will next year receive not £3,000, but a payment of £6,000. The larger primary schools will receive not £9,000, but £20,000. For the smaller secondary schools there will now be payments of £50,000, rising, for the larger secondary schools, to £70,000. Those payments will now be made not just for one year, but for every year until 2004.
We have made our choice: improved investment in health, education, transport and social services, and in our communities. It is now for those who oppose our spending plans to state clearly where their cuts would fall. This Government have been prudent for a purpose. Our

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choice is stability, employment and sustained long-term investment, now and into the next Parliament, to create a Britain of security and opportunity for all.
I commend this statement to the House.
Mr. Michael Portillo: As usual, I draw attention to my entry in the Register of Members' Interests. [HON. MEMBERS: "Ah!"] At least I am honest about it.
I believe that:
The level of public spending is no longer the best measure of the effectiveness of government.—[Laughter.]
I was quoting from the Labour party manifesto. [Interruption.] Labour Members roar. It is in there. That is the basis, that is the commitment, on which the Chancellor of the Exchequer fought the last election campaign. Was the Chancellor being insincere with us then, or is he kidding us all now? Either way, who can believe a word that he says now?
Does the Chancellor recall promising, two years ago, £40 billion to transform health and education and to tackle crime? If Labour Members believe that the £40 billion that he has announced today will save their seats, they should remember that the previous £40 billion did not improve public services. This £40 billion will not improve public services, because Labour's spending is not working. Today the Chancellor announced lots more targets. The history of the Government is that they have dumped the targets that they cannot meet.
Another gem in the Labour manifesto was its commitment that the Labour Government would be
wise spenders, not big spenders.
Now, that is all turned around. Now they are going to be big spenders, not wise spenders, because we are all paying for their failure to reform welfare. We are all paying for their distortion of the clinical priorities in the national health service—distorted by a Government obsessed with spin. We are paying for their failed policies of interference in education. Here is the Chancellor today offering titbits directly to schools. Why does he not give the vast majority of the money directly to schools, as we propose to do? We are still paying for the dome. Is it any wonder that the Labour Government—[Interruption.] Oh yes we are. Is it any wonder that the Labour Government tax more and deliver less?
Does the Chancellor remember that the last time he spoke to us, he said:
if we don't spend the money well, people will suffer.
Well, people have suffered. Their taxes have gone up, but public services have got no better. Hospital waiting lists are up. Class sizes are bigger. [Interruption.]
Madam Speaker: Order. I would be obliged if the House would come to order. The House was not always in good order for the Chancellor, but it was for most of the time. I expect the same for the Opposition spokesman.
Mr. Portillo: Hospital waiting lists are up. Class sizes are bigger. Today the Government have released the most appalling figures for violent crime. How can they spend so much, and spend it so badly?
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Today the Chancellor tells us that spending will be tied to output. If that is the case, what has he been doing in the past? There is never any danger of this Chancellor "underspinning", as he said today. Having broken all his promises before, does he really think that the solution is to make promises again?
The Labour party fought four general elections on a policy of tax and spend. Those are the four general elections that it lost. The only time that Labour won an election was when it committed itself—or appeared to commit itself—to Tory prudence.
Let me remind the House why the Chancellor has so much money in his election war chest today. [Interruption.] Labour Members do not want to hear about that. Is it not because he has taken £5 billion a year out of people's pension funds? This is a Chancellor of the Exchequer who, for his own glorification, is prepared to spend today at the cost of impoverishing generations of pensioners tomorrow.
Does not the Chancellor have the money today only because he has relentlessly increased taxes? Petrol has now reached £4 a gallon, and council tax has increased four times faster than inflation. Tax relief for mortgages has gone, and tax relief for marriage has gone. The additional age relief for pensioners has gone, too. Does not the Chancellor realise that, for families and pensioners, the tax increases that he has imposed are reality today, and that all the fine words that we have heard from him are merely promises for tomorrow?
Did the Chancellor really think that people would not notice that they were being taxed? Did he really think that he could put an extra £670 of tax on average working families in this country and they would not notice? For many families, that is the difference between living comfortably, and life on the edge. It is the difference between getting on and getting into debt—[Interruption.] That is the real world. How out of touch can the Prime Minister and the Chancellor of the Exchequer be?
Is it not true that those who can least afford it have been taxed and taxed until the pips squeak, with taxes on alcohol, taxes on cigarettes and taxes on petrol—the most regressive taxes of all? [Interruption.] Labour Back Benchers know what has happened, and they know that a Labour Chancellor who taxes the poor is no socialist hero. I believe that hard-working families and pensioners should pay less tax than they do now, because Governments—[Interruption.]
Madam Speaker: Order. Many of the people of this country will be watching us, and many will certainly be listening. Tomorrow, I shall get many telephone calls and letters about the extremely poor behaviour in this Chamber.
Mr. Portillo: I believe that hard-working families and pensioners in this country should pay less tax, because Governments often waste their money. I do not believe that it is morally superior for the Government to take money away from parents—money that they might have spent on their children, or on putting a better meal on the table.
A Conservative Government will cut taxes for those people, because families need lower taxes and businesses need lower taxes. When Governments all over the world are cutting taxes, how else is Britain going to compete?

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Despite the revisions that the Chancellor announced today, can he confirm that he still assumes that national income will increase by 2¼ per cent. a year, yet commits himself to increase overall national spending by 3.3 per cent. a year? Would any family in the land plan to go on increasing their spending, year after year, by more than the increases in their income?
Is not the Chancellor's plan just a spending splurge? He will increase spending by almost l½ per cent. of national income, which is the equivalent of £600 of extra tax for every taxpayer. Is it not true that the budget surplus can be spent only once, and that when we have spent that surplus, we are back on the road to higher taxes?
What happens if the future is not quite as rosy as the Chancellor thinks it will be? Is he committed to all the numbers that he has just given us, whatever may happen to the economy four years from now?
We shall study the Chancellor's remarks very carefully. Although he claimed to be "underspinning" today, he will have to admit that every previous statement he has made included double and triple counting, and many hidden surprises. Now, the Prime Minister's notorious leaked memo has displayed the cynicism deep at the heart of this Government. When people trust them so little, who knows what we shall find in the small print?
We shall find out what constitutes genuine investment in our future, and what, on the other hand, risks being wasted by a Government who are now spending £11,700 every second. I trust that we shall find many things to be welcomed, just as we welcomed the extra money for the health service that the Chancellor announced in the Budget statement.
The Chancellor has taken time to prepare his plans, and we shall take time to prepare ours. However, our framework is more prudent than his. We can and we should increase spending in real terms on the things that really matter to people, but we should do that at a sustainable rate. Steady increases above inflation and within the growth in the economy can be combined with tax cuts for hard-working families and for pensioners. Are these not now the dividing lines?
We will fight the next election as the low-tax party. Labour has been exposed as the high-tax party. What Britain needs is not a splurge of taxpayer's money from a Government whom people do not trust, but a sustainable policy for the long term. Labour Governments always end up with tax and spend. A Conservative Government would tax less and spend better. A Conservative Government would show common sense and prudence.
Mr. Gordon Brown: I take it that the right hon. Gentleman is against our spending plans. I think that the most relieved man in the House this afternoon is the Leader of the Opposition—except for the fact that he has had landed on him the policies of the shadow Chancellor.
This afternoon we have heard an extraordinary statement from the shadow Chancellor, because he has refused to match any of our spending commitments. He has refused to match the £11 billion extra that we are spending on education, so in every constituency in the country Opposition Members will have to answer to parents, teachers and others about the Tory education spending cuts guarantee.
The right hon. Gentleman has refused to match the £8 billion extra for public and private improvements in transport, so Conservative Members will have to answer
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for their transport cuts guarantee to all the road users, all the car owners and all the people who depend on public transport. The shadow Chancellor has even refused to match my right hon. Friend the Home Secretary's spending on combating crime, so they will have to answer for a guarantee of spending cuts on law and order, as well.
When the shadow Chancellor went round the television studios at the weekend and said that our spending was unsustainable and, as he repeated today, that it was a "splurge", that Labour was a party that could not be afforded, and that the rate of spending in this country should be 2 per cent. not 3.3 per cent., he was actually saying that public spending should be cut by £16 billion by year four. He cannot escape from that, try as he might. Throughout the country he will have to say which school, which hospital, how many teachers and how many nurses would be affected by his proposals. When Conservative Members go back to their constituencies this weekend, they will have to give the answers.
There is another point. In 1992 the shadow Chancellor imposed 22 tax rises. He is now threatening £16 billion in cuts. I am happy to have our record compared with his when he was at the Treasury. He talks about taxation, but the biggest tax rises took place when he was there. There were 22 tax rises, including VAT on fuel, the rise in national insurance, the airports tax, and the reductions in mortgage tax relief and the married couples allowance. He is not the answer to the Conservatives' problems on tax; he is their problem on tax.
The shadow Chancellor says that he will be prudent. We have reduced the national debt. When he was Chief Secretary the national debt rose by £80 billion. It rose by the fastest rate in years, as the Conservatives doubled the national debt. The right hon. Gentleman says that he does not want to borrow, but when he was at the Treasury borrowing rose from £20 billion to £50 billion—and we have had to sort out the difficulties. We take no lectures from the Conservative shadow Chancellor given that he was responsible not only for tax rises but for borrowing at record levels and doubling the national debt.
There is another reason why we will not take lectures from the right hon. Gentleman this afternoon. In the 1980s the Conservative Government of whom he was a member refused to invest in our country—in education and infrastructure—and blew the privatisation of North sea oil revenues, which led us to the underinvestment and the problems that emerged with boom and bust in the early 1990s. The Conservative party cannot now tell us that it has a solution to the problems of this country, while the Labour Government are having to deal with their legacy of underinvestment to sort out those problems.
Only a few weeks ago, the shadow Chancellor's tax guarantee—it was a guarantee, then—was the issue of the moment, and he was trying to prove that resources were available. Instead of saying that the economy was running into ruin, that it was unsustainable and that things were getting out of control, he said on the Jimmy Young show:
The economy is doing well. There is absolutely no denying that, and I am not going to go around saying that the economy is not going well.
In another speech, he praised us for an "absolutely reliable anti-inflation strategy". How is it that immediately after the Budget, with exactly the same figures for the framework for public spending, he could praise us for our anti-inflation strategy and say that the economy was doing well—but today he comes to the House to predict doom and gloom?

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As we have seen in the seven days since its spending announcement, the Conservative party has resorted to its old ways. It is not prepared to finance education. It is not prepared to finance health as it should be financed. It is not prepared to finance our social services. When the shadow Chancellor left the House of Commons, he said that the Conservative party was identified as uncaring, harsh and not concerned about unemployment, poverty or social conditions—yet it is a return to that Thatcherite policy that he is presuming today.
The shadow Chancellor lost the last election with 22 tax rises. He will lose the next election with £16 billion of public spending cuts.
Mr. Giles Radice: The Treasury Committee will want to question my right hon. Friend on his statement, as he knows, but is it not the case that his announcement of significant but affordable public spending increases is a vindication of the Government's economic policies? Does it not show that the Government's restraint in the first two years in office, the new monetary framework and the steady economic growth have led to a virtuous circle of low inflation, low public debt, and now the increased public spending in vital areas such as education and health that we have heard announced this afternoon?
Mr. Brown: I am grateful to my right hon. Friend. He is the distinguished Chairman of the Treasury Committee, and he says that the economy has been put on a strong foundation. The figures show that 42 per cent. of additional expenditure under the Conservatives went on social security and debt interest, but that only 17 per cent. will go on those things under the new spending plans. That is a recognition not only that the public finances are in order, but that we are using them to best effect. I shall give the House the benefit of further information. Under the regime of the former Chief Secretary to the Treasury, who is now the shadow Chancellor, it was not 42 per cent. but 55 per cent. that went on social security and debt interest. More than half the expenditure went on social security and debt interest. Today, most expenditure goes on health, social services, education, transport, tackling crime and building a better Britain.
Mr. Matthew Taylor: Millions of people will have had one question in their minds as the Chancellor sat down: what about the pensioners? With £43 billion to spend, the Chancellor's Budget in March, with its 75p a week for pensioners, looked miserly; now, with a £2.5 billion surplus in the social security budget, his zero increase for pensioners looks positively mean.
As for the rest of the statement, no one will accuse the Chancellor of underspinning. The shadow Chancellor may be underperforming, but the Chancellor is not underspinning. However, the question that the Chancellor must answer is whether his statement today was effectively an admission that what has happened in the past three years was unnecessary, that Liberal Democrats were right to say that the Government were building an election war chest, and that—contrary to what the shadow Chancellor said—what we suffered from was the problem of having had a Conservative budget in the early years of this Parliament, and the costs that it imposed on
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pensioners, pupils, patients, the police and public services as a whole. This is bust-boom economics; this is exactly the treatment of public services that Liberal Democrats have predicted for the past two years, because it was there for all to read.
The irony of the shadow Chancellor's position is that this Budget will only bring Government spending, as a proportion of national wealth, back to the level they inherited from the previous Conservative Government, having cut it in the early years by following Conservative Budgets. That is not what people voted for, and it was a wasted opportunity. The statement makes that absolutely clear. We have bust-boom treatment of the public services.
The Conservatives now offer £20 billion of cuts while the Liberal Democrats welcome increased investment in public services, even if it is late. However, will the Chancellor guarantee it? In the previous comprehensive spending review, he gave figures that we now know were not true. For example, he said that there would be a 5.1 per cent. increase in spending for education. We know now that last year, schools received only a 2.5 per cent. increase. The spin is all there, but where will the delivery be? It is not there for pensioners. Will it be there for the police? Is the Chancellor able to tell us whether there will be more police on the beat at the end of this process than there were when he came into office?
Will the right hon. Gentleman get rid of tuition fees? Is he able to guarantee lower class sizes for all children, and not only for those up to the age of seven? Or will the position continue to worsen, as it has so far since Labour took office? Can the Government even guarantee that tuition fees are not set to rise to help pay for their higher education policy?
The 18 years of Conservative government were a disaster for public services. However, the early years of the Labour Government left Conservative policies in office. The bust-boom approach is not a sensible way of handling public service investment. It never was, and the Government's cynicism showed through in every sentence that the Chancellor read out. No wonder the Prime Minister's memo did not mention the Chancellor. There never was any chance that the Chancellor would underspin. He follows the same agenda of trying to win elections at the cost of public service.
We will scrutinise the figures because we know that on every previous occasion, the Chancellor has sought to mislead. We want to show pensioners that the Government had the money to give them a decent pension and have not delivered. I suggest to Labour Members that when the leave this place, they will experience the anger of pensioners because they are still left with 75p. That will be the greatest single legacy from the Chancellor's statement.
Mr. Brown: At the general election, the Liberal Democrats stood on a manifesto that stated that they would put £500 million more every year into the national health service. Under our plans, we are putting £13 billion more a year into it. The Liberal Democrat manifesto stated that they would put £1.9 billion extra into education. Under the new plans, there will be £10 billion extra a year. The Liberal Democrats said that they would raise the pension only in line with inflation. They also said in their manifesto that they supported a minimum income guarantee.

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Now we have the shopping-list approach to economics, which has been adopted, unfortunately, by the Treasury spokesman for the Liberal Democrats. He wants in one part of the country to say that he is doing this, while saying in another part that he is doing that. In other parts of the country, he wants to appease particular groups. He tries to coin a new line about bust-and-boom economics, but that sits uneasily with the fact that we have put public finances in order. The national debt has been reduced and the borrowing that we inherited has been eliminated. Debt as a proportion of national income is falling, and we are now able to have sustained and sustainable improvement in our public sector services for the years ahead. That would not have happened under the Liberal Democrats' policy.
Mr. Alun Michael: I welcome the fact that my right hon. Friend's announcements today address Labour issues from the international to the local. In particular, his announcement on the new deal will give opportunities to young people as individuals.
My right hon. Friend will be aware that the announcement has been particularly awaited with interest in Wales. Will he confirm, not least for the right hon. Member for Caernarfon (Mr. Wigley), that his settlement enables the National Assembly for Wales to spend in full the money available to Wales under objective 1 without cutting into education and health spending? Does it also provide the necessary flexibility for the Assembly to deal with matters such as match funding?
Mr. Brown: I am grateful to my right hon. Friend. The settlement does exactly that. I am grateful to him for the work that he has done and I am grateful to all his colleagues who are Welsh Members of Parliament. The Welsh objective 1 settlement ensures that the resources are there to move ahead. The Wales Office expenditure is rising by 5.4 per cent. in real terms, something that could never have happened under Plaid Cymru policies.
Equally, my right hon. Friend is right to say that we have been spending money in Wales on the new deal and the working families tax credit in a way that gets money to the communities that need it most—an allocation of public expenditure that is most important to areas of high unemployment. In total, we are spending £231 million on the new deal and the working families tax credit. Taking into account the Barnett formula, the additional money for objective 1 spending, which my right hon. Friend has urged—as have many others over a period of time—and the £231 million expenditure on the new deal and the working families tax credit, this is not only a good settlement but one that will help Wales to invest in its future and to invest to create a Wales of full employment.
Mr. Kenneth Clarke: Will the Chancellor, who strives for a reputation as a serious policy maker, agree that no one, including himself, can predict accurately now the course of the economic cycle or the growth in the British economy during the next four years? The Chancellor is never knowingly underspun when he is surprised by changes that are favourable compared with his forecast, but will he accept that, if the forecasts go wrong, he does not know the extent to which he might have to raise tax, the extent to which public borrowing will go up, the inflationary pressures that might be caused and the extent
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to which he might squeeze out private sector investment in business by what he has announced? Is not the explanation for a statement in which I do not think Prudence was mentioned once—[Interruption I am told that she had four sad and parting mentions.
The reason for these U-turns and the bran tub approach of throwing money at every problem is that the right hon. Gentleman's colleagues have become panic stricken that big numbers and big promises two years ago have delivered nothing, so they now hope that big numbers and big promises beyond the next election will deliver them a return to office.
If the Chancellor wants to turn to serious policy making, does he accept that the future that we want and the strength of our public services, as well as our jobs and well being, depend on sustaining growth with low inflation and healthy public finances, which he and I have been lucky enough to enjoy at the Treasury for the best part of seven years now? If he wants to sustain that, he should run a surplus at this stage of the cycle and wait, year by year, to see the course of economic events, and release money sensibly to finance public services when he has the money in his pocket.
Mr. Deputy Speaker (Sir Alan Haselhurst): Order. I appreciate the right hon. and learned Gentleman's vast experience in this matter, but that was too long a question.
Mr. Brown: The former Chancellor is forgetting that he left behind a legacy of a £28 billion borrowing requirement, debt at 44 per cent. of national income, inflation rising, the economy heading back to stop-go and even the shadow Chancellor after him predicting that there would be a recession. We had to tackle the issues and reduce the debt. So far from us praising him for the legacy that he left us, he should be more humble about what he achieved when he was at the Treasury.
I was wanting to agree with the right hon. and learned Gentleman because he put up a better show than the shadow Chancellor, but I have since heard that this afternoon, he said on television that VAT on fuel should now be raised to its full amount—something which he says will happen soon. Again, we remind ourselves that two of the Ministers who were responsible for that policy have spoken in the House this afternoon. If the right hon. and learned Gentleman wants to reject three-year planning for public spending and to go back to the old annual cycle, he should remember that there were huge losses in that, with end-of-year settlements that did not work properly. Local government, the health service, education and transport need a long-term framework within which to move ahead.
The right hon. and learned Gentleman talked about the economic cycle. We have met, and will meet, our fiscal rules, even on the most cautious case. We have an £8 million surplus in the current side, even in the year when the surplus is lower, and we have reduced national debt from 44 per cent of national income to 33 per cent. Therefore, the investment can be made on a sustainable basis. I would have expected someone who said that his own spending plans were "eye-wateringly tight" when he passed them on to us would want to praise the fact that we are now spending the sums that I would have thought he wanted to spend on education, health, transport and the public services.
Mr. Robert Sheldon: Is it not clear that my right hon. Friend came to office with a

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three-year programme to put the public finances in order and then to turn to investment? He said that money would he spent to ensure that output and investment were achieved; this is his third test and his track record so far makes us optimistic.
Mr. Brown: Yes; I am usually talked of in the context of five tests.
The first thing we had to do was to create stability. The second thing we have to do is to get people back to work. The new deal, which the Opposition would abolish, is a programme that is helping thousands of young people and the long-term unemployed back into work. I would have wanted an all-party consensus on moving forward on this issue. Instead, the Opposition are determined to abolish the new deal and to deprive young people of the chances of jobs.
The third thing we have to do is to invest to build a stronger economy and a stronger society. That is exactly what my right hon. Friend has spent much of his political career advocating, particularly in relation to productivity and output in the manufacturing sector of the economy. The funds that we are making available for training, education and science, and the funds for regional development agencies so that we can build up our regions, are one way in which we can build a stronger industrial base for the future, in accord with the ambitions that my right hon. Friend has always furthered, on which I congratulate him.
Mr. David Davis: I should like to follow on from the Chancellor's comments on investment. I think I heard him say that the target for net investment will increase from £7 billion to some £18 billion in the next two years. The House of Commons Library tells us that his target last year was £6 billion, but the outturn was less than half that, at under £3 billion. How will he make the promise turn into delivery?
Mr. Brown: Here is a Conservative accusing me of spending too little, rather than too much. Over 20 years, Departments have not been in the business of moving forward investment plans as quickly as we want. We have also innovated in many areas including, following the last Government, public-private partnerships. I believe that the momentum is now there, particularly in transport, where investment is needed. Public-private partnerships in the London Underground and elsewhere have been developed. Therefore, I believe that we can make progress in these investment plans. Given what the right hon. Gentleman says, I hope that, in contrast to the shadow Chancellor, he will support us in them.
Dr. Gavin Strang: It is to my right hon. Friend's credit, and to the credit of this Labour Government, that the country's finances are in such a healthy state.
Does my right hon. Friend recall that in his last comprehensive spending review, he announced a proposal partially to privatise our air traffic control system and a timetable for the partial privatisation of DERA, the Defence Evaluation and Research Agency? Does he agree that the country's finances are much better than could have been imagined in 1998? Against that background, will the
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Government reconsider their decision to privatise key strategic assets such as National Air Traffic Services and DERA?
Mr. Brown: This is a proposal to get new investment into air traffic control. It is a proposal to secure massive investment funds which everybody knows are needed for the future of the air traffic control service. It will raise money from the private sector, but involve a public-private partnership. The same goes for DERA where, again, we are getting new funds in so that we can have the necessary investment in equipment and technology for the future.
This is about investment; about building for the future. In the air traffic control business, it is about building alliances right across the continents. I think that when the final plans are eventually implemented, we shall have the investment that we need in air traffic control and in DERA.
Mr. Peter Brooke: Will the Chancellor remind the House of the annual real-terms growth rate over the three years for defence spending?
Mr. Brown: The annual rate is 0.3 per cent. in real terms over the next year. I take it from what the shadow Chancellor said that he cannot even support that.
Mr. Tam Dalyell: What was the financial message that Sir Charles Guthrie, Chief of the Defence Staff, took to Downing street some two weeks ago? Is the real-terms increase in defence expenditure really sufficient to meet the long-term demands of our commitments in Kosovo and Bosnia? A fortnight ago, when some Albanians under the protection of British troops were asked how long KFOR and the British Army were expected to remain, some of them said 20 years and others said for ever. Has the Chancellor built in that long-term commitment to the Balkans? We have it now, whether people wanted it or not.
Mr. Brown: We have regular meetings with the Chief of the Defence Staff to talk about defence issues. I believe that this is an important settlement which allows our defence forces to complete the strategic defence review which was started by Lord Robertson and which is now being continued by my right hon. Friend the Secretary of State. It provides funds to buy new equipment and to replenish what has to be replenished after Kosovo. It provides funds to ensure the retention and recruitment of staff and to help our international peacekeeping role. As my hon. Friend knows, in normal terms, Bosnia and Kosovo become claims on the reserve.
Sir Peter Tapsell: If the pre-election bonanza that the Chancellor has just announced is to be regarded as economically sound, why has it been necessary for the Bank of England to raise interest rates repeatedly in recent months, causing great distress to British export manufacturing industry and to British agriculture?
Mr. Brown: I always enjoy discussing the economy with the hon. Gentleman because he seems to forget that when the shadow Chancellor was Chief Secretary, interest rates rose to 15 per cent. and remained there for a year. Interest rates are now at 6 per cent., and I remind him that the Bank of England had the Budget announcements,

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which were the framework within which we made our decisions. It said that the result of the Budget on interest rates seemed unlikely to be large over the next two years. All the framework figures were given to the Bank of England. The framework figures on which the decisions were made in the public spending round were announced in the Budget.
Mrs. Anne Campbell: I warmly congratulate my right hon. Friend on his statement, in particular the extra resources for education and science funding, which will be warmly welcomed in my constituency. Will my right hon. Friend ensure, perhaps using his considerable influence, that the extra funding for education is distributed in a way that makes the total funding for each pupil more equitable than at present?
Mr. Brown: This is, of course, a matter for my right hon. Friend the Secretary of State for Education and Employment, who has done a superb job in recent years building up our education system. I believe that he will look at such decisions carefully. I praise my hon. Friend for her work to promote the case for science in our country. It is important to ensure that sufficient funds are spent on science and innovation so that we can build the best productive base for the future. It is also important that investment in education and our schoolchildren is made at the necessary level. It is unfortunate that the Conservative party does not even seem to support education spending now.
Mr. Dafydd Wigley: Why has the Chancellor not taken this opportunity to pass over to Wales the whole of the European structural funds meant for Wales, over and above the Barnett block limit? Of the £540 million coming from Brussels to Wales for objective 1 funding over the next three years, only £272 million has been passed over and £268 million is being pocketed by the Treasury. In other words, the right hon. Gentleman has conceded the principle but kept the cash. Is not the First Secretary right to say that Labour will pay a heavy price for this at the coming general election?
Mr. Brown: The right hon. Gentleman should be man enough to say that we have done a good job and sorted out the problem of objective 1 funding. Wales has a 5.4 per cent. real terms increase in its budget, which is higher than it ever had under a Conservative Government. It is something that the right hon. Gentleman's party could never have delivered had it been in power in the Welsh Assembly or anywhere else. I notice that in the candidatures for leadership, Plaid Cymru is now descending back to being a wholly separatist party, and the right hon. Gentleman should be embarrassed by that.
The Labour Government are putting into the spending settlement the resources needed for the objective 1 programme to be carried out. It is those resources that enable the European funding and provide the matching funding through the spending settlement we have made. In addition, through the windfall tax on the privatised utilities, more money is being spent on the new deal and the working families tax credit in Wales—something that the right hon. Gentleman's party could never have achieved. The fact is that unemployment is coming down in Wales because of a Labour Government.
Mr. Barry Jones: I note the advance towards full employment and I thank my right
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hon. Friend for that and for his plans for decent social services for all of our people. However, what are his plans in the coming years for assisting manufacturing, not least the steel industry and Shotton steel works in my constituency? Does he recollect the £530 million he has given to British Aerospace for the A3XX project, and does he know that I have so far failed to persuade the First Secretary to give £25 million to secure 1,400 new jobs? Will my right hon. Friend use his famed skills of persuasion in Whitehall—using metaphorically the twisted arm and the steel-capped boot—to persuade the First Secretary to give that money and secure those jobs?
Mr. Brown: My right hon. Friend's congratulations have an edge. On manufacturing industry, it is true that we have helped the British aerospace industry, and that matters to his constituency and others around the country. We will continue to support new projects that can yield jobs, investment and growth for our economy in the future. I acknowledge that the difficulties with the pound have caused problems for many sectors of manufacturing, including the steel sector, but at the same time manufacturing productivity has been rising by 5 per cent. We have put in place more measures today, including, first, a research and development tax credit so that we finance a substantial part of the investment in new technology and innovation by manufacturing firms. Secondly, we have put 100 per cent. capital allowances in place, so that small and medium-sized firms can claim all that against their tax in the first year. Thirdly, we have put in place regional investment and venture capital funds, which will be of assistance in Wales and other parts of the country.
In terms of stimulating new investment in the manufacturing economy, we are doing what we can and will continue to do so. I can tell my right hon. Friend that even manufacturing firms under pressure say to me that the last thing they want—and what we are avoiding with our policies—is a return to Tory boom and bust.
Mr. John Redwood: Far from the Chancellor offering to many Prudence, with a purpose or without, he has clearly cast her off cruelly. Is he ashamed that he imposed such a massive tax on petrol? Was not that a mugging with a menace that turned out to be totally unnecessary in view of the figures that he has published today?
Mr. Brown: I thought that the right hon. Gentleman was leading the Tory campaign in the House and in the country, but he has started by scoring a massive own goal. Who put the fuel escalator on petrol? It was the Conservative party. Who took it off? It was the Labour Government.
Mr. Dennis Skinner: Is the Chancellor aware that some 22 years ago, the previous Labour Government made a statement that resulted in pay freezes and cuts in the budgets for health and education? It was met by some weary, drooping heads on this side of the House. This statement, whichever way you cut it, is a sight better than that one. When I hear my right hon. Friend talk about an extra 3 per cent. above inflation for this Department, an extra 4 per cent. above inflation for that Department and an extra 5 per cent. above inflation

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for yet another, I can only assume that the pensioners will also get 3, 4 or 5 per cent. above inflation. Will he confirm that?
Mr. Brown: My hon. Friend tries to draw me into something that is a matter for further consultation. Unlike the Conservative party, we will keep the winter fuel allowance and pay that £150. Unlike the Conservative party, we will ensure that the free colour television licences goes to pensioners and the minimum income guarantee rises in line with earnings to take thousands of pensioners out of poverty. For further announcements, I hope that my hon. Friend, who has been patient for 22 years, will continue to be patient for at least a few more days and weeks.
Mr. Michael Jack: Can the Chancellor confirm that today's announcement on spending levels is predicated on the figures in the "Financial Statement and Budget Report" for tax receipts and total Government receipts maintaining their increasing percentage share of GDP? On the question of fraud, as a Chancellor interested in outcomes, will he explain to the House why the Department of Social Security has so far failed to meet any of its fraud targets?
Mr. Brown: The Department of Social Security has just cut the number of inaccurate income support payments by half and has made considerable savings as a result, which is something that, unfortunately, the Government of whom the right hon. Gentleman was a member failed to do when in power. On tax revenues, the right hon. Gentleman should consult the Budget documents; he will find that the tax share of national income, which has been 37.1 per cent, 37 per cent and 36.9 per cent, is 36.7 per cent in 2003–04. The right hon. Gentleman should consult the appropriate table on that matter.
The problem for the Conservative party having dropped its tax guarantee, is that, nobody trusts it at all on the issue of tax. As a result of its failure to spell out its public spending cuts, every public service, from education to health, transport, housing and social services is now seen to be vulnerable. It is the same old Tories.
Mr. Bill Rammell: May I tell the Chancellor about Brays Grove school in my constituency which, having had to wait 10 years under the Tories to refurbish its science labs, has now received £325,000 under the new deal for schools? Does my right hon. Friend agree that, as a result of this afternoon's statement, other schools in my constituency are likely to benefit in future? Is it not that increased investment in our schools which is most at risk from the return of a Conservative Government, as the Opposition are committed to cut those increases? Is not the most dishonest aspect of the politics that the Opposition are putting forward the fact that they are calling for cuts but are never prepared to say where the cuts will be imposed?
Mr. Brown: The shadow Chancellor came to the House this afternoon for the traditional occasion on which he replies to the statement, and says what he agrees with and what he does not agree with. He was unable to tell us that he would protect even the education budget, and he
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has put his party in a sorry state because, over the next few days, right across the country, Conservatives will have explain to parents and teachers why education is not safe from the £16 billion of Tory cuts.
My hon. Friend is right to raise the repair of schools, as there are 32,000 schools in the country, 16,000 of which will have been repaired or modernised as a result of the new deal for schools. The new deal for schools was made possible by the windfall tax on the privatised utilities, which was opposed tooth and nail by the Conservative party. However, it has yielded better schools for 15,000 communities in our country.
Mr. John Townend: Does the Chancellor accept that he would not have been able to come here today and announce these telephone number increases in expenditure if the Government had kept the pledge that the Prime Minister made before the election—that there would be no overall increase in taxation? The Chancellor is getting £25 billion over a five-year Parliament from pensions, and billions of pounds from petrol and extra tobacco tax. He has attacked married couples with more tax and has also attacked home owners. Does he accept that if, as he proposes, expenditure continues to rise at a faster rate than the growth in the economy, further tax increases are inevitable? Is not this Labour Government reverting to type, as they are taxing, spending and taxing again?
Mr. Brown: Our pledge was to keep the basic rate of tax the same, or to reduce it, which is what we did. We also pledged not to raise the top rate of tax and to cut to 5 per cent. the rate of Conservative-imposed VAT on fuel, which we did. Our pledges on taxation have been kept.
I know that the hon. Gentleman is a permanent tax cutter, and has been saying that in the House for as long as I have known him. He must be very sad that the Conservative party is now dropping its tax guarantee, or is trying to do so. The hon. Gentleman believed in the tax guarantee, but the problem is that the shadow Chancellor did not. The Conservative leader said that there would be a tax guarantee, with no ifs, no buts and no question marks, which the Conservatives would carry out. It was absolutely clear that the tax guarantee would be imposed, which the shadow Chancellor confirmed only a few weeks ago. The Conservatives tried to ditch that seven days ago, which is why nobody believes anything that they say about tax.
Ms Sally Keeble: I very much welcome the extra spending on child care, schools, higher education and health care. My right hon. Friend also mentioned the child care tax credit and the working families tax credit. Will he give some global figure of how much extra the Government are investing in public services through the tax credits to support hard-working families? As those families rely to a great extent for their security and stability on knowing the long-term plans, does he agree that people will also want to know in the run-up to the election whether the Conservative party is committed to such spending levels?
Mr. Brown: I agree with my hon. Friend. We are spending £7 billion extra a year on families. We are doing that by raising child benefit by 35 per cent., which I presume the Conservative party now wants to cut; by

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introducing the working families tax credit, which is benefiting 1 million families, and which we now know the Conservative party wants to abolish; and by introducing the child care tax credit from next year, which I must presume from the Conservative party's silence it would abolish too. I also presume that the Conservative party will not want the extra investment that we are making in child care under the national child care strategy, which is welcome throughout the country.
We have just today set up a children's fund, in which we have linked charities, community groups, Churches and other organisations throughout the country to tackle and to help to solve the problems of children in need. That will be a £250 million fund which I believe charities will welcome and with which community groups will be happy to work. Again, I must presume that the Conservative party's new policy means that it would oppose even that.
Mr. Michael Fallon: Amidst all the hype and spin, will the Chancellor confirm one fact: at the end of his three completed years so far, the tax burden is higher than it was when he started? Secondly, if it is right to give every secondary school £70,000, why not give the schools all the money?
Mr. Brown: The Conservatives' proposals which were issued without great thought—like almost all their policies which have had to be rethought, including the tax guarantee—would fail to promote, for example, special needs. The £1 billion for special needs, and, indeed, school transport, were not even calculated for. After this week's episodes, the Conservative party will have to go back to the drawing board with their proposals in their entirety.
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On the tax burden, I have already given the figures: 37.1 per cent., 37 per cent. and 36.9 per cent. and, by 2003–04, according to the published figures, 36.7 per cent. The shadow Chancellor has got yet another fact wrong today.
Mr. Nigel Beard: I congratulate my right hon. Friend on his statement, which is indeed a watershed in the history of public services in this country. Given the accumulation of problems over 18 years of neglect of health, education and our transport service, how does he intend to ensure that the money is spent to best effect?
Mr. Brown: I am grateful to my hon. Friend. He rightly says that the matter is not just one of increasing the amount of money. It must be increased, contrary to what the shadow Chancellor says, because there has been long-term underinvestment, which was a feature of 18 years of Conservative government. We must ensure that the money goes to front-line services. That is why, when the health and transport plans and what are called our public service agreements are published, there will be strict output targets, a new regime of penalties and incentives, greater inspection in many areas and a flow of information to the public, which is itself a discipline.
Therefore, we are taking steps to try to improve value for money and quality of service, which particularly people from the poorest areas have been denied for too long as a result of cuts in investment. We are determined to ensure such action. I welcome what my hon. Friend says. This is sustained investment in our country's future and it means that we can look forward, under a Labour Government, to improvement in the social and economic fabric.
Mr. Deputy Speaker: Order. We must move on; there will be further opportunities to return to these matters.

Point of Order
5.4 pm
Mr. Bob Russell: On a point of order, Mr. Deputy Speaker. On 6 July, along with other right hon. and hon. Members, I tabled an oral question to the Chancellor of the Exchequer. I had the good fortune to be drawn at No. 1. Last night, 11 days later, I was advised that the question had been vetoed by the Chancellor. I have made inquiries today and his office has confirmed that. The question was identical to one that I tabled two years ago, which was answered on the Floor of the House by the Paymaster General. May I please have some guidance on the Chancellor's right personally to veto an oral question 11 days after it was tabled?
Mr. Deputy Speaker (Sir Alan Haselhurst): I am grateful to the hon. Gentleman for giving notice of his point of order. As "Erskine May" makes clear, it is a long-established principle that decisions on the transfer of questions rest with Ministers, not the Chair. However, the Speaker does expect Departments to act promptly in transferring questions. Successive Speakers have said that it is a discourtesy if transfers are not notified within two sitting days of the first appearance of the notice. In this case, the practice has been breached by a very wide margin. Decisions on which Minister should answer a particular question should be taken consistently, so that Members can have a reasonable expectation of what questions will be answered by which Department when they table oral questions.

Leasehold Reform
5.5 pm
Shona McIsaac: I beg to move,
That leave be given to bring in a Bill to enhance and protect the rights of homeowners in purchasing the freehold of their house; and for connected purposes.
To put my case simply, I want to bring in a Bill to stop greedy landowners insisting that home owners—usually pensioners in my part of the country—pay them tens of thousands of pounds simply so that they can stay in their own homes. I wish to thank the chairman of the all-party group on leasehold reform, my hon. Friend the Member for Brent, North (Mr. Gardiner), the Campaign for the Abolition of Residential Leasehold and LEASE—the Leasehold Advisory Service—for their support on this issue.
Two million people live in leasehold properties; there are thousands in my constituency. That is a time bomb waiting to go off. Unless the Government wake up and do something urgently, thousands of pensioners could find themselves on the streets through no fault of their own. Councils will have to pick up the tab, while landowners and landlords will be laughing all the way to the bank.
Many homes built in the Victorian building boom in the 19th century were sold on 99-year leases. Those leases are now up for renewal, and people who have worked hard all their working lives to pay off their mortgages are being asked to fork out vast sums to buy the freehold of homes that they thought they already owned. Residents are being asked to pay up to £30,000 to purchase the freehold of those houses. In Grimsby and Cleethorpes, that is more than the value of the property.
Of course people who cannot afford to buy the freehold can extend their lease by 50 years, but, in doing so, they lose all their rights to buy the freehold and, in effect, become tenants. That is a scam by the landlords and landowners. It is a scandal that those who have contributed nothing for almost 100 years can waltz in and demand from home owners outrageous sums so that they can stay in their own homes. Those landlords and landowners never laid a brick or paid to build the houses. They never paid a penny towards their upkeep and improvement over the years. They never paid a household bill, insurance, the rates or the council tax. Yet they want tens of thousands of pounds from mainly elderly people—often widows—who simply cannot lay their hands on such sums. The law must be changed to stop leaseholders being fleeced by unscrupulous landowners.
Leasehold is a fundamentally flawed system of home ownership. It is a throwback to feudal times. Someone who wrote to me recently called his landlord a modern-day robber baron. The leasehold system enables the landowners to benefit from a rise in property values at no cost to themselves.
My right hon. Friend the Minister for Local Government and the Regions said:
leasehold tenure is totally unsuited to the society of the 20th—let alone 21st century—which still allows abuses to flourish and causes misery and frustration to many leaseholders.
I shall tell the House about some of the misery that I have come across in my constituency. One woman was quoted £20,000 to buy the freehold when there was still 30 years on the lease. Another pensioner is frantically trying to

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raise money from relatives to meet a demand of £10,000 to buy her freehold, which is due to expire soon. She cannot get a bank loan for that sum because she is aged over 80.
Another frail widow wanted to sell her house so that she could go into residential care. Her lease is due to expire, and she too has been quoted £10,000 to buy the freehold. She had hoped for comfort and care in her remaining years, but is now fraught with worry about raising money that she simply does not have. Another family who could not get hold of the necessary money have resigned themselves to extending the lease for 50 years. Those people have become tenants, losing the right to buy their freehold. They no longer own their own home. In all the cases that I have given, the mortgages had been paid off. People thought that they owned their own homes.
We must reform the completely unrealistic conditions that apply when families inherit leasehold houses. To buy freehold, family members must have been resident in the house at the time when the deceased passed away, and they must have been resident for three of the past 10 years. Everything is stacked in favour of the landlords: few families can meet those conditions.
The Under-Secretary of State for the Environment, Transport and the Regions, my hon. Friend the Member for Sunderland, South (Mr. Mullin), wrote to me saying that people who inherit a lease will often be unable to qualify to buy freehold and might have to pay large sums for it. I can offer the example of a constituent who passed away in January, leaving his house, with the mortgage paid, to his family. The family discovered that the lease ran out at the beginning of April. The freeholder, a Mr. J. C. Mountain, refused at first to sell the freehold. When I put pressure on him, he agreed to do so, and wrote to me on 13 March—days before the lease expired—quoting a price of £35,000 if my constituents were to inherit their parents' home. They could not raise the money and have lost their parents' home. The freeholder is laughing all the way to the bank.
Owners of freeholds, such as Mr. Mountain and the estate of the Earl of Yarborough, must be delighted that the Government have been slow to introduce measures to stamp out their nice little earners. Landowners also fail to tell people about their rights—leasehold valuation tribunals, for example. Bully-boy tactics are being used to scare pensioners into coughing up the dosh.
Ultimately, the Government must keep their manifesto promise to abolish leasehold as a form of housing tenure. Today, however, I seek to protect the rights of homeowners through the abolition of marriage value as part of the calculation in determining the price of a freehold. We must get rid of the special valuation basis for calculating the price of a freehold, which, because of high prices, freeholders in Grimsby and Cleethorpes are using wrongly to determine prices. The special valuation basis, under which the landowner must receive 50 per cent. of the marriage value and compensation for any severance and losses while the leaseholder must meet his or her own costs and those of the landowner—is wrong.
My hon. Friend the Member for Great Grimsby (Mr. Mitchell)—who is not present—has told me that Grimsby grannies, many of whom are widows of trawlermen for whom he has fought for many years, are losing their homes while the Government dither.
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I therefore introduce this Bill to enhance the rights of owners of leasehold houses by abolishing marriage value when considering the purchase price of the freehold, by extending the rights of family members to purchase the freehold of a house on inheriting it and by extending the right of homeowners to purchase a freehold if, at the end of a 99-year lease, they extend it.
Question put and agreed to.
Bill ordered to be brought in by Shona McIsaac, Mr. David Borrow, Mrs. Christine Butler, Mr. Ian Cawsey, Valerie Davey, Mr. Paul Flynn, Mr. Barry Gardiner, Mrs. Joan Humble, Mr. Jon Owen Jones, Mr. Austin Mitchell, Mr. Ian Stewart and Mrs. Betty Williams.

Leasehold Reform
  LEASEHOLD REFORM
  Shona McIsaac accordingly presented a Bill to enhance and protect the rights of homeowners in purchasing the freehold of their house; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 21 July, and to be printed [Bill 163].

  DELEGATED LEGISLATION
  Mr. Deputy Speaker (Sir Alan Haselhurst): I propose to put together the Questions on the five motions.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

  DELEGATED LEGISLATION
    INSIDER DEALING
    That the draft Insider Dealing (Securities and Regulated Markets) (Amendment) Order 2000, which was laid before this House on 22nd June, be approved.
    TRADE UNION AND LABOUR RELATIONS
    That the draft Code of Practice on Industrial Action Ballots and Notice to Employers, which was laid before this House on 26th June, be approved.
    LOCAL GOVERNMENT FINANCE (SCOTLAND)
    That the Local Government Finance (England) Special Grant Report (No. 64) on the Special Grant for Activities undertaken by Beacon Councils (House of Commons Paper No. 564), which was laid before this House on 27th June, be approved.

    LEGAL AID AND ADVICE
    That the draft Legal Aid (Functions) Order 2000, which was laid before this House on 27th June, be approved.
    That the draft Legal Aid (Prescribed Panels) (Amendment) Order 2000, which was laid before this House on 27th June, be approved.—[Mr. Jamieson.]
    Question agreed to.

  FINANCE BILL [MONEY]
  Queen's recommendation having been signified—
  Resolved,
  That for the purposes of any Act resulting from the Finance Bill, it is expedient to authorise the deduction of sums from the gross

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  revenues of the department of the Commissioners of Inland Revenue for the purpose of making payments in respect of stamp duty paid on instruments—

  (a) executed in the period beginning with 22nd March 2000 and ending with the day on which the Finance Bill is passed, and

  (b) stamped on or before the day on which the Bill is passed,

  where stamp duty was chargeable in respect of the instrument and, had the instrument been executed after the day on which the Bill is passed, no stamp duty or less stamp duty would have been chargeable.—[Mr. Jamieson.]

  FINANCE BILL [WAYS AND MEANS]
  Resolved,
  That provision may be made in the Finance Bill, amending section 97A of the Finance Act 1986 by the insertion, after subsection (12), of the following subsection—
  "(13) Nothing in section 70(9) or 97(1) above has effect to prevent a charge to stamp duty or stamp duty reserve tax arising—

  (a) on a transfer to which subsection (5) above applies, or

  (b) on a deemed transfer under subsection (11) above.".—[Mr. Jamieson.]

  FINANCE BILL [WAYS AND MEANS]
  Resolved,
  That, notwithstanding anything in the Resolution of the House (Amendment of the Law) of 27th March 2000, provision may be made in the Finance Bill amending paragraph 5(4) of Schedule A1 to the Value Added Tax Act 1994 by the insertion, after paragraph (e), of the following paragraphs—

  '(f) wind turbines;

  (g) water turbines.'.—[Mr. Jamieson.]

Orders of the Day

  Finance Bill
  Not amended in the Committee and as amended in the Standing Committee, considered.
  Ordered,
  That the Finance Bill, as amended, be considered in the following order: New Clauses; Amendments relating to Clauses 1 to 6, Schedule 1, Clauses 7 to 17, Schedule 2, Clauses 18 to 22, Schedule 3, Clause 23, Schedule 4, Clause 24, Schedule 5, Clauses 25 to 30, Schedules 6 and 7, Clauses 31 to 47, Schedule 8, Clause 48, Schedule 9, Clauses 49 to 57, Schedule 10, Clauses 58 and 59, Schedule 11, Clause 60, Schedule 12, Clause 61, Schedule 13, Clause 62, Schedule 14, Clause 63, Schedules 15 and 16, Clause 64, Schedule 17, Clause 65, Schedule 18, Clauses 66 to 68, Schedule 19, Clause 69, Schedules 20 and 21, Clauses 70 to 82, Schedule 22, Clauses 83 to 87, Schedule 23, Clauses 88 to 91, Schedule 24, Clause 92, Schedules 25 and 26, Clauses 93 to 97, Schedule 27, Clause 98, Schedule 28, Clauses 99 to 102, Schedule 29, Clause 103, Schedule 30, Clause 104, Schedule 31, Clauses 105 to 116, Schedule 32, Clause 117, Schedule 33, Clauses 118 to 128, Schedule 34, Clauses 129 to 132, Schedule 35, Clause 133, Schedule 36, Clauses 134 to 139, Schedule 37, Clause 140, Schedule 38, Clauses 141 to 146, Schedule 39 and Clauses 147 to 151; New Schedules; Amendments relating to Clauses 152 and 153, Schedule 40 and Clause154.—[Miss Melanie Johnson.]

  Finance Bill
    New Clause 3

      STAMP DUTY: EXCEPTIONS FROM SECTION 119
      '.—(1) Section 119 does not apply by virtue of paragraph (a) of subsection (1) of that section in any of the following cases (any reference in this section to A or B being taken as a reference to the person referred to as A or B, as the case may be, in that subsection).
      (2) Case 1 is where B holds the estate or interest as nominee or bare trustee for A.
      (3) Case 2 is where A is to hold the estate or interest as nominee or bare trustee for B.
      (4) Case 3 is where B holds the estate or interest as nominee or bare trustee for some other person and A is to hold it as nominee or bare trustee for that other person.
      (5) Case 4 is where (in a case not falling within subsection (2) or (4) above)—

      (a)the transfer or vesting is a conveyance or transfer out of a settlement in or towards satisfaction of a beneficiary's interest;

      (b) the beneficiary's interest is not an interest acquired for money or money's worth; and

      (c) the conveyance or transfer is a distribution of property in accordance with the provisions of the settlement.

      (6) Case 5 is where (in a case not falling within subsection (3) above) A—

      (a) is a person carrying on a business which consists of or includes the management of trusts; and

      (b) is to hold the estate or interest as trustee acting in the course of that business.

      (7) Case 6 is where (in a case not falling within subsection (3) above) A is to hold the estate or interest as trustee and, apart from section 839(3) of the Taxes Act 1988 (trustees as connected persons), would not be connected with B.
      (8) Case 7 is where—

      (a) B is a company;

      (b) the transfer or vesting is, or is part of, a distribution of assets (whether or not in connection with the winding up of the company); and

      (c) the estate or interest was acquired by B by virtue of an instrument which is duly stamped.

      (9) This section shall be construed as one with the Stamp Act 1891.
      (10) This section applies to instruments executed after the day on which this Act is passed.'.—[Miss Melanie Johnson.]
      Brought up, and read the First time.
      5.15 pm
      The Economic Secretary to the Treasury (Miss Melanie Johnson): I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker (Sir Alan Haselhurst): With this it will be convenient to discuss the following: Government new clause 4—Stamp duty: relief for certain instruments executed before this Act has effect.
      Government new clause 5—Stamp duty and stamp duty reserve tax: transfers between depositary receipt systems and clearance systems.
      Government amendments Nos. 108 to 130.
      Miss Johnson: New clauses 3, 4 and 5 and amendments Nos. 108 to 130 respond to a number of representations about the Finance Bill provisions relating to stamp duty. New clause 3 makes some exceptions to clause 119. New clause 4 applies these exceptions to documents executed between the Budget announcement and Royal Assent, and similarly backdates the relief in clause 129 for transfers of local authority housing stock to registered social landlords. New clause 5 makes an existing relief more comprehensive in response to developments in the financial markets.
      The bulk of amendments Nos. 108 to 130 address a concern about the application of clauses 122 to 124. They align the definition of a stamp duty group with the definition of a group for the purposes of corporation tax group relief.
      Clause 119 ensures that there is a stamp duty charge based on market value on land or buildings which are transferred to a connected company. In Committee, I mentioned that I would be tabling measures to exempt land settled on an independent corporate trustee from the scope of that clause.
      New clause 3 ensures that trustees are exempted and also that transactions involving nominees and certain types of distribution of land in specie fall outside the scope of clause 119. New clause 4 provides for the effect of these exemptions to be backdated to 28 March, when clause 119 took effect.
      Mr. John Burnett: Is that exemption on settlement where the settlement is for nil value?
      Miss Johnson: Perhaps I could come back to that, because I am not sure what point the hon. Gentleman is raising.

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      New clause 4 also backdates the effect of the relief for transfers of local authority housing to registered social landlords. Clause 129 relieves these transfers from stamp duty with effect from Royal Assent. New clause 4 extends this relief to transfers after 21 March. This affects transfers under the large-scale voluntary transfer programme that has taken place since the date of the Budget announcement.
      New clause 5 is a response to representations from the financial markets. It concerns transfers between depositary receipt systems and clearance systems. Its purpose is to make the stamp duty and the stamp duty reserve tax reliefs for transfers between these systems more comprehensive to cope with market developments. Transfers of United Kingdom shares within depositary receipt systems or clearance systems are free of duty, in return for the payment of a 1.5 per cent. charge when the shares first enter the system. That is usually described as a season ticket charge. There are reliefs which ensure that no stamp duty charge arises when shares are transferred from one season ticket system to another of the same type. The new clause extends the reliefs to include transfers from one type of season-ticket system to another.
      Government amendments Nos. 108 to 125 deal with stamp duty group relief. The new clauses and amendments align the definition of "stamp duty group" with the definition of "group" for the purposes of corporation tax group relief. One of the effects of the new clause is that, when there are arrangements in place for a company to be sold out of the group, it ceases to be a group member. That provision blocks group relief for the transfer of assets between that company and the rest of the group, and it is needed to prevent assets from being transferred into the company leaving the group.
      I have received representations expressing concern about the blocking of relief for transfers from the company about to leave the group to another group member—in other words, when the company leaving the group is the transferor. I am persuaded that there are commercial situations in which an asset is transferred to another group company after arrangements are in place for the transferor company to leave the group; in a sense, therefore, the asset never leaves the original group. I am willing to make a concession for such cases, which will be useful to businesses, as their legal advisers have suggested.
      I have some worry that it might be possible to construct avoidance devices from the concession, so I have asked the Stamp Office to monitor carefully the use of the relief. If the concession is abused, the Government will not hesitate to act swiftly.
      As I said, the new clauses and amendments have been tabled in response to representations about the effect and timing of the measures in the Bill. They meet a range of reasonable concerns expressed to us on these matters—some of them by Conservative Members in Standing Committee.
      I commend the new clauses and amendments to the House.
      Mr. Howard Flight: The Government amendments are welcome, as they deal with situations where no transfer of beneficial ownership takes
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      place. A major aspect of some of the exemptions is that they will not get in the way of company reorganisations, but that will apply only when the transfer takes place entirely within the group. Company reorganisations involving joint ventures, for example, will attract full stamp duty at a likely rate of 4 per cent.
      Not long ago, I recall the Chancellor standing at the Dispatch Box and referring to the McKinsey report. He spoke about a difficulty in improving productivity that stemmed from the existing legislation in respect of property and planning. The report referred specifically to problems and delays in obtaining planning consents, and to the costs of property transactions. Those costs have now been increased still further, and there is an element of hypocrisy in that.
      I put it to the Government that, if the aim is for greater productivity and greater flexibility of property use in business, the amendments could go a lot further. The proposals amount to a major stealth tax on business.
      In essence, the later amendments deal with securities that move between depositary receipt systems and that contain exemptions as a result. That is the territory of the business of the City of London. I should declare an interest in that respect, as should all hon. Members who are members of the House of Commons pension scheme.
      I have a question for the Economic Secretary. At a public meeting two years ago, I asked Lord Simon, who was then Minister for Trade and Competitiveness in Europe, whether the Government were aware of the business that was being lost to Frankfurt as a result of the stamp duty that applies on securities in this country, and whether the Government intended to do anything about it. He responded that the Government were well aware of the issue and intended to address it.
      It is ironic that I am asking this question on the very day on which the Government have announced a massive and cynical splurge to buy votes ahead of an election. It is an age-old game to tighten taxation in the first three years in power and then splurge a year or so before an election. That tactic is as old as the hills.
      However, given the strength of the revenues, if there were any desire to protect them, the near future would be the time to address this issue. Unless stamp duty on securities is phased out, there will be a massive loss and haemorrhaging of business in security transactions away from the United Kingdom and to the other centres in Europe, especially Frankfurt, where no stamp duty applies. When will the Government honour the pledge that the previous Minister for Trade and Competitiveness in Europe gave on this issue? Have they considered the potential total loss of revenue if that issue is not addressed?
      Mr. Burnett: It might help the Economic Secretary if I mention that my earlier intervention related to exemptions on transfer into settlement. Let us make the question absolutely clear: is that exemption available only when there is no consideration and no passing of beneficial ownership?
      The Finance Act 1998 contained many anti-avoidance provisions for stamp duty and for stamp duty reserve tax. At that time, the Government trumpeted the effect of the anti-avoidance measures. Unfortunately, they were not very successful under that Act, and because transactions were channelled through American depositary receipts, significant amounts of revenue were lost to the Exchequer.

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      I understand that in three major transactions—involving, I believe, BP Amoco, Vodafone and one other—some £1.5 billion was lost to the Treasury. To what extent does the Inland Revenue believe stamp duty and stamp duty reserve tax are being avoided, especially in international transactions? The Economic Secretary has told the House that the Stamp Office is monitoring transactions for avoidance. What has been the cost to the Government of avoidance of stamp duty since March 1998?
      Miss Melanie Johnson: I am interested by some of the remarks that Opposition Members have made, which do not entirely relate to the amendments. However, I shall do my best to answer them. In his earlier intervention, the hon. Member for Torridge and West Devon (Mr. Burnett) asked the question that he has now reiterated, which was whether the exemption to clause 119 is available when there is a nil consideration. The answer is yes, the exemption takes the transaction out of the scope of clause 119, whatever the consideration, including a nil consideration.
      Mr. Burnett: Does that mean that there is no change in the beneficial ownership, or can the exemption apply if there is no consideration but there is a change in the beneficial ownership?
      Miss Johnson: I shall await some further thoughts on that matter.
      The hon. Member for Arundel and South Downs (Mr. Flight) said that many opportunities for joint ventures will not be helped by the group relief. The relief will apply where a joint venture falls within the scope of the group relief provisions. The new clauses have not changed the rules for joint ventures.
      The new clauses and amendments are all about anti-avoidance measures and making those measures work properly, ensuring that they are effective but not too tight. None of the existing arrangements is changed, although it is always tempting for hon. Members to think otherwise.
      Mr. Flight: The key point is that the cost of the tax to business is enormously higher than it was three years ago. The rules may not have changed, but they are a far more powerful deterrent to corporate modernisation than they were.
      5.30 pm
      Miss Johnson: The only change in the Budget was to increase the upper limit to 4 per cent., and that has affected only those making transactions involving more than £500,000. That is a sizeable sum, so we are talking about large deals and not smaller businesses or individuals, unless they are quite wealthy. The Budget leaves 95 per cent. of stamp duty effects completely unchanged. I understand that the proportion of stamp duty revenue from shares and from property transactions has remained more or less constant.
      The hon. Member for Arundel and South Downs spoke about the changes in stamp duty reserve tax and the arrangements for depositaries to ensure that we reflect changes that we understand are likely to take place in the business environment. This has not been an issue for business to date. We are enabling a flexibility in the system which has not hitherto existed but which we believe will be necessary in the future.
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      The hon. Gentleman asked about the future of stamp duty reserve tax in general, which is not directly relevant to the new clauses and amendments. We consider these matters every year in the Budget. We have not identified any need for action this year, so it was not a feature of the Budget or the Bill, but we always keep these matters under review.
      On the hon. Gentleman's little splurge of an attack on so-called splurge, let me remind him that it is the Government's prudence in managing the economy and public expenditure that has enabled us to announce today some very generous investment in public services. Instead of spending 42p in the pound of extra money on social security and debt repayment, as the previous Government did, we have brought the figure down to only 17p. I caution the hon. Gentleman not to return to the earlier discussion, because we would be delighted to have a further debate on those subjects.
      Question put and agreed to.
      Clause read a Second time, and added to the Bill.

    New Clause 4

      STAMP DUTY: RELIEF FOR CERTAIN INSTRUMENTS EXECUTED BEFORE THIS ACT HAS EFFECT
      '.—(1) This section applies to an instrument of any of the following descriptions executed in the period beginning with 22nd March 2000 and ending with the day on which this Act is passed—

      (a) an instrument transferring or vesting an estate or interest in land in such circumstances as are mentioned in section 119 (transfer of land to connected company), in a case specified in section (Stamp duty: exceptions from section 119) (excepted cases);

      (b) a conveyance or transfer of an estate or interest in land, or a lease of land, to a qualifying landlord within the meaning of section 129 (transfers to registered social landlords, etc.) from a qualifying transferor within subsection (6)(c), (d), (e), (f) or (h) of that section.

      (2) If the instrument is not stamped until after the day on which this Act is passed, the law in force at the time of its execution shall be deemed for stamp duty purposes to be that which would have applied if it had been executed after that day.
      (3) If the Commissioners are satisfied that—

      (a) the instrument was stamped on or before the day on which this Act is passed,

      (b) stamp duty was chargeable in respect of it, and

      (c) had it been stamped after that day no stamp duty, or less stamp duty, would have been chargeable,

      they shall pay to such person as they consider appropriate an amount equal to the duty (and any interest or penalty) that would not have been payable if the law in force at the time of execution of the instrument had been that which would have applied had it been executed after that day.
      (4) Any such payment must be claimed before 1st April 2001.
      (5) Entitlement to a payment is subject to compliance with such conditions as the Commissioners may determine with respect to the production of the instrument, to its being stamped so as to indicate that it has been produced under this section or to other matters.
      (6) For the purposes of section 10 of the Exchequer and Audit Departments Act 1866 (Commissioners to deduct repayments from gross revenues) any amount paid under this section shall be treated as a repayment.
      (7) This section shall be construed as one with the Stamp Act 1891.'.—[Mr. Jamieson.]
      Brought up, read the First and Second time, and added to the Bill.

    New Clause 5

      STAMP DUTY AND STAMP DUTY RESERVE TAX: TRANSFERS BETWEEN DEPOSITARY RECEIPT SYSTEMS AND CLEARANCE SYSTEMS
      '.—(1) In Part III of the Finance Act 1986 (stamp duty), after section 72 insert—
      "Transfers between depositary receipt system and clearance system
      72A.—(1) Where an instrument transfers relevant securities of a company incorporated in the United Kingdom between a depositary receipt system and a clearance system—

      (a) the provisions of section 67(2) to (5) or, as the case may be, section 70(2) to (5) above shall not apply, and

      (b) the stamp duty chargeable on the instrument is £5.

      (2) A transfer between a depositary receipt system and a clearance system means a transfer—

      (a) from (or to) a company that at the time of the transfer falls within section 67(6) above, and

      (b) to (or from) a company that at that time falls within section 70(6) above.

      (3) This section does not apply to a transfer from a clearance system (that is, from such a company as is mentioned in subsection (2)(b) above) if at the time of the transfer an election is in force under section 97A below in relation to the clearance services for the purposes of which the securities are held immediately before the transfer.".
      (2) In Part IV of the Finance Act 1986 (stamp duty reserve tax), after section 97A insert—
      "Transfer between depositary receipt system and clearance system
      97B.—(1) There shall be no charge to tax under section 93 or 96 above where securities are transferred between a depositary receipt system and a clearance system.
      (2) A transfer between a depositary receipt system and a clearance system means a transfer—

      (a) from (or to) a company which at the time of the transfer falls within section 67(6) above, and

      (b) to (or from) a company which at that time falls within section 70(6) above.

      (3) This section does not apply to a transfer from a clearance system (that is, from such a company as is mentioned in subsection (2)(b) above) if at the time of the transfer an election is in force under section 97A above in relation to the clearance services for the purposes of which the securities are held immediately before the transfer.".
      (3) In sections 67(9), 70(9), 95(1) and 97(1) of the Finance Act 1986 (transfers between depositary receipt systems or between clearance systems), the words "and is resident in the United Kingdom" and "and is so resident" shall cease to have effect.
      (4) In section 97A of that Act (clearance services: election for alternative system of charge), after subsection (12) add—
      "(13) Nothing in section 70(9) or 97(1) above has effect to prevent a charge to stamp duty or stamp duty reserve tax arising—

      (a) on a transfer to which subsection (5) above applies, or

      (b) on a deemed transfer under subsection (11) above.".

      (5) The amendments in this section have effect as follows—

      (a) subsection (1), and subsections (3) and (4) as they apply for stamp duty purposes, apply in relation to instruments executed after the day on which this Act is passed;

      (b) subsection (2), and subsections (3) and (4) as they apply for the purposes of stamp duty reserve tax, apply where the securities are transferred after that day.'.—[Mr. Jamieson.]

      Brought up, read the First and Second time, and added to the Bill.

    New Clause 1

      CORPORATION TAX ON CERTAIN INSURANCE COMPANY PROFITS
      '(1) Section 88A of the Finance Act 1989 (lower corporation tax rate on certain insurance company profits) is amended as follows.
      (2) In subsection (1) for the words "lower rate income", substitute "lower rate income or gains".
      (3) In subsection (3) for the words from the beginning to "following descriptions", substitute—
      "(3) In this section, references to a company's lower rate income or gains for any accounting period are references to all of the chargeable gains of its basic life assurance and general annuity business for the period, and to so much of the income of that business for the period as consists in income of any of the following descriptions—".
      (4) In subsections (4), (5) and (6), for the words "lower rate income", in each place where they occur, substitute "lower rate income or gains".
      (5) This section has effect for the financial year 2000 and subsequent years.'.—[Mr. Jack.]
      Brought up, and read the First time.
      Mr. Michael Jack: I beg to move, That the clause be read a Second time.
      New clause 1 would make a small—some may even say technical—change to the method of taxing life assurance policies. That small change, however, represents an attempt to bring the way in which the taxation of such policies deals with capital gains tax, in terms of taxation within the policy, into line with the change in the impact of CGT on those with assets whose value increases outside life assurance policies.
      I was grateful to the Financial Secretary for writing me a courteous and helpful letter on 1 June, following my first foray into this area. When I raised the subject in general terms when clause 37 was debated in Committee, he agreed to consider my arguments, and wrote me that helpful letter. I was heartened by the beginning of the final paragraph, in which he wrote:
      I accept that the case for change is not totally without merit.
      I think I scored seven out of 10. The purpose of this debate is to establish whether we can bring that score nearer, or perhaps all the way, to reality.
      When preparing for today's debate—and, indeed, for the debate in Committee—I first wanted to identify the cost implications of my proposal. I therefore tabled a

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      series of parliamentary questions to try to elicit some facts from the Treasury. I think it worth noting how the Treasury responded to a perfectly legitimate request for information.
      The taxation formula known as I minus E relates to life assurance policies, and my proposed change relates to that formula. I wanted to know how much it would cost. When I asked the cost of a 1 per cent. change in each rate of tax in the so-called composite that constitutes the life assurance tax rate, the Treasury told me that no estimates were available. When I asked what the tax yield from life assurance policies had been over the past eight financial years, in the context of the I minus E formula, I was told that the information was not available.
      I then tried a different tack in an attempt to elicit the truth. I asked for the individual rates that made up the composite taxation rate of life assurance returns each year. I managed to obtain that information from the Treasury, which pointed out that there was an inconsistency between the personal rate of capital gains tax and that used in terms of the I minus E formula.
      I have dwelt on those parliamentary answers for a reason. It is remarkable that, when the Financial Secretary finally got around to responding to my points on clause 37, he managed to find out how much my proposal would cost. Let me send this message to the Treasury: when Opposition Back Benchers ask legitimate questions to which they, the public and the insurance industry should be able to obtain answers, they should not have to go through the expensive process of tabling numerous parliamentary questions and being told that the information requested is not available, only to find that—magically—it is available when the Financial Secretary writes a letter.
      Some 25 million people, including me, have life assurance policies, which, for them, represent an important part of saving. Many, however, have seen the returns on their policies suffer as a result of changed economic circumstances. The new clause would enable the money saved through the change in capital gains tax—about which I shall say more in a moment—to go back into those policies and, in a modest way, to help increase returns on them, thus counterbalancing some of the market tendencies that have disadvantaged their holders.
      The proposal would have the advantage of not discriminating against the life assurance policy as a form of saving. As I have said, changes have been made under section 26 of the Finance Act 1999, which reduced the rate of capital gains tax paid by basic rate taxpayers to 20 per cent. People with assets outside a life assurance policy get that lower rate. Under the present arrangements, those with life assurance policies do not have that advantageous change in the capital gains tax regime incorporated in the composite rate of tax attached to the earnings of life assurance policies.
      Originally, when the Financial Secretary wrote to me costing out the proposal, he said that, in his estimate, the proposal would cost £30 million, but the Association of British Insurers observes that the basic rate of tax that has been proposed has dropped to 22 per cent. I should be grateful if the Economic Secretary confirmed that that change in the basic rate of tax reduces the cost of my proposal to £20 million or thereabouts. It is important that there be equitable treatment of capital gains tax within life
      260
      assurance policies to bring them into line with the way in which capital gains apply outside life assurance policies. That is the purpose of the new clause.
      People value the life assurance policy because, effectively, the tax for which they would be liable had they made that investment in some other way is paid for them as the policy appreciates over time. If it is a qualifying policy—that is, one with regular payments lasting 10 years or longer—the situation of effectively receiving the money tax paid applies to both the basic rate and higher rate taxpayer. Therefore, it is a particularly, if you like, tax administrative-friendly form of saving, but I do not see why at this juncture the Government should not agree to make the small change that I propose: to bring into line the external capital gains treatment with the internal capital gains tax treatment in terms of life assurance policies.
      The Association of British Insurers, which was most helpful to me in analysing the situation, rightly drew my attention to the fact that, if the change were to come in instantaneously, there might be a problem because the gains within a policy build over time. It may be that the new clause has a technical deficiency that does not necessarily reflect that particular situation. I would take advice from the Economic Secretary on that, but it is the principle that is at stake. If they do not accept my proposal now, the Government should commit themselves to firm action to regularise the position with regard to capital gains tax.
      Mr. Flight: I support the new clause. The taxation of insurance companies is one of the mysteries of our culture. The number of people who understand it can perhaps be counted on the fingers of one hand. Time was when it was tax advantageous to save through insurance companies, which was unfair against other forms of saving. That was sorted out about 15 years ago. There is a powerful logic to the point of principle that my right hon. Friend the Member for Fylde (Mr. Jack) makes, which is that, given the changes that the Government have made to the capital gains tax regime, there should be a level playing field between saving within an insurance wrapper and without an insurance wrapper.
      The Government have commissioned the Myners report to look into institutional investment in venture capital and to identify why it is not greater. As the Minister will no doubt be aware, one of the main things that it has found is that there is a need for reform of the tax of insurance companies, which do not have the lower capital gains tax incentives on venture capital that are available outside. I believe, therefore, that the rather broad drafting of my right hon. Friend's new clause would address that issue, which the Government's own commission is asking to be addressed.
      5.45 pm
      Miss Melanie Johnson: I am not aware that the Myners review has reported yet. The hon. Gentleman must be getting his intelligence on that from his tea leaves.
      New clause 1 would reduce the rate of tax that life assurance companies and friendly societies pay on capital gains that will contribute to benefits payable to policyholders. As the right hon. Member for Fylde (Mr. Jack) said, the logic behind the new clause is to

      261
      bring the rate of corporation tax on those gains into line with the rate of tax applied to the capital gains of individuals. There are already rules to ensure that the share of a life company's income needed to fund policyholder benefits is charged to tax at rates equal to the basic rate or the lower rate of income tax, whichever would apply if the income belonged to an individual policyholder.
      Before April 1999, the rate of corporation tax on a life company's policyholder gains and the rate applicable to an individual's capital gains did correspond. However, as the right hon. Gentleman said, under the Finance Act 1999 the rate applicable to individual gains was reduced from the basic to the lower rate of tax without a corresponding change in the rate applicable to a life company's gains.
      I can confirm that, because of cuts in the tax rates, the cost of the right hon. Gentleman's proposal would be £20 million annually. Therefore, at first sight, his proposal seems logical. However, a more detailed analysis shows that the logic applies only at a relatively superficial level. There are fundamental differences between the regimes for taxing gains made by companies, especially life companies, and the capital gains of individuals. When citing the formula I minus E, the right hon. Gentleman should really have said I plus G—for gains—minus E. That is the right formula.
      The right hon. Gentleman raised the same issue in the Committee's debate on clause 37. As he said, my hon. Friend the Financial Secretary wrote to him. In that letter, my hon. Friend set out some of the key differences between the way in which a company's gains are taxed and the way in which an individual's gains are taxed. For the benefit of the House, I shall outline those differences, as they are entirely relevant to whether parity could be achieved as the right hon. Gentleman suggests in new clause 1.
      Individuals enjoy taper relief, whereas companies have indexation. Another difference is that individuals have an annual exempt amount below which gains are not taxed. Additionally, life companies can deduct management expenses in computing their liability on chargeable gains, whereas individuals cannot. Life companies are also able to fund payments to policyholders from incoming premiums without realising assets and, therefore, making capital gains. That enables the companies to defer making taxable gains almost indefinitely, and so reduces the effective rate of tax that they pay on the policyholder gains. Those differences mean that a simplistic comparison, or a relatively simplistic comparison, of nominal rates of tax is not a very satisfactory way of comparing effective rates of tax on the gains of life companies and individuals.
      Another point is that policyholders who pay higher rate tax on their policy gains get a credit for the basic rate tax. It would be appropriate to reduce that credit if the rate of tax on life company gains were reduced. However, new clause 1 would not do that. Therefore, it would not achieve quite the effect described by the right hon. Gentleman.
      I grant the right hon. Gentleman that there are arguments both ways. If the changes that he seeks were to be made, it would have to be as part of a larger package than he is proposing. Although I am not persuaded that
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      such a package would necessarily be right, we shall continue to bear in mind the possibility for future Finance Bills. What is clear is that new clause 1 does not present such a package. Therefore, should the hon. Gentleman press the new clause today, I shall urge the House to reject it. Nevertheless, I concede that, in his proposal, he has achieved seven of 10.
      Mr. Jack: It was most generous of the Economic Secretary to agree with my own self-marking. I drew some comfort from her last few words, having tried to grapple with the complexities of life assurance taxation—not always with great success, although I got a general idea of what it was about. If the hon. Lady was indicating that there may be a possibility of further dialogue with the life assurance industry when she said that my proposal would have to be wrapped around by other measures as part of a wider package, is she willing to commit the Treasury and the Revenue to further dialogue with the life assurance industry on this and other points? The industry and I would certainly draw comfort from the fact that the door was not closed on this seven-out-of-10 proposal.
      Understandably, the hon. Lady drew attention to the taxation regime for life assurance companies and pointed out that certain tax advantages to companies negated the need for my proposal, but, tellingly, she did not mention that the treatment of capital gains within life assurance policies includes no equivalent to the personal allowance on capital gains. In other words, in respect of the composite rate for capital gains, the clock starts ticking from the first £1, whereas if the same asset were held outside the policy there would be an individual allowance before the capital gains clock started ticking. It is the view of the industry—certainly from my consultation—that that would counterbalance some of the hon. Lady's arguments in respect of the position of a company as opposed to that of an individual.
      It comes down to equity. If we make a change to benefit the individual outside the policy in respect of capital gains tax, is it equitable not to benefit the individual who holds their savings in the form of a policy? I am very conscious that on the wider front the savings ratio in the United Kingdom has fallen and that people with life assurance policies have faced particular difficulties. Many events in terms of an individual's future financial outgoings are predicated on good returns being achieved, and the new clause is a small and modest proposal that would help to improve the returns on life policies at a difficult time for that particular savings product. I would very much appreciate a response from the Economic Secretary on that point.
      Mr. Burnett: Is the right hon. Gentleman seeking to ensure that only one exemption is available per annum per individual, so that if the exemption is used outside the life policy no further exemption is available within it?
      Mr. Jack: Very few individuals actually pay capital gains tax—I think that there are only a couple of hundred thousand. Putting that to one side, my proposal would deal on a continuing basis with a small change in the composite rate in respect of the way in which the formula to which the Economic Secretary referred—I plus G minus E—operates. That is the purpose of the new clause. It would become intolerably complex to try to relate an

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      individual's capital gains tax position in respect of assets held outside the policy to those within it. That is certainly not part of my proposal.
      I conclude by asking the Economic Secretary to be kind enough to respond to my point about the proposal being part of a package and the possibility of opening dialogue with the industry so that, if necessary, the subject may continue to be discussed in the round.
      Miss Melanie Johnson: First, let me return to a point that I should have answered earlier, which was mentioned by the right hon. Member for Fylde (Mr. Jack) in his opening remarks. He referred to the answers he received to parliamentary questions. He formulated questions requiring breakdowns of figures that were not available; he did not ask the question that my hon. Friend the Financial Secretary then answered. My hon. Friend explained the costs of reducing the rate of corporation tax on policyholders' chargeable gains from 23 to 22 per cent., but the right hon. Gentleman had not asked that question. Therefore, the mystery that he attached to the fact that the answer was available is not a mystery at all.
      Also, in response to the right hon. Gentleman's argument about the exempt amount for life companies, I have already said that there is no exempt amount, but there are several factors pointing the other way. I have gone through the list and I am prepared to go through it again. It is a matter of balance.
      The right hon. Gentleman referred to equity. I think that he did not use the right word in this context and that his argument was more about parity. There are a number of factors which cut both ways. As I hope I have explained, the matter is more complicated than the issue that he is raising in new clause 1.
      I am not making a specific commitment to dialogue at this point; however, we will keep the matter in mind. Obviously, there will be future Budget rounds and discussions. As I am sure the right hon. Gentleman is aware, I regularly meet representatives of the insurance industry and the Association of British Insurers. I am sure that there will be opportunities for discussion, but I am making no commitment to introduce any future package. As I said, such a package would probably be the right way to achieve the right hon. Gentleman's objective, and I accept that there may be some arguments in favour of that objective. I hope that I have persuaded him to withdraw the new clause.
      Mr. Jack: I accept what the Economic Secretary said about the word "parity" as that would achieve the same purpose. She has set a challenge to the insurance industry to use the opportunities of discussion with the Treasury and the Revenue to develop a package in which my proposal might find a place. However, I would not expect her to commit herself at this stage.
      As for my parliamentary questions, I think that those who draft the answers to questions were pretty clued up as to why I was asking them, so it was disappointing that rather than the negative answers that I received there was not a little more imaginative drafting. However, given the assurances about future dialogue and the fact that no doubt the industry will want to rise to the challenge, I beg to ask leave to withdraw the motion.
      Motion and clause, by leave, withdrawn

    New Clause 2

      RATES OF DUTY, ETC.: REFERENCE TO RETAIL PRICE INDEX
      'In setting rates of duty, taxes, tax allowances, or tax credits by reference to a change in the Retail Price Index, there shall be used the actual change in the 12 months to the month preceding the announcement of the change.'—[Mr. Heathcoat-Amory.]
      Brought up, and read the First time.
      Mr. David Heathcoat-Amory: I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker: With this it will be convenient to discuss new clause 7—Timing of announcement of pensioner income tax allowances—
      'In section 257C(3) Taxes Act 1988 add at the end "The order shall be made by 31st December following the preceding September referred to in subsection (1).".'.
      Mr. Heathcoat-Amory: An important part of the budgetary process is the uprating of tax rates and associated matters and, at other times of the year, the uprating of benefits and pensions. New clause 2 seeks to bring some honesty and transparency into the process and into Government finances more generally. It would require the Government to do what the previous Government did, and base the uprating of taxes, allowances and tax credits, and, by implication, benefits and pensions, on a single backward-looking or historical basis—in other words, to treat all upratings in the same way. Not only is that right in principle but it gives additional certainty and precision, because people can see that the increased rates are based on an arithmetical index that is generally published and available.
      6 pm
      The Financial Secretary to the Treasury (Mr. Stephen Timms): The right hon. Gentleman suggests that the Government should follow the practices of the previous Government. On a number of occasions, the previous Government froze the allowances altogether. Will he acknowledge that when he advocates that we follow their practices?
      Mr. Heathcoat-Amory: Not only did we freeze some of the upratings but we reduced certain duties. In our last two Budgets, we froze the duty on alcohol and reduced it on spirits. We did that for sound reasons, and it is regrettable that the incoming Labour Government failed to follow that practice and uprated alcohol duties again. Now we hear that a main cause of disorder in all our streets is abuse of alcohol, some of it bought from illegal outlets and undoubtedly smuggled across the channel. The Government should have tackled the cause of that crime rather than trying to tackle its symptoms; they should have tackled the severe smuggling problem. So the answer to the Minister is that on occasions we froze some tax increases. I commend the practice to him.
      The new clause ensures that where the Government increase taxes and benefits by reference to a prices index, they use a single historical one. I contrast that with what the Government are doing now. They pick and choose whether they use an historical or a projected index, purely for their own convenience. The most obvious example is the treatment of fuel duties. The basis of that treatment was changed in 1997 from an historical to a projected

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      inflation assumption. That was a clear break with what had happened previously, probably caused by the fact that the Government sought to introduce an extra uprating. The Government introduced four upratings in three years before they finally came off the fuel duty escalator.
      Mr. John Bercow: Given that 29.5 per cent. of the price of a pint of beer, 50.5 per cent. of the price of a bottle of wine and 61.3 per cent. of the price of a bottle of whisky goes directly to Treasury coffers, can my right hon. Friend offer the House a guesstimate of how much lower those proportions would be in the happy event that new clause 2 had been passed at the beginning of this Parliament?
      Mr. Heathcoat-Amory: My hon. Friend makes a good point, and most usefully broadens the debate. We are not discussing the increase in road fuel duty alone. As he has rightly spotted, the same system has been used to uprate tobacco and alcohol taxes in the Budget by far more than was justified. The figures are revealing. Fuel and alcohol duties increased by 3.4 per cent. immediately on Budget day. That was the anticipated inflation rate for the rest of the year. Curiously, that inflation rate does not appear anywhere in the Red Book, but that was undoubtedly the Government's estimate. By contrast, income tax allowances and tax credits, such as the tax credit for the disabled, all increased not by 3.4 per cent. but by between 1 and 1.5 per cent. That is all laid out on pages 138 and 139 of the Red Book.
      So the Government took a high inflation figure when it suited them for revenue purposes, but when they gave away some money to working families or disabled people, or simply uprated personal allowances, they used a far lower figure. The net benefit to the Treasury was simply colossal. The Government notoriously used exactly the same methodology to uprate pensions by only 1.1 per cent., leading to the 75p per week insult to pensioners with which the country is so familiar.
      Needless to say, there was not a word about the change in treatment of fuel duties in the Budget speech. The increases were all described as simply increases by the rate of inflation. Worse than that, when challenged, the Government denied it. I am glad that the Paymaster General is attending the debate. She will recall that this very issue was raised by my hon. Friend the Member for Arundel and South Downs (Mr. Flight), who is in his place now. On 6 April, he challenged her and pointed out that petrol duty had been raised by an inflation index of 3.4 per cent., whereas allowances had been raised by only 1.2 per cent.
      The Paymaster General replied with a mixture of patronising my hon. Friend and being wrong. She said:
      I think that I am right in saying that the hon. Gentleman has never been in government, so I suppose he can be forgiven for not knowing how the tax system works.
      That was the patronising bit. The false and wrong statement was as follows:
      The methodology used for this year's increase is exactly the same as that which has been used in previous years. It is the same methodology that the Conservative Government used.—[Official Report,6 April 2000; Vol. 347, c. 1145.]
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      That was flatly untrue. I have already described how in 1997 the incoming Labour Government changed the methodology from one based on an historical index to one based on a projected index. I should be grateful if the Minister would apologise for misleading the House.
      Such examples show why people have lost faith in the Government and why the Government's assertions about taxes and benefits are simply not believed any more. Indeed, the contents of the memo leaked from No. 10, in which the Prime Minister whinges that no one believes him any more and he has lost touch with the instincts of the British people, are at least in part attributable to the fact that people have not been told the truth. When challenged, the Government flatly deny what is in fact the case. The practice of using two indexation procedures, simply for their convenience, has grown under this Government. I believe that that is not just wrong but probably illegal.
      Some of us served on the 1998 Finance Bill. I have done more Finance Bills than I care to remember, and I certainly attended all the debates on that one. Under what became section 155 of the Act, the Treasury is committed by law to certain key principles in the formulation and implementation of fiscal policy. One of those key principles is transparency. I do not know what happens if the Government break one of their own laws—who gets arrested, or who is responsible for ensuring that an Act of Parliament is obeyed. That we can leave for another time, but the Government are building up a good deal of case law of instances in which they are in breach of section 155 of the Finance Act 1998.
      The example of indexation subterfuges that are carried out and then denied comes in addition to other stealth taxes, and the House is familiar with many of them. The Select Committee on the Treasury, with its distinguished Labour Chairman and a Labour majority, drew attention in its report on the Budget this year to no fewer than five examples of a lack of transparency in the presentation of the national accounts. It pointed out that the Government used the term "tax burden" without making it clear that they were only talking about the direct tax burden. That conveniently omitted all the indirect taxes, which were increasing. The Select Committee asked that that be put right.
      The Committee also drew attention to the rather propagandist little document that the Government published at Budget time, again at taxpayers' expense. It asked that in future such a document should be independently audited.
      Mr. Bercow: Will my right hon. Friend confirm that the Select Committee's request was not spectacularly radical? It was merely asking the Chancellor to revert to the proper practice that was operated by Conservative Governments for 15 successive years, from 1981 to 1996.
      Mr. Heathcoat-Amory: My hon. Friend is right. We are not asking for the impossible or the unusual. We are merely asking the Government to revert to previous practice.
      I can give my hon. Friend another example. The Select Committee pointed out that the Government had dropped the previous practice of reporting on the effects of indirect taxes on households of various sorts. That was the subject of one of its recommendations. We all remember that in

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      previous years that information was routinely published by Conservative Governments. However, it was dropped immediately and without explanation, because the results would be embarrassing. That is wrong, and conflicts with the Finance Act 1998.
      My final example is the working families tax credit, which is now being treated as a deduction from taxation, although it is part of the sum of social security expenditure. That fact is confirmed half way down page 220 of the Red Book, admittedly in small print:
      income tax credits … score as public expenditure under national accounting conventions.
      Despite that, in every other reference to working families tax credit in all other documents, and elsewhere in the Red Book, it is wrongly, confusingly—and, in my view, deceitfully—described as a deduction from income tax.
      I have provided some examples, and the new clause is designed to prevent the situation from becoming worse. It would require the Government, by law, to have one policy for uprating the various taxes and duties, and to stick with it. This is not simply a question of honesty in the presentation of the national accounts, important though that is. It is also about protecting the country from further damage. If the clause had been implemented last year, the Government could not have raised fuel duties or other indirect duties by 3.4 per cent. I will not say that they got away with it, because what they had done was discovered, but the 3.4 per cent. increase has made petrol and diesel in the UK the most expensive in Europe.
      If by some lucky chance the new clause is accepted this evening, the Government could find a way of paying back at least the windfall element in the money that they have netted since the Budget. Revenue from road fuel comes from hydrocarbon duty and value added tax. The Government's latest excuse for the rise in petrol prices is that the world price of oil has risen. However, that, too, nets the Government a great deal of extra revenue. It is calculated that VAT on the higher oil price since Budget day is netting the Government an extra £150 million a year.
      6.15 pm
      That is bad for taxpayers, particularly for those who have to have cars. It is also bad for the haulage industry and for manufacturing. However, it is good for some. We are told that it is very good for the racketeers and paramilitary organisations in Northern Ireland. I have often asked the Treasury whether it has any estimates of the smuggling that takes place across the land border between Northern Ireland and the Republic—another EU member state. It always replies that it has no such estimates. That shows an extraordinary degree of complacency.
      Some other people have been doing some work. The Petrol Retailers Association has noticed that official deliveries of petrol in Northern Ireland have fallen from more than 160,000 tonnes in the last quarter of last year to less than 110,000 in the first quarter of this year. More than that, it has counted that more than 70 petrol stations in Northern Ireland have closed as a result of the smuggling. It believes that this is providing funds for racketeering and paramilitaries of various sorts.
      It is extremely disturbing that that should have been worked out by an outside organisation and not by the Government. I ask the Government and the Treasury, in
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      all sincerity, to consider again the damage caused by the escalation in petrol prices. The Chancellor said this afternoon that he had come off the fuel duty escalator, but I have described a situation where he has done anything but that. There is no justification for the past increases and the extra budget that he has had in the past three years, which means that the cumulative effect will be even more damaging. In addition, he increased duty by 3.4 per cent. this year, which made a bad situation worse.
      The new clause, which I commend to the House, is designed to put some honesty and transparency back into the method of calculating duty rates. It would be good for the country if it helped to unwind the entirely unjustified duty increase on 21 March.
      Mr. Malcolm Chisholm: I shall make only two points given the pressure of business. The right hon. Member for Wells (Mr. Heathcoat-Amory) cannot get away with taking the high moral ground on such a spurious basis. First, we heard the nonsense about fuel duty. We have been hearing about it also in recent weeks from the Scottish National party in Scotland, and in a few minutes we may hear about it again from the SNP. There was a change because of the general election and a Budget soon afterwards.
      As the right hon. Member for Wells knows, the last Conservative Budget in November 1996 used the September 1996 uprating. Therefore, in July 1997, the Labour Government had to use September 1997 in accordance with the fuel duty escalator.
      Mr. Heathcoat-Amory: Why did they not use the prices index up to June 1997?
      Mr. Chisholm: What they used was similar to that. September is the point that is always used for these indexes. It was natural to use September for the first Budget.
      Secondly, the right hon. Gentleman has praised previous practice. He knows that there were two different upratings under the Conservative Government. There was one for the headline rate of inflation for pensions and similar benefits, whereas income-related benefits have always been the subject of the Rossi index, as he knows. It would have been far better if he had acknowledged that fact. Perhaps he has forgotten because there is complete confusion in the new clause, in which he asks for tax credits to be governed by the retail prices index, when income-related benefits have always been governed, even by Conservative Governments, by a different index.
      Mr. Edward Davey: New clause 7 relates to the timing of the announcement of the increase in income tax allowances. It is a modest new clause, but it would provide real benefits to pensioners who pay income tax. At the moment, because of the problems that there have been with the announcement in the past two years, pensioners are effectively paying an interest-free loan to the Chancellor between April and May. The new clause would reduce the Inland Revenue's administration costs when it sends out the various codings. Perhaps the most important benefit that it would bring would be to end the confusion and anxiety felt by many pensioners when they receive their changed tax coding later in the year.

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      When the Budget was in March, the longstanding practice was for tax codings to be sent out to all income tax payers in January and February, based on the income tax allowance for that year. Then, after the March Budget, when the new income tax allowances had been announced, a new coding would be sent out to all taxpayers. That was the usual practice with which everyone became familiar, and it did not create a problem because it was done in time for the forthcoming financial year. But there has been a change which has gone unnoticed by many. When the Chancellor rightly aligned class 1 national insurance contributions with income tax, he decided that he would announce the following year's allowances in the November when he announced the changes to the national insurance system. The changes to the allowance for the following year for employed people—the non-pensioner income tax-paying community—were announced in November. The correct PAYE codes could be sent out in January and February, so there was no problem for them.
      However, because pensioners do not pay national insurance contributions, the Chancellor has not announced in the pre-Budget report of the previous two years the increases in the pensioner allowances. Therefore, the tax codings for pensioners have gone out in January based on that year's level of allowances, and when the Chancellor has announced the increases in the pensioner income tax allowances in the following March Budget, another tax coding has had to be sent out, in the main just to pensioners. That has meant that pensioners, for the months of April and May, have paid too much income tax, and the extra bureaucracy from the Inland Revenue has caused them concern and anxiety. They have had to ask their tax advisers what on earth it is all about, and when it has been explained to them, they have been flabbergasted. They wonder why on earth the Government are behaving in such a way, why all that bureaucracy is being created and why, they, the pensioners, have to have too much tax deducted from them during the month of April.
      New clause 7 would resolve that problem once and for all. It amends the famous section 257C of the Income and Corporation Taxes Act 1988, which was introduced by the Rooker-Wise amendment. The new clause would ensure that the announcement of the upratings for the income tax allowances was made by the latest by 31 December of the year before the tax year to which those upratings apply.
      I raised the matter in the House in an Adjournment debate on 9 June 2000. The Paymaster General was kind in replying to that point and to others. She admitted that the Government recognised that this was an issue. She said:
      It is something that I should like to address.
      She went on:
      The hon. Gentleman made a point on coding notices. We are aware of that matter and are examining it. We have not yet found a solution to it, but we are still looking for one.—[Official Report,9 June 2000; Vol. 351, c. 617–18.]
      I was grateful for that positive reply from the Paymaster General.
      New clause 7 is the solution to which the Government should be looking. The Minister may say that it would tie the Chancellor's hands, but it would not because the
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      Chancellor would still be free in the March Budget and the future Finance Bill to announce changes over and above what was announced in December to the future uprating of income tax allowances, either up or down. The clause would not tie the hands of the Chancellor or restrict Parliament; it would simply make for good administrative practice. It would mean that low-income pensioners did not make interest-free loans to the Chancellor, which cannot be right.
      I hope that the Minister will consider this minor administrative matter, which is important to tens of thousands of pensioners and possibly more. I tried recently to elicit how many by various parliamentary questions, but I was unable to obtain exact figures. However, many are affected by this. It cannot be right that we and other taxpayers are spending money on bureaucracy for something that is completely unnecessary and further disadvantages some of the most disadvantaged people in our society.
      If the Government do not accept new clause 7 tonight, I hope that they will go away and make sure that the problem is addressed in the way in which the Chancellor makes future uprating statements for income tax allowances for the employed and for pensioners, and that they will provide statutory protection to prevent such a mistake from happening again.
      Liberal Democrats have nothing against new clause 2. It is one way of changing the uprating of the allowances and duties. The Conservative Government had more than one way of doing that, and this Government have more than one way. There is nothing sacrosanct about any particular process for uprating allowances and duties, so Liberal Democrats have no problem in supporting the new clause. There is a genuine case for it in the sense that the uprating would be based on a reality—a figure which could be proved, analysed and agreed upon, rather than a forecast figure, which might not be the eventual inflation figure for that period. One need not waste a huge amount of time on it. It is a relatively simple measure concerning a technocratic issue.
      The right hon. Member for Wells (Mr. Heathcoat-Amory) made a few political points, some of which were well made. There is no doubt that the two upratings in the Government's first year were rather stealthy. There is no doubt that pensioners think it rather odd that their pensions have gone up by 1.1 per cent. while fuel duty has gone up by 3.4 per cent. and council tax often by far more than that. People on incomes that are increasing only modestly are concerned. New clause 2 may be one mechanism by which to address that unfairness and ensure that people do not perceive that this Government or other Governments are treating them unfairly.
      However, new clause 2 is only a tiny measure to get rid of that unfairness. What we really need are higher basic state pensions for the ordinary pensioner. Unfortunately, we did not see that in today's statement or last April, and that is a shame. It is about time that the Government addressed that issue, which is a matter of a great deal more substance than new clause 2. However, as I said, Liberal Democrats have no problem with it.
      6.30 pm
      Mr. Alasdair Morgan: I would like to speak briefly to new clause 2, specifically in relation to fuel duties. I am glad that you called me,

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      Mr. Deputy Speaker, because I would have hated to disappoint the hon. Member for Edinburgh, North and Leith (Mr. Chisholm), who would not otherwise have had a chance to listen to the "usual nonsense", as he called it, from the SNP.
      It is a serious matter that fuel duties have been put up by more than the real rate of inflation, particularly for my constituency, which has the third lowest level of income of all the Scottish constituencies, but about the third highest level of car ownership. That is not because the people in my constituency, being of average lower income, are perversely buying cars and luxury items. It is because the ownership of a car, or often two cars in a family, is essential to earning a livelihood.
      Therefore, to increase one of the principal costs of car ownership by more than the real rate of inflation is insupportable. Because the tax, certainly in Galloway and in many other rural areas, is paid by those on lower incomes, regardless of what those incomes are, effectively it is a regressive tax which is being increased by more than the rate of inflation.
      That would be bad enough if tax were the only influence on the price of petrol, but it is not. The right hon. Member for Glasgow, Anniesland (Mr. Dewar), then Secretary of State for Scotland, said in the Scottish Grand Committee last year:
      The oil price is likely to stay at about $10 to $12 a barrel—at least in the foreseeable future—[Official Report, Scottish Grand Committee,1 February 1999; c. 8.]
      This June, the oil price touched $31 a barrel. The right hon. Gentleman does not seem to have displayed great foresight. Perhaps it is as well that he is not in charge of Treasury forecasts.
      In the light of that, perhaps the Government thought that they could get away with such increases and their mechanism for them when oil prices were very low, and they thought that they were likely to remain low. That is no longer the case. Petrol has gone up for other reasons; it has gone up because the price of oil has gone up. That is a very good reason why the Government should revisit the mechanism for taxing petrol. There are, therefore, three reasons why.
      First, as I have said, the price of petrol is going up anyway. Secondly, as the right hon. Member for Wells (Mr. Heathcoat-Amory) said, as a result Government revenues elsewhere are going up. They are going up from VAT on oil; they are going up increasingly from the petroleum revenue tax. I think it is estimated that £20 billion over the next four years will be gained from the PRT. Lastly, as the right hon. Gentleman also said, the Government are suffering a severe loss of revenue because of above-inflation increases in the price of diesel fuel and petrol here while there is cheaper fuel elsewhere.
      In my constituency, the nearest to Northern Ireland, we are very conscious that cross-channel hauliers—I am speaking about the north channel between Galloway and Northern Ireland—very often do not fill up in Galloway or in Northern Ireland, but fill up in the Republic, in places such as Dundalk. That means money lost to the Exchequer, because basically we are trying to be too greedy. The mark-up on what would be the retail price of petrol without the duty is, I believe, 333 per cent., which is fairly good by anybody's standards.
      It is not just ordinary people who are paying the tax. It is also heaped on to the police, the fire service, the ambulance service and school buses. Every time we
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      increase the tax by more than the real rate of inflation, the costs of all those essential services go up at the same time. That is insupportable.
      The Chancellor has made much of the fact that he has done away with the automatic fuel escalator. I do not see that there is any point in doing away with an automatic escalator if what we get instead is a manual escalator. We need a much more sensible approach to the issue. I urge the Government to think again before it is too late for many businesses in the rural economy, and perhaps before it is too late for their majority at the next election.
      Mr. Jack: I support my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory), who made a telling case for standardising indexation changes based on a retrospective look at the retail prices index. One feature that has not come out in the debate so far is the accuracy of the inflation forecast. If by chance inflation does not move ahead at the same rate as the forecast increase used for the various tax purposes that my right hon. Friend outlined, the Government have a windfall gain, but they do not give themselves an obligation to pay back to the taxpayer any of the extra money obtained through fortuitously lower inflation than forecast.
      As has been said in the debate, the windfall gain in VAT receipts as a result of the rise in oil prices, with its knock-on effect on petrol prices, bears witness to the fact that the present Government enjoy using every opportunity to take the people's money and put it into the Treasury's coffers to do with it as they think fit. Therefore, in terms of safety and equity, my right hon. Friend is correct.
      I should like to conclude by expressing a provocative thought. The whole question of uprating the Government's income is perhaps a disincentive to their making certain that they always make every pound of taxpayers' money work as hard as possible. The Government can simply say that they can guarantee that a certain amount of money will come in through uprating, but a company cannot assume that it will receive automatic price increases. A company will try extremely hard to make every penny work as hard as possible, because it cannot guarantee receipt of that extra income.
      We have got ourselves into the way of thinking that the Government's position must always be protected. From the individual's point of view, I can well appreciate why indexation should continue to be a regular feature, because he or she has less room for manoeuvre; in the real world an individual may well not receive a pay increase, but he still has his taxes to pay. Therefore, some form of price index-insulated indexation is important to him if he is not to be worse off year on year in real terms. But the Government's automatic assumption that they will receive money through indexation perhaps makes them a bit sloppy around the edges when it comes to spending the public's money. That may be a feature that the House will return to when it debates today's statement by the Chancellor.
      Mr. Timms: We have been over the ground covered by new clause 2 on a number of occasions. This is probably the third time that we have heard the speech of the right hon. Member for Wells (Mr. Heathcoat-Amory). I had hoped that he might have something different to say on this occasion, but I was disappointed. He made his points in the usual way.

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      I should like to set out the position again. It is standard practice for inflation increases in excise duties to be based on a forecast of September retail prices index figures, and for income tax allowances and pensions to be based on the previous September's out-turn figure for the retail prices index.
      Mr. Jack: The Financial Secretary used the expression "standard practice". Why must it be the standard practice? Why could the hon. Gentleman not change the standard practice to a more equitable practice if he wished?
      Mr. Timms: Of course, the practice could be changed, but I want to explain what the practice is. September is the date that has been used on both sides, in excise and in allowances, with a forecast in the case of excise duties and a look back at the previous year's figures in the case of allowances.
      Mr. Alasdair Morgan: If that practice is followed, and if—heaven forbid—Treasury forecasters are always pessimistic, we shall continue to have an increase each year that turns out to be higher than inflation, and gradually the average prices index and the duty levels will diverge.
      Mr. Timms: I am glad to be able to reassure the hon. Gentleman on that point. The duty increases since the election have been less than they would have been if inflation had been used. The duties being paid by the hon. Gentleman's constituents are less than they would be if we were to take up his suggestion.
      The Opposition have got excited about this matter on a number of occasions and have drawn attention to the fact that, this year, inflation increases for duties have been greater than for allowances and pensions. It is a matter of swings and roundabouts. Last year, the reverse was the case, and allowances and pensions went up by 3.2 per cent. while duties went up by 1.3 per cent. We heard nothing about stealth handouts in the debate at that time. In a era of stable inflation—the result of the extremely successful management of the economy that we have enjoyed over the past three years—things even out over time. As I have been able to point out, duties have increased by less than inflation over that period. All this fuss has been entirely misplaced.
      Announcement of the personal allowance in November means that the latest practical reference point for income tax allowance indexation is September—the month preceding November would not work. It would be impractical—this is a suggestion in new clause 2—for the Budget to be early in the month. If the Budget were in early March, the new clause would require the duty increase to be the change in the RPI in the year to February, which would not even have been published by that time. It is an unworkable proposal.
      Another difficulty with the proposal is that different indexation figures would be used for different allowances. Basic personal allowances would rise by the increase in RPI in the year to October, while the other allowances and the rate bands would rise in line with the RPI increase to February. That is just within the allowances. There is no sense in that.
      274
      I should remind Conservative Members that it was their Government who introduced the Income and Corporation Taxes Act 1988, which requires the use of the September RPI for income tax as opposed to the much more arbitrary and less satisfactory proposition that they are advancing today.
      I noticed that, in response to my intervention, the right hon. Member for Wells was understandably shy when it came to talking about what the previous Government did with income tax allowances. The previous Government froze income tax allowances for 1993 and 1994; they did not uprate them at all. They also froze the basic rate limit, not just for those two years, but for 1990 and 1992 as well. As a result, they raised taxes by over £2 billion. The measures to freeze allowances and the basic rate threshold with effect for April 1993 and April 1994 brought in about £1.75 billion. The Chief Secretary responsible for that was the current shadow Chancellor. The Opposition are a great deal more vulnerable on this than the Government. The proposal is unworkable.
      The right hon. Member for Wells or it may have been his hon. Friends in Committee—said that the Red Book does not mention the figure of 3.4 per cent. It does. It appears several times in table A.9 on page 146 and the figure 3.41 per cent. appears in table A.12 on page 148. It is always worth reading the Red Book. It is a practice that I commend to Opposition Members.
      I was rather surprised by the fact that the right hon. Gentleman said that he had been unable to establish the figure for revenue lost through cross-border shopping and smuggling of oil in Northern Ireland. We have said on a number of occasions that we estimate that to be £100 million in 1998. That has been published in parliamentary answers and it was stated in Committee. We have published that figure on a number of occasions, and I am sorry that the right hon. Gentleman missed it.
      6.45 pm
      The hon. Member for Galloway and Upper Nithsdale (Mr. Morgan) raised concerns, specifically about fuel duty. I hope that he will be reassured by what I have said about the impact of the method used for inflation uprating of duties. He expressed particular concern, for reasons that I well understand, about the position of low-income constituents in areas such as his. They will benefit particularly from the changes that we have announced to vehicle excise duty. We have extended the threshold for the lower rate from 1100 cc to 1200 cc vehicles. His constituents will also benefit from the new arrangements being introduced from next year for lower rates of vehicle excise duty on fuel efficient cars. Those measures will be particularly welcome to the hon. Gentleman and his constituents.
      Mr. Morgan: Will the Minister accept that those measures are much more likely to benefit those who can afford to buy new cars? People on low incomes tend to buy second-hand cars, often without a low engine size because such cars tend to be cheaper on the second-hand market.
      Mr. Timms: The concession for vehicles of less than 1200 cc applies equally to new and old cars. I anticipate that the hon. Gentleman's constituents who are on a limited income and driving an inexpensive car will welcome those measures.
      Mr. David Heath: I wonder whether the hon. Gentleman can help me with a query

      275
      from a constituent who points out that the differential between unleaded petrol and leaded petrol was introduced as a perfectly proper environmental measure. Why is that differential maintained between unleaded petrol and lead replacement petrol? That affects people who own older cars, which may not be able to run on unleaded fuel.
      Mr. Timms: The differential with lead replacement petrol is a reflection of the different costs in the production process. I should be happy to drop the hon. Gentleman a line setting out the details of that arrangement.
      I am grateful to the hon. Member for Kingston and Surbiton (Mr. Davey) for his explanation of the new clause. I know that he takes a keen interest in the way that the tax system affects pensioners. As he said, my hon. Friend the Paymaster General had an opportunity to debate a wide range of issues of concern to pensioners with him in the Adjournment debate on 9 June and, in particular, to consider the proposals made by the low income tax reform group.
      For reasons that he spelled out, the hon. Gentleman would prefer the Revenue to reflect in the PAYE codes on occupational pensions, which are issued in January and applied in April, the increased amount of state pension and the increased amount of allowances resulting from indexation. His proposal is that the Revenue would be able to do that if the Treasury order setting out index values of allowances were published by the end of December rather than on Budget day the following March. Publishing that order earlier would not have that effect because it is always possible for Parliament to override indexation, as it did in 1999 when pensioner allowances rose by up to £200 more than the indexation required.
      Mr. Edward Davey: I understand that point, but surely in most years and in most circumstances there would not need to be a second tax coding because Parliament would usually go by the normal Rooker-Wise index.
      Mr. Timms: I know that the hon. Gentleman feels strongly about this. My hon. Friend the Paymaster General gave him an assurance during the debate on 9 June that she would look into this matter. I know that she is doing so with great care and I hope that the hon. Gentleman will feel that he can accept that assurance and not press this issue.
      Mr. Heathcoat-Amory: The Minister started by saying that we had debated these matters before, but we have raised them again because we still have not got any answers. I will make a deal with him—I shall stop raising the subject if he starts giving some answers. The debate that we have just had illustrates my point because, for example, the Minister did not apologise on behalf of the Paymaster General for the flat untruth of her assertion that the previous Government had indulged in the same subterfuge.
      The fact is—I note that the Minister did not disagree—that we had an historical system for uprating all the allowances and duties. It was the incoming Labour Government who changed the rules to uprate according to a forward-looking estimate of inflation. That is why fuel duty and other indirect taxes went up by 3.4 per cent. this year, instead of increasing by the pension increase index of 1.1 per cent. I ask the Minister to correct that example
      276
      of a Treasury Minister misleading the House. That is a serious enough point to draw the Minister into a late intervention, and I will give way to him if he will now agree that that was an example of a Minister giving an incorrect reply. The fact that he will not do so only confirms our allegation that no one believes what this Government say about taxes any more. It is no good the Prime Minister saying that he now wants a lot of eye-catching initiatives instead of policies, when he has already lost the trust of the House and of the wider public. The Government cannot even admit it when they have made a mistake.
      The Minister then boasted that there was no problem because the Government had achieved what he called low and stable inflation. If that is the case, why are they putting up alcohol and road fuel duties by nearly 3.5 per cent., when they have an inflation target of 2.5 per cent.? I do not call that either low or stable.
      The Minister also said that the figure of 3.4 per cent. appears in the Red Book so it is not a secret. I never said that it was. We spotted quickly the divergence and that the Government were putting up allowances by only 1.1 per cent. and all other duties by nearly 3.5 per cent. My point, which I repeat, is that the issue of inflation and the inflation index is discussed in no fewer than three places in the Red Book but at no point in those discussions does the figure of 3.4 per cent. appear. The Minister cannot contradict that point.
      Mr. Nicholas Soames: Does my right hon. Friend agree that, with that eagle-eyed clarity and persistence that led him to seek out that figure, he has also drawn other inconsistencies in the Red Book to the attention of the House?
      Mr. Heathcoat-Amory: That was a typically sagacious intervention by my hon. Friend, who is clearly on form at an early point in our proceedings. We have said enough to demonstrate beyond doubt that on this issue we are right—and I include my hon. Friend in that observation. We are on the side of right and truth and it is the Government who have made a mistake. We shall divide the House on the issue.
      Question put, That the clause be read a Second time:—
      The House divided: Ayes 168, Noes 319.

      Division No. 275]

      [6.54 pm

      AYES

      Allan, Richard

      Burnett, John

      Amess, David

      Burns, Simon

      Arbuthnot, Rt Hon James

      Burstow, Paul

      Baldry, Tony

      Butterfill, John

      Ballard, Jackie

      Cash, William

      Beggs, Roy

      Chapman, Sir Sydney (Chipping Barnet)

      Beith, Rt Hon A J

      Bell, Martin (Tatton)

      Chidgey, David

      Bercow, John

      Chope, Christopher

      Beresford, Sir Paul

      Clappison, James

      Bottomley, Peter (Worthing W)

      Clarke, Rt Hon Kenneth (Rushcliffe)

      Bottomley, Rt Hon Mrs Virginia

      Brake, Tom

      Clifton-Brown, Geoffrey

      Brand, Dr Peter

      Collins, Tim

      Brazier, Julian

      Cormack, Sir Patrick

      Breed, Colin

      Cotter, Brian

      Brooke, Rt Hon Peter

      Cran, James

      Bruce, Ian (S Dorset)

      Curry, Rt Hon David

      Bruce, Malcolm (Gordon)

      Davey, Edward (Kingston)

      277

      Davies, Quentin (Grantham)

      Madel, Sir David

      Davis, Rt Hon David (Haltemprice)

      Major, Rt Hon John

      Donaldson, Jeffrey

      Malins, Humfrey

      Dorrell, Rt Hon Stephen

      Maples, John

      Evans, Nigel

      Mawhinney, Rt Hon Sir Brian

      Ewing, Mrs Margaret

      May, Mrs Theresa

      Faber, David

      Moore, Michael

      Fabricant, Michael

      Morgan, Alasdair (Galloway)

      Fallon, Michael

      Norman, Archie

      Fearn, Ronnie

      Oaten, Mark

      Flight, Howard

      O'Brien, Stephen (Eddisbury)

      Forth, Rt Hon Eric

      Ottaway, Richard

      Foster, Don (Bath)

      Paice, James

      Fox, Dr Liam

      Paterson, Owen

      Fraser, Christopher

      Portillo, Rt Hon Michael

      Garnier, Edward

      Prior, David

      George, Andrew (St Ives)

      Randall, John

      Gibb, Nick

      Rendel, David

      Gidley, Sandra

      Robathan, Andrew

      Gill, Christopher

      Robertson, Laurence

      Gillan, Mrs Cheryl

      Roe, Mrs Marion (Broxbourne)

      Gorman, Mrs Teresa

      Ross, William (E Lond'y)

      Gorrie, Donald

      Rowe, Andrew (Faversham)

      Green, Damian

      Ruffley, David

      Greenway, John

      Russell, Bob (Colchester)

      Gummer, Rt Hon John

      St Aubyn, Nick

      Hague, Rt Hon William

      Sanders, Adrian

      Hamilton, Rt Hon Sir Archie

      Sayeed, Jonathan

      Hammond, Philip

      Shepherd, Richard

      Hancock, Mike

      Simpson, Keith (Mid-Norfolk)

      Harris, Dr Evan

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

      Harvey, Nick

      Soames, Nicholas

      Hawkins, Nick

      Spelman, Mrs Caroline

      Hayes, John

      Spicer, Sir Michael

      Heald, Oliver

      Spring, Richard

      Heath, David (Somerton & Frome)

      Stanley, Rt Hon Sir John

      Heathcoat-Amory, Rt Hon David

      Streeter, Gary

      Hogg, Rt Hon Douglas

      Stunell, Andrew

      Horam, John

      Swayne, Desmond.

      Howard, Rt Hon Michael

      Syms, Robert

      Howarth, Gerald (Aldershot)

      Tapsell, Sir Peter

      Hughes, Simon (Southward N)

      Taylor, Ian (Esher & Walton)

      Jack, Rt Hon Michael

      Taylor, John M (Solihull)

      Jackson, Robert (Wantage)

      Taylor, Sir Teddy

      Jenkin, Bernard

      Thomas, Simon (Ceredigion)

      Johnson Smith, Rt Hon Sir Geoffrey

      Tonge, Dr Jenny

      Townend, John

      Keetch, Paul

      Tredinnick, David

      Kennedy, Rt Hon Charles (Ross Skye & Inverness W)

      Trend, Michael

      Tyler, Paul

      Key, Robert

      Tyrie, Andrew

      King, Rt Hon Tom (Bridgwater)

      Viggers, Peter

      Kirkbride, Miss Julie

      Waterson, Nigel

      Kirkwood, Archy

      Webb, Steve

      Laing, Mrs Eleanor

      Whitney, Sir Raymond

      Lait, Mrs Jacqui

      Whittingdale, John

      Letwin, Oliver

      Wigley, Rt Hon Dafydd

      Lewis, Dr Julian (New Forest E)

      Wilkinson, John

      Lidington, David

      Willetts, David

      Lilley, Rt Hon Peter

      Willis, Phil

      Livsey, Richard

      Wilshire, David

      Lloyd, Rt Hon Sir Peter (Fareham)

      Winterton, Mrs Ann (Congleton)

      Loughton, Tim

      Winterton, Nicholas (Macclesfield)

      Luff, Peter

      Yeo, Tim

      McIntosh, Miss Anne

      Young, Rt Hon Sir George

      MacKay, Rt Hon Andrew

      Maclean, Rt Hon David

      Tellers for the Ayes:

      Maclennan, Rt Hon Robert

      Mr. Peter Atkinson and

      McLoughlin, Patrick

      Mr. Stephen Day.

      NOES

      Ainger, Nick

      Ashton, Joe

      Alexander, Douglas

      Atkins, Charlotte

      Allen, Graham

      Austin, John

      Anderson, Donald (Swansea E)

      Barnes, Harry

      Anderson, Janet (Rossendale)

      Barron, Kevin

      278

      Battle, John

      Dean, Mrs Janet

      Bayley, Hugh

      Denham, John,

      Beard, Nigel

      Dismore, Andrew

      Begg, Miss Anne

      Dobbin, Jim

      Benn, Hilary (Leeds C)

      Doran, Frank

      Benn, Rt Hon Tony (Chesterfield)

      Dowd, Jim

      Benton, Joe

      Drew, David

      Bermingham, Gerald

      Dunwoody, Mrs Gwyneth

      Berry, Roger

      Eagle, Angela (Wallasey)

      Betts, Clive

      Eagle, Maria (L 'pool Garston)

      Blackman, Liz

      Edwards, Huw

      Blears, Ms Hazel

      Ellman, Mrs Louise

      Blizzard, Bob

      Ennis, Jeff

      Boateng, Rt Hon Paul

      Field, Rt Hon Frank

      Borrow, David

      Fisher, Mark

      Bradley, Keith (Withington)

      Fitzpatrick, Jim

      Bradley, Peter (The Wrekin)

      Flint, Caroline

      Bradshaw, Ben

      Flynn, Paul

      Brinton, Mrs Helen

      Foster, Michael Jabez (Hastings)

      Brown, Rt Hon Nick (Newcastle E)

      Foster, Michael J (Worcester)

      Brown, Russell (Dumfries)

      Fyfe, Maria

      Browne, Desmond

      Gardiner, Barry

      Buck, Ms Karen

      Gerrard, Neil

      Burden, Richard

      Gibson, Dr Ian

      Burgon, Colin

      Gilroy, Mrs Linda

      Butler, Mrs Christine

      Godsiff, Roger

      Byers, Rt Hon Stephen

      Goggins, Paul

      Caborn, Rt Hon Richard

      Golding, Mrs Llin

      Campbell, Mrs Anne (C'bridge)

      Gordon, Mrs Eileen

      Campbell, Ronnie (Blyth V)

      Griffiths, Jane (Reading E)

      Campbell-Savours, Dale

      Griffiths, Nigel (Edinburgh S)

      Cann, Jamie

      Grocott, Bruce

      Caplin, Ivor

      Grogan, John

      Casale, Roger

      Gunnell, John

      Caton, Martin

      Hain, Peter

      Cawsey, Ian

      Hall, Patrick (Bedford)

      Chapman, Ben (Wirral S)

      Hamilton, Fabian (Leeds NE)

      Chaytor, David

      Hanson, David

      Chisholm, Malcolm

      Heal, Mrs Sylvia

      Clapham, Michael

      Healey, John

      Clark, Rt Hon Dr David (S Shields)

      Henderson, Doug (Newcastle N)

      Clark, Paul (Gillingham)

      Henderson, Ivan (Harwich)

      Clarke, Charles (Norwich S)

      Hepburn, Stephen

      Clarke, Eric (Midlothian)

      Heppell, John

      Clarke, Rt Hon Tom (Coatbridge)

      Hesford, Stephen

      Clelland, David

      Hewitt, Ms Patricia

      Clwyd, Ann

      Hinchliffe, David

      Coaker, Vernon

      Hodge, Ms Margaret

      Coffey, Ms Ann

      Home Robertson, John

      Cohen, Harry

      Hood, Jimmy

      Coleman, Iain

      Hope, Phil

      Colman, Tony

      Hopkins, Kelvin

      Connarty, Michael

      Howarth, Alan (Newport E)

      Cook, Rt Hon Robin (Livingston)

      Howells, Dr Kim

      Cooper, Yvette

      Hoyle, Lindsay

      Corbett, Robin

      Hughes, Kevin (Doncaster N)

      Corbyn, Jeremy

      Humble, Mrs Joan

      Corston, Jean

      Hurst, Alan

      Cousins, Jim

      Hutton, John

      Cox, Tom

      Iddon, Dr Brian

      Crausby, David

      Illsley, Eric

      Cryer, Mrs Ann (Keighley)

      Jackson, Ms Glenda (Hampstead)

      Cryer, John (Hornchurch)

      Jackson, Helen (Hillsborough)

      Cunningham, Rt Hon Dr Jack (Copeland)

      Jenkins, Brian

      Johnson, Miss Melanie (Welwyn Hatfield)

      Cunningham, Jim (Cov'try S)

      Curtis-Thomas, Mrs Claire

      Jones, Rt Hon Barry (Alyn)

      Dalyell, Tam

      Jones, Mrs Fiona (Newark)

      Darling, Rt Hon Alistair

      Jones, Helen (Warrington N)

      Darvill, Keith

      Jones, Ms Jenny (Wolverh'ton SW)

      Davey, Valerie (Bristol W)

      Davidson, Ian

      Jones, Jon Owen (Cardiff C)

      Davies, Geraint (Croydon C)

      Jones, Dr Lynne (Selly Oak)

      Davis, Rt Hon Terry (B'ham Hodge H)

      Jones, Martyn (Clwyd S)

      Jowell, Rt Hon Ms Tessa

      Dawson, Hilton

      Keeble, Ms Sally

      279

      Keen, Alan (Feltham & Heston)

      Powell, Sir Raymond

      Keen, Ann (Brentford & Isleworth)

      Prentice, Ms Bridget (Lewisham E)

      Kelly, Ms Ruth

      Prentice, Gordon (Pendle)

      Kennedy, Jane (Wavertree)

      Primarolo, Dawn

      Khabra, Piara S

      Prosser, Gwyn

      Kidney, David

      Purchase, Ken

      Kilfoyle, Peter

      Quin, Rt Hon Ms Joyce

      King, Andy (Rugby & Kenilworth)

      Quinn, Lawrie

      Kumar, Dr Ashok

      Radice, Rt Hon Giles

      Ladyman, Dr Stephen

      Rammell, Bill

      Lawrence, Mrs Jackie

      Rapson, Syd

      Laxton, Bob

      Reid, Rt Hon Dr John (Hamilton N)

      Lepper, David

      Rooker, Rt Hon Jeff

      Leslie, Christopher

      Rooney, Terry

      Levitt, Tom

      Ross, Ernie (Dundee W)

      Lewis, Ivan (Bury S)

      Rowlands, Ted

      Lewis, Terry (Worsley)

      Roy, Frank

      Liddell, Rt Hon Mrs Helen

      Ruane, Chris

      Linton, Martin

      Ruddock, Joan

      Lloyd, Tony (Manchester C)

      Russell, Ms Christine (Chester)

      Lock, David

      Ryan, Ms Joan

      McAllion, John

      Salter, Martin

      McAvoy, Thomas

      Sarwar, Mohammad

      McCabe, Steve

      Savidge, Malcolm

      McCafferty, Ms Chris

      Sawford, Phil

      McDonagh, Siobhain

      Sedgemore, Brian

      McDonnell, John

      Shaw, Jonathan

      McFall, John

      Sheerman, Barry

      McGuire, Mrs Anne

      Sheldon, Rt Hon Robert

      McIsaac, Shona

      Shipley, Ms Debra

      McKenna, Mrs Rosemary

      Short, Rt Hon Clare

      Mackinlay, Andrew

      Simpson, Alan (Nottingham S)

      McNamara, Kevin

      Skinner, Dennis

      McNulty, Tony

      Smith, Miss Geraldine (Morecambe & Lunesdale)

      MacShane, Denis

      Mactaggart, Fiona

      Smith, Jacqui (Redditch)

      McWalter, Tony

      Smith, John (Glamorgan)

      McWilliam, John

      Smith, Llew (Blaenau Gwent)

      Mahon, Mrs Alice

      Snape, Peter

      Marsden, Gordon (Blackpool S)

      Soley, Clive

      Marsden, Paul (Shrewsbury)

      Southworth, Ms Helen

      Marshall, David (Shettleston)

      Squire, Ms Rachel

      Marshall, Jim (Leicester S)

      Steinberg, Gerry

      Martlew, Eric

      Stevenson, George

      Meacher, Rt Hon Michael

      Stewart, David (Inverness E)

      Meale, Alan

      Stewart, Ian (Eccles)

      Merron, Gillian

      Stinchcombe, Paul

      Michael, Rt Hon Alun

      Stoate, Dr Howard

      Michie, Bill (Shef'ld Heeley)

      Strang, Rt Hon Dr Gavin

      Miller, Andrew

      Straw, Rt Hon Jack

      Mitchell, Austin

      Stringer, Graham

      Moffatt, Laura

      Sutcliffe, Gerry

      Moonie, Dr Lewis

      Taylor, Rt Hon Mrs Ann (Dewsbury)

      Moran, Ms Margaret

      Morley, Elliot

      Taylor, David (NW Leics)

      Morris, Rt Hon Ms Estelle (B'ham Yardley)

      Temple-Morris, Peter

      Thomas, Gareth (Clwyd W)

      Morris, Rt Hon Sir John (Aberavon)

      Timms, Stephen

      Todd, Mark

      Mountford, Kali

      Touhig, Don

      Mudie, George

      Trickett, Jon

      Murphy, Rt Hon Paul (Torfaen)

      Truswell, Paul

      O'Brien, Bill (Normanton)

      Turner, Dennis (Wolverh'ton SE)

      O'Hara, Eddie

      Turner, Dr Desmond (Kemptown)

      Olner, Bill

      Turner, Dr George (NW Norfolk)

      O'Neill, Martin

      Turner, Neil (Wigan)

      Organ, Mrs Diana

      Twigg, Derek (Halton)

      Osborne, Ms Sandra

      Tynan, Bill

      Palmer, Dr Nick

      Vis, Dr Rudi

      Pearson, Ian

      Walley, Ms Joan

      Pickthall, Colin

      Ward, Ms Claire

      Plaskitt, James

      Wareing, Robert N

      Pollard, Kerry

      Watts, David

      Pond, Chris

      White, Brian

      Pope, Greg

      Whitehead, Dr Alan

      Pound, Stephen

      Wicks, Malcolm

      280

      Williams, Rt Hon Alan (Swansea W)

      Worthington, Tony

      Wray, James

      Williams, Alan W (E Carmarthen)

      Wright, Anthony D (Gt Yarmouth)

      Williams, Mrs Betty (Conwy)

      Wright, Tony (Cannock)

      Wills, Michael

      Wyatt, Derek

      Winnick, David

      Winterton, Ms Rosie (Doncaster C)

      Tellers for the Noes:

      Woodward, Shaun

      Mr. Mike Hall and

      Woolas, Phil

      Mr. Robert Ainsworth.

      Question accordingly negatived.

    New Clause 6

      MARRIED COUPLES ALLOWANCES
      'The Chancellor of the Exchequer may by order introduce regulations to provide for increases in personal tax allowances to recognise married couples. Orders made under this section may only be made if a draft of the instrument containing the order has been laid and approved by resolution of the House of Commons.'.—[Mr. Ottaway.]
      Brought up, and read the First time.
      Mr. Richard Ottaway: I beg to move, That the clause be read a Second time.
      The new clause, which has been tabled by my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory), my hon. Friend the Member for Arundel and South Downs (Mr. Flight) and myself, refers to marriage. I do not know whether. you have received the married couples allowance, Mr. Deputy Speaker. If so, like millions of people in the country, you will have been sent a document in the past few weeks which consists of explanatory notes and a form that must be filled in if one is to claim children's tax credit. It states:
      The Children's Tax Credit is replacing the Married Couple's Allowance and the Additional Person Allowance.
      Are you likely to have a child under 16 living with you during the tax year starting on 6 April 2001? If yes, you may be able to claim Children's Tax Credit.
      I suspect that you are a normal citizen, Mr. Deputy Speaker. I do not know whether you have a child under 16, but the important point is that there are a heck of a lot of people in this country who do not have a child under 16. To say that the children's tax credit is replacing the married couples allowance is untrue, inaccurate and a distortion of what the Government intend. I am not sure whether it is spin or underspin but, whatever it is, that statement is wrong.
      Mr. John Gummer: Has my hon. Friend noticed that the form, which is a document about marriage, insists on referring to one's "partner"? May I put it to him that many married women do not wish to be referred to as partners because they are married and have taken on the responsibility of a lifelong union to look after the children for whom the allowance is supposed to be paid? Is it not about time that people had enough respect for married women to refer to them as married, not partners, which can involve all kinds of arrangement, many of which are not the sort that my wife and many other wives wish to enter into?
      Mr. Ottaway: I am grateful to my right hon. Friend. The form goes far too far in political correctness. We have

      281
      seen too much of that sort of stuff. As I happen to know my right hon. Friend's wife, I know that she would be offended by being described as a partner.
      Mr. Gummer: Did my hon. Friend notice the grins on the faces of Labour Members, especially those on the Front Bench, when he mentioned that many women do not share their loose attitudes towards marriage?
      Mr. Ottaway rose—
      The Paymaster General (Dawn Primarolo)rose—
      Mr. Deputy Speaker (Mr. Michael Lord): Order. The hon. Member for Croydon, South (Mr. Ottaway) must deal with one intervention before he takes the next, if he wants to do so.
      Mr. Ottaway: I will give way, but I will first answer the point raised by my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer). I have some respect for the Paymaster General and the Economic Secretary, who are sitting on the Front Bench; whether they wish to be described as a partner is entirely a matter for them.
      Dawn Primarolo: My objection is to being called a loose women. I am married and I consider my husband to be my partner—my partner in life. The suggestion made by the right hon. Member for Suffolk, Coastal (Mr. Gummer) was out of order. I am sure that he would like to correct the impression that he gave to women of his attitude towards them.
      Mr. Ottaway: I do not want to get caught in the crossfire. If the House does not mind, I shall move on.
      The deception of replacing the married couples allowance with the children's tax credit will hit millions of families very hard. Until April, every married couple was in receipt of £197 a year. That money is lost. Indeed, there is a gap between the two provisions because the children's tax credit does not come into effect until next year.
      Mr. David Taylor: If the former married couples allowance was such a great idea—it was of course available to people who were not married but had children and lived together—why did the hon. Gentleman's Government reduce it in two stages to 20 per cent. and then 15 per cent? Are not this Government continuing that process? Does he not endorse the approach that his Government took?
      Mr. Ottaway: Whatever level the allowance got to, the important point is that the principle of marriage was recognised in the tax and benefits system. We undertake to maintain that, unlike the hon. Gentleman's party, which has, effectively, undermined the concept of marriage.
      Until April, one earner on a salary of £34,000 a year would have paid income tax last year at 23 per cent. and this year at 22 per cent., but the abolition of the married couples allowance has taken that person into the higher tax band. The House may not be aware that if one is in the higher tax band, one does not qualify for children'
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      tax credit. We estimate that more than 1 million people in the higher rate tax band will not be entitled to the children's tax credit even if they have children under the age of 16. So, people will not qualify because they are paying too much tax and are being moved into different tax bands.
      The replacement system is an utterly inadequate form of compensation. That is why, when the Conservatives win the next election, we will reintroduce recognition of marriage in the system by reintroducing the married couples allowance. We shall do so for two reasons. First, we think that there are benefits to society from marriage. Families are where society starts and ends. Family breakdown weakens a free and ordered society. Parents do their best for their children in a wide range of circumstances, but, in general, children from two-parent families do better at school, have better chances in life and are less likely to end up ensnared in crime. Two-parent families are better units if the parents are married.
      The Government should not discriminate against the one institution that has been shown to help families stick together and help the process of raising children: marriage. The Government have attacked marriage; they have abolished the married couples allowance and discriminated against couples in the structure of the working families tax credit. That is why we are pledged to recognise the benefits of marriage in the tax system.
      Mr. Geraint Davies: Will the hon. Gentleman give way?
      7.15 pm
      Mr. Ottaway: I will not give way to the hon. Gentleman.
      Secondly, we make the pledge to reintroduce the married couples allowance because of the defects in the children's tax credit. Two earners who live together and both earn £30,000 a year, with a household income of £60,000 a year, will qualify for the children's tax credit. Yet, one earner on £40,000 a year will not do so. What logic is there to that?
      The second anomaly in the children's tax credit is its ineffectiveness as a benefit. The Financial Secretary said in Committee:
      We have increased substantially support for families with children through the working families tax credit, through the increase in the children's premium income support and through child benefit.—[Official Report, Standing Committee H, 23 May 2000; c. 333.]
      The Minister failed to say that the payment of £8 a week in children's tax credit is substantially reduced by the impact of the working families tax credit and housing and council tax benefits.
      I am obliged to Mr. Roger Cockfield, reader in taxation at De Montfort university, Leicester, who has sent me copies of the model that he has compiled. He has demonstrated that a lone parent with two young children earning £180 a week—someone working for 12 hours at, say, £15 an hour is not an unusual example—faces a loss of £5.33 in housing benefit and £1.70 in council tax benefit when he or she receives £8.50 of children's tax credit. He or she is only £1.27 better off—not the £8.50 claimed.
      The children's tax credit is no substitute. It is available to the better off but not to the poorer people in our society. I was always under the impression that a Labour

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      Government were there to protect the poorer people rather than to give tax breaks to the better off. If anything illustrates why they are losing support in their heartlands, it is much trumpeted measures such as the children's tax credit, which goes not to the poorer people but to the better off.
      The form sent in the past few weeks to families who used to receive married couples allowance also contains the following sentence:
      If you are likely to have a child under 16 living with you during the tax year—
      it goes on to describe the tax year—
      you may be able to claim the Children's Tax Credit. If not, please throw this form away and accept our apologies for troubling you. Do not return blank forms to us.
      I do not know how many blank forms might have been sent back, but I conclude by reading a letter that was sent to the Chancellor of the Exchequer, No. 11 Downing street from a gentleman in Merseyside. It reads:
      Dear Sir,
      Please find enclosed my claim form for Children's tax credit returned as my wife and I do not meet the criteria required. Like millions of similar couples, i.e. children grown up and gone, and not 65 before 5th April 2000, we feel that you have, dare I say, stealthily, removed the acknowledgement by the Government of the merits of being married.
      How you have the audacity to claim that that Children's Tax credit replaces the married couple's allowance and Additional Personal Allowance amazes me. I will be 65 in December this year, and as a result of your 1999 Budget changes, I, since April of this year, now pay approx. £20 per month tax on my modest company pension, and when I reach 65 I will be further taxed on my old age pension, unlike my elder brother, who is one of the privileged pensioners that you have created, i.e. 65 before 5th April 2000 who still retains the Married Couple's allowance.
      Hon. Members might think that that letter came from a Conservative party supporter—Labour Members are nodding their heads. They think they know what the letter says because it was sent to No. 11. However, it concludes:
      I find that as a lifelong socialist, an ex Labour party member, with a son who is a Labour councillor, that your new Tax changes are totally unacceptable, and unless some revision to these Fagin-like measures is made in this year's Budget, then my vote will go elsewhere.
      I can think of nothing else that better shows why the Government are losing support. They sit there like rabbits stuck in the headlights, watching the on-coming change in the political direction of this country which such proposed measures will cause. The Conservative party's tax system will provide benefits for rich and poor, because we are the party of one-nation conservatism. We shall stand up for the Mr. Speakmans of this world. We will not say that a tax credit is worth £8.50, when it is in fact worth £1.27.
      Mr. Chisholm: I was tempted to speak because, during an earlier debate, those on the Conservative Front Bench referred to previous practice, as discussed when we first raised the issue when considering the 1994 Finance Bill. During the Division, I was able to read an interesting speech that the current shadow Chancellor made then, in which he justified taking more than £1 billion out of the married couples allowance. I invite Conservative Members to read that speech, as well as the previous one that I made, in which I said:
      Everyone knows that families have suffered most in tax terms over the lifetime of the Conservative Government.—[Official Report, Standing Committee A,22 February 1994; c. 345.]
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      I was particularly referring to families with children. It is precisely their problems that the current Government have been reversing during the past three years.
      It is a simple fact that no additional costs are associated with marriage, but that many additional costs are associated with having children. That is why the children's tax credit, the working families tax credit and the record rise in child benefit have been introduced. People outside the House are more interested in targeting support on children, which is the Government's priority, rather than trying to make spurious party political capital out of the small sums that were involved in the married couples allowance.
      Mr. Edward Davey: The new clause is interesting not because it would introduce a married couples allowance, but because it would change the procedures of the House. We normally scrutinise tax provisions through primary legislation, such as the Finance Bill. However, under the new clause, we are asked to give the Treasury the power to vary or change income tax allowances by regulation, rather than by primary legislation. That is an interesting idea, but I am surprised that the Conservatives have proposed it. They usually want to avoid secondary legislation and prevent Governments from trying to hide stealthy tax changes in statutory instruments.
      Mr. David Ruffley: Has the hon. Gentleman voted for or against any such measures since becoming a Member of Parliament?
      Mr. Davey: I do not think that since I have been a Member the House has considered any such new clause, in which it is suggested that the Chancellor should be given the power to increase personal tax allowances. It is a very unusual new clause and I therefore began to wonder whether it represents a way to change the financial procedures of the House. Many right hon. and hon. Members will know that I take a particular interest in such matters because I believe that the House does not do its job properly. The Finance Bill procedure and the estimates and supply procedures are very inadequate.
      There are arguments for changing procedures in the way proposed in the new clause. Many hon. Members have already said that this Finance Bill is one of the longest in history and that that does not help the way in which the House scrutinises detailed financial legislation. Today and tomorrow, the House will debate many Government amendments and new clauses but they will not be given the scrutiny that they deserve, given that they involve significant changes. The House has become too used to dealing with detailed tax legislation on the hoof, very quickly and not properly.
      It is time that we changed that process, and perhaps the new clause represents a way of doing so. It would certainly reduce the content of future Finance Bills—perhaps Delegated Legislation Committees should deal with more tax legislation. Perhaps there would be proper scrutiny if individual Committees considered each change to tax legislation. That would certainly push the remainder of the Government's tax proposals into other legislation. I hope that such legislation could be debated in draft form, and perhaps Select Committees could take evidence on it.
      Such measures could be dealt with in a more leisurely way than the Finance Bill must be proceeded with because of the need to provide the Inland Revenue with statutory

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      cover for taxes. We should separate that requirement—the need to provide statutory cover for the way the Inland Revenue and Customs and Excise go about their business—from the technical changes that we see in so many different forms in this and many other Finance Bills. There is a need for such reform, but I do not necessarily think that the new clause provides the best way to do it.
      I have suggested in previous debates that a small Finance Bill, which would cover the statutory requirements for collecting tax, should follow the Budget and that a tax technicalities Bill, which the House could take several months to pass, could also be introduced and, perhaps, considered by the other place, changing the current process. Such a Bill could be given proper scrutiny. That would be my preferred way to reform our financial procedures, but perhaps the new clause represents another way to do so. Having expressed surprise that the Conservatives tabled the new clause, I do not think it represents a bad route to follow and perhaps we should experiment with it.
      Whether the Liberal Democrats would use the power suggested in the new clause would depend on the regulations that were proposed. We might do so if the allowance that the Conservatives, or the then Chancellor of whichever party, proposed under that legislation took proper care of children. As the hon. Member for Edinburgh, North and Leith (Mr. Chisholm) said, the prime need is to ensure that children living in families receive the necessary support. Perhaps the proposal would be as wide as the former married couples allowance package, which recognised that some people who were not married still needed support. As the Chancellor said—indeed, the shadow Chancellor mentioned it too when in government—many people who were not married received the former married couples allowance. Perhaps the Conservative proposal would mimic many of the characteristics of the old system. The Conservatives might want to propose a tax allowance that was paid not only to married couples. However, they have not proposed such a measure so we cannot decide whether we would support it.
      Having listened to the hon. Member for Croydon, South (Mr. Ottaway), I am concerned about the motives behind the proposal. A good motive would be to focus on those elderly people on the cusp, who did not retire on whatever the date was, and therefore cannot continue to receive the married couples allowance. If the intention was to focus on their needs and the fact that they had been disadvantaged, that would be a good motive. The Conservatives sometimes suggest that theirs is the only party that supports marriage, but that is not a particularly helpful or mature approach. We should be less partisan and, frankly, less immature when discussing the welfare of families.
      If we want to support marriage, there are many things that we could do, such as investing in services like Relate, which try to support and save marriages that may be breaking down. We should think about other ways to support families, perhaps considering how we recognise the role of Churches and other religious institutions in supporting families and marriage. Ideas like those would make a positive contribution to the debate.
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      7.30 pm
      I do not believe that many people marry for tax reasons. Should we suggest that people marry for money? Is that the key message that the House wants to send? People should marry for love, not money. Perhaps the Conservatives are sending the wrong message.
      Dawn Primarolo: You old softie.
      Mr. Davey: As I am unmarried, my girl friend may not agree with the Paymaster General on that, but I am interested in hearing details of the Conservative proposals. I feel strongly about this matter. I lost my father when I was four. My mother was widowed, and cared for me and my two older brothers. Are the Conservatives saying that my widowed mother should not have benefited from an extra tax allowance? She was not married, and the new clause is not clear. Before the Conservatives get on their high horses about marriage, they need to flesh out their proposals with rather more detail. Would they penalise single parents, such as my widowed mother, rather than ensuring that she could benefit from extra tax allowances? I cannot believe that they would want that, but it sometimes sounds like it.
      The new clause might serve some purpose in promoting reforms of our financial procedures. To that extent, the Liberal Democrats have no problem with it; it is time those matters were addressed. In supporting the new clause this evening, however, we will not be saying that we support the Conservative position, because it has not been properly spelled out.
      Mr. Geraint Davies: I am pleased to speak briefly about the married couples allowance, partly because my good neighbour, the hon. Member for Croydon, South (Mr. Ottaway), would not allow me to intervene on him.
      The new clause is completely incoherent. The hon. Gentleman suggested that the motivation for restoring the married couples allowance was not so much marriage as support for children in stable family relationships. Of course, the married couples allowance is not available to stable couples with children. It is available to married couples, often without children, or to single parents who are unmarried. That is completely inconsistent.
      Mr. Ruffley: Will the hon. Gentleman give way?
      Mr. Davies: In a moment.
      The idea behind the allowance was support of children in marriage because, when it was introduced, the majority of those who had children were married. Relationships have changed, and many children are born out of wedlock. We must be even-handed about fiscal management, although I accept that, as the hon. Member for Kingston and Surbiton (Mr. Davey) said, we ought to think of ways to encourage stable relationships and marriage.
      Mr. Ruffley rose—
      Mr. Davies: I will give way in a moment.
      The most important way to do that would be to provide the economic well-being and independence that would keep couples together. Break-ups are often motivated by economic despair. The Government have brought 1

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      million children out of poverty and away from the legacy of despair and family destruction inherited from the rag bag opposite—talking of which, I will now take the hon. Gentleman's intervention.
      Mr. Ruffley: I thank the hon. Gentleman for giving way in his typically graceless way. He said earlier that stable couples who were not married but had children received the married couples allowance. Would he like to correct himself? He should know that the additional personal allowance is what non-0married stable couples with children receive.
      Mr. Davies: The hon. Gentleman's hearing seems to have failed him. He may check Hansard to find that I said that people in stable relationships with children are not eligible for the married couples allowance. That was one reason why we got rid of it. To be fair, however, I should make it clear that it was being gradually phased out by the Tories—which merely exposes their opportunist cynicism tonight. They are offering an off-the-cuff, uncosted proposal that does not mention the corollary of the abolition of the children's tax allowance. The policy is entirely un-thought-out and intended merely to provide an electoral opportunity, as the hon. Member for Croydon, South revealed at the end of his speech.
      Mr. Oliver Letwin: Will the hon. Gentleman give way?
      Mr. Davies: Not for a moment.
      We appear to be talking about electoral bribery. That is extremely unfortunate. The Tory measure would cost £1.4 billion in 2000–01 and £1.85 billion the next year, and the cost would continue to rise. It is another example of the kind of expenditure cuts that we would face under a Conservative Administration. We have had a wider debate this afternoon, and the £2 billion or £3 billion that they propose to spend over two years would be taken away from the health service, the education system or other vital services for people in need. The money would be taken away from children to pay for tax cuts for the most well off—couples without children in which both partners earn. That would be quite wrong.
      The married couples allowance was being phased out by the previous Administration, but the Tories have suggested that we should reintroduce it. Those who hear our debate will realise that the Labour Administration have lifted 1 million children out of poverty, have put 1 million more people in work and have provided a record increase in child benefit. I urge all hon. Members to resist this stupid new clause.
      Mr. Nicholas Winterton: I am pleased to follow the hon. Member for Croydon, Central (Mr. Davies) who put his case very fairly, even if on odd occasions he indulged in rather vicious comments about what my hon. Friend the Member for Croydon, South (Mr. Ottaway) seeks to do for the Opposition.
      I endorse what my hon. Friend said in his excellent presentation. His case would have been stronger, however, if he had apologised to the House and to the people of this country for the fact that the Conservative party began this process when we were in government. At the time, a number of us criticised reduction of the
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      married couples allowance. Like my hon. Friend, I have no doubt that the marriage of a man and a woman committed to each other in a ceremony that all people take seriously can create the most stable environment for children to grow up in. Problems for society arising from such a registered union are likely to be less than those arising from the situation of single parents.
      The hon. Member for Kingston and Surbiton (Mr. Davey) also made a thoughtful speech, but I was surprised to hear him suggest that these matters should be debated and decided in the House of Lords. I should have thought that all matters relating to the amount of taxation levied on an individual or family—I still think that allowances have something to do with taxation—should be decided by the elected Chamber.
      Like the hon. Member for Kingston and Surbiton, I am not sure whether the proposal of my hon. Friend the Member for Croydon, South should be decided by statutory instrument—secondary legislation. It is too important for that; it is a matter of serious philosophy. Should we encourage the formal presence of marriage, and because of the benefits that it brings society, should marriage be recognised through the allowance and tax system? I believe so.
      I am saddened that the previous Government started the reduction in the married couples allowance. With respect, my hon. Friend's case would have been stronger if he had apologised for that and said that in the light of experience, we realised that we made a mistake. I believe that the people out there whom we represent in this House are prepared to forgive a party when it shows that it realises that it has made a mistake.
      I accept the advice of the hon. Member for Kingston and Surbiton about children—their interests are absolutely vital. That does not mean, however, that this is an either/or situation. I believe that we could have both options. We could, where necessary, provide additional assistance for families and single parents with financial difficulties, while also recognising the estate of marriage as making a valuable contribution to the environment in which children grow up. The cost to the state when children do wrong and appear before the courts is likely to be less when children are brought up in a stable marriage.
      I share the views of my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), who believes that marriage is very precious. I do not believe that marriage is often entered into lightly. The benefits to a civilised, stable society that emanate from marriage are very great indeed.
      Mr. David Taylor: I am sure that many people in the House would agree with the hon. Gentleman—not least the hon. Member for Congleton (Mrs. Winterton). However, some £190 a year is not a strong incentive for an unmarried couple to troop along to the nearest church or registry office. Does the hon. Gentleman really think that many hundreds of thousands of people will change their status because of that tax incentive? I fear not.
      Mr. Winterton: My views differ from those of the hon. Gentleman. I believe that the country benefits from children being brought up within a stable married relationship, and that the cost to Government and society is likely to be much less when that is the case. I regret that the previous Government started the reduction in the

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      married couples allowance. I would have preferred the allowance to have been much higher than it was. However, I accept that there might be a contrary view.
      7.45 pm
      As the hon. Gentleman said, I am married to my hon. Friend the Member for Congleton (Mrs. Winterton). She carries my name, so our outlook on these matters is very traditional, and there is nothing wrong in that. She shares my view that in a married family relationship, whether the husband and wife are married in a registry office or in a church—although I prefer the church service, as it is more solemn—the saving to society is greater than the total cost to the Exchequer of the married couples allowance, even at its original level before the previous Conservative and Unionist Government reduced it.
      I regret that the present Government have gone the whole hog and abolished the allowance. What they have replaced it with is less beneficial, although I appreciate that they have sought to target assistance on those whom they perceive as having the greatest need. However, I think that the principle spelled out by my hon. Friend the Member for Croydon, South is sound. I am delighted that we have learned from our mistakes in our previous period in office. The allowance means a great deal to people, and has a significance far greater than its cost to the Exchequer. Therefore, I strongly support the new clause.
      Mr. Ruffley: I am delighted to support the new clause. I do so for one simple reason—I believe that the family is an important part of the fabric of civil society, and needs to be supported and recognised in the British tax system.
      I was interested to hear the contributions from Labour Members. The one word that they did not use was "extremist". This is obviously an example of a U-turn, because on 16 April the Chief Secretary to the Treasury described Conservative proposals for recognising marriage in the tax system as "extremist". What folly that turned out to be.
      It was no accident, in my view, that in the leaked memorandum this week, of which we have heard so much, the Prime Minister described his policy on the family as weak. He was worried that the Government were looking weak on the family, and were hopeless at developing sensible policies to support the family.
      The new clause would go some way towards helping the Prime Minister out. Were the Government to adopt it, the Prime Minister would be able to demonstrate beyond peradventure that he believes that the family is worth supporting. He would be able to use the simple and direct mechanism described in the new clause.
      Mr. Christopher Leslie: Does the hon. Gentleman agree with the hon. Member for Macclesfield (Mr. Winterton), who has a high regard for parliamentary and legislative procedures, that it would be incorrect to introduce these measures through statutory instruments and orders? Can he justify why, under new clause 6, such changes would be made by order rather than in primary legislation?
      Mr. Ruffley: The answer to the hon. Gentleman's question should be clear to him; I am rather surprised that
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      he bothered to ask it. He should scrutinise the proceedings of some of the Standing Committees on which I have had the pleasure, and sometimes the misfortune, to serve. Treasury orders of this kind are often to be found; our proposal is not especially unusual. I was rather surprised by the perplexity of the hon. Member for Kingston and Surbiton (Mr. Davey) about that. It is a device that those on the Treasury Bench have used on many occasions.
      To return to my original point, the Prime Minister has said that his Government's policy is weak on the family, and unconvincing and unappealing to the people of this country. He is quite right there. The new clause would remedy the defect in current Government policy.
      Before Labour Members get to their feet in a desperate attempt to win brownie points with the Treasury Whip, let me tackle head on the point made by my hon. Friend the Member for Macclesfield (Mr. Winterton) about the reductions in the value of the married couples allowance under the previous Government. I remember it well. In the March 1993 Budget, the Chancellor, Norman Lamont—Lord Lamont as he is now—set in train a two-tranche reduction in the married couples allowance from the basic rate of 25 per cent. to 15 per cent. That is a matter of record. However, the then Conservative Government did not go on to abolish the allowance, as this Government have.
      Why was the reduction in the MCA so necessary? It was an important part of deficit reduction. [Laughter.] The guffaws from the glove puppets on the Government Benches would lead one to think that they considered deficit reduction a bad thing—but it is a good thing. The Chancellor celebrated it today, and he is the proud heir and inheritor of the previous Government's sensible fiscal policies.
      What was the attitude of today's Ministers to the sensible but limited deficit-reducing measures in 1993, which stopped at 15 per cent? The present Government have gone for the next 15 per cent. What was the record of the Paymaster General on the 1993 Finance Bill? I hope that she will tell us when she winds up.
      I remind the House of the importance of the new clause in terms of the tax policy of the Conservative party. My right hon. Friend the Leader of the Opposition made it clear this week that the next Conservative Government will reintroduce recognition of marriage in the tax system. The Government have abolished it, and so have no claim to be the defenders of married couples and families.
      One issue has angered pensioners in my constituency. My mailbag is full of letters from them—I should be surprised if Labour Members had not received similar letters—about a decision in the March 1999 Budget. The Chancellor gave the distinct impression that pensioners would continue to receive the married couples allowance. However, we had to find in the small print one thing that he did not spell out—that pensioners reaching the age of 65 after April 2000 would not get any married couples allowance. That meant that those individuals found themselves some £500 worse off when that 1999 Budget tax change took effect.
      The Conservatives were not alone in being intelligent enough to read the small print. Help the Aged was on

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      to the matter fairly rapidly. Mr. Mervyn Kohler of that organisation described the pernicious effect of the change on pensioners who reach the age of 65 this fiscal year:
      600,000 people reach retirement age in a typical year … only a third of them exceed their personal allowances…. There will be quite a lot of rather cross people about when they realise they are affected, having planned on receiving the existing allowances.
      Whereas the Chancellor has been saying that he has lifted many older people out of paying taxes in previous Budgets, this could have the effect of putting many of them back into paying tax. This is very unfair because it is so arbitrary and it will squeeze the older generation. They are going to take a bit of a hammering.
      Many of my pensioner constituents who were 63 or 64 before the 1999 Budget change now realise that they will not get the £500 that they had counted on getting when they turned 65 this fiscal year. I have had many letters to that effect.
      Mr. Geraint Davies: Will the hon. Gentleman give way?
      Mr. Ruffley: No, I will not give way to the hon. Gentleman. I may reconsider if he has something sensible to say. He rarely has.
      Mr. Mervyn Kohler said that pensioners would take a hammering, and many of. my pensioner constituents felt that they had been hammered by the Government, especially by the abolition of the married couples allowance. They had no warning or notice of the change, as Lady Greengross, the director general of Age Concern, said when she described how pensioners in their early 60s would have woken one morning to find out what was in the 1999 Budget.
      Lady Greengross did say:
      We welcome the fact that those already 65 will not lose the allowance…,
      but it was a rather limited welcome, as she went on to make it clear that she wanted the measure to be phased in for people who will not get the allowance when they reach 65 this year. The argument for some transitional relief for people turning 60 was rather callously ignored by the Chancellor. He has not rethought things, and as a result many pensioners in many constituencies are very aggrieved.
      Mr. Nicholas Winterton: One of my great concerns about what happened to people in the situation described by my hon. Friend is that the change, which they had not anticipated, occurred too late to allow them to make alternative financial arrangements to ensure that the quality and standard of their lives were not adversely affected. That is why I support my hon. Friend in his contention about transitional arrangements.
      Mr. Ruffley: My hon. Friend has made my day. I am supported by Help the Aged, by Age Concern, and now by him. I could want for nothing more.
      Labour Members have made no attempt to answer those important points in the debate. Age Concern and Help the Aged say that the change is a problem, and Labour Members who read their mail agree. It ill behoves them to smirk and grin and ignore the point. The Paymaster General owes the House an answer when she winds up.
      Mr. Geraint Davies: Will the hon. Gentleman accept that any change in the tax system will be unplanned, in
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      the sense that before the Chancellor stands at the Dispatch Box, no one knows what he will say? People plan for the world to go on as before. Does not the hon. Gentleman therefore agree that his is a rather silly argument?
      Mr. Ruffley: I am sure that the hon. Gentleman will be applauded in his constituency by Age Concern and Help the Aged when he refers to their arguments as silly, misplaced or misguided. Old people are vulnerable. They do not have large incomes, and we believe that they are a special case, as do Help the Aged and Age Concern.
      Mr. David Taylor: Will the hon. Gentleman cast his mind back to 1980, when he might still have been in primary school? Then, the Administration of the lady now known as Lady Thatcher perpetrated one of the meanest acts of their 18 years in office. They broke the link between pensions and pay in the economy. Does the hon. Gentleman think that that showed due regard to a vulnerable group?
      Mr. Ruffley: This Labour Government have never said that they would reintroduce that link. There is a good reason for that. Baroness Hollis, the Under-Secretary of State for Social Security in the House of Lords, has said that if the link were restored now it would cost £25 billion by 2025. Not even this profligate Chancellor would be able to find that sort of money, which is why the Government have not decided to restore the link. The hon. Gentleman should know his party policy before he intervenes in that way.
      Non-pensioners have also lost their married couples allowance to the value of some £200 a year plus. Added to the other stealth taxes—the petrol tax, the personal pension tax, and increases in council tax—the net result is that the average hard-working family is £670 worse off. That is the tax bill they face. The abolition of the married couples allowance is part of that £670. It is for that reason, and the other reasons that I have adduced, that I strongly support new clause 6, and I urge hon. Members to support it.
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      Mr. Desmond Swayne: I shall not detain the House long, because the matter has been well aired by my hon. Friends and by Labour Members. Strangely enough, I share the view of the hon. Member for North-West Leicestershire (Mr. Taylor) that changes in the married couples allowance such as that made in the last Budget are unlikely to have any measurable effect on the incentive to marry. Indeed, it would pose profound questions about the nature of marriage if they were an incentive.
      Nevertheless, I share the view expressed by my hon. Friend the Member for Macclesfield (Mr. Winterton). This matter has a symbolic importance that rises well above the issue of how much the allowance may be worth.
      The attraction of the new clause is the speedy remedy that it provides. Previously, married people enjoyed a tax allowance that they no longer enjoy. In other words, there is now a tax on marriage.
      Mr. David Taylor: Will the hon. Gentleman give way?
      Mr. Swayne: No, I will not give way. The matter is fairly straightforward.
      Mr. Taylor: On that very point.
      Mr. Swayne: No, not on that point. I will not give way.
      Mr. Taylor: rose—
      Mr. Deputy Speaker: Order. The hon. Gentleman has said that he is not giving way.
      Mr. Swayne: I want to draw my remarks to a conclusion. For those of us who disapprove of the new penalty on marriage, the clause would provide a speedy remedy. It is obvious that the Government will shortly be sent packing, and my right hon. and hon. Friends on the Front Bench will take their place. They will readily use this new clause to remedy the matter.
      Dawn Primarolo: Those who watch and listen to the debates in the House will be greatly saddened by some of the contributions that have been made this evening. Value judgments have been made on those who choose to marry, whether in a civil ceremony or a church service, and on those couples who make a lifelong commitment to each other as partners, but who do not choose to marry. The debate is not about whether we are in favour of marriage or a commitment of individuals to each other: it is about a tax relief, and it needs to be set in that context.
      I applaud the honesty of the hon. Member for Macclesfield (Mr. Winterton) in saying that he opposed everything that the Conservative Government did when they were in power—[Interruption.] The hon. Gentleman is too keen; I was not going to make a sweeping claim on his behalf. He opposed the Conservative Government when they reduced the married couples allowance. In all honesty, I cannot remember how he voted on that issue. When the Conservative Government were in power, the number of children living in families in poverty rose to 3 million; that is what his party presided over. It now tells us that it is committed to marriage and to stable relationships, whether in a legal or a church ceremony.
      Mr. Nicholas Winterton: I want to clarify my position. I am sure that the Paymaster General will accept that during my short speech, I said that additional steps could be taken if it were necessary to help children in families in difficult financial circumstances. I wanted both the married couples allowance and, if necessary, additional help for children from families in difficult financial circumstances.
      Dawn Primarolo: I noted the hon. Gentleman's bid for more money, and I shall come back to that. He is quite right; he acknowledged that point.
      I want to put it clearly on the record that in my opinion, a commitment to a stable relationship or a marriage is reward in its own right, as the hon. Member for Kingston and Surbiton (Mr. Davey) said. The idea that a financial incentive in the tax system would encourage people to many and would provide a good, sound basis for a stable
      294
      relationship shows little respect for the institution of marriage, because it does not fully recognise the commitment that is made.
      Mr. Burnett: Will the hon. Lady give way?
      Dawn Primarolo: I shall give way, but if the hon. Gentleman will allow me, I shall then explain why this allowance has never been about marriage: it is about taxable capacity.
      Mr. Burnett: I sincerely hope that the Paymaster General will assure the House that this measure is not a precursor to the abolition of inter-spouse exemption for inheritance tax purposes, which was established by the Labour party when it introduced capital transfer tax in the Finance (No. 2) Act 1975.
      Dawn Primarolo: The hon. Gentleman is ever vigilant about the Government's possible future plans. I shall not stray beyond the new clause before us.
      We need to be reminded that the origin of the married couples allowance was the married man's allowance, which was meant to recognise a reduced taxable capacity when a man acquired a wife to support. Marriage is no longer the point at which taxable capacity is reduced; many couples continue to work. Taxable capacity is now reduced when children arrive and one partner reduces or gives up work, or the marriage or partnership faces the challenge of funding child care. It is right that the Government should shift support to the point at which that occurs, and should concentrate on the existence of children in that family unit. That is what the children's tax credit does. It is right to support the family with a child whatever their circumstances. It is important to invest in children, and to improve their life chances.
      We need to provide equivalent relief to one-parent families for many reasons. The parent may be bereaved or may have been deserted by the partner. A child needs to be fed whatever the circumstances of his or her conception. The old married couples allowance recognised that, as did the additional personal allowance. The children's tax credit recognises unmarried couples, as did the additional personal allowance introduced by the Conservative party. This is not about political correctness: it is a practical matter of preventing unmarried couples from getting more generous treatment than married couples. That can be avoided by using tapers and by preventing them from having two credits.
      The rules for additional personal allowance introduced by the Conservatives in 1988 covered exactly the same point as is now covered by the children's tax credit. The argument that this proposal is a departure in our tax rules from recognising only married couples to recognising unmarried couples is spurious.
      Mr. Ottaway: The Minister annunciated the benefits of the children's tax credit. Will she acknowledge that, in calculating that credit, housing benefit and council tax benefit are deducted?
      Dawn Primarolo: The children's tax credit is a tax relief and it is paid within the tax system. The hon. Gentleman is confusing it with working families tax credit.
      Mr. Ottaway: I am not confused in the least. It is a fact that a lone parent working for 12 hours at £15 an

      295
      hour, which is a perfectly normal situation, faces a loss of £5.33 in housing benefit and £1.70 in council tax benefit when he or she receives £8.50 of children's tax credit. In other words, that person is only £1.27 a week better off, not £8.50, as the Minister claims.
      Dawn Primarolo: I think that the hon. Gentleman is referring to the position when the couple have an increased income because the amount of tax has gone down and there is a taper on any housing or council tax benefit. If they are on those benefits, they will have an income that is low enough to qualify them for working families tax credit, so the changes in the premiums in that credit will address those points.
      Conservative Members who were in the previous Government have selective amnesia about how much they reduced the value of the married couples allowance. For instance, in 1994–95, they reduced it by £83.25; in 1995–96, by £83.75; and in 1996–97, by £85.25. They removed it from the position in which it affected whether reliefs were given.
      Under the previous Administration, the married couples allowance was cut first to 20 per cent. and then to 15 per cent. Some taxpayers began to pay an extra £8 a week as a result of those changes. The right hon. Member for Kensington and Chelsea (Mr. Fortino), who was then Chief Secretary, said that the married couples allowance was the "most anomalous of allowances" with "no on-going justification".
      We agree with the right hon. Gentleman, although he apparently no longer agrees with himself. We have abolished the married couples allowance for under-65s from 6 April 2000, not because we do not support marriage, but because the allowance was not supporting marriage. When a couple can get twice the tax relief for splitting up that they could get for staying together, Opposition Members must explain how that is support for marriage.
      We have a better approach. We are investing in our future by providing more financial support for all families with children. Families face their greatest financial pressure when they have children. We have made record increases in child benefit—35 per cent.—which the Conservative party froze. We have introduced the working families tax credit to support hard-working families. We have increased the credits by another £4.35 a week from last month. We have increased income support for the poorest families. The working families tax credit will give families more money, and over the lifetime of this Parliament, about 1.2 million children will be lifted out of poverty.
      The hon. Member for Croydon, South (Mr. Ottaway) spoke about the claim form. The form is clear and expressed in neutral terms to cover both married and unmarried couples. The children's tax credit covers both, to ensure that married couples do not get less relief. It was the Conservative party that introduced, in the additional personal allowance, the rules to cover unmarried couples.
      8.15 pm
      The hon. Gentleman went on to say that the form is overkill. The Inland Revenue does not hold details of children in families, so we needed to send the forms out to get to the people who had received married couples allowance and the additional personal allowance and who
      296
      might be eligible. We wanted to ensure that they understood their entitlement and were alerted that they should claim it.
      The hon. Gentleman said that the children's tax credit was unfair to single-earner families. That is the effect of independent taxation. Single-earner couples will tend to pay more than two-earner couples on the same family income, because one uses one set of allowances and rate bands. We are trying to address that anomaly, which the Conservative party helped to create, in the integrated child credit.
      Now Conservative Members say that the taper is unfair, but we think that it is right that we should get the maximum benefit to those on the lowest incomes. They then say that 100,000 people will pay higher rate tax as a result of the changes. That is simply not true. Nobody will be brought into a higher rate of tax as a result of the abolition of the married couples allowance—unlike the 200,000 people who became higher rate taxpayers when the Conservative party cut the value of the married couples allowance to 20 per cent. in 1994–95.
      The hon. Member for Croydon, South says that the benefits of the children's tax credit do not get through to the families that really need them, such as those on working families tax credit. Again, he is wrong. It is not true. He ignores the fact that the child rate in the working families tax credit was raised in October 1999 to take account of the interaction between that credit and the children's tax credit, and the child credit for under-16s was raised again, by £4.35, from June 2000, on top of the indexation from April 2000. It is simply wrong to create the illusion that the money is not going to those who really need it.
      The new clause asks for rather odd things. It asks for powers to make regulations. Why does the Chancellor need powers to make regulations about tax allowances when he has at least an annual opportunity, in the Finance Bill, to make any changes that he wants, with the proper scrutiny of the House? In any case, what is to stop the Chancellor introducing another Finance Bill in a year? The Chancellor already has the power to make regulations.
      Conservative Members have revealed how out of touch and confused they are about how people organise their lives and bring up their children. I urge my hon. Friends to reject the new clause and ensure that the Government's sound policies for tackling child poverty, directing resources to the families who need it most, can continue.
      Mr. Ottaway: We tabled the new clause not for those reasons, but because of the deception being practised on the people of this country when the Government say that the children's tax credit replaces the married couples allowance. It does not replace that allowance, and millions of people will not receive it. Many will suffer financial loss as a result of the Government's proposals.
      For the Minister to say that the poorest people in our society are getting the entire benefit of the children's tax credit is plain misleading. Housing and council tax benefit have to be taken into account. The poorest people in our society will not get the funding that she says they will get. That is why we want to divide the House.
      Question put, That the clause be read a Second time:—
      The House divided: Ayes 157, Noes 289.

      Division No. 276]

      [8.19 pm

      AYES

      Allan, Richard

      Horam, John

      Arness, David

      Howard, Rt Hon Michael

      Arbuthnot, Rt Hon James

      Howarth, Gerald (Aldershot)

      Atkinson, Peter (Hexham)

      Jack, Rt Hon Michael

      Baldry, Tony

      Jackson, Robert (Wantage)

      Beggs, Roy

      Jenkin, Bernard

      Beith, Rt Hon A J

      Keetch, Paul

      Bell, Martin (Tatton)

      Key, Robert

      Bercow, John

      King, Rt Hon Tom (Bridgwater)

      Beresford, Sir Paul

      Kirkbride, Miss Julie

      Body, Sir Richard

      Kirkwood, Archy

      Bottomley, Rt Hon Mrs Virginia

      Laing, Mrs Eleanor

      Brake, Tom

      Lait, Mrs Jacqui

      Brazier, Julian

      Letwin, Oliver

      Breed, Colin

      Lewis, Dr Julian (New Forest E)

      Brooke, Rt Hon Peter

      Lidington, David

      Bruce, Ian (S Dorset)

      Lilley, Rt Hon Peter

      Bruce, Malcolm (Gordon)

      Livsey, Richard

      Burnett, John

      Lloyd, Rt Hon Sir Peter (Fareham)

      Burns, Simon

      Loughton, Tim

      Burstow, Paul

      Luff, Peter

      Butterfill, John

      MacGregor, Rt Hon John

      Cash, William

      McIntosh, Miss Anne

      Chapman, Sir Sydney (Chipping Barnet)

      MacKay, Rt Hon Andrew

      Maclean, Rt Hon David

      Chope, Christopher

      Maclennan, Rt Hon Robert

      Clappison, James

      McLoughlin, Patrick

      Clifton-Brown, Geoffrey

      Madel, Sir David

      Collins, Tim

      Major, Rt Hon John

      Cormack, Sir Patrick

      Malins, Humfrey

      Cotter, Brian

      Maples, John

      Cran, James

      Mawhinney, Rt Hon Sir Brian

      Curry, Rt Hon David

      May, Mrs Theresa

      Davey, Edward (Kingston)

      Morgan, Alasdair (Galloway)

      Davies, Quentin (Grantham)

      Norman, Archie

      Davis, Rt Hon David (Haltemprice)

      O'Brien, Stephen (Eddisbury)

      Donaldson, Jeffrey

      Öpik, Lembit

      Dorrell, Rt Hon Stephen

      Ottaway, Richard

      Evans, Nigel

      Paice, James

      Ewing, Mrs Margaret

      Paterson, Owen

      Faber, David

      Prior, David

      Fabricant, Michael

      Randall, John

      Fallon, Michael

      Rendel, David

      Fearn, Ronnie

      Robathan, Andrew

      Flight, Howard

      Robertson, Laurence

      Forth, Rt Hon Eric

      Roe, Mrs Marion (Broxbourne)

      Foster, Don (Bath)

      Ross, William (E Lond'y)

      Fraser, Christopher

      Rowe, Andrew (Faversham)

      Garnier, Edward

      Ruffley, David

      George, Andrew (St lves)

      Russell, Bob (Colchester)

      Gibb, Nick

      St Aubyn, Nick

      Gill, Christopher

      Sayeed, Jonathan

      Gillan, Mrs Cheryl

      Shepherd, Richard

      Gorman, Mrs Teresa

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

      Gorrie, Donald

      Soames, Nicholas

      Green, Damian

      Spelman, Mrs Caroline

      Greenway, John

      Spicer, Sir Michael

      Grieve, Dominic

      Spring, Richard

      Hague, Rt Hon William

      Stanley, Rt Hon Sir John

      Hamilton, Rt Hon Sir Archie

      Steen, Anthony

      Hammond, Philip

      Streeter, Gary

      Hancock, Mike

      Stunell, Andrew

      Harvey, Nick

      Swayne, Desmond

      Hawkins, Nick

      Syms, Robert

      Hayes, John

      Tapsell, Sir Peter

      Heald, Oliver

      Taylor, Ian (Esher & Walton)

      Heath, David (Somerton & Frome)

      Taylor, John M (Solihull)

      Heathcoat-Amory, Rt Hon David

      Taylor, Matthew (Truro)

      Hogg, Rt Hon Douglas

      Taylor, Sir Teddy

      298

      Thomas, Simon (Ceredigion)

      Wilkinson, John

      Tonge, Dr Jenny

      Willetts, David

      Townend, John

      Willis, Phil

      Tredinnick, David

      Wilshire, David

      Trend, Michael

      Winterton, Mrs Ann (Congleton)

      Tyrie, Andrew

      Winterton, Nicholas (Macclesfield)

      Viggers, Peter

      Yeo, Tim

      Waterson, Nigel

      Young, Rt Hon Sir George

      Webb, Steve

      Whitney, Sir Raymond

      Tellers for the Ayes:

      Whittingdale, John

      Mr. Stephen Day and

      Wigley, Rt Hon Dafydd

      Mr. Keith Simpson.

      NOES

      Ainger, Nick

      Crausby, David

      Ainsworth, Robert (Cov'try NE)

      Cryer, Mrs Ann (Keighley)

      Alexander, Douglas

      Cryer, John (Hornchurch)

      Allen, Graham

      Cunningham, Jim (Cov'try S)

      Anderson, Janet (Rossendale)

      Curtis-Thomas, Mrs Claire

      Ashton, Joe

      Darling, Rt Hon Alistair

      Atkins, Charlotte

      Darvill, Keith

      Austin, John

      Davey, Valerie (Bristol W)

      Banks, Tony

      Davidson, Ian

      Barnes, Harry

      Davies, Rt Hon Denzil (Llanelli)

      Barron, Kevin

      Davies, Geraint (Croydon C)

      Battle, John

      Davis, Rt Hon Terry (B'ham Hodge H)

      Bayley, Hugh

      Beckett, Rt Hon Mrs Margaret

      Dawson, Hilton

      Benn, Hilary (Leeds C)

      Dean, Mrs Janet

      Benn, Rt Hon Tony (Chesterfield)

      Dismore, Andrew

      Benton, Joe

      Dobbin, Jim

      Bermingham, Gerald

      Doran, Frank

      Berry, Roger

      Drew, David

      Betts, Clive

      Eagle, Angela (Wallasey)

      Blackman, Liz

      Eagle, Maria (L'pool Garston)

      Blizzard, Bob

      Edwards, Huw

      Boateng, Rt Hon Paul

      Ellman, Mrs Louise

      Borrow, David

      Field, Rt Hon Frank

      Bradley, Keith (Withington)

      Fisher, Mark

      Bradley, Peter (The Wrekin)

      Fitzpatrick, Jim

      Bradshaw, Ben

      Foster, Michael Jabez (Hastings)

      Brinton, Mrs Helen

      Foster, Michael J (Worcester)

      Brown, Russell (Dumfries)

      Fyfe, Maria

      Browne, Desmond

      Gardiner, Barry

      Buck, Ms Karen

      Gerrard, Neil

      Burden, Richard

      Gibson, Dr Ian

      Burgon, Colin

      Gilroy, Mrs Linda

      Butler, Mrs Christine

      Godsiff, Roger

      Campbell, Mrs Anne (C'bridge)

      Goggins, Paul

      Campbell, Ronnie (Blyth V)

      Golding, Mrs Llin

      Campbell-Savours, Dale

      Gordon, Mrs Eileen

      Caplin, Ivor

      Griffiths, Jane (Reading E)

      Casale, Roger

      Griffiths, Nigel (Edinburgh S)

      Caton, Martin

      Grocott, Bruce

      Cawsey, Ian

      Grogan, John

      Chapman, Ben (Wirral S)

      Gunnell, John

      Chaytor, David

      Hall, Mike (Weaver Vale)

      Chisholm, Malcolm

      Hall, Patrick (Bedford)

      Clapham, Michael

      Hamilton, Fabian (Leeds NE)

      Clark, Rt Hon Dr David (S Shields)

      Hanson, David

      Clark, Paul (Gillingham)

      Harman, Rt Hon Ms Harriet

      Clarke, Eric (Midlothian)

      Heal, Mrs Sylvia

      Clarke, Rt Hon Tom (Coatbridge)

      Healey, John

      Clelland, David

      Henderson, Doug (Newcastle N)

      Clwyd, Ann

      Henderson, Ivan (Harwich)

      Coaker, Vernon

      Hepburn, Stephen

      Coffey, Ms Ann

      Heppell, John

      Cohen, Harry

      Hesford, Stephen

      Coleman, Iain

      Hewitt, Ms Patricia

      Colman, Tony

      Hinchliffe, David

      Connarty, Michael

      Home Robertson, John

      Corbett, Robin

      Hood, Jimmy

      Corbyn, Jeremy

      Hopkins, Kelvin

      Cousins, Jim

      Howells, Dr Kim

      Cox, Tom

      Hoyle, Lindsay

      Cranston, Ross

      Hughes, Ms Beverley (Stretford)

      299

      Hughes, Kevin (Doncaster N)

      Murphy, Rt Hon Paul (Torfaen)

      Humble, Mrs Joan

      O'Brien, Bill (Normanton)

      Hurst, Alan

      O'Hara, Eddie

      Hutton, John

      Olner, Bill

      Iddon, Dr Brian

      O'Neill, Martin

      Jackson, Ms Glenda (Hampstead)

      Organ, Mrs Diana

      Jackson, Helen (Hillsborough)

      Osborne, Ms Sandra

      Jenkins, Brian

      Palmer, Dr Nick

      Johnson, Miss Melanie (Welwyn Hatfield)

      Pearson, Ian

      Pickthall, Colin

      Jones, Rt Hon Barry (Alyn)

      Plaskitt, James

      Jones, Mrs Fiona (Newark)

      Pollard, Kerry

      Jones, Helen (Warrington N)

      Pond, Chris

      Jones, Ms Jenny (Wolverh'ton SW)

      Pope, Greg

      Pound, Stephen

      Jones, Jon Owen (Cardiff C)

      Powell, Sir Raymond

      Jones, Dr Lynne (Selly Oak)

      Prentice, Ms Bridget (Lewisham E)

      Jones, Martyn (Clwyd S)

      Prentice, Gordon (Pendle)

      Keeble, Ms Sally

      Primarolo, Dawn

      Keen, Alan (Feltham & Heston)

      Prosser, Gwyn

      Keen, Ann (Brentford & Isleworth)

      Purchase, Ken

      Kennedy, Jane (Wavertree)

      Quin, Rt Hon Ms Joyce

      Khabra, Piara S

      Quinn, Lawrie

      Kidney, David

      Radice, Rt Hon Giles

      Kilfoyle, Peter

      Rammell, Bill

      King, Andy (Rugby & Kenilworth)

      Rapson, Syd

      Kumar, Dr Ashok

      Reid, Rt Hon Dr John (Hamilton N)

      Ladyman, Dr Stephen

      Rooker, Rt Hon Jeff

      Lammy, David

      Rooney, Terry

      Lawrence, Mrs Jackie

      Rowlands, Ted

      Laxton, Bob

      Roy, Frank

      Lepper, David

      Ruane, Chris

      Leslie, Christopher

      Ruddock, Joan

      Levitt, Tom

      Russell, Ms Christine (Chester)

      Lewis, Ivan (Bury S)

      Salter, Martin

      Lewis, Terry (Worsley)

      Savidge, Malcolm

      Liddell, Rt Hon Mrs Helen

      Sawford, Phil

      Linton, Martin

      Sedgemore, Brian

      Lloyd, Tony (Manchester C)

      Shaw, Jonathan

      Lock, David

      Sheerman, Barry

      McAllion, John

      Sheldon, Rt Hon Robert

      McAvoy, Thomas

      Shipley, Ms Debra

      McCabe, Steve

      Short, Rt Hon Clare

      McCafferty, Ms Chris

      Simpson, Alan (Nottingham S)

      McCartney, Rt Hon Ian (Makerfield)

      Skinner, Dennis

      Smith, Miss Geraldine (Morecambe & Lunesdale)

      McDonagh, Siobhain

      McDonnell, John

      Smith, John (Glamorgan)

      McFall, John

      Smith, Llew (Blaenau Gwent)

      McGuire, Mrs Anne

      Snape, Peter

      McIsaac, Shona

      Soley, Clive

      McKenna, Mrs Rosemary

      Southworth, Ms Helen

      Mackinlay, Andrew

      Steinberg, Gerry

      McNamara, Kevin

      Stevenson, George

      McNulty, Tony

      Stewart, David (Inverness E)

      MacShane, Denis

      Stewart, Ian (Eccles)

      McWalter, Tony

      Stinchcombe, Paul

      McWilliam, John

      Stoate, Dr Howard

      Mahon, Mrs Alice

      Strang, Rt Hon Dr Gavin

      Marsden, Gordon (Blackpool S)

      Stringer, Graham

      Marshall, Jim (Leicester S)

      Sutcliffe, Gerry

      Martlew, Eric

      Taylor, Rt Hon Mrs Ann (Dewsbury)

      Meacher, Rt Hon Michael

      Merron, Gillian

      Taylor, David (NW Leics)

      Michael, Rt Hon Alun

      Temple-Morris, Peter

      Michie, Bill (Shef'ld Heeley)

      Thomas, Gareth (Clwyd W)

      Miller, Andrew

      Thomas, Gareth R (Harrow W)

      Mitchell, Austin

      Timms, Stephen

      Moonie, Dr Lewis

      Todd, Mark

      Moran, Ms Margaret

      Trickett, Jon

      Morgan, Ms Julie (Cardiff N)

      Truswell, Paul

      Morley, Elliot

      Turner, Dennis (Wolverh'ton SE)

      Morris, Rt Hon Sir John (Aberavon)

      Turner, Dr Desmond (Kemptown)

      Turner, Dr George (NW Norfolk)

      Mudie, George

      Turner, Neil (Wigan)

      Mullin, Chris

      Twigg, Derek (Halton)

      300

      Tynan, Bill

      Winnick, David

      Vaz, Keith

      Winterton, Ms Rosie (Doncaster C)

      Vis, Dr Rudi

      Woodward, Shaun

      Walley, Ms Joan

      Woolas, Phil

      Ward, Ms Claire

      Worthington, Tony

      Wareing, Robert N

      Wright, Anthony D (Gt Yarmouth)

      Watts, David

      Wright, Tony (Cannock)

      White, Brian

      Wyatt, Derek

      Williams, Rt Hon Alan (Swansea W)

      Tellers for the Noes:

      Williams, Alan W (E Carmarthen)

      Mr. Don Touhig and

      Williams, Mrs Betty (Conwy)

      Mr. Jim Dowd.

      Question accordingly negatived.

    New Clause 8

      PAYE ADMINISTRATION OF RETIREMENT ANNUITY INCOME
      'In section 648A Taxes Act 1988, paragraph (1) after the words "approved personal pension scheme", add "or an approved retirement annuity contract within the meaning of section 620 Taxes Act 1988".'.—[Mr. Edward Davey.]
      Brought up, and read the First time.
      8.30 pm
      Mr. Edward Davey:I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker: With this it will be convenient to discuss the following: Government amendments Nos. 83 and 84.
      Amendment No. 145, in schedule 13, page 294, leave out lines 15 and 16.
      Amendment No. 146, in page 294, line 18, at end add—
      '(3) Subsection (1) shall not prevent the approval of the scheme which contains no requirement to purchase an annuity by a certain age.'.
      Government amendments Nos. 85 and 86.
      Mr. Davey: This group contains some significant amendments. Government amendments Nos. 83 to 86, which cover pension contributions to pension plans running concurrently, are incredibly important. I believe that the hon. Member for Arundel and South Downs (Mr. Flight) raised the matter in Committee. Amendments Nos. 145 and 146 cover the annuity issue. I do not intend to cover those two important issues. I shall leave them to my hon. Friend the Member for Northavon (Mr. Webb), who is far more eminently qualified than I am to cover them in detail.
      I wish to speak to new clause 8, which is more modest. Again, it takes up the issue of unnecessary bureaucracy and the way in which that hits low-income pensioners. It makes a practice that is permitted by the Inland Revenue into a statutory requirement to help pensioners.
      In specific detail, new clause 8 deals with the way in which retirement annuity income is administered. At the moment, tax on retirement annuity income is deducted at source at the basic rate, with a non-taxpayer option for gross payment on submission of form R89. That is different from the way in which other sources of pension income are administered for income tax.
      I do not know how familiar tight hon. and hon. Members are with the amazing number of different ways in which different forms of pensioner income are administered for income tax purposes. I am grateful to the

      301
      low incomes tax reform group of the Chartered Institute of Taxation for the way in which it has set that out in its paper entitled, "Older people on low incomes. The case for a friendlier tax system." It bears reference to because it shows how complex the administration of income tax has become for pensioners, who often rely on a wide variety of often very small income sources.
      Some sources of pensioner income are tax exempt: premium bonds, national savings certificates and, for National Savings bank ordinary accounts, the first £70 of interest. There are sources of pensioner income that are taxable, but paid without tax deducted at source. Those include National Savings bank ordinary accounts where the interest is more than £70, investment accounts, income bonds, capital bonds and pensioners bonds. There is a source of pensioner income that is taxable, but paid with tax deducted at source at 20 per cent: first option bonds.
      When we go into the wider general investment market, we see another set of tax administrative arrangements related to pensioner incomes. Personal pensions and occupational pensions are taxable and paid with tax deducted by the pay-as-you-earn code number. Retirement annuities—the subject of the new clause—are taxable and paid with tax deducted at the basic rate of tax, with the non-taxpayer options that I have described. The income element of the return from purchased life annuities is taxed in yet another way: tax is paid and deducted at 20 per cent. The non-taxpayer has the option to ensure that the income is paid gross upon submission of yet another form: R89.
      Building society and bank interest is taxable. The tax is paid at 20 per cent. at source. The non-taxpayer can apply to have it paid gross, but he has another form to fill in to do that: R85. United Kingdom company dividends are taxable and paid with a repayable credit of 20 per cent. The taxation on many overseas pensions and interest from overseas deposits is administered in yet another way. They are taxable, but received without tax deduction at source, because it is from an overseas source. I have not even begun to mention PEPs, TESSAs and ISAs, which we know are not taxable. We see from that long litany of examples what a complicated tax administrative system faces the ordinary pensioner.
      The result of all that is that pensioners often pay too much tax, because they are faced with forms that they do not understand, so they do not apply to have the income and interest paid gross, and with a system that is so complex and such a minefield that they are made anxious by it. That complexity does not serve the Inland Revenue. It increases its administration costs, so the Government do not win by that minefield.
      Let us look at different financial products for pensioners, be they ordinary pensions or other types. The administrative arrangements are so different, with some tax taken at source, some not, some taken at different rates and some with non-taxpayer options for payment gross. That complexity reduces transparency in comparing the returns from different financial products. Each marketing of each different product must try to explain the different tax arrangements to pensioners.
      There is absolutely no reason for the system that we have. It has just grown. It has been given to us by history. It is time that it was reformed. New clause 8 is a small
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      step in reforming that over-complex system. It relates just to the tax on retirement annuity income. It seeks to enshrine in statute law and to make mandatory something that the Inland Revenue already permits. It ensures that retirement annuity income can be paid through the PAYE system, so that the correct amount is taken and so that pensioners who do not owe any income tax on that retirement annuity income do not have to fill in forms. It ensures that they do not have to pay tax that is not due to the Exchequer. It is simple.
      I am delighted that the Government were relatively positive when I raised the matter. In response, the Paymaster General said that the Government were
      in discussions with the industry on how to simplify the system and make it much more responsive to pensioners.—[Official Report, 9 June 2000; Vol. 351, c. 618.]
      I was grateful for that reply. I hope that those discussions with the industry have taken place, or are soon to take place, and that soon we can get a bit more logic in the system, so that poor pensioners—we are talking about non-income tax paying pensioners; some of the poorest pensioners—do not pay tax when they are not supposed to.
      I hope that the Government can make that relatively simple administrative change as a first step to reforming completely that bizarre aspect of the income tax system. If they do, pensioners throughout the country will applaud them.
      Mr. Flight: I believe that the debate on this group is one of the more important this evening. It covers several territories related to pension arrangements.
      I entirely support new clause 8, which addresses a practical issue. I cannot see why there should be any objections to it. I greatly welcome Government amendments Nos. 83, 84, 85 and 86, which, as kindly acknowledged, broadly address the issue of concurrent membership, which we discussed in Committee. I think that there will be some practical problems in establishing the demarcation level at £30,000. Although that figure will cause some injustices, at least it is a practical solution to the problem. It will be interesting to see how it works out, especially in relation to concurrent membership of final-salary occupational pension schemes and stakeholder schemes—which had previously been deemed not to be practical.
      I shall, however, use my time to speak to amendments Nos. 145 and 146. Amendment No. 145 deals with a straightforward issue. I confess that, when first trying to get my brain round schedule 13, I had not taken in the fact that paragraph 9 will remove section 633(2), so that a pension scheme cannot provide insurance covering contributions that have not been made because of a member's illness or temporary redundancy. There will, however, be a grandfather provision for those who already have such arrangements.
      I do not think that a case has ever been made why such a provision should not be part of the new tax rules covering stakeholder and other personal pensions. The removal of such a provision seems to be a bad idea. Surely it is thoroughly desirable that people have insurance to ensure that they are able to accumulate an adequate pension. I therefore ask the Minister at the very least to explain the logic behind removing the provision. Amendment No. 145 deletes that change.

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      The major chestnut to crack is the issue of ending the obligation to buy an annuity by the age of 75. The Government seem to be burying their head in the sand. The official Opposition's policy on the issue has been clear for the past two years—to abolish the obligation subject to individuals having in place pension arrangements that will deliver a pension ensuring that they will not qualify for the pension guarantee. Therefore, we suggest—as the report commissioned by the Association of Unit Trusts and Investment Funds suggested—that the obligation should be abolished, subject to lesser annuities being taken out, when required, to deliver a pension up to a set level.
      Ministers must be aware that millions of people are concerned about the issue, and that we are living in an age in which there is an explosion in demand for money purchase pensions. Additionally, the Government's stakeholder measures will have a major impact in increasing the number of companies that end final-salary schemes and create money purchase schemes.
      In many ways, schedule 13 is extremely useful in providing a tax framework that encompasses both group personal pensions and occupational money purchase pensions. Many companies and their consultants have been waiting to see what the final stakeholder arrangements and obligations would be before taking the decision.
      Mr. Steve Webb: The hon. Gentleman said that this is an issue of importance to millions of people. However, one of the issues that I have wrestled with in our debates on this matter is whether that is so. Does the issue matter only to those who have whopping great pension pots? If there is a floor below which people will not be allowed to draw-down, and if stakeholder pensions will be targeted at those who are on modest earnings, will many people ever be affected by those income levels?
      Mr. Flight: I thank the hon. Gentleman for his question, which I shall deal with in detail in a few moments. However, the quick answer is that the issue has to do not only with a well-pensioned elite. As money purchase provisioning works its way through—it started only in the 1980s—the number of those who will be obliged to buy an annuity will run into the millions. Within the arrangements that I have discussed, they would not have to put all their pension money into an annuity. The issue affects not only a narrow body of people. However, I shall revert to that in a moment.
      8.45 pm
      The key point is that the next few years will see a huge explosion in the number of people with money purchase pensions. Final-salary schemes operate essentially with a revolving pot of money—with accumulated pension assets usually invested predominantly in equities, although the equity-bond mix depends on the maturity of the scheme—out of which the pension is paid. Therefore, the capital that provides the final-salary pension should be prudently invested with scope to increase in capital value, and should not be locked into an exposure to bonds.
      The key investment problems with an obligation to buy an annuity is that an overwhelming number of people will be buying a guaranteed annuity; that most of the assets
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      funding the annuity will be invested in bonds; and that, even at 75, one or other spouse will live for another 20 years. The Government's legislation forces annuity managers to invest all the capital available for pension provisioning in fixed-interest securities. As I have said in the House before, if a financial adviser had put all someone's capital into fixed-interest assets for 20 years, he or she would be hauled up by the Financial Services Authority for negligence and mis-advice. Investment only in gilts is simply inappropriate for the length of time that that pension capital has to provide an income.
      As the House will be aware, the combination of a Budget surplus, the subsequent repayment of national debt, increasing demand for money purchase pensions and—following the passage of the Pensions Act 1995—increasing demand for fixed-interest products by mature pension schemes have all created essentially a false market in long-dated gilts. In the past 12 years, not only has the nominal interest rate decreased with lower inflation, but the real interest rate has almost halved. The real interest rate has been close to 4 per cent. for quite a long time, but, now, it is down to 2 per cent. and a bit. So what is happening elsewhere is creating a false market and, as the law stands, people are being forced to buy investment pension products based on that false market. If and when that changes, irrespective of any change in inflation, such individuals will be seen to have been grossly unfairly—and I would argue negligently—treated by the law.
      I am pleased that many annuity providers have produced new products but, as the Minister will be aware, there are tax inflexibility problems associated with equity-linked annuities. In short, if an equity-linked annuity consistently performs well, the beneficiary is unable to take the full return. If the product performs poorly, investors face considerable problems if they wish to change their fund manager.
      Canada and Ireland have addressed the problem—Canada did so 10 years ago and Ireland has done so in the past two years—along the lines of the recent report by the Association of Unit Trusts and Investment Funds Committee which broadly envisages the creation of a pension account into which the capital goes. Everything that comes out of the account is taxed as income. Within that pension account, the beneficiary can determine the investment policy within sensible parameters analogous to those laid down for ISAs.
      Mr. Barry Gardiner: I have been listening carefully to the hon. Gentleman. Does he accept that, just as tax relief is initially given on a pension fund in order to provide certainty and security in old age, an investor may wish to diversify the application of their fund at an early stage into other ways of financial management that do not attract the same tax relief, but are not subject to the same limitations? While the hon. Gentleman is considering that point, will he also say how he sees investors who are in the fortunate position of being able to consider their financial future and think of diversifying their fund in that way in light of the remarks of the hon. Member for Northavon (Mr. Webb) about the number of people involved?
      Mr. Flight: I thank the hon. Gentleman for his intervention, but I am not sure what point he is making. Could he please sharpen it up a little?
      Mr. Gardiner: I do not want to make a speech on the subject. As the hon. Gentleman is aware, quite simply, tax relief is given to help provide security and certainty of provision from the point of retirement until death. I accept the problem that the hon. Gentleman has outlined as it affects many people approaching retirement. Somebody seeking to achieve better returns than they were likely to get from an annuity could have made alternative provision that did not attract the same level of tax relief.
      Mr. Flight: With respect, the hon. Gentleman's intervention reflects completely wrong thinking. Tax relief is provided to help build up the maximum assets to create adequate provision for retirement. As the hon. Gentleman will be aware, a final salary pension scheme will have an appropriately balanced portfolio of equities and possibly some fixed interest investments, depending on the maturity of the scheme. That is an entirely sensible arrangement that maximises both the pension accumulation and, in due course, the tax take. Even with money purchase pensions, there is clearly an argument that the tax take would ultimately be greater to the Revenue if the assets were invested on a basis that would create better returns because everything that is drawn out is taxable as income.
      Under the present rules, if there is anything left when both spouses are dead, it suffers a 30 per cent. rate of tax and then becomes subject to inheritance tax as well. The rules can be changed if the Revenue wishes, but if the hon. Member is arguing that the correct moral price for the tax benefit must be that all the money should be invested in gilts for the last 20 years of someone's life, I do not see any logic here either in terms of maximising revenue to the Treasury, or in terms of doing the best for pensions in people's old age.
      I now turn to some of the issues that have been raised this evening and some of the alleged reservations by the Revenue and Treasury in respect of adopting the proposals from the AUTIF committee. It has been suggested that the AUTIF report reflects the vested interests of the investment management industry—I should declare an interest here as a member thereof—but that is a completely outdated view as the life offices that provide annuities are also substantially part of the fund management industry. Indeed, most of them would welcome the proposed changes as they provide ISAs, unit trusts and so on. There is no longer an investment management industry and a separate insurance industry. That is not how the industry is structured.
      The argument has been made about the interaction between the supply of gilts and the growing volume of pension funding that will eventually have to buy annuities. The arrangements that we propose would ease that problem because people would be free to buy guaranteed annuities if they wanted to, but everyone would not be forced down that route. Therefore, it should lead to real interest rates which are more normal and not the result of a false market, as they are at present.
      Some people have made the point that this territory largely involves only the better off. The average annuity purchase from each life office is between £25,000 and £30,000. The average has fallen largely because more people are using draw-down to postpone annuity purchase. I am afraid that the statistics are not particularly reliable. I might add that the Government's statistics go back to 1995. However, personal pensions have been in
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      existence only since 1988 and most of those now retiring may not have held a personal pension for all of that time. So the numbers of people with reasonable amounts in personal pension schemes will rise.
      A survey recently conducted for the AUTIF study group found that more than 70 per cent. of annuitants had an income in excess of the proposed minimum. In other words, more than 70 per cent. of people with money purchase pensions would have capital with which they would not need to buy an annuity to take them up to a minimum pension income level. So the subject affects not just a narrow group of people but the overwhelming majority.
      Mr. Webb: I broadly agree with the hon. Gentleman on this point, so I hope that he does not think that I am being critical. Which minimum is he referring to—the minimum income guarantee or the minimum in the McDonald proposals, which as I recall is roughly double the minimum income guarantee?
      Mr. Flight: I was referring, as I think I mentioned, to the minimum in the AUTIF report led by Dr. Oonagh McDonald. That is where the 70 per cent. figure bites. The hon. Gentleman will find that in the report.
      Of equal importance is the point that the percentage will change over time as people build up more in money purchase pensions. The proposals are aimed not at the wealthy but at all those who will be able to purchase the minimum income and will have some capital to invest thereafter. Such individuals would greatly appreciate the freedom so to do.
      A good case can be made for abolishing the obligation to buy annuities, at least for stage 1 because the Government's pension guarantee virtually requires abolition to be along the lines of the AUTIF report.
      The argument has also been levelled that the proposals would be a threat to defined benefit final salary schemes. My response is that they are already under threat as a result of the rising costs of final salary schemes, of companies trying to save money and, indeed, the attractions of the simple stakeholder schedule 13 legislation. In 10 years, I estimate that at least half of the existing final salary schemes will be closed. The shift to money purchase will be far greater than many realise. The Towers-Perrin survey of money purchase pension arrangements in the United Kingdom suggests that at least half the direct contribution money purchase schemes are associated with the closure of final salary schemes. That is a telling statistic.
      There has been some false concern within the Revenue, if not the Treasury, that the proposals in the AUTIF report would lead to people wanting to transfer in their last year or so from a final salary scheme into some form of money purchase pot, and that employees of the Government, in particular, would want to do that because their pensions are often not funded. It is argued that the proposals would create a funding problem. The answer is that it would be extraordinary if public sector pension schemes have rules to permit that. Most do not. If others do, the rules should be changed. This option is not the norm within a final salary pension scheme in the private sector. Revenue concerns that a wide range of civil servants would want to, and be able to, switch to a money pot are wrong. They would be much better off staying in their final salary

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      schemes and receiving generous inflation-linked pensions. In terms of the rules of the scheme and the motivation, there is a false concern. Often, pension arrangements for spouses are considerably better within public sector schemes.
      9 pm
      We are dealing with a major issue that has been under debate for two years. A great deal of work has been done. The Government said that they would respond to the AUTIF report, and there has been no response. Yet about two thirds of the electorate are 46 or older and are either focusing on their pension arrangements as they are about to draw them, or are already drawing them. The Government would be most unwise in their own interests to underestimate what has become a major issue. People are aware that standard guaranteed annuities are now extremely poor value. They do not want to be locked in whether the amounts involved are large or small, and there is no logical reason why they should. There need be no loss of revenue as a result of the changes and the revenue could be greater.
      There are also two small points that I would like to add to what is really the final debate on schedule 13. First, I referred earlier to the Myners report. As the Minister said, the final report is not out, but the consultative paper is. The Minister will be aware that this is all about encouraging investment in venture capital by pension schemes. Under the rules of all forms of personal pension schemes and the provisions in schedule 13, such schemes cannot invest in unquoted shares. If the Government wish to encourage greater venture capital investment by pension funds, this is an issue to be dealt with potentially within the terms of schedule 13.
      Since we discussed schedule 13 in Committee, the individual pension accounts announcement has been made by the Government, I think outside the House. We welcome that announcement, but I do not understand the logic of why an IPA has to be purchased via some form of money purchase pension scheme. There is more than adequate protection within financial regulation and potential investment rules to cut out the unnecessary costs of the pension scheme umbrella and to permit IPAs to operate on an entirely analogous basis to ISAs. We would then have specific rules about who could buy an IPA and how, and who could not. Why have the Government concluded that the IPA is simply to be a method of managing money for a form of money purchase pension scheme and not a pension packet in its own right, as it easily could be?
      I have strayed because, although those matters relate to the key schedule 13, they are not the key points raised by our amendments. I encourage the Government to bite the bullet and to follow Canada and Ireland, broadly to follow the AUTIF report, and to get a move on. There are hundreds of thousands of people, if not millions, who are now coming up to 75. They are extremely concerned about being forced to buy a bad annuity product. All of us receive letters from these people. The Department of Social Security is well aware of the issue, but it is ultimately a Treasury matter when it comes to reform. I fail to understand why the Government have not yet bitten the bullet.
      Mr. John Butterfill: I should like to support the principle behind new clause 8, which is a well conceived proposal, but, in particular, to speak on amendments Nos. 145 and 146, to which my hon. Friend the Member for Arundel and South Downs (Mr. Flight) has just referred.
      If there is any justification at all for requiring those who are retiring to use their pension pot to buy an annuity, it can only be that tax relief has been given on the accumulation that provides that pot, so it is argued that it is not unreasonable for the Revenue to require such people to buy an annuity to make sure that they are no longer a burden on the state. The compact with the state is that the purchase will guarantee, or, hopefully, will go some way to guaranteeing, that such people will not be a future burden.
      But annuities are the only type of investment for the future, or virtually the only one that anyone would seriously contemplate, that carries that burden. The Government have introduced individual savings accounts, which have all the tax advantages that a pension product has, but without the disadvantages—without the requirement to buy an annuity at the end of it; without the requirement to lose one's capital at the end of the day. For the more sophisticated investors, to whom the hon. Member for Kingston and Surbiton (Mr. Davey) referred—those with large pots of money—there is the enterprise investment scheme or the venture capital trusts—much more sophisticated, perhaps more risky—in which they can invest and have even greater tax advantages.
      One is puzzled to know why successive Governments have continued to lay this particular burden on those who have prudently saved for their old age, who are doing a service to society by so doing, and yet are forced into purchasing an end product, the annuity, which, as my hon. Friend the Member for Arundel and South Downs said, is probably the worst investment that people could make for their on-going retirement future. People are living much longer now than they were.
      Something on the lines of the AUTIF report is not desirable but essential. The competition for the purchase of gilt-edged investments is becoming greater every year—in fact, every month. In a previous speech in the House I explained how the operation of the minimum funding requirement is creating a black hole. As gilt yields go down, so the minimum funding requirement requires institutions to purchase more gilts. By purchasing more gilts, they drive the yields down further, and so on. We have a downward spiral of gilt yields, which is becoming unstoppable.
      There is a way to remedy that, at least partially, and I know that the Government are considering the minimum funding requirement to see how it can be amended. There is a suggestion that, in addition to gilts, some corporate bonds might be added as appropriate investments. I still do not think that that will solve the problem because fewer gilts are still being produced and a limited amount of money can be issued through corporate bonds, yet, as I have explained, the demand is insatiable.
      What we should be doing in terms of the minimum funding requirement is what almost every other sensible fund does, which is to have a balanced portfolio where—prudently, of course—one makes sure that the appropriate ratios are maintained and looks at the total return on

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      investment and not simply at what can be obtained from gilts. The people who are really suffering are those who are forced to purchase gilts at the time of retirement in a market that is going further and further against them, month by month, year by year.
      If we follow the suggestion in the AUTIF report, we can release people from at least part of that problem. If they are required to purchase a minimum income that will ensure that they are no longer liable to be a burden on the state—it will have to be on an indexed basis—we fully justify the tax relief; if indeed it needs justifying, because in the other forms of investment it is not required to be justified. They can then invest their money in any way they think prudent.
      At present we have a ludicrous situation, shown at its most perverse by a self-administered scheme. This applies usually, though not exclusively, to people with a larger pot. There are people who have bought property into a self-administered scheme and now at the end of the day have to sell the property, which gives them a secure and reliable income, and convert it into gilts. If anyone were advised to do that it would be blatant mis-selling, far worse than any scandal we have seen in any other area. Yet we in this House and successive Governments require people to behave in that way. At some time somebody will say "Let's sue the Government for making us do something so perverse and foolish". They might have a point, although I do not think it is possible to do it. Perhaps it should be.
      The best thing we can do this evening is to say that we have got it wrong, that we need to change the basis on which pensions are dealt with when they come to maturity. I hope that the Government will accept the amendment.
      Mr. Frank Field: I also wish to speak to amendments Nos. 145 and 146. It was in the last Parliament that the first letters came from my constituents asking why they were forced into a financial arrangement that they thought was not the most beneficial that they could undertake to protect their retirement and possibly, as the hon. Member for Bournemouth, West (Mr. Butterfill) said, hand on wealth when they died. Although there has been a very important change since then—the election of our Government—I do not find it easier to answer that question when it comes from my constituents.
      Therefore, I make a plea to the Economic Secretary to address specifically, in replying to the debate, what is the defence of the status quo and to what extent the Government are thinking and moving and in what direction.
      The simple point that my constituents put to me, which I happen to agree with, and on which I have not been able to obtain a more sensible view from either the previous Government or the present one, is as follows. They accept that they have built up pension arrangements which have been supported by fellow taxpayers, and that therefore some restraints can be put on the way in which they spend the income, so that they do not receive a second injection of public funds to underpin their livelihood. In other words, they do not believe that they should be able to blow their capital and become dependent on welfare. But
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      what they ask is this: if they make sure that they are in no way a responsibility on the state, why should the state lay down how they should behave with the capital that they have built up?
      In a sense my constituents' questions preceded the questions posed in the report that a previous Member of the House, Dr. Oonagh McDonald, recently successfully steered to publication. I am anxious to learn from the Government what their defence of the status quo is. All of us, on both sides of the House, can see that people should not be paid twice for doing the same thing, but if they are careful enough, or enter into specific arrangements, to ensure that some of their capital is put aside so that they in no sense become dependent on welfare, why should they not be able to spend the remainder, which probably, as the decades pass, will become a larger and larger proportion, in a way that suits them?
      My constituents' final point is that they have built up their capital, have been pleased to do so and believe that it is their duty to do so. They believe that they were advantaged in being able to do that. They are not being cocky and understand that other people have not been as advantaged and may not have been able to do so. They also believe that, if at all possible, it is a good idea to hand on capital to children and grandchildren. I must ask the Government whether that is the view that we hold. Do we believe that wealth is not something to be gobbled up by companies or Governments but, as far as possible, should be spread as widely as possible, through the entire community? If that is so, should we not be thinking—this has been debated by those on both sides of the House—along the lines of reforming the strict rules that govern the purchase of annuities?
      9.15 pm
      The hon. Member for Bournemouth, West gave us a macro-debate on what is happening in the gilts market. He explained why it is a bad buy to purchase annuities now. Many of my constituents understand that argument. They are distressed by it and are fully aware of what is going on in the money markets in that respect. They believe that the debate involves a question of fairness in that they have done everything required of them as good citizens and wonder why the Government stop them from being even better citizens by not letting them become dependent on welfare. They want the freedom to choose how they spend their capital and, if possible, they want to pass it on to members of their extended family.
      After hearing my hon. Friend the Economic Secretary's reply, I hope that I will be able to write letters to my constituents that are different from those I have had to write since they began writing to me on this topic about five or six years ago.
      Mr. Webb: Had I been asked a few years ago how I wanted to spend the evening of my 35th birthday, discussing the finer points of annuities might not have been at the top of the list. However, it is a privilege to contribute to the debate.
      I want to touch on Government amendment No. 83 and the associated amendments and amendment No. 146. On the concurrency amendment, like the Conservative party, the Liberal Democrats welcome the concessions that the Government have made. It would be churlish to describe

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      this as a victory for the Department of Social Security over the Treasury—I am sure that it was a partnership—but as such victories are rare, one could describe it as such anyway.
      I have some questions about the detail of what is proposed in Government amendment No. 83, specifically the £30,000 threshold. It may be that I have missed it, but I wonder whether there has been a specific explanation for why £30,000 was chosen. Will the Economic Secretary clarify why that was chosen. Is it because it is something akin to the higher-rate threshold and that, therefore, higher-rate taxpayers are more likely to try to abuse concurrent membership of two pension schemes, or was the figure plucked from the air?
      I notice that the £30,000 figure is in the primary legislation. Does that imply that it will be capped? There is no suggestion that it is to be prescribed in regulations and then to be indexed. What is the thinking behind that? Given that earnings are rising each year, is there an attempt to clamp down? It is not clear why that figure has been chosen.
      My abiding impression of the concurrency issue is the recollection that, when I pressed the Financial Secretary at Social Security questions, in his halcyon days as the Minister responsible for pensions, as to whether he regarded simplicity in pensions as a virtue, he answered with a confident yes. Now that he is at the Treasury, I do not know whether he still holds that view.
      It is clear that we have a dog's breakfast, and concurrency with thresholds is just another aspect of that dog's breakfast. We have completely different tax regimes for personal pensions, occupational pensions and stakeholder pensions and we have different regimes for additional contributions. Far from getting simpler under the present Government, the options have got wider and the complications have increased. I fear that people will continue making the wrong choices. Concurrent membership certainly helps to prevent one wrong choice, and to that extent we welcome the amendment.
      I wonder sometimes whether the Government have lost the big picture. They probably came into office believing in simplicity, and it may be that the realities of office mean that simplicity will never be delivered. I hope to find that out for myself at some point, but in the interim I would be interested to learn whether the Economic Secretary still holds to the goal of simplicity. I wonder whether, with hand on heart, she can say that the strategy that the Government have adopted has created a simpler pension regime for the investor who, in the world envisaged by the Government, will receive less advice, not more. The stakeholder pension purchaser will probably have to get by, at best, with a decision tree, but often it is suggested that the person seek advice. Government amendment No. 83 moves in the right direction of clearing up a mess that the Government have created, but I wonder whether the big picture has been lost.
      On amendment No. 146, the hon. Member for Arundel and South Downs (Mr. Flight) has become associated with this issue in this Parliament and I praise his efforts and persistence in keeping it before the House. The Liberal Democrats broadly sympathise with his concerns, but I had an informative conversation this morning with Evergreen Retirement Assurance, a company which has
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      written to several hon. Members and met some of them. It raised some significant issues that are germane to amendment No. 146.
      The first is the issue of the compulsory purchase of annuity, but the question is whose annuity is purchased. Is it the annuity provided by the company with which a person has saved or is it the best annuity on the market? The point that the company, and others, make is that choosing the wrong annuity can cost one 10 per cent. of one's income for the rest of one's life. That could be hundreds, if not thousands, of pounds a year and potentially tens of thousands of pounds over a lifetime. However, the issue appears to have received almost no attention.
      I asked the company what was needed to resolve the problem, because it appears that too many people, out of inertia, condemn themselves to too low an income for the rest of their lives and, potentially, cost the taxpayer money by ending up on the minimum income guarantee or housing benefit. The answer I was given was that the problem could be addressed if the Financial Services Authority were to say that the letter to those who had accumulated a pension pot and were about to purchase an annuity had to include the statement in great big bold capitals, "You have a choice and it may be that your provider does not provide the best product, " before any mention of the product of the company that had provided the pension. Or perhaps companies could be obliged to include a freephone number for an Inland Revenue helpline that would provide the telephone numbers of five annuity bureaus. That could make a big difference to the incomes in retirement of many people.
      I asked why those solutions had not been tried and the answer was that the FSA would be keen to do so, but it has not been pushed by the Treasury. I hope that that is wrong and the Economic Secretary will tell us that she has taken a stick to the FSA and it will act. If that is not the case, I hope that she will assure us in her response to the debate that those people who have taken out annuities are getting better value for them. One of the legitimate concerns expressed by the hon. Member for Arundel and South Downs was that the annuities are bad enough value as it is for many people and if they buy one that is not the best available, it is a double whammy.
      I do not wish to go too deeply into the question of how important the issue is and to how many people, but I wonder whether its importance to the general public is overstated.
      Mr. Field: It may be an issue that will grow in importance.
      Mr. Webb: I agree, for some of the reasons given by the hon. Member for Arundel and South Downs, but I wonder how quickly it will grow and for how many people. The hon. Member for Arundel and South Downs said that 70 per cent. of those with money purchase pensions who are now retiring are living on incomes above the threshold recommended in the AUTIF report. However, that is not the test of whether draw-down would be attractive to someone. If one had a combined income just above the guaranteed threshold and had £1,000 left in the pot, one would not gain very much by drawing down £1,000, which one might just as well convert, given the costs of fiddling around with that sum. Seventy per cent.

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      of people with money purchase pensions may be above that threshold, but I would have thought that the number who are sufficiently above it to want to start fiddling around with draw-down is still quite limited.
      I know that stakeholder pensions have not yet started, but I would have thought that those who will get such pensions and for whom this will be a serious issue will not be affected by it for a long time, as the target market is people who will struggle to get clear of the first guarantee, let alone the second. Clearly, there is a drift to money purchase schemes, which are affected by the issue, which will grow in importance. I believe that I have had three letters about the matter which, multiplied by the number of Members, is about 2,000. Perhaps I do not attract letters about annuities—I am sure that the hon. Member for Arundel and South Downs does—but I wonder whether the scale of the problem has been overstated.
      The problem is, however, significant, and we support the general stance of the hon. Member for Arundel and South Downs. This morning, a worry was expressed to me, and I am concerned about risking another mis-selling. We talked about mis-selling and forcing people to invest in gilts for the last 20 or 30 years of their life, which is not an optimal strategy. However, will people end up with draw-down policies that are not right for them? Again, Evergreen Retirement Assurance tells me that it has surveyed the investment strategy of those draw-down policies. It turns out that a good chunk of the investment strategy of a draw-down policy—about a third, Evergreen told me—is in gilts. Therefore, if people try to get hefty returns from the remaining 70 per cent, a good chunk having had to be left in the fund to cover the double guarantee level, one starts to wonder how they will make the sort of returns that are being talked about.
      A point made to me that has some force is that it is wrong to look at the issue of annuities in isolation and say that it is just about an age limit of 75. I am sure that the hon. Member for Arundel and South Downs does not do that. However, it was pointed out to me that the matter involves an age limit of 75, the open-market operation and long-term care. Why cannot one buy an annuity which, if one has to go into nursing care, can be converted into a much higher annuity to cover the fees? At present, that is not allowed. There is a danger that, if we pick at bits of the matter in amendments, we shall miss the big picture, which takes me back to my starting point of simplicity.
      We welcome the amendment on concurrency as far as it goes, as it is a step in the right direction. However, it is a symptom of a messy system, which is messier than it was three years ago. We generally sympathise with the point on annuities, but we want the matter to be responded to in the round, as more issues are involved than just compulsion at 75. I am grateful for the chance to put my concerns on the record and I hope that the Minister will respond specifically to the point about the open-market option and put a rocket under the FSA.
      Miss Melanie Johnson: I should like to thank right hon. and hon. Members on both sides of the House for their thoughtful contributions to our debate and the knowledgeable points that they have all made.
      May I start by responding to new clause 8 before turning to the amendments? I shall do my best to cover the points that Members have made in the course of our
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      debate. I thank the hon. Member for Kingston and Surbiton (Mr. Davey) for his clear exposition of the reasoning behind new clause 8. I have recently corresponded on this very issue with his colleague the hon. Member for Northavon (Mr. Webb). However, for the reasons that I shall outline, I hope that it is a probing proposal that will be withdrawn.
      The problem is of long standing and has been reviewed on several occasions by the Government in office. On the last occasion, in 1995, the Institute of Chartered Accountants in Scotland put forward a proposal that was very similar to the new clause, but it withdrew it after talking to various Scottish annuity providers, who suggested that switching to schedule E would be an onerous administrative task for insurers. As drafted, the new clause would impose the requirement to tax annuities arising from retirement annuity contracts under schedule E from the date of the Bill's Royal Assent. That is—hopefully—only days away.
      So, there is no provision for agreeing later implementation dates with the Inland Revenue, as was allowed when the schedule E requirement was placed on providers of personal pension annuities. The new clause would therefore place a considerable burden on financial institutions, which would be particularly difficult for them at the present time and within the time scales about which I have spoken.
      9.30 pm
      In the past, the insurance industry was against operating tax codes for annuities from retirement annuity contracts because some companies had paper-based systems that were not up to the task. That is not a reason for never making changes. As computerised systems are increasingly replacing older systems, the matter could usefully be looked at again. I hope that the hon. Member for Kingston and Surbiton will accept my assurance of interest in the topic and of the value of the points that he has raised.
      I am asking officials to discuss the matter further with the Association of British Insurers and to report back to me. I am grateful to the hon. Gentleman for raising the issue. I appreciate his comments about on-going discussions, but they will be given a further ministerial boost. For the reasons that I have given, I hope that he will feel able to withdraw the motion.
      Government amendments Nos. 83 to 86 are all connected with the issue of concurrency. I acknowledge that they are the result of the very helpful and constructive series of discussions with representatives of employers, employees and the pension industry. In particular, my thanks go to the ABI, the National Association of Pension Funds, the Trades Union Congress, the Confederation of British Industry, AUTIF and the Pensions Management Institute for their contributions.
      There was very much a partnership between the Treasury and the Department of Social Security in trying to find a way forward on concurrency with the industry and interested groups. I hope that hon. Members accept that that is a fine demonstration of effective cross-departmental work in government in partnership with the private sector.
      At the moment, a member of an employer's pension scheme cannot normally contribute to a personal scheme. The amendments will change that. They will allow

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      someone who is not a controlling director and who does not earn more than £30,000 a year to pay up to £3, 600 into a stakeholder or personal pension in any one of the subsequent five years assessed.
      Perhaps I should at this point reply on the issue of the £30,000 limit; it is easiest to address that question at this moment. We picked the figure of £30,000, after some considerable thought, to try to strike the right balance between cost, ease of administration and coverage. A lower figure would increase complexity by excluding more individuals, whereas a higher figure would reduce complexity but increase Exchequer costs. We decided that £30,000 struck the right balance. It will reach nearly 90 per cent. of those in occupational schemes, which seems good coverage, and will cost £150-odd million by 2010.
      I should like to make several responses on the issue of simplicity, but perhaps that would take too long. I should like to tax the remarks of the hon. Member for Northavon on simplicity by saying that I believe strongly that we have simplified several matters, not least tax arrangements for stakeholders. Indeed, the concurrency arrangements themselves make matters much easier. It is true that the £30,000 limit is in the Bill, as the hon. Gentleman said, but that is not say that it will not be reviewed from time to time. Indeed, we have no intention of lowering the figure.
      We have not index-linked the figure partly because it gives people a degree of simplicity in their arrangements. Once a person has earned under the £30,000 limit in one year, they know that they will for five years be able to pay in on a concurrency arrangement. Therefore, the provision has the built-in simplicity that the hon. Gentleman was demanding and that we have succeeded in delivering in a number of changes since we came to government.
      Stakeholder pensions have been extended to about 8 million more people, 90 per cent. of whom are in occupational pensions. Many of those employees do not expect to receive a large pension, but they are currently putting off making further provision because they consider existing AVCs and FSAVCs to be complicated and inflexible. They also worry about those products because of past pension mis-selling. We are offering those employees the opportunity to use a new, good value stakeholder pension to increase their retirement savings. It is worthwhile remembering that 40 per cent. of those who have AVCs are currently below the £30,000 income level. It is not the case that those with incomes of less than £30,000 do not already pay into AVCs.
      Some have argued that we should allow concurrency for everyone, but such an approach would not be focused and would not represent good value for money. We therefore worked with the pensions industry earlier this year to produce the more focused approach set out in the amendments. We have followed the points made to us during those discussions. The proposal will help more individuals to save more money for their retirement, but it will also remove some of the practical problems that might otherwise have arisen when people change jobs. Again, simplicity is important.
      The proposal should help pension providers to offer lower-cost pensions by increasing the benefits of scale. That will help to open up the pensions market, and it will offer consumers more choice and better value products. It has had an excellent reception, and therefore we are
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      confident that we are right to believe that there is merit in the open approach that we have adopted and in the details of the changes that we propose to make.
      I turn next to some of the issues raised under amendment No. 145. It is worthwhile saying that that amendment deals with points made in Standing Committee under what was then amendment No. 181, which Opposition Members tabled but then withdrew. They are returning to the matter under cover of a technically deficient amendment. I hope that I shall persuade them not to press it to a Division for two reasons. Up to 25 per cent. of pension contributions can be used to insure future contributions against sickness and incapacity. That reduces the amount of contributions going into pension funds.
      The changes that we have included in the Bill will directly boost money entering peoples' pension funds, rather than subsidising insurance contributions. That is achieved by stopping tax relief up front, but giving it when the payment arising from a claim under the insurance policy is paid into the pension fund. In effect, that involves recycling.
      Like all other contributions, tax at the basic rate will be added to the payment into the pension fund. In turn, that means that a lower sum can be assured. The change in the tax treatment of waiver insurance will not increase what is paid overall for the insurance cover, and some companies have suggested that it might reduce the premiums. Similarly, because tax relief is given on the use of the proceeds of the insurance, there is no need for restrictions on what can or cannot be insured. So providers can extend the insurance to cover situations that they could not cover before, such as unemployment and not just ill-health. I hope that I have fully explained the attractiveness of those arrangements. Many people accept that they represent a more flexible, better deal.
      Overall, the changes that we have introduced will improve the existing arrangements. We know from questions addressed to the Revenue that companies are already engaged in imaginative product design based on our proposals. We cannot therefore support amendment No. 145, under which the existing arrangements would be re-introduced.
      Under amendment No. 146, the requirement for the holder of a tax approved pension plan to purchase an annuity with the proceeds of the plan not later than age 75 would be removed. I assume that the intention is to permit income draw-down arrangements to continue indefinitely. Amendment No. 146 is flawed, but I do not place much weight on that, because it would not amend the section in the existing legislation that requires income draw-down to cease by age 75. The result would be that the holder of a personal pension could not continue income draw-down, but would be compelled to buy an annuity so that benefits could cease altogether. I am sure that that is not what is intended.
      Many people have raised general concerns about whether annuities are good value. That was discussed in the Budget debate, and I recall hearing the hon. Member for Bournemouth, West (Mr. Butterfill) discuss the minimum funding requirement and I know of his connections with the topic. We have also discussed these matters in the Standing Committee. I shall explain why the amendment would not provide a solution, although I accept that many interesting issues relating to points raised in debate remain to be explored fully.

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      The main purpose of a pension scheme is to provide secure income for scheme members for the whole of their retirement. It is worth highlighting that point because the hon. Member for Bournemouth, West suggested that the principal purpose might be recouping tax relief. A key feature of annuities is that they provide income for the remainder of a pensioner's life. Variations on the basic product, such as with-profits annuities, already exist, but they all have that essential core characteristic.
      Tax rules therefore require personal pensions and other money purchase pension schemes to buy out their benefits as annuities to guarantee a continuing income, no matter how long the scheme members may live. To give flexibility, the tax rules allow members of money purchase pension schemes to take an income from their pension funds from 50 and to defer the annuity until they are 75. People are familiar with the detail of those arrangements.
      Income draw-down is theoretically available to all members of money purchase pension schemes. However, the perceived wisdom is that it is suitable only for those with larger funds—at least £100,000—who can afford to bear associated risks. Depending on the investment returns achieved, someone who chooses to take maximum income from his or her fund might see a substantial reduction in income at age 75 in comparison with what he or she might have been able to secure by buying an annuity at, say, 60. The age limit of 75 strikes a balance between flexibility in the timing of the annuity purchase and the increasing danger of the fund being exhausted as the person continues to draw on it as he or she grows older.
      Particular issues have been raised and I shall try to address the main ones. First, my right hon. Friend the Member for Birkenhead (Mr. Field) commented on inheritance and the defence of the status quo. It is not clear that the underlying value of annuities has in fact fallen once all other factors are taken into consideration. We could have a lengthy debate about that, but other factors should be taken into consideration. [Interruption.] Notwithstanding the mutterings of the Treasury Whip about my ideas of a lengthy debate, we accept that those factors exist.
      We have sustained low inflation, which looks set to continue, and that is one factor in enabling annuities to retain their real purchasing power far better than did higher headline annuity rates paid in a higher inflation environment. We all know that life expectancy is increasing, and, as it is the hon. Member for Northavon's birthday, we can hope that that will affect him. People can expect to draw an annuity income for longer in their retirement. The value of a guaranteed income for life should not be underestimated. Many pensioners will still enjoy secure income as they grow older. The Oonagh McDonald report accepts that annuity arrangements work well for many people.
      9.45 pm
      My right hon. Friend the Member for Birkenhead said that pensioners should be able to pass on their remaining funds, at death, to their dependants. Generous tax reliefs were provided to support that. Annuities are not supposed to be tax-advantaged inheritance vehicles, however—they
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      are insurance products. One way in which they work—a point that sometimes gets lost in this debate—is as a pooling of pension funds, enabling those who live longer than the average life expectancy to go on receiving the guaranteed income because, sadly, some people do not live that long. That is an important point about the way in which annuities are structured.
      Increased longevity means that annuities are paid out for longer. A number of right hon. and hon. Members have remarked on the need to purchase more gilts to maintain the same income stream to back an annuity and on the availability of long-dated gilts. The MFR review has not yet reported; we will want to consider it when it reports, which I believe is not a long way off. As the hon. Member for Arundel and South Downs (Mr. Flight) said, the outcome of the Myners review will provide another aspect to all the matters being considered.
      The hon. Gentleman and others have commented on the new products that are being produced. We are very interested in those new products and in new ideas for tackling the issues that the topic raises. We are looking at the Oonagh McDonald report and also at the more recent report of the Social Market Foundation. There are a number of issues surrounding the purchase of annuities and the supply of gilts, so there are many matters to be considered. When we have got all the information together and given it due consideration, if we think that there is a new way forward, we will consult people about those arrangements. I can give no undertakings to do so, but I hope that right hon. and hon. Members will have gathered from the tone of my responses that we believe the issue to be worthy of full consideration.
      We have been asked why we made the changes to waiver insurance. I believe that I have already covered this point, but let me say again that our approach is better because it is better focused by boosting income going into the pension. Rather than tax subsidising insurance arrangements, it provides better cover against eventualities, and is better value and cheaper overall.
      The hon. Gentleman expressed the view that annuities lock people into bonds and that equity-linked annuities cause problems. A number of innovative non-bond-based annuities are coming on to the market. These will benefit the majority with small to medium pension pots. Removing the requirement to purchase an annuity could stifle that development. As I said, Oonagh McDonald's report recognises that an annuity will remain the best option for many people. The Inland Revenue is working with financial institutions to aid the development of equity-based annuities. We are giving all these matters our full consideration.
      Mr. Webb: Perhaps I have pre-empted the Minister regarding the open market option. Can she reassure us that she will push those who send out the letters to make sure that people are more aware of their choices than they are at present?
      Miss Johnson: I am happy to give the hon. Gentleman the assurance that I will look at that issue. I cannot go further than that at this point, but I will in due course study in Hansard the points that have been made in the debate by right hon. and hon. Members.

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      I hope that none of the Opposition amendments is pressed to a vote, and that the House will support the Government amendments.
      Mr. Edward Davey: The debate has been interesting and useful. The Minister has put on record the Government's thinking on some of these matters. I am sure that hon. Members and people outside the House will want to consider her words with care. She has helped explain the direction of Government policy in this area, and I am grateful for that.
      The Minister made some welcome comments about new clause 8. I hope that she will urge her officials to produce genuine solutions to the problem of how the income from retirement annuities is administered for tax, and to the related problem that pensioners face extra complexity in their tax arrangements. However, I do not want to detain the House so I beg to ask leave to withdraw the motion.
      Motion and clause, by leave, withdrawn.

    Schedule 2

      AMUSEMENT MACHINE LICENCE DUTY
      Amendments made: No. 7, in page 122, line 45, leave out from "any" to end of line 48 and insert—
      'gaming machine which is a small—prize machine or five—penny machine.'.
      No. 8, in page 123, line 4, at end insert—
      '(aa) a five-penny machine,'.
      No. 9, in page 124, line 44, leave out from beginning to end of line 5 on page 125 and insert—
      '3.—(1) In any case where—

      (a) the Commissioners give a default notice,

      (b) the due date specified in the notice passes, and

      (c) it appears to the Commissioners that at some time during the alleged default period specified in the notice one or more amusement machines were provided for play on the relevant premises so specified without an amusement machine licence being in force in relation to the machines,

      the Commissioners may grant, in accordance with this paragraph, one or more licences in relation to each of the machines.
      (2) In this Schedule—
      "default licence" means a licence granted by the Commissioners under sub—paragraph (1) above;
      "unlicensed machine" means a machine in relation to which a default licence is granted by the Commissioners.'.—[Mr. Timms.]

    Clause 20

      VEHICLE EXCISE DUTY
      Amendments made: No. 94, in page 16, line 2, leave out from second "of to end of line 24 and insert "licences—

      (a) issued in the period beginning with 1st March 2000 and ending with 28th February 2001, and

      (b) not surrendered before the end of that period,

      where the amount of vehicle excise duty chargeable on the licence would have been less if the amendment in subsection (1) had applied.

      (3) The amount of the refund is—

      (a) £55 for a 12 month licence, and

      (b) £27.50 for a 6 month licence.

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      (4) The person entitled to the refund is—

      (a) in the case of a licence in force on 28th February 2001, the keeper of the vehicle on that date;

      (b) in the case of a licence that has ceased to be in force before that date, the keeper of the vehicle when the licence expired.

      (5) For the purposes of subsection (4) the keeper of the vehicle shall be taken to be—

      (a) the person registered as keeper of the vehicle on the date in question, or

      (b) if the Secretary of State has received notification of a change of ownership of the vehicle as a result of which another person is on that date entitled to be registered as the new keeper of the vehicle, that person.'.

      No. 95, in page 16, line 33, leave out from "section" to end of line 39 and insert—
      'in respect of a licence does not affect the validity of the licence.
      (8A) For the purposes of section 19 of the Vehicle Excise and Registration Act 1994 (surrender of licences) as it applies to the surrender on or after 1st March 2001 of a licence in respect of which a refund under this section has been made, or applied for, the annual rate of duty chargeable on the licence shall be taken to be that which would have been chargeable if the amendment in subsection (1) above had applied.'.
      No. 96, in page 16, line 43, at end insert—
      '(10) In the application of this section to Northern Ireland, references to registration as the keeper of a vehicle shall be read as references to registration as the owner of the vehicle.'.—[Mr. Timms.]

    Clause 30

      CLIMATE CHANGE LEVY
      Mr. Letwin: I beg to move amendment No. 98, in page 20, line 4, leave out from "until" to end of line 6 and insert—
      'one year after the expiry of a twelve month period during which UK emissions of CO2 show an increase on the previous year'.
      I do not want to detain the House, not least because my voice is failing. The arguments on the climate change levy are well rehearsed, but we could not let pass this opportunity to explain to the House why the Opposition consider that the implementation of this dreadful new tax should be delayed. A much better solution would be its withdrawal. Given the mood of co-operation in the House, perhaps the Financial Secretary will have a Damascene conversion and withdraw this dreadful tax before the evening is out.
      Page 108 of the Red Book contains chart 6.2, which shows the root of the conceptual problem with the climate change levy. The number of millions of tonnes of carbon released through greenhouse gas emissions has been falling steadily since 1990 and remains on a declining trend. The new levy is being introduced at a time when there is no need for it.
      What is worse, it will be entirely ineffective, not least because all the industries most able to respond to it, through the elasticity of price in relation to production, will be exempt, for one reason or another. The levy is a classic example of a new tax that is misnamed and misdesigned. With the exception of the companies whose behaviour it might affect, it applies to all companies of all sizes. It will be widely regarded as a supreme example of a stealth tax. I doubt whether the Financial Secretary

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      will, even now, be able to mention any small business in Britain that is yet aware of what is about to hit it—but hit it this tax will.
      The tax is not neutral, particularly because the offsetting national insurance contributions reduction, even if that were real, would not be coincident with the effect of the tax. Firms will be either gainers or losers. As the Financial Secretary is well aware, we are by no means persuaded that the offsetting NIC reduction will remain as an effect of the introduction of this levy. In any event, the offsetting NIC changes could have been introduced without the levy.
      The levy is a tax. It is not a neutral tax. It is not neutral either in its particular or in its general effects. Its effect will be to raise the Government's tax income.
      The levy is complicated. We became aware, as we went through it in Committee, that it is probably the most complicated tax that the Government have ever introduced—and that is saying something. If I remember correctly, its provisions extended to 55 pages. The situation has been made worse rather than better by Government amendments, which have made the tax significantly more complicated.
      This tax hits our competitiveness. As we explained repeatedly in Committee, it is not levied outside the European Union, and many EU states have exemptions from comparable taxes. It is unnecessary, and it is the more unnecessary because other more effective means, such as voluntary agreements and emissions trading, could have been used to achieve our Kyoto targets of further reductions in greenhouse gas emissions.
      Most important, and most directly germane to the amendment, is the fact that the policy represents work in progress—actually, I am doing the Government undue justice in saying that, because it is actually a mess in progress. It may be making gradual progress towards coherence, but it certainly has not got there yet. No one knows how combined heat and power schemes will be affected, and no one understands how the rebate mechanisms will work. No one knows whether the EU clearances on state aid will work. In that connection, I draw the Financial Secretary's attention to a letter, which he may also have received, from the Chemical Industries Association. It states
      the real "showstopper" for industries such as chemicals
      is that the Government may be
      unable to get its existing package of Levy concessions…past the European Commission.
      The tax is hugely complicated, not neutral, and does not achieve anything that needs achieving. Even if it were necessary to achieve something, the levy cannot achieve it as well as other measures could. It is also undeveloped both structurally and legally. All we seek with this modest little amendment is to delay this dreadful measure until there is evidence that it is required, that it has been sorted out and is legally feasible, and that it will work. Until that has been done, I do not see the slightest shred of justification for the application of the tax.
      I hope that the Financial Secretary will have seen as much light as his colleagues have seen on double tax relief. By changing their minds, they have mercifully spared British industry from one of the worst disasters
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      that could have befallen it. I hope that he will tell us that he will accept this amendment—this life-saving device that we have thrown him—with the open arms with which it would behove him to accept it.
      Mr. Andrew Stunell: As the hon. Member for West Dorset (Mr. Letwin) has said, the climate change levy was extensively debated in Committee. The Conservatives and the Liberal Democrats tabled amendments. The Liberal Democrats sought to improve and develop the tax. It is right to call it a tax—I certainly agree with the hon. Gentleman on that point. The Conservatives were consistently ambiguous in their intentions and in the amendments that they tabled.
      Mr. Jack: Does the hon. Gentleman accept that my amendment on a 100 per cent. exemption from the climate change levy for the horticulture industry was clear and utterly unambiguous?
      10 pm
      Mr. Stunell: The right hon. Gentleman is absolutely right, and he will recall that I supported that amendment.
      Mr. Letwin: I hope that the hon. Gentleman will recognise that any ambiguity in our remarks in Committee was entirely due to our ineptitude as orators, because in fact our position is wholly unambiguous. We regard the climate change levy as an aberration that should never have been brought before Parliament.
      Mr. Stunell: There we have it. That, in a nutshell, encapsulates why we cannot support the amendment.
      Whatever the defects of the climate change levy—I shall mention one or two in a moment—the fact is that it is just about the Government's only visible policy for fulfilling our Kyoto obligations. Hundreds of consultation papers have been issued and many sensible proposals have been mooted, but nothing has been done. The levy, with all its defects, should in general terms be supported and developed rather than opposed and defeated.
      We supported the principle on the Floor of the House and in Committee, but we voted against the schedule because of the manifest difficulties in its operation. The Conservative case against the tax is unclear. It is founded on an assertion about what is best for business, but entirely leaves out what might be best for the environment, and therefore for business too.
      Substantial opportunities exist for United Kingdom businesses in the vigorous pursuit of climate change policy. There is the opportunity to be a world leader, and for jobs and investment to flow from a positive response to the Kyoto protocol. In all honesty, the climate change levy is only a small brick in the wall of such a policy, and it is by no means perfect—but the Conservatives owe it to themselves to say clearly whether they think there is a problem with climate change or whether they now repudiate the stance taken by the right hon. Member for Suffolk, Coastal (Mr. Gummer) when he first set the United Kingdom Government on the track of responding to this fundamental issue. If they do, they should say so, and if not, they should say what policies they think should be in place.
      Mr. Letwin: We accept that there may be a serious problem in the long run, although we are currently

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      meeting the Kyoto standards, but the hon. Gentleman should accept that we have specifically mentioned emissions trading and voluntary agreements as serious ways forward. We do not accept that the corner shop, which cannot turn off its lights and reduce its electricity use, or do anything else to achieve the Kyoto targets, should be subject to a levy with no environmental purpose whatever, designed solely to increase the amount of money in the Chancellor's coffers—although I admit that after this afternoon, that will be very necessary.
      Mr. Stunell: This afternoon I had the benefit of meeting representatives of Sainsbury's—not exactly a corner shop, I concede, as it has about 800 premises in this country—and they made the point that some of the ways in which the levy is coming into force could have been improved, in particular by accepting some of the amendments tabled by Liberal Democrat Members in Committee.
      I am thinking in particular of the need for the tax to be introduced at a low level, along with a clear long-term signal that the intention is to raise it. I know how businesses respond when they know the direction in which Government policy is going—when they see that it is starting at a level that is not punitive and will not damage competitiveness, but signals to them that they must make investment decisions that will take them in the right direction.
      Every shop in the country can save energy, whether its current activity involves refrigeration, lighting, insulation or simply controlling the flow of heat from its premises through open doors in winter. There is a tremendous gap between good practice and bad practice. Most professional experts say that between 20 and 35 per cent. of the energy currently used could be saved, so we know that there is scope for savings. The first question is, "Is that necessary?" The hon. Gentleman has said he accepts that it is. The next question is, "If it is necessary, and if it is possible, is the climate change levy a useful vehicle?" The answer is that it is a vehicle with some use, but that it does not give the complete picture, and is certainly not perfect.
      Liberal Democrats have criticisms of the climate change levy. We have pointed out, for instance, that it is not a tax on carbon emissions, which are what it was designed to prevent. We have also pointed out that it is being introduced at too high a level, and, in that sense, too abruptly, and that it gives no clear signals for the future.
      We established in Committee that the Treasury expected the tax to rise by the rate of inflation—in other words, to be inflation-linked. We do not think that that is the right approach. We think that we should have introduced the tax at, say, 50 per cent. of its current level, and that the Bill should have indicated clearly that a series of steps were involved. We believe that it should be clear to industry and commerce that in 10 years' time—by 2010, which is becoming a magic environmental date—they will need to take the levy into account, because it will constitute a significant impost on their fixed costs.
      We also criticised the proposal for another reason. Not only does it not tax carbon, it does tax some renewables—in particular, large-scale hydro-electricity generation schemes involving more than 10 MW. In Committee that consideration was dismissed as not being particularly important, but such schemes provide about half the country's current renewable energy resources.
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      The Government do not seem to have recognised that in the new market—in the new electricity trading arrangements—those hydro schemes will be competing in a very different world from the world in which they were designed and built. At least some operators are concerned about their capacity to sell into that new market in a way that will enable them to remain viable. Because large-scale hydro schemes will be hit by the levy, there is a serious risk that they will be driven out of the market and replaced by the use of another fuel—inevitably, a fossil fuel. That would increase carbon emissions.
      We have also criticised the tax because it is undoubtedly complicated. So far its provisions cover 83 pages, and I assume that subsequently, all the additional pages of Government amendments will be attached. I think that that will add up to 86 or 87 pages. Anyway, clearly this will be a phenomenally complex piece of legislation. It must also be said that we shall deal later with Government amendments responding to some of the criticisms made in connection with combined heat and power, and, to a limited extent, horticulture.
      I find it surprising that, having decided to table just one amendment, the Conservatives should base that amendment on the assumption first that we do not need to start as soon as possible, because there is not enough evidence for us to know what we are supposed to be doing now, and secondly, apparently, that the longer we put off any action in the House, the better it will be for business and the environment.
      The Liberal Democrats reject that completely. We do not accept an argument for delay—an argument that is founded on disbelief. We do not think that the House should accept an argument that is so disingenuous and self-serving. We shall vote against amendment No. 98 not because we think that the Government have come up with a perfect vehicle, but because the planet faces a situation in which any vehicle is better than no vehicle.
      Mr. Alasdair Morgan: I should like to pick up on the points that were made by the hon. Member for Hazel Grove (Mr. Stunell) and to address—and to ask the Minister to respond to—the particular problems faced by Scottish and Southern Energy and those of its plants that formerly belonged to the North of Scotland Hydro-Electric Board. The board was set up to generate electricity from renewable resources, which in itself was unusual. It also had a specific social responsibility in the highlands of Scotland: to provide electricity to remote glens where electricity was not available.
      The company has a significant number of small and medium hydro plants operating in the highlands; those are plants with between 10 and 25 MW capacity. It is my understanding—I have to take it on trust because, having read schedule 6, I am none the wiser about what it means—that plants under 10 MW will be exempted from the levy. From talking to Scottish and Southern Energy, I believe that it feels that plants of over 25 MW can compete commercially with the implications of the levy.
      Most of the plants that we are talking about were built during the early 1950s; some were built in the late 1950s in the great spate of hydro building in the highlands of Scotland. Therefore, they are reaching the end of their useful life. It may come as a surprise to some tourists, but Scotland is not a particularly wet country. It certainly is not in terms of hydro generation; I was speaking to the

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      chairman of the Scottish tourist board at the end of last week, and he wished me to emphasise that point about the weather. Those plants operate at a load factor of about 30 per cent. If the climate change levy is imposed on them, the renewal of their equipment—which is due as we speak and which would extend their life for a further 30 years—would not, in the estimation of Scottish and Southern Energy, be economic in current market conditions.
      It would be tragic for the highlands if that investment, much of which was the brainchild of the first post-war Labour Government, elected in 1945, was lost. We would lose that valuable resource to the highlands. It would be ironic if a levy that was designed to encourage renewable energy led to the scrapping of some of the most significant and successful renewable energy schemes ever in this country.
      Therefore, I urge reconsideration, if for no other reason than to avoid disappointment for the Scottish Executive—the Scottish Labour-Liberal Executive—which as recently as 11 July, issued a press release on an agreement that was signed at Lubreoch power station in Killin, near where I was brought up. If I remember rightly, that is one of the power stations that I am talking about: it has a fairly small capacity and was built in the early 1950s. The press release says:
      SSE will provide 100 per cent. of the Executive's requirements from renewable resources.
      Mrs. Margaret Ewing: On a point of order, Mr. Deputy Speaker. May I point out that no one on the Front Bench appears to be listening to the significant points being made by my hon. Friend the Member for Galloway and Upper Nithsdale (Mr. Morgan)?
      Mr. Deputy Speaker (Mr. Michael J. Martin): So long as I am listening, that is the important thing.
      Mr. Morgan: I thank you for your attention, Mr. Deputy Speaker.
      I continue with the quote from the Scottish Executive, which I am sure everyone on the Front Bench listens to:
      This is a first for central government and it underlines our commitment to the promotion of renewable energy as outlined in our draft Scottish Climate Change Programme.
      We are moving in the right direction and I am delighted to note that SSE are able to provide the public sector with a supply that is 100 per cent. renewable.
      I ask Ministers not only to spare the blushes of the Scottish Executive, but especially to encourage the renewal of existing renewable energy supplies by reconsidering their current approach to those particular power stations.
      10.15 pm
      Mr. Denis MacShane: I should like to make a few comments on behalf of the United Kingdom's electric arc furnace users. Electric arc furnaces consume recycled material—scrap metal—to produce steel, but those steel producers are concerned about the climate change levy. I pay tribute to my hon. Friend the Financial Secretary for receiving many deputations and representations from the steel industry. However,
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      although the levy has been negotiated down to help the industry—which is going through very great difficulties—one anomaly remains. I had planned to table an amendment on the anomaly, but prefer to make a few comments about it. I hope that my hon. Friend will reply to them.
      I ask the Minister to consider narrowly the very few companies that use electric arc furnaces, which consume scrap metal—which is recycled material. There is a fear that, as currently formulated, the climate change levy will force the sector to close those furnaces and to use iron ore. It would be perverse if the tax, instead of encouraging the use of recycled material, caused the sector to return to raw iron ore to produce the steel that our economy wants.
      I ask my hon. Friend the Minister to consider whether—when fine-tuning the Bill, before it goes to another place and becomes law—he might receive a delegation of me and other hon. Members representing the steel communities where electric arc furnaces are being operated, to discuss whether the legislation might take on board those considerations.
      Mr. Jack: May I remind the hon. Member for Hazel Grove (Mr. Stunell)—who chastised Conservative Members for having no alternative to the climate change levy—not only of my own remarks in Committee, but of the answer to a parliamentary question that elicited the fact that we would save 2 million tonnes of CO2, which was the original target of the climate change levy, if the gas-fired power station moratorium were lifted and only one third of those power stations were built? If we achieved that saving, the Government would have no need for the bureaucracy that they are proposing. Conservative Members take entirely seriously the state of the planet. However, lifting the gas moratorium would deliver in a much more straightforward manner what the Government's great cumbersome tax is supposed to do.
      In Committee, I also proposed a biomass alternative which, admittedly, needs more work. However, the conversion of 0.05 per cent. of the cultivable land area of the United Kingdom to short rotational coppice would, at a stroke, save more than 2 million tonnes of CO2. Recently, I received a letter from Shell International in support of that proposition.
      Therefore, Conservative Members need no lectures from Liberal Democrat Front Benchers that we do not take the subject seriously and that we have no alternatives. I shall not make a lengthy speech now about the virtues of nuclear power—fuel for which comes from my own constituency—but simply say that nuclear power is CO2-free. However, the Government do not have a proper nuclear strategy.
      I am speaking to this amendment to record once again, despite Government amendments, my deep disappointment that Ministers have done nothing to relieve the horticulture industry of a wholly unnecessary new tax. I am delighted to see my hon. Friend the Member for Broxbourne (Mrs. Roe) in the Chamber. On 15 June 2000, in an Adjournment debate, she reminded the House that the National Farmers Union had estimated that the climate change levy was effectively a tax of £3,750 per acre on glasshouses in this country.
      The Government talk about competitiveness; I heard the Chancellor's speech today. If representatives of the glasshouse industry were in the same room as the

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      Chancellor, they would think that he was from another planet. The climate change levy has visited on the glasshouse industry a tax that is wholly unnecessary for an industry that consumes its own output of carbon dioxide and has the potential for saving more.
      The levy really does not apply and it makes the industry uncompetitive. There is no levy in Spain, Belgium, Ireland or Portugal. In the Netherlands, negotiations are taking place with the industry to reduce emissions, but no tax is envisaged. Here, however, the Government are imposing a tax on our horticulture industry which will diminish its competitiveness. At the same time, they claim to have the interests of British industry and commerce at heart.
      In areas where the horticulture industry is important in employment terms, the levy is disproportionately important. When the Financial Secretary argues the case for the levy, he will put yet another nail in the coffin of the British horticulture industry. We and the industry will know who is responsible.
      In Standing Committee, I put on the record, enterprise by enterprise, a list of small-scale businesses. The Chancellor said this afternoon that small-scale businesses were the engine room of our economy. It seems to me that the Government are stripping out the oil and the pistons, and they will soon be getting rid of the operator because the engine-room companies in the horticulture industry will have to bear a substantial extra burden which, as I said in Standing Committee, they cannot and should not bear. Even at this late stage, I make this appeal on behalf of the British horticulture industry. Instead of providing little tiny bits of help which do not address the issue, the Minister should recognise that the horticulture industry is genuinely a special case and find some way of absenting it from more than the proposed 50 per cent. reduction.
      Mr. Christopher Gill: I shall speak briefly in support of the amendment. I find the case for the climate change levy quite unsatisfactory. We keep hearing from Ministers that it will be revenue neutral. It may be revenue neutral as far as the Government are concerned, but it certainly will not be for individual businesses. Although it could be claimed to be revenue neutral in respect of companies that are eligible for the rebate and employ a large number of people, as my right hon. Friend the Member for Fylde (Mr. Jack) has just said, it will be far from revenue neutral for companies that employ very few staff.
      The hon. Member for Kingston and Surbiton (Mr. Davey) said that the climate change levy would not affect competitiveness. That is absolute bunkum. Any tax affects competitiveness. Last Thursday at Question Time, the Minister for Energy and Competitiveness in Europe tried to maintain that the levy would not affect competitiveness. The Government are living in cloud cuckoo land if they think that they can impose a tax that will not affect British businesses.
      In effect, the climate change levy will impose a poll tax on employment, and its effect will be to export production that is currently carried out in Britain, and the jobs associated with it, to other parts of the world where environmental considerations are ignored. My right hon. Friend the Member for Fylde rightly mentioned other European countries where there is no equivalent of the climate change levy, or if there is, it is not being imposed in such a dramatic way.
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      As was made clear on Second Reading, there are anomalies. For example, in several industries the prime producer is eligible for the 80 per cent. rebate, but processors in the same industry are not. That is totally unacceptable. The Liberal Democrat spokesman was good enough to admit that the tax was complicated. To my mind, that makes it a bad tax in any case, but the Government's assumption that companies and employers are not doing their level best to reduce the cost of energy is equally spurious. Everyone in business today realises that they have to keep bearing down on overheads. As energy is one of the most significant overheads, companies automatically bear down on energy costs without the incentive of the proposed tax.
      This is a bad tax. It is a poll tax on jobs in this country, and I shall support the amendment.
      Mr. Simon Thomas: I say, with much regret, that Wales is plenty wet enough for hydroelectricity schemes. That is why, in my constituency, I have the largest hydro-electricity scheme in Wales and England.
      I support the comments made by the hon. Members for Galloway and Upper Nithsdale (Mr. Morgan) and for Hazel Grove (Mr. Stunell). Hydro-electricity has been overlooked in the workings of the climate change levy, and I hope that the Government will review how the tax impacts on hydro-electricity schemes and the renewable energy that comes from it.
      However, I hope that the Government will resist the amendment. I am sure that they need no encouragement from me to do that. The hon. Member for West Dorset (Mr. Letwin) correctly pointed out that the rate of carbon dioxide emissions was going down, but he did not go on to say that the emissions are expected to rise significantly again after 2005. That is not in the Red Book, but it is in the Government's predictions. That has been borne out by the royal commission on emissions, which issued its report last month.
      Mr. Swayne: Part of that rise may be consequent on the strangling to death of British horticulture and the importation of the products that it previously produced by air, with a great use of aviation fuel, which is one of the most serious carbon dioxide pollutants.
      Mr. Thomas: I accept the hon. Gentleman's latter point, but his former point was somewhat peripheral to the argument, although I support the point made by the right hon. Member for Fylde (Mr. Jack) about the horticulture industry. There is an obvious carbon-negative factor that should be taken into account in the workings of the tax.
      The tax is complicated, and it is right to call it a tax, not a levy. However, none of the complicated difficulties with it persuade me to oppose it in principle. In fact, having heard the comments of the Opposition Front-Bench Treasury spokesman, I feel even more strongly that we should put the tax through as a marker of the changes that we need to see in this country. The amendment tabled by the Opposition is poorly drafted from a party that purports to want to form a Government at some stage in the countries of the United Kingdom. It shows a lack of understanding of what the Kyoto targets mean and of how we can move to achieve that international obligation.

      329
      The time scale for the changes that we want to see in the environment and in carbon dioxide emissions is between 15 and 25 years. The magic year 2010 has been mentioned and 2020 is increasingly coming on the horizon in working out the targets. Legislation that pivots around some environmental blip from year to year would send out a tremendously bad signal to business, the public at large and our international partners.
      The poor understanding within the Conservative party is reflected in the way in which it has approached the issue. It has not come up with an alternative scheme for meeting the Kyoto targets. Many of us who have serious doubts about the complexity of the climate change levy and what it leaves in and leaves out would have liked to hear alternative methods of achieving the Kyoto targets, but I regret to say that that has not come forward from the Opposition party.
      Mr. Letwin: Is the hon. Gentleman seriously advancing the proposition that lifting the gas moratorium would not do more to achieve the targets than this tax?
      Mr. Thomas: It would in the very short term, but we are talking about a 25-year period. As the hon. Gentleman knows, there would not be the natural gas to pump into stations in 25 years' time. We have to start planning now for the changes that we want to see in 20 or 25 years. That is why the right hon. Member for Fylde was correct in referring to biomass and short coppice rotation. Elephant grass, willow or whatever might be grown, but that is not an answer to the situation that we are in now. I spent three hours with a biomass group in my constituency on Monday morning discussing how we could get a biomass plant established in the area. The members of the group were arguing strongly that they need a lead-in of four to seven years for the coppice rotation to take effect before the plant can be efficient.
      10.30 pm
      I say to those on the Government Front Bench that I hope that Energy Ministers will be informed that there are still pieces missing in the Government's picture on renewables, especially in terms of renewable energy and the price that may be involved. I understand that the Department of Trade and Industry will be discussing next week how it might address the issue. It is part of meeting our climate change obligations that the left hand knows what the right hand is doing. The Government are pressing on with the levy without necessarily bringing in all the other benefits that need to come on stream. For that reason, they are giving the impression that they are introducing a tax without the benefits that should accompany it. It is incumbent upon them to work hard over the summer to produce for industry ideas about the use of renewable energy that will fit the jigsaw and produce a much more complete picture.
      The Government's view is at least robust, if nothing else, and linked to environmental aims. I welcome the later amendments on combined heat and power. I hope that they will improve a deficiency in that area.
      I hope that everyone in the House accepts that there is climate change and that it brings problems. Certainly the occupants of the Conservative Front Bench are starting to
      330
      accept that, although they do not accept the levy. However, climate change demands vision and political bravery. It is regrettable that, on the whole, we politicians are short-termist. We do not like to plan ahead for 10 or 15 years, because on the whole we shall not then be around to reap the benefits. However, the Government have shown a little bravery in this context and I hope that they will resist the amendment, stick to their guns and review the workings of the climate change levy to ensure that some of the other points that have been raised are taken into account, particularly the future of renewable energy.
      Mr. Timms: The hon. Member for West Dorset (Mr. Letwin) asked me to withdraw the tax. I wish I could withdraw the huge problem of climate change which faces the world and requires an effective response throughout the world. The hon. Gentleman said in an intervention on the hon. Member for Hazel Grove (Mr. Stunell) that it might be a problem. Well, it is a problem. That is the reality that we face, and we are taking effective action to respond to it.
      The hon. Member for West Dorset seems to be labouring under some straightforward misapprehensions, and in a brief contribution I shall attempt to correct them. He said that the problem could be solved alternatively by lifting the restrictive consents policy. We have announced that that policy will be lifted, and that is reflected in chart 6.2 of section 6 of the Red Book about the projections for carbon dioxide emissions. The levy is needed in addition to that to meet our objectives.
      Annual emissions are expected to be about 15 per cent. below 1990 levels this year, but it is forecast that they will start rising again as a result of continuing economic growth and because of factors such as the decommissioning of nuclear power stations. The projected increase in emissions takes into account the expected impact of the levy. That is why it is vital that the levy and all the other measures within the climate change programme are implemented in full to prevent any slippage.
      The hon. Member for Ceredigion (Mr. Thomas) rightly said in an effective contribution that a wide range of measures is required, of which the levy is one.
      Mr. Letwin: If the Minister believes—I am sure that he is right—that the decommissioning on a substantial scale of nuclear power stations will have a significant effect on emissions, why is it that the so-called climate change levy does not exempt power produced from nuclear stations?
      Mr. Timms: I do not know whether it is the policy of the Conservative party to promote new nuclear development. We know what is happening to nuclear power over the next 10 or 15 years, and that is one of the factors that we should take into account in projecting the future of carbon dioxide emissions. It is not a matter, as the amendment suggests, of watching some statistics to check whether we might need to take action to deal with climate change. That is wilfully to ignore the seriousness of the problem of climate change when, in reality, urgent action is imperative.
      The hon. Member for Galloway and Upper Nithsdale (Mr. Morgan) asked about hydro-electric plants with a capacity of more than 10 MW. He is right to say that

      331
      the exemption for renewables in the climate change levy applies to hydro schemes with a capacity of less than 10 MW. That is because we want to promote new renewable energy sources. There is a great deal of scope for new forms of renewable energy generation, and that is what the exemption is designed to promote. We want to incentivise new activities rather than subsidising existing activities that have competed successfully with other forms of generation for a long time.
      I have had a number of discussions on the issue with the organisation that the hon. Gentleman mentioned and others, and no one has suggested to me, as the hon. Member for Hazel Grove did, that big hydro-electric operators will shut down when the levy comes into effect. It would be wrong to suggest that. I recognise that there is a concern about a band of hydro-electric schemes, perhaps in the 10 to 25 MW capacity range, that, at some point in the future, they may want to carry out refurbishment, and that may well be a point that needs to be considered at that stage. But we are right to focus the exemption for renewable generation on new forms of renewable energy so that we can substantially increase the extent of that.
      Mr. Stunell: Will the Minister give way?
      Mr. Timms: I shall not give way again as I need to make some progress.
      My hon. Friend the Member for Rotherham (Mr. MacShane) raised some questions about electric arc furnaces for steel. I do not anticipate the problems that he fears because the 80 per cent reduction will be available. There will also be significant reductions in the price of electricity because of the new electricity trading arrangements. There is not an amendment on the subject before the House tonight, so the Bill represents the position that will prevail when the levy takes effect next April, but I shall be glad to meet my hon. Friend and others to discuss the concerns of the steel industry.
      To the right hon. Member for Fylde (Mr. Jack), I would say that we have fully recognised the special case of horticulture. The 50 per cent. concession that we have announced is unique. No other industry will enjoy the benefit of that, and that is being extended through a later group of amendments tonight to include lighting and heating. Belgium is working up an energy tax, and I anticipate that most, if not all, of the EU states will, in due course, need to introduce such a measure to meet their Kyoto objective. That trend is clear.
      As I have said, I welcome the support of the hon. Member for Ceredigion. He is right to recognise the importance of taking the step that is contained in the climate change levy. We are permanently improving energy efficiency across the business and private sectors, providing a continuing incentive to innovation aimed at improving energy use.
      The burdens on business will be kept to a minimum. I repeat what I am sure I have already said many times to the hon. Member for West Dorset, that we are recycling all the revenues from the levy in full to business through equivalent cuts in employer national insurance contributions and schemes to promote energy efficiency, including additional support for renewable sources of energy. There is no net gain to the Exchequer from the levy package.
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      If the projection of an increase in carbon dioxide emissions after 2000 is correct, the amendment could delay the onset of a levy only until 2002, but we need the levy in our fight to reduce greenhouse gas emissions. Any delay in implementation of whatever duration would prove deeply damaging to our aims. The problem of climate change remains a great challenge and a challenge that the Government are prepared to face up to. I am pleased that, on this occasion at least, the hon. Member for Hazel Grove can support us in taking the levy forward.
      I have one last point. The hon. Member for West Dorset talked about emissions trading as an alternative to the levy. It is not an alternative; it is a complement. We are taking forward an emissions trading scheme.
      The amendment is inconsistent with our key long-term goal of reducing greenhouse gas emissions and improving energy efficiency in business. I urge the House to reject it.
      Mr. Letwin: We have tried to save the Government from themselves. Alas, we have failed. Although this is sad for the country, it is marvellous politically. We look forward with glee to the moment when literally hundreds of thousands of businesses up and down the country discover that they will be subject to this ghastly tax, and we look forward to the Financial Secretary's doing little else for months than dealing with them.
      Question put, That the amendment be made:—
      The House divided: Ayes 127, Noes 345.

      Division No. 277]

      [10.40 pm

      AYES

      Amess, David

      Fraser, Christopher

      Ancram, Rt Hon Michael

      Garnier, Edward

      Arbuthnot, Rt Hon James

      Gibb, Nick

      Baldry, Tony

      Gill, Christopher

      Beggs, Roy

      Gillan, Mrs Cheryl

      Bercow, John

      Gorman, Mrs Teresa

      Beresford, Sir Paul

      Green, Damian

      Boswell, Tim

      Greenway, John

      Bottomley, Peter (Worthing W)

      Grieve, Dominic

      Bottomley, Rt Hon Mrs Virginia

      Hamilton, Rt Hon Sir Archie

      Brazier, Julian

      Hammond, Philip

      Brooke, Rt Hon Peter

      Hawkins, Nick

      Browning, Mrs Angela

      Hayes, John

      Bruce, Ian (S Dorset)

      Heald, Oliver

      Burns, Simon

      Hogg, Rt Hon Douglas

      Butterfill, John

      Horam, John

      Cash, William

      Howard, Rt Hon Michael

      Chapman, Sir Sydney (Chipping Barnet)

      Howarth, Gerald (Aldershot)

      Jack, Rt Hon Michael

      Chope, Christopher

      Jackson, Robert (Wantage)

      Clappison, James

      Jenkin, Bernard

      Clifton-Brown, Geoffrey

      Key, Robert

      Collins, Tim

      King, Rt Hon Tom (Bridgwater)

      Cormack, Sir Patrick

      Kirkbride, Miss Julie

      Cran, James

      Laing, Mrs Eleanor

      Curry, Rt Hon David

      Lait, Mrs Jacqui

      Davies, Quentin (Grantham)

      Leigh, Edward

      Davis, Rt Hon David (Haltemprice)

      Letwin, Oliver

      Donaldson, Jeffrey

      Lewis, Dr Julian (New Forest E)

      Dorrell, Rt Hon Stephen

      Lidington, David

      Evans, Nigel

      Lilley, Rt Hon Peter

      Faber, David

      Lloyd, Rt Hon Sir Peter (Fareham)

      Fabricant, Michael.

      Loughton, Tim

      Fallon, Michael

      Luff, Peter

      Flight, Howard

      MacGregor, Rt Hon John

      Forth, Rt Hon Eric

      McIntosh, Miss Anne

      Fowler, Rt Hon Sir Norman

      MacKay, Rt Hon Andrew

      Fox, Dr Liam

      Maclean, Rt Hon David

      333

      McLoughlin, Patrick

      Stanley, Rt Hon Sir John

      Madel, Sir David

      Steen, Anthony

      Major, Rt Hon John

      Streeter, Gary

      Malins, Humfrey

      Swayne, Desmond

      Maples, John

      Syms, Robert

      Mawhinney, Rt Hon Sir Brian

      Tapsell, Sir Peter

      May, Mrs Theresa

      Taylor, Ian (Esher & Walton)

      Norman, Archie

      Taylor, John M (Solihull)

      O'Brien, Stephen (Eddisbury)

      Taylor, Sir Teddy

      Ottaway, Richard

      Townend, John

      Paice, James

      Tredinnick, David

      Paterson, Owen

      Trend, Michael

      Prior, David

      Tyrie, Andrew

      Randall, John

      Viggers, Peter

      Robathan, Andrew

      Waterson, Nigel

      Robertson, Laurence

      Whitney, Sir Raymond

      Roe, Mrs Marion (Broxbourne)

      Whittingdale, John

      Ross, William (E Lond'y)

      Wilkinson, John

      Ruffley, David

      Willetts, David

      St Aubyn, Nick

      Wilshire, David

      Sayeed, Jonathan

      Winterton, Mrs Ann (Congleton)

      Shephard, Rt Hon Mrs Gillian

      Winterton, Nicholas (Macclesfield)

      Shepherd, Richard

      Yeo, Tim

      Simpson, Keith (Mid-Norfolk)

      Young, Rt Hon Sir George

      Soames, Nicholas

      Spelman, Mrs Caroline

      Tellers for the Ayes:

      Spicer, Sir Michael

      Mr. Stephen Day and

      Spring, Richard

      Mr. Peter Atkinson.

      NOES

      Abbott, Ms Diane

      Chaytor, David

      Adams, Mrs Irene (Paisley N)

      Chidgey, David

      Ainger, Nick

      Chisholm, Malcolm

      Ainsworth, Robert (Cov'try NE)

      Clapham, Michael

      Allen, Graham

      Clark, Rt Hon Dr David (S Shields)

      Anderson, Janet (Rossendale)

      Clark, Paul (Gillingham)

      Ashton, Joe

      Clarke, Charles (Norwich S)

      Atkins, Charlotte

      Clarke, Rt Hon Tom (Coatbridge)

      Austin, John

      Clelland, David

      Ballard, Jackie

      Clwyd, Ann

      Banks, Tony

      Coaker, Vernon

      Barnes, Harry

      Coffey, Ms Ann

      Barron, Kevin

      Cohen, Harry

      Battle, John

      Coleman, Iain

      Bayley, Hugh

      Colman, Tony

      Begg, Miss Anne

      Connarty, Michael

      Beith, Rt Hon A J

      Corbett, Robin

      Benn, Hilary (Leeds C)

      Corbyn, Jeremy

      Benton, Joe

      Corston, Jean

      Bermingham, Gerald

      Cousins, Jim

      Berry, Roger

      Cox, Tom

      Betts, Clive

      Cranston, Ross

      Blackman, Liz

      Crausby, David

      Blears, Ms Hazel

      Cryer, Mrs Ann (Keighley)

      Blizzard, Bob

      Cryer, John (Hornchurch)

      Boateng, Rt Hon Paul

      Cummings, John

      Borrow, David

      Cunningham, Rt Hon Dr Jack (Copeland)

      Bradley, Keith (Withington)

      Bradley, Peter (The Wrekin)

      Cunningham, Jim (Cov'try S)

      Bradshaw, Ben

      Cunningham, Ms Roseanna (Perth)

      Brand, Dr Peter

      Brown, Russell (Dumfries)

      Curtis-Thomas, Mrs Claire

      Browne, Desmond

      Dalyell, Tam

      Bruce, Malcolm (Gordon)

      Darling, Rt Hon Alistair

      Burden, Richard

      Darvill, Keith

      Burgon, Colin

      Davey, Edward (Kingston)

      Burnett, John

      Davey, Valerie (Bristol W)

      Butler, Mrs Christine

      Davidson, Ian

      Caborn, Rt Hon Richard

      Davies, Rt Hon Denzil (Llanelli)

      Campbell-Savours, Dale

      Davis, Rt Hon Terry (B'ham Hodge H)

      Cann, Jamie

      Caplin, Ivor

      Dawson, Hilton

      Casale, Roger

      Dean, Mrs Janet

      Caton, Martin

      Denham, John

      Cawsey, Ian

      Dismore, Andrew

      Chapman, Ben (Wirral S)

      Dobbin, Jim

      334

      Doran, Frank

      Jones, Ms Jenny (Wolverh'ton SW)

      Dowd, Jim

      Drew, David

      Jones, Jon Owen (Cardiff C)

      Dunwoody, Mrs Gwyneth

      Jones, Dr Lynne (Selly Oak)

      Eagle, Angela (Wallasey)

      Jones, Martyn (Clwyd S)

      Eagle, Maria (L'pool Garston)

      Keeble, Ms Sally

      Edwards, Huw

      Keen, Alan (Feltham & Heston)

      Efford, Clive

      Keen, Ann (Brentford & Isleworth)

      Ellman, Mrs Louise

      Kennedy, Jane (Wavertree)

      Ennis, Jeff

      Khabra, Piara S

      Ewing, Mrs Margaret

      Kidney, David

      Fearn, Ronnie

      Kilfoyle, Peter

      Field, Rt Hon Frank

      King, Andy (Rugby & Kenilworth)

      Fisher, Mark

      Kirkwood, Archy

      Fitzpatrick, Jim

      Kumar, Dr Ashok

      Flint, Caroline

      Ladyman, Dr Stephen

      Flynn, Paul

      Lammy, David

      Foster, Michael Jabez (Hastings)

      Lawrence, Mrs Jackie

      Foster, Michael J (Worcester)

      Laxton, Bob

      Fyfe, Maria

      Lepper, David

      Galloway, George

      Leslie, Christopher

      Gardiner, Barry

      Levitt, Tom

      George, Andrew (St Ives)

      Lewis, Ivan (Bury S)

      Gerrard, Neil

      Lewis, Terry (Worsley)

      Gibson, Dr Ian

      Liddell, Rt Hon Mrs Helen

      Gidley, Sandra

      Linton, Martin

      Gilroy, Mrs Linda

      Livsey, Richard

      Godsiff, Roger

      Lloyd, Tony (Manchester C)

      Goggins, Paul

      Lock, David

      Golding, Mrs Llin

      Love, Andrew

      Gordon, Mrs Eileen

      McAllion, John

      Gorrie, Donald

      McAvoy, Thomas

      Griffiths, Jane (Reading E)

      McCabe, Steve

      Grogan, John

      McCafferty, Ms Chris

      Hain, Peter

      McCartney, Rt Hon Ian (Makerfield)

      Hall, Mike (Weaver Vale)

      Hall, Patrick (Bedford)

      McDonagh, Siobhain

      Hamilton, Fabian (Leeds NE)

      McDonnell, John

      Hancock, Mike

      McFall, John

      Hanson, David

      McGuire, Mrs Anne

      Harman, Rt Hon Ms Harriet

      McIsaac, Shona

      Harris, Dr Evan

      McKenna, Mrs Rosemary

      Harvey, Nick

      Mackinlay, Andrew

      Heal, Mrs Sylvia

      McNamara, Kevin

      Healey, John

      McNulty, Tony

      Heath, David (Somerton & Frome)

      MacShane, Denis

      Henderson, Doug (Newcastle N)

      Mactaggart, Fiona

      Henderson, Ivan (Harwich)

      McWalter, Tony

      Hepburn, Stephen

      McWilliam, John

      Heppell, John

      Mahon, Mrs Alice

      Hesford, Stephen

      Marsden, Gordon (Blackpool S)

      Hewitt, Ms Patricia

      Marshall, David (Shettleston)

      Hinchliffe, David

      Marshall, Jim (Leicester S)

      Hodge, Ms Margaret

      Martlew, Eric

      Home Robertson, John

      Meale, Alan

      Hood, Jimmy

      Merron, Gillian

      Hopkins, Kelvin

      Michael, Rt Hon Alun

      Howarth, Alan (Newport E)

      Michie, Bill (Shef'ld Heeley)

      Howells, Dr Kim

      Michie, Mrs Ray (Argyll & Bute)

      Hoyle, Lindsay

      Miller, Andrew

      Hughes, Ms Beverley (Stretford)

      Mitchell, Austin

      Hughes, Simon (Southwark N)

      Moffatt, Laura

      Humble, Mrs Joan

      Moonie, Dr Lewis

      Hurst, Alan

      Moore, Michael

      Hutton, John

      Moran, Ms Margaret

      Iddon, Dr Brian

      Morgan, Alasdair (Galloway)

      Illsley, Eric

      Morgan, Ms Julie (Cardiff N)

      Jackson, Ms Glenda (Hampstead)

      Morley, Elliot

      Jackson, Helen (Hillsborough)

      Morris, Rt Hon Ms Estelle (B'ham Yardley)

      Jamieson, David

      Jenkins, Brian

      Mountford, Kali

      Johnson, Miss Melanie (Welwyn Hatfield)

      Mowlam, Rt Hon Marjorie

      Mudie, George

      Jones, Rt Hon Barry (Alyn)

      Mullin, Chris

      Jones, Mrs Fiona (Newark)

      Murphy, Rt Hon Paul (Torfaen)

      Jones, Helen (Warrington N)

      Naysmith, Dr Doug

      335

      O'Brien, Bill (Normanton)

      Steinberg, Gerry

      O'Hara, Eddie

      Stevenson, George

      Olner, Bill

      Stewart, David (Inverness E)

      O'Neill, Martin

      Stewart, Ian (Eccles)

      Öpik, Lembit

      Stinchcombe, Paul

      Organ, Mrs Diana

      Stoate, Dr Howard

      Osborne, Ms Sandra

      Strang, Rt Hon Dr Gavin

      Palmer, Dr Nick

      Stringer, Graham

      Pearson, Ian

      Stuart, Ms Gisela

      Pickthall, Colin

      Stunell, Andrew

      Plaskitt, James

      Taylor, Rt Hon Mrs Ann (Dewsbury)

      Pollard, Kerry

      Pond, Chris

      Taylor, David (NW Leics)

      Pope, Greg

      Temple-Morris, Peter

      Pound, Stephen

      Thomas, Gareth (Clwyd W)

      Prentice, Ms Bridget (Lewisham E)

      Thomas, Gareth R (Harrow W)

      Prentice, Gordon (Pendle)

      Thomas, Simon (Ceredigion)

      Primarolo, Dawn

      Timms, Stephen

      Prosser, Gwyn

      Todd, Mark

      Purchase, Ken

      Touhig, Don

      Quin, Rt Hon Ms Joyce

      Trickett, Jon

      Quinn, Lawrie

      Truswell, Paul

      Radice, Rt Hon Giles

      Turner, Dennis (Wolverh'ton SE)

      Rammell, Bill

      Turner, Dr Desmond (Kemptown)

      Rapson, Syd

      Turner, Dr George (NW Norfolk)

      Reid, Rt Hon Dr John (Hamilton N)

      Turner, Neil (Wigan)

      Rendel, David

      Twigg, Derek (Halton)

      Rooker, Rt Hon Jeff

      Tyler, Paul

      Rooney, Terry

      Tynan, Bill

      Vaz, Keith

      Ross, Ernie (Dundee W)

      Vis, Dr Rudi

      Rowlands, Ted

      Walley, Ms Joan

      Roy, Frank

      Ward, Ms Claire

      Ruane, Chris

      Wareing, Robert N

      Ruddock, Joan

      Watts, David

      Russell, Bob (Colchester)

      Webb Steve

      Russell, Ms Christine (Chester)

      Welsh, Andrew

      Ryan, Ms Joan

      Whitehead, Dr Alan

      Salter, Martin

      Wicks, Malcolm

      Sanders, Adrian

      Williams, Rt Hon Alan (Swansea W)

      Sarwar, Mohammad

      Savidge, Malcolm

      Williams, Alan W (E Carmarthen)

      Sawford, Phil

      Williams, Mrs Betty (Conwy)

      Sedgemore, Brian

      Willis, Phil

      Shaw, Jonathan

      Wills, Michael

      Sheerman, Barry

      Winnick, David

      Shipley, Ms Debra

      Winterton, Ms Rosie (Doncaster C)

      Short, Rt Hon Clare

      Woodward, Shaun

      Simpson, Alan (Nottingham S)

      Woolas, Phil

      Skinner, Dennis

      Worthington, Tony

      Smith, Miss Geraldine (Morecambe & Lunesdale)

      Wray, James

      Wright, Anthony D (Gt Yarmouth)

      Smith, John (Glamorgan)

      Wright, Tony (Cannock)

      Smith, Llew (Blaenau Gwent)

      Wyatt, Derek

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

      Snape, Peter

      Tellers for the Noes:

      Soley, Clive

      Mr. Gerry Sutcliffe and

      Southworth, Ms Helen

      Mr. Kevin Hughes.

      Question accordingly negatived.

    Schedule 6

      CLIMATE CHANGE LEVY
      Amendments made: No. 16, in page 138, line 27, leave out sub-paragraph (2).
      No. 17, in page 138, line 37, leave out subparagraph (5).
      No. 18, in page 142, line 10, leave out subparagraph (2).
      No. 19, in page 142, line 36, at end insert—
      'except where he is acting otherwise than for purposes connected with the carrying on of activities authorised by the exemption.
      ( ) Sub-paragraph (5) applies subject to—

      (a) any direction under paragraph 148A(1), and

      (b) any regulations under paragraph 148A(2).'.

      No. 20, in page 142, line 36, at end insert—
      'Exemption: supplies (other than self-supplies) to combined heat and power stations
      14A.—(1) A supply of a taxable commodity to a person is exempt from the levy if—

      (a) the commodity is to be used by that person in—

      (i) a fully exempt combined heat and power station, or

      (ii) a partly exempt combined heat and power station,

      in producing any outputs of the station, and

      (b) the supply is not a supply of electricity that is deemed to be made under paragraph 22(3).

      For this purpose "outputs" has the meaning given by paragraph 147(7).
      (2) Where—

      (a) a supply of a taxable commodity to a person would (apart from this sub-paragraph) be exempted in full by subparagraph (1), and

      (b) at the time the supply is made, the efficiency percentage for the combined heat and power station in which the commodity is to be used by that person is less than the threshold efficiency percentage for the station,

      sub-paragraph (1) only exempts the relevant fraction of the supply.
      (3) For the purposes of sub-paragraph (2), the "relevant fraction" of a supply of a taxable commodity that is to be used in a combined heat and power station is the fraction—

      (a) whose numerator is the efficiency percentage for the station at the time the supply is made, and

      (b) whose denominator is the threshold efficiency percentage for the station at that time.

      (4) For the purposes of this paragraph—

      (a) the "threshold efficiency percentage" for a combined heat and power station is the percentage set as the threshold efficiency percentage for the station by regulations made by the Treasury;

      (b) the "efficiency percentage" for a combined heat and power station is the percentage stated as the efficiency percentage for the station in a certificate in force in respect of the station under paragraph 147 (certificate given by Secretary of State that station is fully or partly exempt).

      (5) Paragraph 147A confers power to make provision by regulations for determining the efficiency percentage to be stated in a certificate under paragraph 147.'.
      No. 21, in page 150, line 13, leave out from "5(2)" to end of line 14 and insert—
      '(partly exempt combined heat and power stations).'.
      No. 22, in page 156, line 47, after "it, " insert—
      '( ) in the lighting, for the growth of horticultural produce primarily with a view to the production of horticultural produce for sale, of any building or structure, '.
      No. 23, in page 159, line 34, leave out paragraph (d) and insert—
      '(d) to which a representative of each facility to which it applies is a party,'.
      No. 24, in page 159, line 43, at end insert—
      '( ) In this paragraph and paragraph 47 "representative", in relation to a facility to which an agreement applies, means—

      (a) the person who is the operator of the facility at—

      (i) the time the agreement is entered into, or

      (ii) if later, the time the facility last became a facility to which the agreement applies,

      or

      (b) a person authorised by that operator to agree to the facility being a facility to which the agreement applies.'.

      No. 25, in page 160, line 17, leave out paragraph (d) and insert—
      '(d) to which a representative of each facility to which it applies is a party.'.
      No. 26, in page 160, line 30, leave out paragraph (e) and insert—
      '(e) to which a representative of each facility to which it applies is a party.'.
      No. 27, in page 160, line 44, at end insert—
      '(1A) Where a climate change agreement (the "new agreement") applies to a facility to which another climate change agreement previously applied, the first certification period specified by the new agreement for the facility shall be—

      (a) a period beginning as provided by sub-paragraph (1), or

      (b) a period that—

      (i) begins earlier than that, and

      (ii) is a period that was a certification period specified for the facility by any climate change agreement that previously applied to the facility.

      A period such as is mentioned in paragraph (b) includes a period beginning, or beginning and ending, before the date on which the new agreement, so far as relating to the facility, is expressed to take effect.'.
      No. 28, in page 161, line 3, leave out—
      'by the agreement for the facility'
      and insert—
      'for the facility by the agreement or by a climate change agreement that previously applied to the facility'.
      No. 29, in page 161, line 5, after "agreement" insert "in question".
      No. 30, in page 161, line 10, at end insert—
      '( ) For the purposes of sub-paragraphs (1A) and (2), the circumstances in which a facility to which a climate change agreement applies is one to which another such agreement previously applied include those where the facility is—

      (a) a part, or a combination of parts, of a facility to which another such agreement previously applied,

      (b) a combination of two or more such facilities,

      (c) any combination of parts of such facilities, or

      (d) any combination of such facilities and parts of such facilities.'.

      No. 31, in page 162, line 4, leave out from first "of' to end of line 5 and insert—
      'taxable commodities, and of any other commodities specified in the regulations. subject to each of those intentions are such that any conditions specified in the regulations are satisfied.'.
      No. 32, in page 162, line 15, leave out from first "of' to end of line 16 and insert—
      'taxable commodities, and of any other commodities specified in the regulations, subject to each of those intentions are such that any conditions specified in the regulations are satisfied.'.
      No. 33, in page 162, line 18, leave out "taxable".
      No. 34, in page 163, line 4, leave out "output" and insert "input".
      No. 35, in page 163, line 7, leave out "output" and insert "input".
      No. 36, in page 191, line 8, leave out "and 17" and insert ", 17 and 20".
      No. 37, in page 202, line 39, at end insert—
      '( ) the giving, withdrawal or variation of a utility direction under paragraph 148A(1);'.
      No. 38, in page 213, line 12, leave out from beginning to "for" in line 13 and insert—
      'Where the principal is a person falling within any of paragraphs (a) to (c) of sub-paragraph (1), the principal shall notify the Commissioners in writing of the name of any person designated by the principal'.
      No. 39, in page 216, line 12, leave out from "instrument" to "under" in line 15 and insert "that—

      (a) contains regulations made under this Schedule, and

      (b) is not subject to a requirement that a draft of the instrument be laid before Parliament and approved by a resolution of the House of Commons,

      shall be subject to annulment in pursuance of a resolution of the House of Commons.
      (3) A statutory instrument that contains (whether alone or with other provisions) regulations'.
      No. 40, in page 216, line 15, leave out "6(2), ".
      No. 41, in page 216, line 15, after "14(3), " insert "14A(4)(a), ".
      No. 42, in page 216, line 16, leave out "or 147" and insert ", 147(3A) or 147A".
      No. 43, in page 216, line 16, after "147" insert "or 148A(2)".
      No. 44, in page 216, line 16, leave out "unless a draft of and insert—
      'shall not be made unless a draft of the statutory instrument containing'.
      No. 45, in page 217, line 10, after "148(2)" insert "(but see paragraph 148(4))".
      No. 46, in page 217, line 13, after "148(3)" insert "(but see paragraph 148(4))".
      No. 47, in page 217, line 22, leave out "6(2), ".
      No. 48, in page 217, line 22, leave out "147" and insert "147(3A)".
      No. 49, in page 218, line 8, leave out from "in" to end of line 9 and insert—
      'respect of which there is in force a certificate (a "full-exemption certificate")—

      (a) given by the Secretary of State,

      (b) stating that the station is a fully exempt combined heat and power station for the purposes of the levy, and

      (c) complying with sub-paragraph (3C) and (so far as applicable) any provision made by regulations under sub-paragraph (8).'.

      No. 50, in page 218, line 11, leave out from "station" to end of line 16 and insert—
      'in respect of which there is in force a certificate (a "part-exemption certificate")—

      (a) given by the Secretary of State,

      (b) stating that the station is a partly exempt combined heat and power station for the purposes of the levy, and

      (c) complying with sub-paragraph (3C) and (so far as applicable) any provision made by regulations under sub-paragraph (8).

      339
      (3A) The Secretary of State shall give a full-exemption certificate in respect of a combined heat and power station where—

      (a) an application is made for a certificate under this paragraph in respect of the station, and

      (b) it appears to him that such conditions as may be prescribed are satisfied in relation to the station.

      For this purpose "prescribed" means prescribed by regulations made by the Treasury.
      (3B) The Secretary of State shall give a part-exemption certificate in respect of a combined heat and power station where—

      (a) an application is made for a certificate under this paragraph in respect of the station, and

      (b) his decision on the application is to refuse to give a full-exemption certificate.

      (3C) A full-exemption or part-exemption certificate given in respect of a combined heat and power station shall state the percentage that, for the purposes of paragraph 14A, is the efficiency percentage for the station determined in accordance with any regulations under paragraph 147A.'.
      No. 51, in page 218, line 17, leave out "(2)" and insert "(3A)".
      No. 52, in page 218, line 22, leave out from beginning to end of line 23 and insert—
      'A condition prescribed under sub—paragraph (3A) may, in particular, relate to any of the following—'.
      No. 53, in page 218, line 32, at end insert—
      '(8) The Secretary of State may by regulations make provision for or about—

      (a) certificates under this paragraph;

      (b) applications for such certificates;

      (c) the information that is to accompany such applications.

      (9) The provision that may be made by virtue of sub—paragraph (8)(a) includes in particular—

      (a) provision in respect of the periods for which certificates under this paragraph are to be in force;

      (b) provision for the (non-retrospective) variation or revocation of such certificates.

      Determination of efficiency percentages for combined heat and power stations
      147A.—(1) The Treasury may by regulations make provision for determining the percentage that is to be stated in a certificate under paragraph 147 as the efficiency percentage for a combined heat and power station.
      (2) Regulations under this paragraph may, in particular, include—

      (a) provision in respect of methods of calculating efficiency percentages;

      (b) provision in respect of the measurements and data to be used in calculating such percentages;

      (c) provision in respect of the procedures for determining such percentages;

      (d) provision in respect of verifying—

      (i) calculations by which such percentages are produced, and

      (ii) measurements and data used in such calculations;

      (e) provision that, so far as framed by reference to any document, is framed by reference to that document as from time to time in force.

      (3) In making provision under this paragraph, the Treasury must have regard to the object of securing that the efficiency percentage for a combined heat and power station is (save for any appropriate adjustments) a percentage that reflects a fair assessment of the efficiency with which commodities are transformed in the station into electricity or motive power.'.
      No. 54, in page 218, line 49, at end insert—
      '(4) Sub-paragraphs (1) to (3) have effect subject to—

      (a) any direction under paragraph 148A(1), and

      (b) any regulations under paragraph 148A(2).

      Person treated as, or as not being, a utility
      148A.—(1) The Commissioners may by direction (a "utility direction") make, in respect of a person (or persons) specified in the direction, provision authorised by sub-paragraph (3).
      (2) The Treasury may by regulations ("utility regulations") make, in respect of any person of a description specified in the regulations, provision authorised by sub-paragraph (3).
      (3) The provision authorised by this sub-paragraph is provision for—

      (a) a person who is an unregulated electricity supplier to be treated for levy purposes as being an electricity utility;

      (b) a person who is an unregulated gas supplier to be treated for levy purposes as being a gas utility;

      (c) a person who is an electricity utility to be treated for levy purposes as not being an electricity utility;

      (d) a person who is a gas utility to be treated for levy purposes as not being a gas utility.

      (4) References in sub-paragraph (3) to provision for a person to be treated in a particular way for "levy purposes" are to provision for him to be treated in that way for—

      (a) the purposes of this Schedule, or

      (b) such of those purposes as are specified in the direction or regulations by which the provision is made.

      (5) The power to make any provision by a utility direction or utility regulations may be exercised so that the provision applies in relation to a person only to an extent specified in, or determined under, the direction or regulations.
      (6) A utility direction cannot take effect until it has been—

      (a) given by the Commissioners to each person in respect of whom it makes provision, and

      (b) published by the Commissioners.

      (7) Paragraph 145(7)(b) and (c) applies to the power to make provision by a utility direction as to a power to make provision by regulations.
      (8) In this paragraph—

      "unregulated electricity supplier" means a person who—

      (a) makes supplies of electricity, and

      (b) is not an electricity utility;

      "unregulated gas supplier" means a person who—

      (a) makes supplies of gas that is in a gaseous state and is of a kind supplied by a gas utility, and

      (b) is not a gas utility.'.

      No. 55, in page 219, line 44, leave out—
      'in part to the Authority and in part to the Gas and Electricity Consumer Council)'
      and insert—
      'to the Authority) or abolished'.
      No. 56, in page 220, line 2, leave out—
      'in part to the Authority and in part to the Gas and Electricity Consumer Council)'
      and insert—
      'to the Authority) or abolished'.—[Mr. Timms.]

    Clause 39

      GIFT AID PAYMENTS BY INDIVIDUALS
      Mr. Burnett: I beg to move amendment No. 101, in page 25, line 39, leave out—
      'donor shall be assessable and'
      and insert—
      'charity receiving the gift shall be'.
      Mr. Deputy Speaker (Mr. Michael Lord): With this it will be convenient to discuss amendment No. 102, in page 25, line 41, at end insert—
      'as if it were being assessed as the donor.'.
      Mr. Burnett: We have also discussed these amendments at length with the Chartered Institute of Taxation's low incomes tax reform group.
      We warmly welcome the new rules for relief for charitable giving, but in one major respect they do not go far enough. The only people whose gifts will not qualify for relief will be those who do not pay tax—if they do not pay tax, they should not give a gift aid declaration. However, that presupposes that during the tax year everyone will know whether, at the end of it, it will turn out that they are liable to pay tax. All sorts of thing can happen. Individuals may fall ill, lose a job—part-time or otherwise—or start a baby and go on maternity leave. They will not know how their income relates to the personal allowances appropriate to their status.
      Everyone in the House knows how complex the tax rules are, but they are even more complex in this area than we had thought. It transpires that, even though an individual is no longer able to claim payment of the tax credit attached to a dividend that he or she receives, a charity is not able to do so either. Nevertheless, a charity will be able to receive payment of the tax credit attached to a dividend received by an individual who gives it as a donation.
      The purpose of the amendment is to provide that if an individual who turns out to be a non-taxpayer makes a gift that is subject to gift aid declaration to a charity and the charity claims the tax, the liability to repay that tax will fall on the charity and not on the donor.
      11 pm
      We do not believe that that is as burdensome as it may sound. The Inland Revenue has made it clear that it would look first to the charity to repay the tax and that it would look to the donor only in the unlikely event that the charity refused. The amendment would give effect in law to what the Revenue has said would happen in practice. It is surely better that practice should be the servant of the law and the law should put matters right.
      Mr. Flight: I agree with the amendment, which is designed to address important matters that we raised in Committee. Individuals giving to charity but not paying tax could find themselves being pursued for tax that a charity had reclaimed accidentally. That would clearly be undesirable and unjust. The remedies that we suggested were, we felt, the best means of dealing with the problem, but this remedy at least addresses the problem.
      Mr. Gardiner: The relief proposed by the Chancellor could be both extended and maximised. At present, shares
      342
      that can be given and qualify for relief are limited to those listed or dealt in on a recognised stock exchange. That leaves out a significant category of potential donors—namely, the entrepreneur who has built up a business to the point at which he is about to sell a significant part of it but at which the company is technically still unquoted.
      I recognise that the Inland Revenue would not want to become involved in the administrative burden of valuing small parcels of shares—indeed, charities would not want to receive them—but the relief could be improved if it were to include other categories of donor. I would ask my right hon. Friend the Chancellor to extend the kind of shares or securities that would qualify for relief to include those effectively able to be traded or realised. An existing definition is used for the purpose of pay-as-you-earn.
      Mr. Roger Casale: I am following my hon. Friend's argument with care and it contains much of merit. I wonder, however, whether it might not be more appropriate to make these points under amendments Nos. 132 and 133, which appear later on the amendment paper.
      Mr. Gardiner: My hon. Friend has made an extremely good point, for which I am very grateful.
      Miss Melanie Johnson: The intention of the amendments is to save people on low incomes from having to face a tax bill because they have mistakenly used gift aid when they had paid insufficient tax to allow the charity to reclaim the tax on their donation. In those circumstances, the donor would be liable to be assessed on any shortfall. I agree that that is not a position in which we wish people on low incomes to find themselves, but I do not believe that the amendment is the best way in which to deal with the problem.
      The gift aid scheme works by allowing charities to reclaim basic rate income tax paid by donors on payments made to the charity. That means that, under the changes that we have introduced this year, a donor must have paid basic rate tax on income equal to the amount of his gift to the charity under either a deed of covenant or gift aid. We have extended gift aid so that a donor need pay only an amount of income tax or capital gains tax at any rate equal to the amount reclaimed by the charity.
      The changes allow more people to use gift aid, but it is still not suitable for non-taxpayers, or, except for modest gifts, for those who pay very little tax. For those people, prevention is better than cure.
      We will be publishing information for donors that will make it clear that gift aid is not appropriate for those who pay little or no tax. The declaration must contain a suitable explanation of the requirement to pay sufficient tax, as we discussed in Committee. The charities need to give the same message when recruiting donors. The scheme is not designed to trap the unwary into a tax charge. People for whom the gift aid scheme is not appropriate can still give to charity outside the scheme.
      Let me deal with why the amendments are not a suitable way in which to tackle the perceived problem. The gift aid scheme is very straightforward. The donor simply gives a gift aid declaration which must contain the health warning about having paid sufficient tax to cover the tax that the charity will reclaim. The donor needs to disclose nothing further about his or her tax affairs.

      343
      The charity can then, with certainty, proceed to recover tax on the gift. I hope that, as a matter of practice, charities will remind the donor from time to time of the need to meet the tax to cover the requirement. The onus to comply with that requirement is on the taxpayer.
      If the charities were made liable for any shortfall, they would need to know more about the donor's tax position as well as any other gift aid payments to other charities in the year in question so that they could satisfy themselves that everything was correct. That would be a most unwelcome burden for charities and an unacceptable intrusion for donors.
      We believe that it is more important for people to be made aware by Inland Revenue leaflets and in the charities' own literature about the requirements of the scheme. The amendments would add complexity to the gift aid scheme, which we have endeavoured to make as simple and straightforward as possible. I believe that they would be most unwelcome to charities and donors alike. For those reasons, I hope that the hon. Member for Torridge and West Devon (Mr. Burnett) will withdraw the amendment.
      Mr. Burnett: This matter was discussed in Committee, and I think that all right hon. and hon. Members are aware of how gift aid works. We do not claim that the amendment is perfect. However, my point is that the circumstances of individuals can change dramatically during a tax year. I was hoping that there would be rather more sympathy for individuals who had suffered a dramatic change in their circumstances.
      The Minister says that the Inland Revenue will be publishing information to donors making the pitfalls clear should they cease to be taxpayers during a year of assessment and if they enter into a gift aid scheme. Given that that information will be available, I beg to ask leave to withdraw the amendment.
      Amendment, by leave withdrawn.

    Clause 43

      GIFTS OF SHARES AND SECURITIES TO CHARITIES ETC
      Amendments made: No. 87, in page 30, line 1, leave out "83A" and insert "587A".
      No. 88, in page 30, line 3, leave out "83B" and insert "587B".—[Dawn Primarolo.]
      Mr. Flight: I beg to move amendment No. 132, in page 31, leave out lines 31 and 32.
      Mr. Deputy Speaker: With this it will be convenient to discuss amendment No. 133, in page 31, line 46, leave out from beginning to end of line 4 on page 32 and insert—
      "'qualifying investment" shall mean all forms of property constituting an asset for the purposes of the 1992 Act;'.
      Mr. Flight: The amendments are designed to give the same relief to all forms of security, property and art treasures gifted to charity as the Bill proposes for quoted equities. In Committee, the Government resisted the proposed extension of the new relief for gifts of quoted shares to charities to include unquoted shares on three grounds. The first was that charities should not be encouraged to hold unquoted shares as they were not
      344
      easily realisable. The second was that unquoted shares were difficult to value, making the relief more complicated to administer for both donor and donee. The third was that the relief provided was already generous enough.
      The first point does not stand up to scrutiny. Charities have always held all sorts of assets, some of them more easily realised than others. The Trustee Bill will give most charities subject to proper standards of prudence the power to invest in any property capable of producing an income or capital return. The Government cannot, on the one hand, promote a measure that will allow charities to invest in almost any type of property and in broader categories of property, and, on the other, argue in the other direction in connection with this Bill.
      The second objection is also unconvincing. The Inland Revenue has no difficulty valuing all sorts of assets gifted to charities for inheritance tax purposes. The Government are clearly not willing to commit the resources to facilitate evaluations for widespread giving to charity. An independent valuation can be obtained easily by a donor and donee for any type of property. The problem is the Government's unwillingness to commit resources to enable the Revenue to scrutinise the valuation.
      The third objective was repeated consistently by the Government in Committee. They believe that they have been more than generous already with the reliefs that they have offered, and that those reliefs will serve as adequate compensation for the withdrawal from charities of the recovery of dividend tax credits and irrecoverable value added tax.
      That conviction relies on two broad assumptions—that all charities are fundraisers, and that measures in the Bill will make a real difference to the amount given to charity. The first of those assumptions is not correct, and the second is debatable: the Government's estimate of the value of the changes to giving is less than the collective losses sustained by charities of some £500 million a year when advance corporation tax recovery phases out.
      Since the Bill was considered in Committee, I have been approached by several entrepreneurs involved in key universities in this country. They told me that they had already purchased property that they had intended to give to the various universities but which they will not give if it does not enjoy the same tax position as listed shares.
      The entrepreneurs also said that the argument against unquoted shares—that the right time to give them is when they are listed and their value fructifies—does not apply to many of the new high-tech industries. Those shares get bought for cash or loan stock by other businesses, and so would never qualify for gift aid reliefs.
      The debate is especially relevant to gifts made to institutes of higher education. In the United States, giving amounts to some 2 per cent. of gross national product, but only to some 0.6 per cent. in this country. Do we want our universities to get really large gift aid from successful alumni? If so, it must be logical to extend to unquoted securities and all other forms of property the relief now being offered to quoted securities.
      I do not believe that any good argument exists for not accepting the amendments.
      Mr. Gardiner: The parliamentary day begins with the prayer "Prevent us, 0 Lord", and I have learned this

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      evening the appropriateness of that sentiment. I prevented the hon. Member for Arundel and South Downs (Mr. Flight) from speaking to this amendment earlier, but I was prevented from continuing in my error by my hon. Friend the Member for Wimbledon (Mr. Casale). However, my comments on the amendments and on the extension and maximisation of the relief proposed by my right hon. Friend the Chancellor are now apposite.
      At present, shares that can be given and which qualify for relief are limited to shares traded on a recognised stock exchange. That leaves out a significant category of potential donor—the entrepreneur who has built a business, such as a dot.com company, up to the point at which he is about to sell a significant part of it. Technically, such a company would remain unquoted on an exchange.
      11.15 pm
      Although I recognise that the Inland Revenue would not want to get involved in the administrative burden of valuing small parcels of shares, and indeed charities would not want to receive them, I believe that the relief could be improved if it were to include this category of donor. I ask my hon. Friend the Economic Secretary to consider extending the definition of the shares or securities that can qualify for relief to include those that are able to be traded or realised. An existing definition is used for the purposes of pay-as-you-earn.
      In practical terms, donors are most likely to consider using the relief when they know what their income tax bill is, as that represents the limit of the gift for which they can obtain the tax deduction. That happens at the self-assessment deadline of 31 January each year in respect of the income to the previous 5 April. I believe that donors would increase their gifts if they were able to obtain relief against their income of the previous tax year. Under the present rules, a donor who wants to make a gift has to anticipate his income for the current tax year to 5 April. That inevitably prompts individuals, or most certainly their advisers, to adopt a cautious estimate in order not to give more than is available for relief. A carry-back facility would encourage larger gifts.
      A number of individuals realise significant capital gains in a particular year, and again entrepreneurs spring to mind. For such individuals, the amount they may be willing to give to a charity could be a proportion of their capital gains rather than of their somewhat smaller income. Again, by allowing the relief to be given where necessary as a deduction against capital gains in addition to income, it would encourage certain donors to give considerably more when they feel able to afford it.
      Experience passed on from America, where there is a similar tax relief, is that a large proportion of the funds going to charities comes from a small number of donors who give significant amounts. Any measure that encourages those individuals to raise the level of their generosity is likely to help the new relief that the Chancellor has introduced succeed even more. I commend it for my hon. Friend's consideration.
      Miss Melanie Johnson: I am grateful to my hon. Friend the Member for Brent, North (Mr. Gardiner) for his remarks and suggestions, and I shall give them due
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      consideration. It is probably best that I do so at not such a late hour, when my mind is clearer. I assure him that I will then be able to give him the benefit of total clarity.
      I shall address the general point that has been raised in the debate on these two amendments. The point that we have made in Committee and that I reiterate now is that we designed the relief to ensure that it is applied to investments that are readily realisable and easy to value. I have made that point many times, and I know that it will be familiar to the hon. Member for Arundel and South Downs (Mr. Flight). That will allow a charity to make an unfettered decision on whether to add the gift to its investment portfolio, or to realise the gift immediately and use the proceeds for charitable purposes.
      Amendment No. 133 would extend the range of qualifying investments that a donor can give to charity and get relief on to include all assets as defined in the Taxation of Chargeable Gains Act 1992, to which amendment No. 132 makes a consequential change.
      I do not think that the amendment achieves the hon. Gentleman's intention. It would mean that certain investments, such as gilts, which qualify for relief under the provision as drafted, would no longer do so as they are not chargeable to capital gains tax. He may not be aware of that.
      In addition, certain other assets, such as cars, would not qualify for relief, as they are not defined as assets for the purposes of capital gains tax. Many assets would come within that wider definition that would not be as easy to value or as readily realisable. There are no markets for some assets, so charities would be constrained in realising the value of the assets and using them for charitable purposes. That goes back to the basic principles that I mentioned earlier.
      Clause 43 will introduce an exciting new relief for charities and their donors. We would like to see how that works in practice. There is already a very generous relief for works of art. There are additional significant reliefs from capital gains tax, inheritance tax and stamp duty for gifts of assets to charity. There are also already extremely generous reliefs from capital gains tax and inheritance tax for gifts and sales of pre-eminent works of art and heritage assets to museums and galleries. We have a tax relief for businesses that make donations to charities of trading stock and items of equipment that are used in business.
      The assets that qualify for the new relief were carefully chosen to fulfil the criteria that I have already set out, so I hope that the hon. Gentleman will allow the full effect of the new changes to be seen in practice and will withdraw the amendment.
      Mr. Flight: I will not press the amendment to a vote at this time of night, but I exhort the Government to step back and take the point that property in particular is an absolute natural for donation to higher education institutions. On the whole issue of unquoted investments, here we are in an age in which the Government want to encourage venture capital—the age of the internet and so forth—and if the issue is not addressed quickly, charities will lose out on a particular economic phase. It is by no means certain that venture capital investments will turn into licit investments suitable for relief. If the Government

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      are not willing to address the issue right now, which clearly they are not, I will put strong pressure on them to ensure that it is addressed next year, if they are still in power. I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      Amendment made: No. 89, in page 32, line 19, leave out "83B(2)(b)" and insert "587B(2)(a)(ii)".—[Dawn Primarolo.]
      Further consideration adjourned.—[Mr. Allen.]
      Bill, not amended in the Committee and as amended in the Standing Committee, to be further considered tomorrow.

    PETITION

      Medical students
      11.23 pm
      Dr. Evan Harris: I am pleased to present this petition on behalf of no fewer than 3, 779 medical students from medical schools up and down the country. The petition states:
      The ineligibility of medical students who started at medical school prior to 1998 to receive full student loans in the final year of study is inequitable. Final year medical students are unable to work to support themselves during their course as academic years can be up to 50 weeks long and they incur far greater expenditure than students in other disciplines. Medical students maintain that the Government's continued refusal to recognise this is unjustifiable.
      The petitioners therefore request that the House of Commons calls upon the Government to ensure that all final year medical students are eligible to apply for the full financial support that they so urgently need.
      To lie upon the Table.

Compulsory Purchase Orders
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Allen.]
11.24 pm
Mr. Tony Lloyd: This debate is essentially about fairness and about whether, in an area in which tens of millions of pounds are being invested, and in which we hope that many people will have their quality of life greatly improved, we can avoid a situation whereby the 45 or 50 households left in the Lower Beswick compulsory purchase order area will lose out very badly, and whether we can allow them to be cushioned against the worst excesses of the decline in the area.
Let me say a little about east Manchester. It was badly hit by unemployment from the early 1980s onwards; the destruction of the traditional heavy engineering industries, for instance, caused massive damage, while in the background were all the usual patterns of rising crime.
The community to which I refer is traditionally tight-knit; historically, people have been proud to say that they come from it. Sadly, however, we saw the breakdown of that community spirit, and an increase in vandalism and anti-social behaviour that people had not experienced before.
I first became closely involved at the time of the boundary changes, when the boundaries of my constituency were changed. I was shocked by the state of the whole east Manchester area. The Government recognised its plight, and awarded it one of the earliest new deal for the community programmes. Tens of millions of pounds will go to east Manchester, which is good for the area as a whole. The problem for the area that I am talking about is that it was among the hardest hit of the east Manchester sub-communities. It contains, perhaps, only 250 houses, but people living there probably suffered all the problems that hit east Manchester generally, with a vengeance.
Lower Beswick certainly experienced all the problems of property surplus. Houses there began to be left empty, and to be boarded up. It also experienced an increase in the number of unscrupulous speculative landlords—landlords who moved in and tried to purchase property at low prices in the hope of making a quick return from cheap and easy lets, or landlords who saw a rather longer-term opportunity for speculative capital gain.
One housing association, Northern Counties, behaved atrociously. Irresponsibly, it bought numerous properties, and when it could not let them, mothballed the area rather than trying to market them, allowing the blight of empty properties to affect the immediate area in a way that almost guaranteed the long-term destruction of Lower Beswick.
Neither the housing association nor the private landlords were prepared to do anything about the quality of the tenants whom they took in. There was no control by either social or private landlords. There were many anti-social tenants who, although they often stayed for only a short time, in that short time managed to wreak enormous damage. The short-term damage caused massive cumulative long-term damage. I well remember the slum clearances that took place in Manchester in the early 1960s, but I have never seen anything like what we saw in Lower Beswick.

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People in that small community do not tend to moan. They tend to get on with life, and have put up with a great deal over many years. In this case, however, I have no doubt that the stress of simply living in the area was enormous. Those who are left suffer from ill health, much of it directly caused by intolerable living conditions. Those who could leave—perhaps they had short-term tenancies—simply got up and went, which in itself exacerbated the problem. The good people—those who had invested in the area, who wanted to make a life for themselves, to be part of the community and to build that community—are, sadly, those who have been stranded by the changes that have taken place in Lower Beswick, and it is they who now bear that heavy load. As I have said, of the 250 houses in the area perhaps no more than 40 or 50 are still occupied.
The announcement of the new deal was a cause for great rejoicing. I was delighted that the Government had recognised the needs of east Manchester, and also felt that I had achieved a lot: I had had my own role to play in the new deal, although many others had contributed. However, the problem is that once the new deal was declared, the existing problems of Lower Beswick became intolerable. It was obvious at that point that Lower Beswick would have to be taken out, to allow the regeneration of the greater area. The greater good of the many was pitted against the immediate and longer-term needs of a limited number of people.
It was a prerequisite for the improvement of the new deal area that Lower Beswick had to come down. I think that the people in Lower Beswick themselves accepted that demolition was almost inevitable by the time the new deal was declared, but that had an immediate impact on property prices. They had already suffered a loss from the high mark of the early to mid-1990s. At that time, in about 1993–94, small two-bedroom terraced houses in the area were being sold for £28,000 or £30,000.
I accept that that is not a lot compared with the elevated prices in London, but the people of that area are not on the elevated incomes of London, so those property prices fitted the income and needs of the people of that community. However, once the CPO was declared, property prices—in so far as property could even be sold—dropped to literally a few thousand pounds each. In some cases, property could not be sold.
The choices that people then faced in Lower Beswick were invidious. They could walk away. They could leave the key in the door and walk out—but in doing so, they left behind not only their own way of life and home, but in many cases, debt to building societies or banks. For those who were lucky enough to have paid off their mortgages, it was impossible to raise another mortgage when they had walked away from a property that had become valueless.
The building societies and banks deserve no credit in the story. With one or two exceptions, they have taken an extremely hard line. They have simply told my constituents that where building society debt exists, it is up to the individual to redeem that, and that before he could be even considered for any further loan, he would have to pay off existing and outstanding debt—even though that debt is not the fault of those who find themselves in that position. Of course, for many people
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remortgage is impossible. If they are elderly or retired, building societies will not look at the possibility of a remortgage.
The compensation scheme available under CPOs is inadequate. The Government recognised that some months ago in the Department's White Paper. There was a reference to the need to look again at the compensation scheme. I think that there is to be a consultation specifically on the question of compensation under such CPOs, but change in the future will not help my constituents, who face the problem here and now. However, compensation is certainly inadequate, as the Government recognise.
The money distributed under CPOs is trivial. It is designed to allow people to refit carpets or whatever; the amounts are modest for people who are losing tens of thousands of pounds. The relocation grant suffers from two major disadvantages. One is the whole concept of what market value means for a relocation grant. The second is that the grants are means-tested. For those who are desperately poor, it is possible to have compensation that may not be adequate, but at least goes some way towards adequacy. For those on very low incomes, the taper and cut-off under the means test is so sharp that they are told that they qualify for virtually nothing.
Again, we can well imagine the plight of the elderly and of those on low incomes who face walking away from their homes with debt, or with no possibility of repurchase. As things stand, some will carry that debt for many years. The stress and ill health that I have talked about have been made massively worse by that situation.
Today, one of my constituents was telling me that since the whole saga began, her long-term condition has been made worse and that she has had to give up work. Ironically, under the compensation scheme, she is better off having given up work. There is something wrong with a scheme in which my constituents become better off by suffering stress and ill health.
There are ways in which the Government and public agencies could help. Two of my colleagues—local councillors Neil Swanwick and John Smith—have worked hard with local residents to determine whether they can relocate somewhere within the broad east Manchester area, in the hope that with the modest compensation they will be given, they will be able to buy into an area with depressed property prices and benefit as that area is regenerated and property prices increase. That is a hope and an aspiration, and it requires an act of faith by local people. Nevertheless, many people are considering taking that step. I applaud the work being done by those two councillors.
As I said, there is also a problem with lenders. I ask my hon. Friend very seriously to examine the lenders' role and to determine what pressure the Government can bring to bear in addressing the negative equity issue. Building societies that have been prepared to lend on the basis of absolute security, although they know better than would-be purchasers that an area is dicey or may be declining, are not operating within the spirit of honesty and probity.
I think that those building societies need to be brought up very sharply and asked to account for their actions. They should also be asked to put together an adequate rescue programme that would allow people to move out,

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even with some of their current debt, by enabling them to remortgage in a manner that does not cripple them financially for the rest of their lives.
As I have also said, there is a real problem with determining market value. Current market values in the area are based on the depressed values of an area that was being run down, potentially to demolition. However, the market value of properties only streets away is a very different story. Today I was quoted some property values in areas adjoining the CPO area. Although the quotations may not mean much to the House, they will mean a lot to my constituents. Viaduct street adjoins the CPO area and is separated from it only by a railway line. However, I am told that properties there are being valued at £35,000. In Blackrock street—which is only two or three streets away from the CPO area and has almost identical houses—houses are being valued at between £19,000 and £27,000. Market value, therefore, is a subjective matter. I believe that there is an onus on the public sector at least to consider charitably the meaning of market value.
A friend of mine is a surveyor who has dealt with CPOs—I shall not name him; I shall not advertise. He has pointed out to me that
under the Disturbance Rule (Rule 6 Section 5 of the Land Compensation Act 1961) the law specifically says that Councils are not bound by Rule 2 which is the one which refers to market value; precedent says that the Council should pay as part of a Disturbance Claim all losses that reasonably flow from the enforced removal.
My friend's point is that negative equity reasonably flows from an enforced removal. Were it not for the CPO, owners would stick with their property—either hoping that its value would increase in a rising market, or letting it out and benefiting from rental income. His point is that in a CPO, negative equity is created artificially. He also said that there was a possibility—I ask my hon. Friend to consider whether it is a practical proposition—of a test case before the Lands Tribunal, backed by the Government, which could resolve the issue once and for all.
We should try to ensure that any compensation package misses out speculative landlords—those who became part of the problem by buying in the hope of making a quick buck. They really do not deserve any consideration in extraordinary compensation schemes. It would go down badly if compensation were wasted on those who have not done anything to prop up the area, but have done much to undermine it. I hope that my hon. Friend will take that point on board.
If the area is cleared, as I am told it will be, it will cost in the region of £1 million to £2 million to buy everyone out and make the area fit for redevelopment. According to quite modest estimates, there will be an immediate capital gain and the land will be worth between £5 million and £10 million. If that is true, the rest of us stand to gain a great deal on that desirable capital increase.
It is not beyond our wit to devise a scheme whereby a limited number of people—those who stuck with the area and tried to keep it decent when others simply left—should be able to tap into the capital increase in the value of the land that has resulted from their removal. I hope that my hon. Friend the Minister will take that idea on board.
Finally, this is a debate about justice; it is about whether a limited number of people will have to pay an enormous price to make things better for everyone else in
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the area. Frankly, it would not cost much to put right. I know that it is a difficult matter because there are precedents in other parts of the country that are in decline, but I honestly believe that the compensation scheme is now so outdated that we have to look at the situation imaginatively. I hope that my hon. Friend will say something that will be of comfort to my constituents.
11.44 pm
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Ms Beverley Hughes): I congratulate my hon. Friend the Member for Manchester, Central (Mr. Lloyd) and thank him for raising with the Government the difficult circumstances faced by some of his constituents in Lower Beswick as a result of a compulsory purchase order. My ministerial colleagues and I are aware of the specific problems as my hon. Friend and some of his constituents have written to us about them.
The general issue of the compensation payable to owners of low value housing subject to a compulsory purchase order has also been considered in the context of the compulsory purchase policy review to which I shall return later in my speech.
On the surface, this is a valuation dispute between an acquiring authority and some claimants. I understand that in this case the acquiring authority is offering about £7,000 for the properties, but the claimants want some £28,000. They point out, as my hon. Friend has done on their behalf tonight, that their houses are well maintained and have been for many years, so it is wrong for them to be offered the same compensation as that for empty or rundown properties. Their valuations are based on those for similar houses in adjacent districts.
My hon. Friend will know that the compensation regime is based on the principle of equivalence—the system is supposed to ensure that a claimant
shall be paid neither less nor more than his or her loss.
In normal circumstances—and this is the problem—the open market value for the interest in the property, disregarding the effects of the scheme, taken with the rest of the compensation package will achieve that. However, difficulties arise where there is no proper market and no evidence of recent transactions.
Valuers make valuations based on the age, character and location of a property. These are in effect the elements of demand for a property and the weight given to each element will vary from case to case. In areas of low demand, valuers may give a great deal of weight to location which would lead them to give similar values to properties of different character. However, like doctors and lawyers, valuers may disagree with each other.
In terms of the immediate action open to my hon. Friend's constituents—although it is not a guaranteed remedy—I advise them, if they have not done so, to engage experienced valuers who can negotiate with the council on their behalf. If they cannot reach agreement, it is open to them to apply to the Lands Tribunal for a determination of the compensation payable. These cases may be suitable for the new simplified procedure available at the tribunal which is much quicker and cheaper than a full hearing. I urge them to consider that course of action, certainly as a first step, if they have not done so.
There are problems with compulsory purchase in these circumstances, and I have no difficulty acknowledging that to my hon. Friend. The problem of compulsory

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purchase of low value properties, which he has so clearly described, is not unique to Lower Beswick. It was brought to the attention of the compulsory purchase policy review advisory group, which I think is the body to which my hon. Friend referred, which has been looking closely at how to make recommendations on making the compulsory purchase and compensation system more efficient, effective and, above all, fairer to all parties. That was the remit given to them by my right hon. Friend the Member for Sheffield, Central (Mr. Caborn), when he was the Minister for the Regions, Regeneration and Planning.
Although people may be living in an area where there is no effective market, which may mean that they have negative equity, that may not matter very much if they do not intend to move, and have the means to pay the mortgage. Obviously, the problems arise only when an authority comes along with a scheme, possibly for very good reasons, and compulsorily purchases their properties. That crystallises their loss and if a low valuation is upheld, it can catapult people, as my hon. Friend anticipates, from proud owner-occupation to understandably resentful council tenancy in some circumstances, without making much of a dent in their debt. No one ever thinks, and certainly I do not, that that is a satisfactory situation, especially as it has been precipitated by an outside agency and is no fault of the resident. However, the current compensation code does not make provision for overcoming it.
The compulsory purchase policy review advisory group has produced its report for us, and we will publish it very shortly. While I cannot anticipate any announcement that my hon. Friend the Minister for Housing and Planning will make, the options that it has considered have included giving compensation on a like-for-like basis. That would allow claimants sufficient compensation to purchase an equivalent property elsewhere—an option mentioned by my hon. Friend—even if the open market value of the property taken was insufficient to do so. The Government's policy paper, which we hope to publish in the autumn, will contain proposals to overcome such problems.
Clearly, in order to change the system, we need primary legislation. Framing legislation to overhaul the compulsory purchase and compensation system will be a not inconsiderable job. It is something for the medium term when parliamentary time permits.
I would not like my hon. Friend to think that there is nothing that can be done to help his constituents in the short term. He may know that I visited the area not too long ago. The city council told me about a scheme devised to solve an aspect of the problem that he has described, which enabled a group of owner-occupiers to retain their status and move into newly refurbished premises. Without going into great detail, the scheme involved a registered social landlord buying a property that required refurbishment, Manchester city council using its discretion to give an improvement grant and the registered social landlord granting a new mortgage to the claimant, the previous one having been paid off by the compensation package.
Variations on the scheme were made to take account of differing circumstances. The council has emphasised that the mechanism was successful for a small scheme. There may be difficulty applying it to a large number of
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claimants, although I do not think that a large number is involved in my hon. Friend's case. The scheme shows that solutions can be found with sufficient good will and imagination by the acquiring authority, other housing agencies and mortgage lenders, working with the claimants rather than against them.
My hon. Friend also mentioned relocation grants. That was a new power that we gave to local authorities in 1997 to help people affected by clearance to buy other houses nearby. The grants are additional to the compensation that people receive through the compulsory purchase process, and are designed to bridge the gap between the value of the property cleared and the cost of a similar home nearby. They are often particularly useful in areas such as Lower Beswick, where market values have dropped sharply in relation to neighbouring areas.
I am pleased that Manchester city council is making use of its powers to give relocation grants in Lower Beswick. Although I know that the grants have worked well in some instances, I understand that some of my hon. Friend's constituents are unhappy with the amount that they are entitled to receive because they have found that the grants do not close the funding gap
I have a great deal of sympathy with the difficulties faced by my hon. Friend's constituents, and with those of other households that have become trapped in low value housing. As he has said, because of the criteria wrapped round relocation grants, they help those in greatest need—those on the lowest incomes—but do not offer so much help to those who are not wealthy but are earning a bit of money. The system is not perfect, and we have acknowledged those shortcomings in the current system. For that reason, we proposed in the housing Green Paper in April to give local authorities wider powers to tackle the problems of low demand housing. In particular, we want to allow greater discretion over where and how to give relocation grants. Consultation on the Green Paper is still open, and we are seeking views.
My hon. Friend raised three specific points this evening, which he has taken up with me in correspondence. I shall reply shortly. However, I shall make a couple of points on some of the issues to which he referred in the debate.
My hon. Friend referred to negative equity. The compulsory purchase review advisory group has considered the problem, and has acknowledged that it can result in people receiving insignificant and insufficient compensation to acquire an equivalent replacement property. As part of our response to the report, we shall consider carefully ways in which we can achieve what my hon. Friend seeks. We hope that mortgage lenders more generally will be able to adopt the sympathetic approach that one or two have offered in the past, to enable people to overcome the problem of negative equity at that point in the process.
My hon. Friend referred to the disturbance payment and asked whether the Government could finance a test case. I have considered the matter carefully and I am advised that it is not an easy option for the Government to make a test case. However, it would be open to the local authority to do so, and that is something that we shall discuss with it.
On rule 6 and the advice that my hon. Friend has received from a professional with knowledge in the field, those are matters that I shall look into and write to him about. Finally, my hon. Friend asked whether existing

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owners could benefit from the increased value of their own proportion of a compulsorily purchased site. That is anticipating, perhaps hypothetically, increased value of the whole site as a result of redevelopment. It is an interesting question and I think that my hon. Friend acknowledged that it raised some important issues of principle. Currently it would involve an unprecedented use of public funds to apply new deal for the community money to bridge the gap. However, we are prepared to consider the matter.
Such a scheme would favour only those properties that lie within new deal communities. It would not necessarily represent an option for other areas that did not have new deal for the community funding or some similar central Government funding initiative. I am prepared to explore the matter further.
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My hon. Friend has raised with great clarity the problems for people in Lower Beswick as a result of current deficiencies in the CPO system and the relocation grant system. I regret that I cannot offer him, short of the innovatory schemes that Manchester city council has already explored and I hope will continue to explore for his constituents, an immediate remedy. I can assure my hon. Friend that we are well aware of the serious issues that he has raised. We want to find a remedy as soon as we can to help his constituents and other people in similar situations.
Question put and agreed to.
Adjourned accordingly at six minutes to Twelve midnight.

Preamble
[Mr. MICHAEL LORD in the Chair]

Leeds LEA
Motion made, and Question proposed, That the sitting be now adjourned.—[Mr. Dowd.]
10 am
Mr. George Mudie: In November 1999, Ofsted inspected Leeds local education authority, and in February, it published a report in which it claimed that the authority was so bad that it suggested total outsourcing of the authority's services to schools, and consultants were installed to advise on the way forward. The suggestion is now for a joint venture board and company, which would almost certainly involve a private sector partner. The local authority would have two places on the board and the private sector two, with the Secretary of State choosing a chairman from a list provided by the council.
Before I comment on the proposal, two points need to be forcefully made. In the discussions that have been taking place since February, when Ministers have been criticised, they, understandably, take a high moral stance. I am not sure that we shall hear them do so today, but they cry, "Our only concern is for the education of the children."
On behalf of hon. Members who represent Leeds constituencies, I want to make it clear that we in Leeds and all hon. Members present share that position. Indeed, we go further. Although Ministers can only use words in relation to Leeds, we do not only use high moral language. We, as local Members, either have had or have children at Leeds schools, along with our friends' children, our neighbours' children and our constituents' children, and we care deeply about that responsibility. We understand the importance of good education to children's life chances, and I defy Ministers in the Department for Education and Employment to imply that we care less than they do. The implication that we would put political or educational structures before the future of Leeds children is, rightly, regarded as insulting. We want the best for our children, and we have fought and will continue to fight for that objective.
The second point that needs to be placed on record is that not one hon. Member who represents a Leeds constituency regards the LEA as perfect. I challenge the Minister to say that the DFEE is perfect. Like most big cities, Leeds struggles against problems and difficulties of which the Government are aware. It is not easy to run an authority that covers a large inner-city population, with all the attendant problems. In addition, problems have been encountered in finding a director. People accept the fact of and want to end bad provision in some of the services offered to schools. I am not trying to minimise the problems involved, but nor should the Minister try to exaggerate them. It is understood that the authority is working hard under its new management team to tackle a range of problems.
2WH
Where do those two key points—first, that the objective is to provide the highest-quality standard of education for children and, secondly, that the authority needs improvement—lead us? We could debate the Ofsted report and the PricewaterhouseCoopers report that followed it, but would that be sensible or productive? What it would amount to, after the dust has settled, is that I, like many others in Leeds, feel that Leeds is an average authority in most ways but is acceptable, given that its primary school results are above the LEA league table average and are improving at above the average rate of improvement. Although its secondary element needs improvement, its primary element is doing well.
Why did both Ofsted and the DFEE single out the authority? It is one of the biggest Labour authorities, and there is a feeling that everyone would take notice if Leeds were made an example of. It is that type of syndrome. If the Minister reads the press, she will discover that the mood in Leeds has become worse as the saga has developed. The authority may not be perfect, but the grotesque picture painted by Ofsted does no service to anyone, unless the political agenda is to destroy local education authorities. We now know that the increasingly eccentric chief inspector finds that proposition attractive; it touches a nerve with him, which should come as no surprise. We do not yet know the DFEE's intentions, but we know the Conservative party's. The Minister should spell out the Government's approach to LEAs, in relation to that of the Conservatives and the chief inspector.
I have enlarged on my original point and returned to where I started. Would it be sensible or productive for the Minister to fill Hansard with an attack on the Leeds LEA, as reported by Ofsted and PricewaterhouseCoopers? The only result would be to increase the bitterness and anger felt in Leeds over the issue.
Given that we share common objectives, we should decide whether the proposed joint venture company is the most appropriate way forward. In discussions in Leeds, officials from the DFEE and PricewaterhouseCoopers have conceded that the venture is new and unique. Does the Minister accept that, and does she think it appropriate that children's education should be gambled with in such a way? Officials have even used the word "experimental" to describe that joint venture company. Does the Minister think that Leeds children, whom she and the DFEE care deeply about, should be experimented with by handing over their education to an untried body?
Can the Minister tell us of the educational track record of the various firms listed by the DFEE as suggested partners? That list includes W. S. Atkins, Serco Ltd., Prospect, Include and Ensign consortium. None of those names falls readily from the lips of educationalists when the subject of running an education authority is raised. Will the Minister tell us whether it is a fact that none of those firms has a track record of running an education authority? Will she tell disbelieving Labour Members that she is prepared to employ Group 4 to run Leeds primary schools? In the previous Session of Parliament, Group 4 was seen as a joke for losing prisoners. The firm has gone from running prisoners to primary schools in one Government—that is quite a leap in quality, is it not?

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I suppose that the fact that Group 4 has teamed up with Tribal group makes it an appropriate partner in the running of Leeds schools. However, will the Minister tell us the track record of those companies?
Is the joint venture body not simply a body set up to allow the DFEE to run Leeds schools from 200 miles away? It will be good if the Minister disagrees with that theory, but can she explain why her officials continue to insist on the Secretary of State choosing both the chairman and the council nominees? Despite the fact that the Secretary of State once led a local authority, there is the suggestion that councillors would not be acceptable as board members. Does that suggestion have the Minister's approval and backing? If so, could she tell the Leeds council members and the Chamber why it is so?
Will the Minister clear up the confusion between the parties about who sets policy and strategy? Will the joint venture board deal with operational matters only, and is it absolutely accepted that the council will deal with policy and strategy? If that is the case, will she confirm that the outsourcing of services, which is clearly a policy matter, is a decision for the council?
Will the Minister tell us what length of time is needed for the experiment? What levels of performance are required and, when they have been reached, will the service revert to being run by the democratically elected council? If not, why not?
Finally—I know that many hon. Members wish to speak on this important subject—I ask the Minister to consider the following points. It is unacceptable that Leeds children will be experimented on by a company that has no track record in delivering education and it is disturbing that a Labour Government cannot work with a Labour council to agree a common strategy. Leeds does not claim perfection, but it wishes the best for the children and will work with anyone who shares that objective. Foisting an experimental system with untested private sector partners on a large city seems an irresponsible and insensitive approach by a Labour Government. I ask the Minister, although I imagine in vain, to reconsider the matter.
10.10 am
Mr. Harold Best: I support my hon. Friend the Member for Leeds, East (Mr. Mudie). The questions of whose interests we seek to represent, and whether those interests are best served by the people in Leeds elected to do that job or by an outside body appointed from central Government, have been posed to us many times over the past few months.
I want to start by giving a brief outline of my education and that of my family. I was born and educated in Leeds. I have four children, who all went through the Leeds educational system; three of them obtained university degrees and the fourth won a college place in Leeds and obtained a vocational qualification. I have four grandchildren in Leeds. Anyone who questions the interests of the Leeds MPs should understand that we are the organic, elected representation of the people of Leeds. We represent both roles.
If there were weaknesses in the management of the LEA in Leeds, it would not have come as any surprise to any Leeds MP, given the status that I have just claimed
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for us. We were aware of the difficulties and we continually pointed them out—that is part of the natural, continuing process of elected representative democracy. There has never been a period in local government in which all was perfect and management ran like a Swiss watch. Anyone involved in managerial functions understands that anyone—especially I, for example, with my less than expert qualifications to examine the management of any structure—could find fault with any aspect of it if they chose to do so.
Leeds looked long and hard for those managerial skills. For several years, it looked for a director of education who could take on the perceived weaknesses—and managed in the intervening period. Ofsted's identification of several weaknesses in the LEA in Leeds therefore came as no great surprise. At least the problems were being identified by elected representatives—slowly and persistently, one might say, but solutions were being sought. Every time I think of the PricewaterhouseCoopers report, the Beatles song, "Paperback Writer" comes to mind:
I can make it longer if you like the style
I can change it round.
The report has no street credibility in Leeds whatsoever.
The big issue for me is that of democracy. The vital questions are whose education it is and who will manage, control and own it. Democracy is not simply a matter of a snapshot of one frozen moment of history or public opinion. It is about ownership, control and management of the structures of our society and it is extremely important in ensuring people's confidence in those who manage and control, and in the measure of control that they in turn have over those managers. Democracy is at the centre of all things, and as we speak in this place we are acutely aware of our role.
We are concerned with a public agenda, but we have been recently worried about what other agenda is at work. The recent lessons of the Rover car company flooded to mind when it became self-evident that the questions of ownership and control were extremely important to the people in a certain locality.
Make no mistake: the people of Leeds want their children's education back in the control of their elected representatives. The suggestion that it would take five to seven years for the required management skills to be instituted, and therefore before the return of control and management of the educational system to the city's elected representatives, was beyond my ken and that of everyone else in Leeds. The system has served the people of Leeds well for generations.
It is an undisputed fact that large sums of public money are involved. It seems possible that such sums will be handed over to people who need them, for five years or seven years, and the reasons for that are beyond the understanding of the people of Leeds. The Members of Parliament for Leeds suggested that if the expertise in educational management existed outside all local authorities of educational significance, we could buy it in, as we do in many other situations, until we had managed to raise any weaknesses to the required level of expertise. We cannot understand why such a simple solution—a self-evident way forward—was not adopted.
Many hon. Members want to speak, and I thank you for being kind enough to call me to speak second, Mr. Deputy Speaker. The observations made by my

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good and hon. Friend the Member for Leeds, East would be supported not only by me, but by the generations of my family who have benefited from the LEA in Leeds. For my grandchildren's future, I think that they would like control to be back in the hands of the people of Leeds as rapidly as possible.
10.17 am
Mr. Hilary Benn: It is clearly evident from the two contributions so far that there is genuine passion about education in the city on the part of all those who are present to represent it in the Chamber, but there is also concern about how the people of the city will be able to influence education in future.
I share others' view about there clearly being aspects of the educational system in Leeds that need to be improved. I say that not least because head teachers have told me so when I have visited schools. From talking to those same head teachers, however, I also know that there are great strengths in the system. In passing, I should say that on Thursday I had the pleasure of attending a dinner in Leeds for 200 people from schools to celebrate the fact that nearly a quarter of schools in Leeds have achieved Investors in People status. I doubt whether there is an LEA elsewhere with such a high proportion.
Many people have also expressed the view to me that, whatever problems are identified in the Ofsted report, Leeds should have the opportunity to solve them itself. However, I must say to my hon. Friend the Member for Leeds, East (Mr. Mudie) that the city council has acknowledged the need for outside support to address the scale of the problems that it wants considered.
One of our big problems is the fact that there remain many questions about how the new arrangements will work. One can be forgiven for thinking, from reading some of the newspaper coverage of the proposals, that Leeds LEA will cease to exist and that elected members will have no say in, influence over or contribution to make to the future of education in the city. That is not the case, as I understand it, and it would help if my right hon. Friend the Minister would confirm the reasons for that.
The LEA remains in existence as the body that decides the level of education expenditure in schools. It remains responsible for key decisions. My hon. Friend the Member for Leeds, East made an important point about where the balance of responsibility will lie. Crucially, the LEA will be responsible for drawing up the specification to which the new partnership board will work. I hope that, as a result of that process, the LEA will take the opportunity to lay down clearly what it wishes to be provided in terms of educational services. It should focus on further raising standards to build on the success to which my hon. Friend referred. On the other hand, head teachers should have the opportunity to lay down clearly what support they want to help them in their principal job, which is to support children in learning and progressing in their school lives.
On the issue of accountability, I have no doubt that the council, having drawn up the specification—and, as I understand it, having legal responsibility for ensuring that services are delivered according to the contract that it has determined—will use the scrutiny mechanisms, which it recently established, to ensure that that is the
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case. It is not just a question of drawing up a contract and leaving the contractor to get on with it for seven years, five years or whatever period is determined. It will be an on-going dialogue.
There is another reason why I think that some of the fears may be misplaced. As a newcomer to Leeds during the past year, I am conscious that the council has used its influence, which is a result of its democratic legitimacy, over many years to make many things happen. As an outsider, my observation is that much of the success of Leeds as a city is owed to the influence and leadership of the council in partnership with other bodies. The council has little formal control over those bodies, but the legitimacy that comes from being elected puts it in a strong position. My hon. Friend was rightly concerned about major questions of policy. I do not believe for one second that when the elected representatives of the city of Leeds speak clearly and with one voice on such matters, on behalf of the people whom they represent, the partnership board—two of whose members are appointed by Leeds, while the third is appointed by the Secretary of State from a list of persons agreeable to the city—will say, "We don't care what you think; we're going to do something different." Accountability and democracy is not just about how the relationship is established. It must be about an on-going dialogue. As democratically elected representatives, we need not be too pessimistic about our ability to influence others.
Some crucial details—such as contract length, to which my hon. Friend the Member for Leeds, East referred—are yet to be determined. It would help if, in responding to the debate, my right hon. Friend the Minister would deal with the important question of how the decision will be taken in relation to what happens when the contract ends. Assuming that the issues identified by the city council and the Ofsted report have been successfully addressed—and given that the city council makes the contract with the partnership board—will she confirm that the city council will determine, subject to satisfactory progress, how it wishes the delivery of education services to continue in the future? It is difficult to understand how a view on the outcome can be expressed now, because it is difficult to prejudge the situation in five years' time. It would encourage greater confidence and clarify many questions if my right hon. Friend were able to deal with that point.
I ask all these questions because I am a strong believer in the principle of democratic accountability and in the need for a local authority, in the proper sense of those words. An organisation that is elected by the people and democratically accountable is necessary to hold the ring, ensure fairness, deal with problems that arise and hold to account all those who are responsible for providing education. With great respect to the Conservative spokesperson, I cannot say that I look forward to his contribution. However, I shall listen to it with interest, because the Conservative party's proposal to do away with LEAs constitutes the real threat to the democratic oversight and scrutiny of education.
The final point is that the new arrangements, whatever they are, must be made to work. I feel strongly that Leeds, the subject of the debate, has suffered enough from the Ofsted process. It has gone on long enough. Parents, teachers and pupils, elected members

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and the city itself now need confidence and certainty about what is to happen next. Leaving to one side this debate, which is about the means, the common view held in the Chamber today about the end is clear: we should continue to work hard to raise the levels of achievement of the children in Leeds schools.
I know from my one year's experience in the city that anyone there will say that, in order to address the problems of a two-speed Leeds—the fact that some parts of the city and some people who live there do not share in the city's prosperity—it is most important of all for the city to make education a priority. That is why all those Members who represent Leeds constituencies feel so strongly about the issue.
10.26 am
Mr. John Gunnell: I should like to add my voice to those of my hon. Friends because, like them, I wish to see educational standards raised in Leeds, and I am anxious that whatever is done is successful.
I speak frequently with the local authority about the needs of the children and parents in my constituency and, like other hon. Members, I am frequently disappointed with the response; and the parents on whose behalf I have spoken are often frustrated by the actions taken by the authority. Some of those experiences have been identified by Ofsted as areas of weakness, particularly in special needs provision. Although the city council recognises that assistance is required, change is needed in the attitudes of those who deal with the issue at some levels in the city council's administration. I remain to be convinced that the departmental approach will bring about the necessary changes, particularly in the attitudes of the administration. Like other hon. Members, I hope that it will be effective in raising standards in Leeds, and in putting right those weaknesses that have been identified.
I hope that the structure of the joint company, which received general assent from hon. Members, comes about, and I hope that the company's chairman will be acceptable to the Leeds authority. I hope that it will be possible to have a public-public partnership rather than a public-private partnership, because authorities not a great distance from Leeds have expertise in matters that have been found to be weak in Leeds. One such authority worked closely with West Yorkshire council when I was leader. The area has some strengths where Leeds was found to be weak. A public-public partnership would be more acceptable to many people in Leeds.
I hope, too, that the city council will have the pivotal vote in deciding which services to outsource to the joint company. It has identified and accepted weaknesses, including the one that I mentioned. I trust that discussions between the Department and the city of Leeds will identify those weaknesses more clearly. Leeds must have the strongest voice in determining what is outsourced and the length of time during which that takes place.
I also want the matter to be concluded as quickly as possible in a manner that is consistent with the necessary raising of standards. The contract should run no longer
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than the time needed to bring about the necessary changes. I am anxious for the exercise to succeed, which it will if it proceeds in a positive and constructive way. The elected Members of Parliament who have a responsibility for Leeds want to reach the end point in the minimum time and ensure that the services return to democratic control.
10.31 am
Mr. Paul Truswell: It is a pleasure to follow my colleagues from Leeds. Like many who have participated in the debate, I come to this Chamber not only as a Member of Parliament but as a parent, former governor and former councillor.
The individual weaknesses identified by Ofsted were predictable, as my hon. Friends explained. Wearing my various hats, I have, at one time or another, raised most of those. I have no vested interest in excusing the inexcusable. My loyalty to my children and my constituents' children is greater than any that I have to Leeds city council or the Labour Government. But where I and many others part company from Ofsted is on the way in which the weaknesses have been assembled into an unrecognisable picture of a desperately failing authority. Many respected head teachers in my constituency, although critical of aspects of the LEA and sharing the criticisms of Ofsted, reject outright the doomsday scenario painted by Ofsted and subsequently by PricewaterhouseCoopers. I appreciate that my right hon. Friend the Minister—I hope that we will remain friends—will refer to the questionnaires that were completed by head teachers during the Ofsted process. I suspect that the outpouring of criticism was a cathartic experience for heads. It resulted not only from frustrations with the LEA—of which there were many—but from the intensifying pressures of Government initiatives.
My hon. Friends have questioned the role of the chief inspector of schools. He appeared on the scene like a grave robber, anxious to have life pronounced extinct or even to assist in the demise of the hapless victim. That he has his own agenda is beyond doubt. His recent forays into the political arena must make that clear to anyone who may have doubted it. We ask ourselves in Leeds whether the chief inspector of schools is servant or master. It is clear that he possesses delusions of being the latter.
I would not want anyone to run away with the idea that we are simply debating a disagreement between Leeds Labour MPs and the Labour Government. As several hon. Members have pointed out, it is also a disagreement with the philosophy of the Conservatives. It will be interesting to hear the contribution of the hon. Member for Buckingham (Mr. Bercow), who has turned up to be the spectre at this Leeds feast.
Of course, Conservatives and Liberal Democrats have sought to make political capital out of the Ofsted report. They echoed the claims of political interference made by Ofsted, yet they all colluded in one of the major examples of so-called political interference. The chief inspector singled out payments from miscellaneous improvements in the community and environment, or MICE, as it is called in short. The scheme allocated £3, 500 to all councils for investment in local projects based on their knowledge of their areas. That is why it

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has been popular with all and sundry and enjoys all-party support. Many councillors of all parties have chosen to allocate some of the money to schools, but the scheme has been defined as a great crime of political interference.
Historically, Leeds has spent more on education than its standard spending assessment. Expenditure rose to £18 million more at one stage under the Conservative Government. Before we become too focused on specific issues, I should remind hon. Members that much greater damage would have been done to our children's education by retaining the spending levels of the Conservative Government than by anything of which the LEA has been accused. All parties have been involved in campaigns to keep schools open. Is that political interference? Some would say that it was, as it has meant that schools have not closed and surplus places have not been removed. Indeed, that has been the subject of another Ofsted criticism. The Conservatives have cried crocodile tears about Government interference in Leeds, while announcing at the same time their plans to abolish LEAs.
The post-Ofsted debate has resolved the question whether the Leeds LEA has the capacity to achieve improvements in all the weak areas identified by PWC and Ofsted. I shall quote one relevant section from PWC's report. It states:
We conclude that the scale and scope of the agenda for change is such that we do not believe that the current LEA delivery mechanism has the capacity to bring about the fundamental and rapid changes required in a time frame that is acceptable.
As far as I know, however, there has been no definition or clear description of an acceptable time frame. A year will elapse before the so-called joint venture company is set up. It is suggested that the period of the contract should be five years. What sort of time frame for improvement is that? What are the Minister's views on it? It appears to question the speed with which even the new experimental arrangements can deliver. It also fails to acknowledge that the project is an experiment, as my hon. Friend the Member for Leeds, East (Mr. Mudie) said. Experiments can go wrong and five years is a long time to give such an experiment the opportunity to do damage.
I add another question that concerns me greatly, but which I shall not explore in too much detail. What consideration has been made of the staff caught up in this maelstrom of change? I think that the answer is precious little. Cost is another issue that has not been broached as emphatically as it might have been. Will the Minister ensure that, given the money that is going into making this experiment—I make no apologies for using that word—work is not diverted from my children and those of my constituents?
My understanding is that the original aim of the exercise was to assist the LEA in tackling the weaknesses identified by Ofsted. I do not think that there was any convincing argument to suggest that external support was not required. Why is there now a refusal to say, all things being equal, that the service can return entirely to the LEA, subject to the meeting of targets? Fixed-term support to address weaknesses is one thing, but are we really going to persist indefinitely with this rag-bag of arrangements? It exists not only in Leeds, but in other local authorities, whose number will probably increase in future.
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The right hon. Member for Richmond, Yorks (Mr. Hague) has been unequivocal in stating his party's education policies. LEAs are to be abolished under the Conservatives. The policies promulgated by the right hon. Gentleman are crass. They probably represent straws that will break the backs of overburdened schools with more administration. They will herald back-door selection. They contain the most spurious financial calculations and will be utterly destructive to our children's education. However, they have one merit: they are clear. In conclusion, I ask the Minister this: why can she and her colleagues not be equally clear in giving their commitment to the future of local education authorities?
10.40 am
Mr. Fabian Hamilton: I, like many of my colleagues, have a deep vested interest in the future of Leeds LEA. I have three children at school in Leeds. I want them to succeed as I want all my constituents' children to succeed. I want the schools to be of the highest possible excellence that we can achieve.
I chaired Leeds education committee for only one year; I take my small share of the blame for what has gone wrong, although by no means did all of it happen in that one year. I echo what my hon. Friend the Member for Pudsey (Mr. Truswell) said when he talked about the conclusions drawn by the chief inspector of schools regarding the real deficiencies of the LEA, which were clearly marked out in the Ofsted report. Those conclusions clearly equalled far more than the sum of the parts. Many of us could go along with the criticisms in the report because we knew the LEA and that the criticisms were valid. We knew also that they could be put right. However, the conclusions drawn by the chief inspector were a gross exaggeration of those parts.
I received a phone call this morning from councillor Peter Gruen, who is the lead member in Leeds city council responsible for schools. He rang to tell me that the early indications, which the LEA had gathered in the past couple of days, showed that the standard assessment test targets for 11-year-olds set by the Government would be more than reached this year. Indeed, we are heading for the more rigorous targets of 2002. Those are the early indications; they have not yet been verified. However, such SATs results are not the sign of a failing LEA.
In 1992-93, the LEA established the Leeds schools commission. That was when the then Conservative Administration wanted to see schools opting out of local authority control and taking control of their destiny—a policy similar to that promulgated by the Leader of the Opposition, the right hon. Member for Richmond, Yorks (Mr. Hague). The purpose of the commission was to ask all Leeds schools what they wanted from the LEA, what money they wanted devolved to them and what services they wanted the LEA to continue to provide. The study was detailed and all the schools in the city took part through representatives—head teachers, governors and stakeholders in the wider community. The exercise was unique; very few LEAs held similar consultation exercises. It went on for about six months.
The conclusion was that certain functions would be devolved and others would remain, at the request of the schools. I was going to say that, in the end, of the major

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local education authorities in the metropolitan districts, Leeds was the only one to have zero opt-outs. In fact, two schools opted out. One was a Church of England primary due for closure because it was too small to continue and because the Secretary of State refused to allow it to be closed. The second was a Church of England secondary school that did not have the cash to rebuild a building that had been burnt down and needed to opt out to get the bribe money to rebuild. It came back into the LEA as soon as it could. The remaining 300-odd schools remained in the LEA. If the LEA was failing the schools at that time, why were they so anxious to remain part of it?
There is no evidence that a private sector scheme, opting out, the contracting out of many LEA functions, or even a joint venture company would succeed in rapidly improving LEA services. Does my right hon. Friend the Minister have any evidence that such rapid improvement is possible through the involvement of private sector organisations or a joint venture company? The Government and the chief inspector rightly said that there should be a rapid improvement in LEA services. Why, then, must we wait nine months for the establishment of the joint venture company, and probably a few more months for it to be up and running properly and efficiently?
We could start making improvements right away. We do not need to wait for a joint venture company to be set up. If we brought in private sector partners and consultants right away we should fulfil the Government's requirement for private sector involvement in rapid improvement, but immediately—or certainly within a few weeks. Why can we not, for example. bring in private sector recruitment consultants to ensure the replacement of staff who leave, and the appointment of the management team needed to ensure the rapid improvement, which can be dealt with much more quickly than by waiting for the joint venture company to be set up?
Like my hon. Friends, I wonder how long the company will be in operation. Is what is being done an exercise in improving LEA services so that the democratically accountable local education authority can continue to provide services, but of a much higher standard than at present, or is it an exercise in permanently removing the relevant functions from an organisation that is regarded as incompetent?
PricewaterhouseCoopers' report, which was published this month, contains the results of the preliminary evaluation of options in a table on page 61, setting out the criteria used and the different options—retaining in-house services, public-public partnership, joint venture company, outsourcing and strategic partnership. The table gives scores—a bit like credit scores, really, but less scientific—relating to the different criteria, under headings such as legal and regulatory, operational acceptability, cost acceptability, ease of implementation, rapid improvement and incentives to sustain the service. The total of the scores is given, from which we conclude that the joint venture company gets 45 points and total outsourcing gets 48.
On what, however, are those scores based? Surely they must be subjective. For example, retaining the in-house operation scores nine out of nine for operational
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acceptability, while outsourcing and the joint venture company score six out of nine. Why six? I believe that it should be two, one or zero, which would alter the final total. With respect to the heading of incentives to sustain the service, we know that there is a financial incentive for the joint venture company and for outsourcing, which therefore score nine out of nine. However, why is not the wish to serve the public effectively and efficiently—and out of a belief that the service in question should be provided in the public sector—also treated as an incentive? Why is the score for incentive three—not, say, six—for the in-house option? That change would radically alter the scores. The table on which the selection of options is based is highly subjective. I do not accept that the figures have been obtained by objective and measurable criteria.
One of the problems in Leeds is the general public's perception of Ofsted's report and the post-Ofsted action plan. When the report was published, the headline across every page of the Yorkshire Evening Post was not "LEA in Crisis" or "Ofsted Report" but "Leeds Schools Crisis". That is why, when I went to Roundhay St. John's primary school in my constituency shortly after the report was published, staff told me, "We have just had an Ofsted report. Ofsted says that we are one of the best primary schools in the city. Why are we being told by the Government that we are rubbish?" It was not understood that the Ofsted report on the LEA did not mean that Roundhay St. John's was failing to provide its pupils with an excellent education. That is a serious problem.
I reject utterly the Conservative party's policy of complete abolition. Schools have enough to do. My hon. Friend the Member for Pudsey said that the head teachers in his constituency—as in every constituency in the city and throughout the country—have more than enough to do. They do not want to have the functions of an LEA thrust upon them as a result of the abolition of such authorities. That is not an option.
We are concerned about the democratic accountability of the local education authority and the provision of an efficient and effective service that will drive up standards in schools. Most of our schools in Leeds have a good record of achievement, in terms of the league tables. The results are very good—I have mentioned the early indications on the targets for SATs for 11-year-olds—and we shall continue to have such results in Leeds. We do not have failing schools, although we are told that the authority is failing.
I hope that the Minister will answer the crucial questions about the length of time for which the joint venture company will operate, and assure us that the purpose is not the abolition or privatisation of our LEA. We must return the existing LEA, as the most excellent authority that we can have, to democratic control and allow it to continue its work of ensuring that our schools and the education of our children are improved.
10.51 am
Mr. Richard Allan: When I entered the Chamber this morning, I noticed that the hon. Member for Leeds, East (Mr. Mudie) was looking surprised. He said that it was strange to see a Sheffielder at a debate on Leeds. The friendly rivalry between our cities might make us think that the best thing to come

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out of our respective areas is the bus back to Leeds or Sheffield, depending on where we come from, but I can assure the hon. Gentleman that I shall speak as a member of the Liberal Democrat education and employment team and as a Yorkshireman. I am also spokesman for the parliamentary Opposition in South Yorkshire and West Yorkshire. I have held that lonely position since 1997, when the Conservatives were, quite properly, wiped out in our two great metropolitan counties.
I congratulate the hon. Member for Leeds, East and the other Members of Parliament for Leeds on the solidarity that they have shown by coming here today. Debates in the Chamber can be used to advance the cause of a particular area, and it is important that Ministers hear the views of hon. Members representing the entire area. We try to do the same for Sheffield, despite the fact that we have a political divide. Leeds is certainly at the cutting edge of the LEA debate, and we in Sheffield cede that position gladly. It seems that the Government are experimenting with their agenda for LEAs in Leeds. Several hon. Members have said that; it is an experiment. I would be concerned if it were to take place in my area, as would most other hon. Members.
The hon. Member for Leeds, East said at the beginning that he wondered whether the LEA reports had been mixed up, as there was a report on Sheffield at about the same time. The reports were not mixed up, but there was some awful spinning going on—perhaps people in West Yorkshire know more about the spinning industry—at the time of the inspections. Education correspondents were saying, "Leeds will say this" and "Sheffield will say that." There was a strong political agenda involved, and such spinning was not taking place by accident.
My party has a general concern about the Government's adoption of the whole Ofsted agenda, and that of the chief inspector in particular. The hon. Member for Pudsey (Mr. Truswell) mentioned the chief inspector's strong political views, which have been repeated frequently. The hon. Gentleman and I are, I hope, equally concerned about those political views, and the decision to adopt the chief inspector's agenda is part of the problem with the way in which LEAs are portrayed.
The LEA inspections are being used as a big stick to make local authorities go cap in hand to the DFEE, saying, "Please don't hit us. We will do A, B or C if you let us off." Some local authorities have managed to get off, but others have faced the full punishment of being told what they should do, with no options and no let-out. All the LEAs that have been through the inspection process feel that their independence has been challenged and that they must now go cap in hand to the Department, in order to come up with some kind of package to allow them to continue, rather than be forced down a route that they would not choose.
We are concerned that we are moving into an era in which the integrity of the LEA is being challenged. I am pleased that hon. Members have raised that issue, as part of the wider picture. We are specifically discussing Leeds, but the question of where local authorities are going in general is also relevant. There is room for evolution, but the key element is who controls the service and whether the local authority co-operates in
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the process. It is not at all about the dogma of public versus private, but about who controls local education services.
There have been successful examples of LEAs choosing to use the private sector. Islington, for example, has chosen to work with a private sector company, against a poor background. Other local authorities are doing that—some in ways that I would not support. Some of the experiments by Conservative-run LEAs, for example, have involved engagement with the private sector in ways that make me nervous—but they have a right, as an LEA, to do that. That is different from contracting out the whole LEA operation, as is happening in Leeds. If there are other examples of that, I stand corrected.
Mr. Hilary Benn: As I understand it, the whole of the service in Islington has been outsourced, whereas in Leeds a partnership between the local authority and other providers is proposed.
Mr. Allan: My understanding is that the LEA concerned will take a more positive view of the route that it has chosen than that put forward today by hon. Members representing Leeds. It is not just an issue of a single muddle—which is none the less important—but a question of who controls that muddle. I shall come to the issue of control, which is important in the context of LEAs.
We believe that LEAs need evolution rather than revolution—Darwinism rather than Trotskyism. LEAs can evolve. They have already evolved strongly, for example in terms of the local management of schools and the delegation of budgets, which have taken place co-operatively and sensibly. Listening to some of the Conservative spokespeople, one would not believe that LMS has occurred. There seems to be a perception that LEAs are the same as they were in the 1970s. That is not the case. LEAs have demonstrated a tremendous ability to evolve and to respond to schools' concerns.
The history of the LEAs is interesting. They have controlled education for about 100 years. The Local Government Association has pointed out that their name is confusing: why do we talk about a local education authority when we do not talk about a local social services authority or a local housing authority? LEAs are part of local government and, in the ideal model, part of a joined-up package of services. By naming them separately we have given the impression that they are distinct from that package. The LGA has pointed to a different route of evolution to that proposed in Leeds. It is pointing to the model of Cornwall, for example, where the council social services department, the education department and the Cornwall Healthcare NHS trust have jointly established a child and family service. It is talking about joined-up government and about bringing education together with other local government services such as social services and outside services such as health care services.
One of my concerns about the Leeds experiment is that it will reinforce "departmentalitis" and place education in a bunker. It will now be in the hands of a partnership that is involved purely with the delivery of the education service and will ignore some of the other possible evolutionary routes, such as those proposed by

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the LGA. We need a much fuller debate on joined-up local government that brings the LEA further into the ambit of general local services. There are huge educational advantages in doing so. Anyone who represents a city area will know that issues such as health and nutrition are crucial, especially to the performance of primary school pupils. Many issues concerning primary school pupils involve the wider social context, not just what is delivered educationally. My concern is that the company will focus purely on educational aspects and will find it harder to work with outside issues.
We are concerned about centralisation. We are told that we will have an independent chair, who will none the less be chosen by the Secretary of State. Many people in local education are now chosen by the Secretary of State and there are concerns about how that will operate in practice. We are concerned about the DFEE list of possible partners, to which the hon. Member for Leeds, East referred. We are concerned about how those partners will be selected and what input local government will have, as opposed to central Government, in deciding the kind of partners that it wants.
In the short term, we are concerned about morale. Contracting-out processes, such as the one that happened recently in Sheffield with the housing benefit service, which went to a company called CSL, can cause incredible staff morale problems. I am concerned that there may be chaos in the Leeds education system for two years, given the big window that has been given for the process until April 2001. Naturally, there may be a fall in morale as a result of the major changes that are occurring. That is not an insult to staff members because, at a time of transition, it is natural for staff not to be able to focus 100 per cent. on their jobs because their thoughts are taken up with transition issues.
Finally, I should be interested to know what will happen if the new arrangements fail. We have had problems with the outsourcing of all sorts of services. The service that we are discussing is crucial—all hon. Members who have spoken have mentioned its importance—and we must have an option available for if, or when, a service change fails. What will happen if there is major disruption to the service? Will the big sticks be in the hands of the Leeds LEA, as they have been for other contracts, so that the authority is able to sort things out?
It is not simply a question of having a paper contract that states that, in certain circumstances, the authority can impose fines and do this or that. The authority must have a way of reasserting control if it is lost through the proposed mechanism. That is the bottom line, which must be established. However, the Government, to satisfy members of any LEA who are concerned about the future of their authority, must first answer the questions that they have been asked about the political driving forces behind the agenda.
11.1 am
Mr. John Bercow: This has been an important debate, but much of it has had a surreal quality, as several hon. Members from Leeds, though not all, coyly declined to debate the detailed particulars
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of the Ofsted report. That report offered a devastating critique of the performance of Leeds city council. It criticised the authority on such things as its educational development plan and its pursuit of special educational needs, on which it was said to have lost its way. It also criticised the authority for its provision of nursery, primary and secondary school places and of viable sixth forms, the monitoring of schools and the treatment of schools causing concern or judged likely to do so, the evolution of a strategy for the interests of ethnic minorities and the provision of educational welfare. All those policies were roundly attacked by the report.
The hon. Member for Leeds, East (Mr. Mudie), for whom I have a healthy affection and respect, criticised the chief inspector but did not respond to his arguments. The hon. Gentleman said that the chief inspector was eccentric, but that is a matter of opinion and not a robust political or educational case.
Mr. Hilary Benn: Will the hon. Gentleman give way?
Mr. Bercow: I will give way once and only once.
Mr. Benn: The other opinion that matters is clearly that of the head teachers within the authority. Does the hon. Gentleman accept that when Leeds Members have asked head teachers for their views, they have told us that, although there are things that need to be addressed, they do not recognise in its entirety the picture painted by Ofsted? Whose judgment should we trust?
Mr. Bercow: I am grateful to the hon. Gentleman for his insertion of the words "in its entirety", by which he gave the game away. I would not accuse him of telling an untruth and I do not doubt that there are head teachers who share the view that he has just described and are unhappy with the report in its entirety. However, the response rate to the study of Leeds was very high—something like 76 per cent. A great many teachers and head teachers are concerned about the quality of the education provided.
The report was described as shocking by the chief inspector. As he said, in a proud city of 750, 000 people there are 117, 000 children whose hopes and legitimate expectations have been betrayed by the failures described in the report. He emphasised that, although some schools provide a good education, others need support that the local education authority fails to give them. That is a damning indictment. I am bound to say to the hon. Members for Leeds, East and for Leeds, North-East (Mr. Hamilton) that they are no mere innocent bystanders in these proceedings. They both have long track records of service on Leeds city council, and both must accept some responsibility.
My principal target today is the hon. Member for Leeds, North-East. He may have been chairman of education in the city for only one year, but he was severely castigated for his record. I think it a matter of no little significance that Leeds city council's solicitor described his attempt to foist Mr. Gus John on the city as evidence of crass political judgment and said that the appearance of blatant canvassing was contrary to any notion of fairness. I do not dispute the good intentions of all hon. Members in the Chamber, or that some have

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experience of the issues at local level. However, they have responsibility and, one can fairly conclude, culpability for a good deal of what has happened.
The chief inspector concludes that the authority's
weaknesses, particularly with regard to secondary schools, far outweigh its strengths, both in number and significance.
We have had no response to that pivotal change from hon. Members today. Pages 22 and 23 of the report refer to
inappropriate interventions…in parts of the city
being a
potentially destabilising influence on schools.
Curiously, we were told that local councillors were able to influence the allocation of extra funds to schools in their wards. That system is not found anywhere else, according to the chief inspector, and he hopes never to come across it again. It reeks of the worst kind of pork-barrel politics, and hon. Members have no reply to that.
Mr. Truswell: Does the hon. Gentleman accept a point that I tried to make, which was that all political parties and councillors colluded in the exercise that he now denounces? Will he turn his accusation of pork-barrel politics on members of the Conservative group on Leeds city council?
Mr. Bercow: I certainly do not accept culpability on the part of the Conservative party. At the material times at which the Labour party was in control of the council, it had responsibility for the policy and determined the direction. It must be held responsible for the consequences. We need to know from the Minister what targets are to be set under the new arrangements; how, in what form and when the findings are to be published; and whether hon. Members on both sides of the House will have the opportunity to debate them. I accept that the matter is of critical significance to hon. Members who represent Leeds, as they must do their constituency duty, but I hope that they accept that it concerns the wider community and the country. It is right that the House should have the opportunity to debate it.
I shall move on to a subject that may be more welcome to some Labour Members, although that is not why I shall do so. The hon. Member for Leeds, Central (Mr. Benn) tabled a parliamentary question in, I think, February. The Minister's reply suggested that in several significant respects the performance of Leeds at key stages 1, 2 and 3, GCSE and A-level was significantly better than the performances of Hackney, Hull, Islington, Liverpool and—wait for it, as it will trip off my tongue—
Mr. Mudie: Sheffield.
Mr. Bercow: The hon. Gentleman, with his unswerving knack, rightly detects that I was going to say Sheffield. It is a matter of great importance, for we know that the Secretary of State for Education and Employment, the right hon. Member for Sheffield, Brightside (Mr. Blunkett), has blood on his hands as far as that authority is concerned. It is a legitimate grievance of Leeds Members that they appear to have been singled out, comprehensively briefed against and rubbished in the media. They have been used as scapegoats.
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The hon. Member for Leeds, East is a distinguished former Minister. The hon. Member for Leeds, North-East has less defence, as he is a new Member of Parliament. Although the record of Leeds seems poor, it is not obvious that it is uniquely poor. We are entitled to ask why less attention has been given to Sheffield city council, that other rotten apple in the educational orchard of the United Kingdom. It is an authority on which—
Mr. Allan: Will the hon. Gentleman give way?
Mr. Bercow: In a moment. The hon. Gentleman must contain himself and show what restraint he can, in the circumstances, muster.
The Secretary of State served on that authority for no fewer than 18 years, including, if memory serves me correctly, no fewer than seven years as its leader. In an Ofsted report, it is said of that authority:
Overall standards are lower than national averages at every Key Stage and vary greatly between schools. The rate of improvement is slow. The number of schools causing significant concern is high, school attendance is lower than national averages, and the percentage of pupils who stay on in education after the age of 16 is disturbingly low.
That authority performs poorly in terms of its educational development plan, support for improving attendance and provision for looked-after children. Its behaviour support plan is lacking, support for ethnic minority children is regarded as unsatisfactory and provision for special educational needs is deemed to be weak. In a press release issued on 2 February, the Department for Education and Employment told us that, despite progress, the overall performance of the secondary sector in that authority
remains disappointingly low. This is not acceptable.
For all his municipal misdeeds, educational vandalism and destruction of the life chances of a generation of children in Sheffield, have we heard so much as a word of apology from the lips of the Secretary of State? No. Rather, we have heard a robust. consistent and calculated denunciation of Leeds city council. That denunciation seems justified, but if we are to be balanced, fair and genuinely academic and dispassionate, we should hear why Leeds is considered to be so palpably inferior to Sheffield.
Mr. Allan: Just for the sake of the completeness of the record, I hope that the hon. Gentleman will also accept that the report referred to some good signs of improvement recently evident in Sheffield, and that Sheffield may be a good case to advance the argument about why LEAs can perform well when they are subject to political competition. Sheffield became increasingly competitive as the Liberal Democrat and Labour groups became increasingly close, until the Liberal Democrats took control in 1999, and the local authority definitely improved, as the report reflects.
Mr. Bercow: Some improvement has taken place. The hon. Gentleman makes a fair point, although I am bound to say that the improvement starts from a low base. In case he is considering climbing on to the roof of the building and trumpeting from it the achievements of the Liberal Democrat party, I would be inclined to advise him to hold his horses, as that would be premature. Much progress remains to be achieved.

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The onus of responsibility is on the Government to explain why Leeds is so much worse than every other authority. I give way once more, and then I must bring my remarks to a close.
Mr. Mudie: Despite the fact that the hon. Gentleman clearly has my right hon. Friend the Secretary of State in his sights, a more important issue in questioning Ofsted's subjectivity is the authority that the hon. Gentleman mentioned: Hull. Our primary school figures are good, as is accepted. We fail in secondary provision. Nevertheless, even in failing, our GCSE results are double those of Hull. Hull's GCSE results are about 25 per cent.; ours are in the 40s. Is that not a clear example of the subjectivity of an eccentric body that demoralises teachers and has now moved on to demoralising education authorities?
Mr. Bercow: The hon. Gentleman is wrong to pillory Ofsted. He is right to offer Hull as another example of a poorly performing authority with which he does not believe that his own compares badly, but he is wrong to attack Ofsted, which does a professional job of scrutiny and investigation. It does a proud and admirable job that I and my right hon. and hon. Friends on the Conservative Benches believe that it should continue to do. Nevertheless, the hon. Gentleman is right to wonder continually why his authority has been targeted, and the Minister for School Standards must explain why.
The Secretary of State has not apologised for a risible record of educational mismanagement in the city of Sheffield over a long period. I have been spoilt for choice—not least because of the hon. Gentleman's helpful intervention—in terms of the number of poorly performing Labour authorities that I could cite. There is a fundamental mismatch at national level between Labour's rhetoric and the reality of its record in office at local level. Its members' words are contradicted by their deeds. They preach excellence but practise failure. The Government's position is fundamentally implausible, and I invite the Minister to reflect that that might be why people are starting to see through them, regard them with cynicism and not believe a word that Ministers utter.
11.15 am
The Minister for School Standards (Ms Estelle Morris): First, I strongly endorse what hon. Members representing Leeds have said: I never question their commitment to Leeds children or schools. We are united in our objective to attain higher standards. I am happy to place that on the record here, as I have elsewhere.
I have had three meetings with Leeds MPs and four visits to the city over the past few months. It was a great pleasure, on my most recent visit, to visit the constituency of my hon. Friend the Member for Leeds, Central (Mr. Benn) to celebrate its schools' achievements in working with local industry. In this difficult and challenging time—more difficult than I would want—good work is going on in Leeds schools. We should find time and space to celebrate that success, as I was happy to do a few weeks ago.
The comments of the hon. Member for Buckingham (Mr. Bercow) were, frankly, disgraceful. I shall respond to a couple of his points but will not bother with them
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further. It was an outrageous slur on the chief inspector of schools to imply that he had somehow been got at and had written a better report about Sheffield LEA merely because that covers the constituency of the Secretary of State. If the hon. Gentleman has looked at the Ofsted report on Sheffield, he will have seen that it said that the LEA had the capacity to improve itself and did not recommend intervention. In the report on Leeds, the chief inspector recommended that intervention be considered because he did not think that the LEA had the capacity to improve itself. We are guided by the Ofsted evidence, as backed up by a careful reading of the reports on Leeds and on Sheffield, and it is an affront to the independence of Ofsted to imply that Sheffield has been treated in any way differently because it includes the constituency of the Secretary of State.
Mr. Bercow: I am grateful to the Minister for giving way. We can agree to differ on the issue and she can try to spin my words against me, but I did not impugn the integrity of the chief inspector of schools, of whom I have been a supporter since I came out of short trousers. I criticise the Government for the way in which they slant the evidence against one authority and seek to protect Sheffield city council. The chief inspector is an outstanding one and he deserves a better Government under which to work.
Ms Morris: The chief inspector wrote in his report on Sheffield that it was not as bad as Leeds and that it had the capacity to improve itself. We must always act on the evidence in the Ofsted report and if the hon. Gentleman goes back to the Ofsted reports, he will see that that is what we have done.
It is important to put the situation in context. Many local authorities have now been inspected and many have emerged with glowing reports: York, Warwickshire, Newham, Tower Hamlets, Kensington and Chelsea, Birmingham and Camden. All those local authorities, most of which are Labour controlled, are doing a good job in supporting their schools. Hon. Members will know that we are intervening not only in Leeds, but in the 15 LEAs that have a poor standard of service, from Liverpool, where the Liberal Democrats are in control, to Islington, Hackney, Rochdale and Southwark—in a range of authorities of different political complexions. We have demonstrated that we believe that where local authorities are good, they should be praised and left to get on with it, but where they are bad, something needs to be done.
If the Government were against local authorities, the easiest thing to do would be what the previous Government did—nothing. The hon. Member for Buckingham speaks about the failure of Sheffield, but what did the previous Government do about it? Absolutely naught. If it was that bad, one wonders why they did not fulfil their responsibility over 18 years. They failed to step in when local authorities were failing and letting down schools. We have not done that. We are happy to praise some LEAs, but some LEAs are poor, and we will support them.
We have never had a debate on LEA intervention before, and I suspect that we are having one now because reaction in Leeds to the report has been different from that in the other 15 local authorities in which we have implemented intervention strategies. I

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will not argue about that. I say only that we must accept Ofsted's evidence. It would be wrong not to do so or to follow our subjective judgment, whether politically driven or otherwise.
We have already quoted much from the Ofsted report. I will quote only one sentence, which says:
In a survey undertaken for this inspection schools' judgments on the LEA's work rated it significantly lower than the average for all LEAs being inspected this term in 73 out of 96 indicators.
I take the views of head teachers seriously. Hon. Members who represent Leeds were generous in saying that the situation was not perfect and has not been perfect for a long time. They want to see change, as do head teachers. Nobody defends the past or says that the present is good enough. Everybody hopes for better in the future. That unites us, and we must remember that.
I offer one criticism, only to defend what I accept is radical action. Hon. Members, teachers and councillors have long known that things were going wrong. Some hon. Members present tried to take action to remedy that, but did not succeed. In the long series of difficulties with appointing a permanent chief education officer who could do the job and had the confidence of the authority and the schools, improvement did not take place. I am not interested in apportioning blame, but there has been a long record of concern and no evidence that the authority can improve the situation by itself.
I pick up on a word used by my hon. Friend the Member for Leeds, East (Mr. Mudie). He talked about Leeds, as the hon. Member for Leeds, Central did, in an interesting way, and he meant some praise by saying that its schools were average. That is not good enough for Leeds. It is capable of better than average. It is a fine city with a proud tradition. It should be proud of its efforts to overcome the difficulties of the decline in manufacturing. It is a beacon in the north and throughout the country of excellence in the creative and expressive arts. The way in which it has grabbed that new agenda should make Leeds hope for a better than average education system. That is the kernel of the argument. Leeds can do better, and the evidence shows that all the efforts of right-minded people in the past few years have not made a difference.
We need a new set of relationships and we need to increase standards significantly within the time frame. How will we measure that increase? Being okay is no longer good enough for schools, because of the demands on them and the need to improve standards more than ever. I accept that those demands are new. New initiatives always involve risk. I was born in Manchester, and I represent part of Birmingham; places such as those and Leeds, Sheffield and Buckingham have survived only because they were prepared to try something new. I repeat my earlier comments, which were printed in the Leeds press last week. All that we can do when trying something new is stack up the odds in favour of success. I cannot promise that I have done more than that, but I promise that I have put effort into doing that properly.
I shall now discuss the example given about companies. A number of options are available. We could have outsourced, as in Islington. I am happy that Islington councillors were described as willingly agreeing to that. That relationship is good and I am happy for them to take the credit. I do not want the
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credit for that, although I know that the relationship would not have started without intervention. We have used both the method of outsourcing and of letting the LEA get on with the work by itself. I can give two examples from Liberal Democrat-controlled areas. Complete outsourcing was used in Islington. Liverpool LEA was left to get on with it once we made sure that the levers were in place. The hon. Member for Sheffield, Hallam (Mr. Allan) was ungenerous about Liverpool. People in Liverpool are quite fond of us at the moment because they know that our levers brought about those improvements. There is something in the middle, too. The argument in Leeds is not about the public versus the private sector, but about forging a new relationship between the best of Leeds LEA with something new that it currently lacks.
Some of these companies do not themselves have a track record in education. My hon. Friend the Member for Leeds, East was a touch selective so I shall go through some of the others, starting with Birmingham LEA, Arthur Andersen and APS Keele. My local authority in Birmingham will not go to Leeds with the intent of abolishing LEAs. Its chief education officer has spent his working life defending the right of democratically accounted people. The Centre for British Teachers is a not-for-profit provider of education services. Camden LEA is included, too. Serco has a track record not in education but in local government outsourcing. Given the interest of my hon. Friend the Member for Leeds, East in social exclusion, he might remember it better as "Cities in Schools", a small organisation with a valuable and proud track record of dealing with children who have been excluded from school.
The list includes people in the private sector who have expertise in management—much of what has gone wrong in Leeds is due to lack of management—but it brings together people who also have an educational expertise. We are busy building new alliances for a new challenge that is facing Leeds schools. Whether we get it right will depend on the relationship within those new partnerships and the attitude of Leeds and its schools.
In the remaining four minutes, I should like to consider democratic accountability. First, none of the money that goes to schools, which is 85 per cent. of the total schools budget on average, will go near this new company. It will go from us to the LEA and the LEA will decide the funding formula by which it goes to schools. Nothing changes that. We are talking about how the remaining 15 per cent. is spent to run the central services of Leeds LEA. The company will manage and run those services. The contract, the standards and the targets that the company should achieve will be set out by Leeds LEA, not by us, the private company or Ofsted. The democratically elected councillors will agree what the company should provide. They will hold it to account through scrutiny. They will build into that contract penalties if the company does not reach the targets and rewards if it does.
That is a clear role for Leeds local councillors. The council might not deliver those services itself, but it will ensure that they are delivered. When it next goes to the electorate it can explain what money it has given directly to schools, what it has asked the provider to do and how it made sure that the services were delivered. Its opponents will be able to argue the contrary. The

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accountability is there. The council will make sure that the service is delivered. The greatest advantage of that is that it puts the dividing line between strategic decisions, which are matters for locally elected LEA, and aspects of management implementation, which are not.
For the first time in the history of LEAs, the councillors will know what they are doing; the company will know what it is doing and the schools will know what both are doing. That will be the secret of success. There is clear accountability. Everyone knows what to expect for the money. We have devised something new in Leeds. It is a partnership and a board that is not just part of a private company, but is shared 50:50 with Leeds LEA. Although the chairman is appointed by the Secretary of State, he will come from a list compiled by Leeds LEA. The city's history has been one of meeting challenges. Leeds must put Ofsted's arguments behind it and seize this opportunity for the good of the city and its children, schools and teachers. They deserve it. Leeds has represented them well so far. Let us go forward and ensure that the new system works, so that Leeds becomes a flagship for excellent education, as it is in so many areas.
Mr. Roger Gale (in the Chair): Order. We now move to the first of three half-hour Adjournment debates.

Belarus
11.30 am
Mr. Michael Trend: I have been fortunate enough to secure this debate on Belarus. To some people, it is the modern equivalent of Neville Chamberlain's "faraway country" and a people of whom we know little. To others, Belarus has in recent months produced a hero in Vladimir Voltchkov at Wimbledon. It is good to be reminded of that country. Its sorry position and difficult circumstances deserve to be better known in this country.
Recently, I travelled to Minsk as a governor of the Westminster Foundation for Democracy. The Minister and other hon. Members will know that it is both cross-party and party-orientated. That means that we can work to promote democracy together or party by party and with sister parties in countries throughout the world. I went to Minsk a few weeks ago with a group of centre and centre-right European sister parties and European Democrat Union colleagues from Sweden, Poland and Lithuania.
The British Conservative party has long-established links with the United Civic party, led by Mr. Anatol Lebedko. We are also developing closer links with the Belarusian People's Front (Renewal) party and its leader, Mr. Vintsuk Viacorka, who recently visited Westminster. We are keen to continue developing our ties with those parties. On our trip, we met the senior figures from both parties and I was impressed by the way in which they are working together.
Belarus is still a long way behind the countries that surround it; visiting Minsk is like going back 10 or 15 years. The atmosphere is one of oppression and fear, and President Lukashenko is very much an old-style communist leader. I have also visited Moscow recently and it is remarkable how much more liberal that city is than Minsk.
Surely this country and this Parliament have an interest in helping the democrats in Belarus, who deserve our sympathy. We should agree that the right place to put pressure is on Lukashenko, who is directly responsible for the misery and fear, the inflation in the economy and the uncertainty and instability in people's lives.
I shall explain a little of the background. Belarus declared independence in 1991. Lukashenko came to power in 1994 and, two years later, called a referendum that extended his powers considerably. He disbanded the Parliament, which was controlled by the opposition, and replaced the legislature with a body of his supporters, who are scheduled to come up for reelection shortly. I understand that the president has set the election for 15 October.
In 1996, close observers said that the referendum was fixed and western Governments have never recognised its results. As things stand, re-election of the chamber set up by President Lukashenko seems likely to face the same fate: people will not recognise its legitimacy.
Amnesty International published a report on Belarus last month. Again, it sounds curiously historical—like one that might have been written 15 or 20 years ago about the Soviet Union. It begins:
This report gives an overview of the worsening human rights situation in Belarus in the period 1999 to 2000. The unwillingness of the Belarusian authorities to tolerate dissent and independent

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thought and their tolerance of impunity is evident throughout the report. The propensity of the Belarusian authorities to use the state apparatus to repress dissent and criticism, often in the face of condemnation from abroad, through large-scale arbitrary detention and ill-treatment of peaceful demonstrators, imprisonment of prominent opposition figures, the possible abduction of opposition leaders, and the harassment of human rights defenders, academics and independent journalists has been common throughout this period.
Until recently, most observers thought that little could be done and that the course of misery was predetermined. Relations with Russia seemed more important and it was felt that poor Belarus could look after itself. Now, however, some close observers of the political scene believe that, after years in which the cause of democracy appeared to be moving in only one direction—backwards—recent developments in Russia have given rise to a moment of opportunity for Belarus.
President Lukashenko's personal ambitions have to some extent been thwarted by the emergence of a strong man, President Putin, in Moscow. It is difficult to read exactly how Putin will develop and react to international developments, but he may prefer a different leader in Minsk—he may prefer Minsk to show a more open and democratic face to the world at large. The problem is to interpret what opportunities the present moment provides. The immediate and difficult question for Belarusian democrats is whether to engage in the forthcoming elections. Presidential elections are scheduled for next year and I shall return to them in a few moments.
International advice differs. The United States takes a harder line than European countries about the participation of opposition parties in the elections. The week before last, the BBC reported that the United States had formally suspended Belarus from its list of countries with duty-free access to the American market. In a letter to Congress, President Clinton said that that action had been taken because of concern over workers' rights. American officials have criticised Belarus in the past for suppressing trade unions and harassing trade union leaders. The difference of opinion or emphasis between the United States and the Europeans about how best to move forward is regrettable, but it is important to understand it.
Various international bodies—we have already mentioned Amnesty International—take a close interest in developments in Belarus. The Organisation for Security and co-operation in Europe, the European Union, the Council of Europe and the parliamentary bodies associated with them are also interested, particularly in the forthcoming elections. Internally, there is a congress or forum of democratic forces, which co-ordinates political opposition to Lukashenko's regime. It met formally on 2 July and decided to boycott the elections unless Lukashenko agrees to its conditions.
The conditions are intended to ensure a fair contest. There are four, all of which would be recognised in this House. What are the demands of the parties that make up the united opposition? The first is a full-powered and properly functioning Parliament with a proper division of powers—that does not exist in Belarus today because President Lukashenko rules by decree. The second is reformed electoral legislation—in particular, reform of a practice known as early voting, which is an open door for rigging election results. Thirdly, they want guaranteed, real and regular access to the state-run
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electronic media. The persecution of the independent press must stop and the means of distribution of journals and newspapers must be freed up. At present, a paper may be published, but it is often extremely difficult to circulate it. Fourthly, and most importantly, they want an effective and visible change in the political atmosphere—in other words, an end to political repression. Amnesty International has detailed the detentions, disappearances and forcible breaking up of demonstrations in Belarus.
On our fact-finding visit, it was clear that the opposition parties—those opposed to Lukashenko—were not just the centre and centre-right parties, but the trade unions, the non-governmental organisations and other bodies—[Interruption.]
Mr. Roger Gale (in the Chair): Order. This Chairman always wishes to hear the Member who is speaking. Interruptions from the side are distracting.
Mr. Trend: The opposition forces—the political parties, the unions, NGOs and other bodies—are severely beleaguered but unbowed. They act together impressively and come together in a forum. The question of whether to engage in or boycott the parliamentary elections has entered the end—game stage. My strong feeling was that the opposition parties would not take part unless substantial concessions were obtained and could be verified. At present, that seems unlikely.
The opposition parties would prefer, as far as possible, to frustrate Lukashenko's desire to legitimise the elections in international eyes; their eyes are set on next year's presidential elections. There is a good possibility that they will vigorously contest the presidential elections as long as the ground is not cut from beneath their feet in the next few months. They will agree a joint candidate through a primary system, although, for good reasons, they are unwilling to embark on it. That is a good example of the position in contemporary Minsk. If the opposition forces agreed on a chief opposition representative, who would be a figurehead for the presidential elections, that person would be under severe personal threat. It is therefore understandable that the parties would want to wait for a while before deciding who that person should be. That is the atmosphere in which democrats in Belarus have to work, and it is reminiscent of the worst moments of the Soviet Union.
Although I understand the pragmatic view that there might be gradual progress if the opposition parties engaged in the forthcoming parliamentary elections, it is difficult for foreigners who enjoy the luxury of liberty to criticise the present conduct of the Belarusian opposition. To return to Chamberlain, it is a faraway country about which we know little. He was speaking about Czechoslovakia, which is now well within the family of nations that enjoy democracy.
We were accompanied to Minsk by Poles. Ten years ago, people from the Conservative and Labour parties went to countries such as Poland to help them to establish democracy and to develop democratic structures. Now, we believe that the recent experience of Poles is most helpful; the virtuous cycle of the operation is beginning to show itself. One day, Belarus will be a

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country about which we know much more and we will have much friendlier relations with its people. We should never accept that we have reached the limit, but should keep pushing the border forward.
I ask the Minister to join me in urging President Lukashenko to move substantially on the four demands. It is unreasonable for the opposition to take part in the elections unless substantial progress is made. There is no place for President Lukashenko's behaviour in the modern world and we should do all in our power to ensure that he does not have his way. The people of Belarus also have the right to join the family of free nations.
Mr. Andrew Mackinlay rose—
Mr. Roger Gale (in the Chair): Order. Is the hon. Member for Windsor, who is responsible for the debate, willing for the hon. Member for Thurrock to speak?
Mr. Trend indicated assent.
11.44 am
Mr. Mackinlay: I will not take more than a few moments.
I reinforce what the hon. Member for Windsor (Mr. Trend) said and associate myself with his analysis. As a member of the left in Parliament, I am concerned about the denial of human rights in Belarus. President Lukashenko's mandate, and therefore his legitimacy, has long ceased to exist. I was disappointed that the European Union and other western countries did not protest more strongly about it.
I have tabled questions to the Minister about parliamentarians and journalists who have disappeared in Belarus and I hope that the good officers of the Foreign and Commonwealth Office can throw some light on what has happened to them and tell us what representations Her Majesty's Government and the European Union have made on their behalf. We must be constantly vigilant in our monitoring of what happens to opponents of the regime.
I should like my hon. Friend the Minister to make a statement on whether the Government and the EU think that the parliamentary elections in October should be monitored. When I was in Bucharest last week with the parliamentary assembly of the Organisation for Security and co-operation in Europe, there was grave concern that observers from the OSCE and western Governments might validate that which is illegitimate. I do not want to rush a judgment, but we need to make up our mind. A large number of observers will be needed almost immediately. It is not enough to send them 48 hours or three days before polling day.
What is the EU doing for communities bordering Poland and Belarus? Those communities, which depend on cross-border trade, will have a problem when Poland accedes to the EU. Our mission in Minsk is extremely small. I hope that the Minister will reflect on the obvious reasons to upgrade significantly our resources there.
Let me reinforce the point made by the hon. Member for Windsor. Belarus is thought of as a faraway country. I was in Krakow, Poland, on 25 December
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1998 when the treaty was signed by the President of Belarus and the President of the Russian Federation. Although there was great alarm in that region and throughout Europe about the dangerous implications for security and co-operation in Europe, there was not a peep about it in the western press. I returned to the House of Commons and searched for a press report on that major treaty but, despite the enormous ramifications for everyone in the EU and the west, there was no mention of it save a thumbnail in the Washington Post. That underlines how we are fiddling while Rome burns. Belarus is important and, while the totalitarian regime is allowed to endure, dangerous.
11.47 am
The Minister for Europe (Mr. Keith Vaz): The hon. Member for Windsor (Mr. Trend) is a knowledgeable commentator on the situation in Belarus. I congratulate him on his work with that country as part of the Westminster Foundation for Democracy. I am grateful to him for the opportunity to debate Belarus as it enters a crucial pre-election phase. This is the first time that the House has debated Belarus, so it is an important occasion.
I wish to set out the Government's assessment of the underlying situation in Belarus, explain our policy and comment on the forthcoming elections. I regret to say that the flawed Belarusian referendum of November 1996 set the country on an anti-democratic path from which it has not deviated. The referendum significantly increased President Lukashenko's powers, extended his term of office until 2001 and undermined the democratically elected Parliament, the 13th Supreme Soviet. Lukashenko disbanded the Soviet and replaced it with a rubber-stamping legislature largely comprising his own deputies.
To this day, political oppression and the anti-democratic style of Government in Belarus remain a major concern for democratic countries throughout the world. We are particularly concerned about cases of excessive pre-trial detention, politically motivated legal proceedings, the unresolved disappearances of several high profile political figures, the absence of judicial independence, state pressure on the independent media and strong political bias in the state mass media. Current European Union policy is based on the General Affairs Council's conclusions of September 1997, which place restrictions on EU-Belarus relations pending the restoration of democratic rule in Belarus. Those restrictions include withholding technical and financial assistance, except that which is in direct support of humanitarian or regional projects or initiatives that promote democracy; a ban on bilateral ministerial contact; stopping work on the European Union's partnership and co-operation agreement with Belarus, which had reached the stage of ratification by European Union member states; and refusal to support its ambitions for membership of the Council of Europe. The United States has adopted a similarly restrictive policy towards Belarus.
Last year, the European Union attempted to kick-start a rapprochement with Belarus by explaining to the Minsk authorities that the restrictions imposed by the 1997 General Affairs Council conclusions could be lifted step by step if Belarus made progress on specific constitutional and human rights issues. Regrettably, the

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authorities' respect for human rights has not increased in the past year, so relaxation of the restrictions has been impossible.
In addition to applying pressure on Belarus to improve the overall quality of its democracy and show proper respect for human rights, the European Union has been quick to take up specific human rights cases with the authorities in Minsk. Those include the cases of Mikhail Chigir, Nikolai Statkevich, and Valeriy Shchukin. Following Chigir's arrest in April 1999, the EU pressed repeatedly for his release from pre-trial detention and his right to a free and fair trial. The EU has criticised the suspended sentence handed to Chigir in May, which seems designed to prevent him from standing as a candidate in the forthcoming elections, and we have made it clear that we view his appeal to the supreme court as an opportunity to revise the judgment against him.
The European Union has also made it clear to the Belarusian authorities that we regard the legal proceedings against Statkevich and Shchukin as having been politically motivated. We deplore the fact that their sentences seem designed to prevent them from participating in the parliamentary and presidential elections.
Hon. Members would also expect me to say something of our policy towards Belarus. We have strictly enforced the EU restrictions while continuing to work with civil society, the independent media, human rights organisations and non-governmental organisations. Our embassy in Minsk is in close contact with opposition political parties and the independent trade union movement. Leading opposition figures and union leaders have visited the United Kingdom as guests of the Foreign and Commonwealth Office. The hon. Member for Windsor will recall meeting the chairman of the Belarusian Popular Front, Mr. Viacorka, during his visit to the United Kingdom in May. Mention also needs to be made of the excellent work of the OSCE in Belarus.
The OSCE Istanbul summit declaration last November emphasised that only a real political dialogue in Belarus can pave the way for free and democratic elections through which the foundations for real democracy can develop. Through its advisory and monitoring group in Minsk, the OSCE has continued to strive for a breakthrough by maintaining objective and critical dialogue with the opposition and Government. The OSCE parliamentary assembly is another valuable tool for bringing international pressure on Belarus. I am well aware of the important role that Members of Parliament play in that assembly, and of their influence on the strong resolution on Belarus that it adopted in Bucharest earlier this month.
The hon. Member for Windsor mentioned the parliamentary elections. We consider the October elections to be an important opportunity for Belarus to take a step towards real democracy. Delegations representing the OSCE and its parliamentary assemblies, the Council of Europe and the European Parliament have all visited Belarus in recent months and have pressed the authorities to create conditions in
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which the opposition can contest the elections on fair terms. The improvements that are being called for are: first, better opposition access to the state media; secondly, a pre-election environment free from political persecution; thirdly, the strengthening of the electoral code; and fourthly, more powers to be given to the Parliament that is to be elected.
European Union ambassadors in Minsk have frequently put the same message to the Government of Belarus. Subject to Belarus's ability to create appropriate conditions for a free and fair election, the international community will consider whether to take up the Belarusian authorities' invitation to monitor the elections. Time is now pressing, but it remains possible for the Belarusian authorities to take the necessary steps, as set out by the OSCE and others, to provide a proper environment for a fair election.
As Belarus's closest ally and leading trading partner, Russia has more potential than any other country to exert influence on Belarus. During a recent meeting of EU senior officials with Russia, the EU side called on Russia to use its influence to convince Belarus of the advantages of free and fair elections. We will continue to take that approach in our discussions with the Russians.
Although it is looking increasingly unlikely that many of the Belarusian opposition parties will contest the forthcoming elections, we encourage them not to close the door on the opportunity that the elections might represent. I heard what the hon. Member for Windsor said about whether they should contest the elections. Their participation in an election that proved flawed would not be regarded by the international community as validation of that election, as some of the opposition parties seem to fear. On the contrary, as the recent example of Zimbabwe has made clear, participation in elections can make an important statement even when the conditions in which they are contested are not free and fair. Of course, the presidential election in 2001 marks another important opportunity to move towards democracy in Belarus. I hope that the opposition parties there will contest that election and offer a genuine choice to the people of the country, bearing in mind all the caveats that I have mentioned.
The Government share the concerns of the hon. Members for Windsor and for Thurrock (Mr. Mackinlay) about the situation in Belarus. We agree with the hon. Member for Windsor that closer relations with Belarus are desirable but can be envisaged only when Belarus brings itself back into the fold of democratically governed European states. I hope that the Government of Belarus will take the necessary steps quickly to ensure that that happens. I am convinced that improved relations with Belarus are in everyone's interests, not least those of the people of Belarus itself. However, it is up to the Government of Belarus to prove that they have changed and that they wish to make a genuine success of democracy.
Mr. Roger Gale (in the Chair): Order. As the sponsoring Member and the Minister are both present, we may move to the second of this morning's three half-hour Adjournment debates.

Tooting
11.58 am
Mr. Tom Cox: I wish to raise an issue of major importance to my constituency, which is in the London borough of Wandsworth—the local council's application for £5 million under the single regeneration budget for the development of facilities in the Tooting area. The application is supported by the Tooting town centre partnership board. I pay the warmest tribute to local councillors representing wards in the area, who fully realise the importance and need for the approval of the application and also the importance of me, as the local Member of Parliament, doing all that I can to support and highlight the application.
Tooting is one of the key centres—if not the key centre—of the borough of Wandsworth. Many aspects of Tooting have changed in the years since I first became the Member. When I first came to the House, there was only a small ethnic community. Over the years, it has greatly increased. People have come into the area from many countries. Many of them arrived with little, but by hard work and commitment they now run well-organised businesses that provide important local services not only to the people of Wandsworth but to the many people who come into the area to shop and work.
Those who work in the community provide the day-to-day services that it needs, in hospitals, other health services, social services and schools. The people of the community have built up excellent day centres through hard work and commitment. Churches are run by people from many different countries; with temples and mosques, they play a major role in our community. Many of the youngsters in our schools were born in this country, but their parents are from many overseas countries. It is always a joy to visit those schools; there one sees developments taking place that will build the sort of multiracial society that we want. We in Tooting are proud of what our local community has done and what it is committed to continue doing.
The bid to which I refer had to be submitted by June 2000 and I understand that a decision will be taken later this year. We obtained a wide range of local views, especially from young people. A large number of people are unemployed and youngsters feel that they are socially excluded; sadly, nothing is worse for the area. The views of local residents' groups were sought, because they are often concerned about the behaviour of young people. The citizens advice bureau mentioned the development of projects for young people and also for smaller groups.
The views of local church groups were sought—we all respect them for their role in the day-to-day life of our community. They made a number of important proposals, including more support for families under pressure, helping one-parent families, tackling drug abuse, offering help and information about possible careers to young people, advising on health and trying to ensure that youngsters do not fall through the net—all problems that are common in many parts of the country. I could cite the many other groups that have supported the application, which has widespread agreement.
I mentioned the changes that have taken place in the Tooting constituency. Our Asian community now comprises more than 15 per cent. of the local
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population, and our Afro-Caribbean community is more than 14 per cent. Other issues highlight our case. For instance, about 25 per cent. of the young unemployed people in the borough live in the area covered by the proposals contained in the single regeneration budget bid, and 36 per cent. of households with children now living in the area are on benefit—that involves about 2, 500 children.
We have a high teenage pregnancy rate and we have suffered a large increase in youth crime—something else that the budget would allow us to tackle if the bid were approved. Young people have repeatedly highlighted the need for more local recreation and leisure facilities. The exclusion rate from local schools is higher than the national average in what would be the single regeneration budget area. The drop-out rate among our Afro-Caribbean young people in business start-ups in what would be the single regeneration budget area is also very high.
I have been frank about what the local community wants and hopes to see. I have given a clear outline of the problems that we face and of how we hope to develop the central Tooting area, if we obtain the funding. The key development in the project would be a major town centre facility for young people. That is a priority and young people tell me that repeatedly. The facility would be developed in line with the views and wishes of young people. It would be attractive and comfortable and would offer access to the arts and music. It would provide advice on health, employment and training and information on the opportunities that exist in the area. There would be the full range of services that youngsters have told us that they want. We are committed to ensuring that local young people have a voice and are encouraged to make their views known. We must be in the forefront, listening to what young people want from the regeneration of Tooting. We have a large ethnic population and we want to build a community that will develop the richness of that cultural diversity.
All of us can have great ideas and hopes, but we need money. We attach great importance to local views and proposals, particularly those of young people. Young people have much to offer but they can, sadly, be turned off if they see no developments. That is why the bid is so important. We want to keep alive the interest and the culture of young people and provide a modern centre for them. We must encourage young people to start up new businesses, creating work for other young people in the area. That would create a sense of pride in their role in building up the local economy.
In Tooting and throughout the borough of Wandsworth, local councillors and local people want the project to succeed, which is why I, the local Member of Parliament, sought this debate. We look to the Government to support the project and we are in no doubt that we have presented an outstanding case. I hope that the Minister will confirm today the Government's support for our application for £5 million from the single regeneration budget. Then, we can tackle issues such as unemployment and how to get people off benefit, reducing the rates of teenage pregnancy, combating crime and getting more young people into business start-ups.

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Getting people back into work has been one of the Government's outstanding successes. The money saved by doing so is important, but it is even more important that people should have pride in their jobs and in their local area. We must bring hope and opportunity to the area and its people. That is what we hope to achieve by applying for funding from the single regeneration budget. I look to the Government, in conjunction with the Government office for London, to support the project. My constituents, whom I am proud to represent, need the project.
I ask the Minister to give urgent attention to the following two matters. First, Gatton Road school, in the heart of Tooting, is now closed and to be sold, but was once used for other purposes within the community. I walked around that school at the weekend; it is on a site of 1.2 acres and amounts to 36, 000 sq ft, and could be the ideal centre for the sort of project that my constituents, the local councillors and I want to be developed. I ask the Minister to contact Wandsworth council about that possible sale—not next week or next month, but in the next day or two. There is an enormous "for sale" board outside the school and I hope that she and her officials will find out why it is being put on the market when, in the view of many local people, it could be used for the sort of project that I am supporting today.
I will give the Minister a copy of the letter sent to me by Councillor Pam Taplow, one of the local councillors for the area. She says that, at the July meeting of Wandsworth council, cuts were announced of more than £180, 000 from the youth service budget. I hope that she and her officials will take the matter up with Wandsworth council and find out why such a thing is happening when we are seeking money from the single regeneration budget. I have here some of the attractive publicity material that the borough of Wandsworth has put together so well. The headings are "Youth is the key" and "Green light for £5m Tooting bid".
I hope that the Minister will be forthcoming in her response and tell me that the Government intend to support the bid. However, I also ask her to take up the two matters that I have just raised—the selling of the school and the cut of £180, 000 from the youth service budget—with the officials of the borough of Wandsworth.
Finally, my comments show that I fully support the bid. I want it to succeed, as do local councillors in that area and the people whom I am proud to represent. I hope that, after her response, my constituents and I will feel that we are on the way to winning the money because we have the full support of the Government. We need it for the benefit of the area and community and, especially, for the benefit of young local people.
12.14 pm
The Parliamentary Under—Secretary of State for the Environment, Transport and the Regions (Ms Beverley Hughes): First, I congratulate the hon. Member for Tooting (Mr. Cox) on securing this debate on such an important issue for his constituency. He has spoken of the contribution made by all the people of Tooting to the well-being and richness of that community and I applaud the way in which he celebrated its diversity. He also clearly outlined some of the needs that people in
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Tooting continue to face. He conveyed his message with genuine commitment and feeling for the people whom he represents.
The Government view the single regeneration budget programme as an important instrument in our drive to tackle social exclusion and create equality of opportunity. By reducing the gap between deprived and other areas and between different groups, we want to improve the quality of life of local people, especially in areas in need. That includes the important issue of tackling the disadvantage undoubtedly still experienced by people in this country's minority ethnic communities.
I am sure that my hon. Friend will be aware of the considerable benefits that have accrued to London boroughs through the SRB programme. The first five rounds of SRB in London have resulted in 197 successful schemes, which have attracted £1.2 billion of Government funding in their lifetime. Those schemes are expected to lever in a further £2.2 billion of private investment, creating or safeguarding around 186, 000 jobs and establishing many thousands of new businesses. The SRB programme is clearly designed to try to achieve what my hon. Friend seeks in Tooting.
Four schemes have been under way in the London borough of Wandsworth, with Government funding of £22.5 million. The largest of them is the transformation of Wandsworth's town centre, which has focused on the Arndale centre—a large new shopping centre below an estate of high-rise council dwellings. The scheme is successfully improving the area's commercial, housing and social problems. Wandsworth is also involved with adjacent boroughs in four other schemes and in some pan-London schemes. The SRB has clearly made a significant contribution to London as a whole and especially to Wandsworth.
I shall explain to my hon. Friend this year's decision-making process on round 6 of SRB, as it is important to his point. SRB round 6 was launched at the end of last year and is expected to provide an additional £300 million for London in the next seven years. Its main objectives are to support and promote growth in local economies and businesses, to enhance the employment prospects, education and skills of local people, to tackle social exclusion and enhance opportunities for disadvantaged people, to promote sustainable regeneration, and to tackle crime and drug abuse and improve community safety. We injected extra funding into the SRB scheme nationally. We modified the framework to give greater clarity to bidders and to secure the greater community involvement that my hon. Friend says is such a strong feature of Tooting's bid.
Partnerships were invited to submit expressions of interest to the Government office for London in March. As my hon. Friend said, one of them was the scheme proposed by Wandsworth borough council, which aimed to support and involve young people in Tooting. Officials concluded that the proposals supported the objectives identified by the social exclusion unit in its "Bringing Britain Together" report. Tooting is also one of London's 68 priority community regeneration areas—identified as being the capital's focal points of need and deprivation. The Government office for London therefore encouraged Wandsworth to submit a bid on the basis of the expression of interest.

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As my hon. Friend will be aware, the delegation to the mayor of London came into effect recently, on 3 July. With that transfer, responsibility for the approval of London SRB round 6 bids has passed to the mayor. It is his responsibility to decide how the money in SRB round 6 will be allocated across the submitted bids. The London development agency now exercises the day-to-day management of the SRB programme on his behalf. The Secretary of State's functions of giving guidance or directions to the agency are also now exercised by the mayor. In relation to London, Ministers have no further role in directing or giving guidance to the LDA. The mayor will be making the decisions.
My fellow Ministers and I have a legitimate interest in ensuring that the delegated functions are exercised by the mayor in accordance with the conditions of those delegations. If, at any time, the mayor or the LDA did not comply with the terms of delegations, Ministers would have the power to intervene, but only by revoking the whole of the delegated function. I have provided a fairly detailed explanation so that my hon. Friend will understand that decision making about allocation of resources under SRB 6 rests wholly with the mayor of London.
My officials made inquiries in the light of the Adjournment debate and I now understand that the Tooting bid was submitted and is being assessed along with the other London bids by the LDA, which will advise the mayor. I am told that the mayor will make his final decisions on the successful schemes at the end of this month. I hope that my hon. Friend will appreciate that although I cannot comment on the eligibility of the bid, which is a decision for the mayor, I shall try to respond to his points.
The bid for funding, which my hon. Friend outlined in relation to the Tooting submission, involves a number of key projects: training in information and communication technology through a learning matrix, which is very important; additional support for young learners to provide progression routes to further and higher education, which, as he outlined, is an important mechanism in trying to ensure that young people raise their capacity to obtain employment; involving businesses in providing work opportunities; involving families in education by providing family and community learning support; encouraging youth participation in community projects and volunteering; working with young people at risk of offending, to reduce youth crime and try to prevent their route into criminal activity, which would clearly be to their great disadvantage; providing facilities for young people in sport and cultural activities; encouraging young people to start up businesses; providing support for young people with mental health problems; and preventing drug abuse.
A strong feature of the bid—which the Government are supporting in SRB bids in the rest of the country, where we are making decisions—is the extent to which young people and those from ethnic minority groups have been involved from the outset in building up the bids, setting the priorities and trying to define some of
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the solutions, in terms of the projects specified for tackling some of the difficulties and problems that those young people face.
In other parts of the country, we have made it clear that we want more bids to focus on ethnic minority communities and their groups—they should be lead partners rather than merely the recipients of projects administered and managed by other people. My hon. Friend will be interested to know that I am discussing with other regional development agencies their submissions and I am making the point strongly that the Government feel that minority ethnic communities have not been sufficiently represented so far. The SRB bids that we will approve will require more focus on their needs. I have no reason to suppose that that will not also be an important focus and criterion for the mayor of London when he decides on bids from London authorities. In areas such as Tooting, where ethnic minority populations are concentrated, it is important that those people engage in the regeneration process and are involved in developing and delivering the bids and ensuring that the outcomes meet their needs. I was pleased that a combination of methods was used to get young ethnic minority people in Tooting involved in the regeneration process that has led to the bid. I am sure that that is a great strength.
My hon. Friend raised two specific issues: the school that has been closed and Wandsworth's budget. I shall ask my officials to look into the question of the school, which is a matter of local democratic decision making. If, after consultation, Wandsworth council decides to go ahead with the sale, and does so in an appropriate and legal manner, Ministers have no power to intervene in the process. However, I understand my hon. Friend's point about the school being an asset that, if the SRB bid is successful, could be used as a centre to support the project. We cannot deter Wandsworth, but I shall certainly instruct my officials to speak to the council on the matter and check that they have taken cognisance of my hon. Friend's point, which is sound and valid.
The council's budget is also set democratically and I cannot intervene to tell Wandsworth to revise it. I accept my hon. Friend's point that it would not look good if Wandsworth were the lead partner in a bid for additional Government money to develop services for young people while at the same time—according to his information—taking money out of its own budget. When the mayor considers the bid, he may want Wandsworth to explain that matter, in terms of deciding on the allocation of money. I hope that Wandsworth council will take that on board.
I regret that I cannot assist my hon. Friend directly, as the power to make such decisions now rests not with Ministers but with the mayor. However, my hon. Friend has fulfilled an important function on behalf of his constituency by raising the issue and hearing my remarks on the strength of the bid. I hope that he will make representations to the mayor before the end of the month.
Mr. Roger Gale (in the Chair): Order. As the Member sponsoring the debate and the Minister are both present, we can move on to the third and final half-hour debate.

NHS (South Gloucestershire)
12.27 pm
Mr. Steve Webb: It seems appropriate to have a debate about cancelled operations and waiting times on a day when the Chancellor will no doubt announce—or re-announce—the investment of vast billions of pounds in the health service during the coming years. I make no apologies for raising the topic, as it is one that will not go away. In my constituency surgery and mailbag, day after day and week after week, the pressures on the local health service are among the biggest issues. I am grateful for the opportunity to bring them directly to the Minister's attention and I hope that he will offer some encouragement for the future.
I have nothing but praise for doctors, nurses and the other NHS staff—who are often not mentioned on such occasions—and for the work that they do in our local hospitals. I am not criticising them, as they need and deserve our support. They are trying, under great pressure, to deliver a first-rate service. By bringing such concerns to the Minister's attention, I hope that the Government will be encouraged to do more to support them. I shall comment on three issues: cancelled operations, waiting times, and plans in the local area to try to address those problems.
I shall set the context in relation to cancelled operations. The latest figures show that in England about 1.1 per cent. of operations and elective surgery are cancelled. In the Avon area, the figure is 1.9 per cent., which is a little less than double the rate of cancellation. I was alarmed to receive statistics from the House of Commons Library that showed a much more rapid deterioration in Avon than elsewhere in the country. The Library has given me quarterly figures to 1999–2000 from 1995–96. In that period, the number of cancelled operations throughout the country rose by about 11 per cent., while the number in Avon rose three times as fast. The problem of cancelled operations is clearly national, but it seems to be especially acute and rapidly becoming worse in Avon. I realise that Avon is not the worst authority by any stretch of the imagination according to these dodgy, or, rather, unwelcome, league tables, but clearly the problem is quickly becoming much worse.
The Library's statistics show not only how many operations were cancelled but how many breaches of the patients charter followed. It is a requirement that, once an operation is cancelled, treatment should take place within a month. Of the growing number of cancellations, the proportion of operations not performed within a month of cancellation doubled. Three times as many operations were cancelled and double the proportion of that larger number were not treated within a month.
The charter was breached in every quarter from the start of 1995–96. It was never breached more than 100 times in a quarter until the final quarter of this year, when it was breached 221 times. To humanise that figure, 221 people who looked forward to the date of their operations may have arrived at the hospital, or were telephoned first thing in the morning, to be told that their operations would be cancelled and they did not receive treatment even within a month of the time expected. That is a serious problem. A cancelled operation is one of the cruellest experiences possible and it seems to be happening much more and far too often in Avon.
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The trusts that serve south Gloucestershire—the subject of the debate—and North Bristol NHS trust have kindly provided me with some briefing material, as has the health authority. When I requested the debate, I was not aware of the statistics. All that I had seen were the faces coming to my surgery, from which I observed that a problem existed.
The figures bear out that first-hand, anecdotal experience. I have been given monthly figures for cancelled operations from last October. In a typical month, if such exists, North Bristol NHS trust cancels 80 operations, which is, obviously, 80 too many. In January, it cancelled 253 operations—more than three times as many. At the time, we heard a lot about winter pressures, which I had the opportunity to discuss in a separate Adjournment debate in the House. Cancellations on that scale cause misery for far too many people. Clearly, winter pressures were part of the story, but even in summer the trust has to cancel 80 operations a month. The trust's briefing suggests that long-term trends are involved, which are not going away. Long-term upward trends are evident in emergency admissions, the number of over-85s admitted and length of stay in hospital.
The word that has arisen in researching the topic and speaking to hospital staff is "pressure". I am told that in summer it used to ease off, but now all year round there is pressure and a lack of capacity. The lack of capacity in the local NHS was evident from the national beds inquiry, which showed that Avon is an outlier. It has one third fewer hospital beds per head of population than the national average and about one fifth fewer than the regional average.
The strategy proposed is to use community care and nursing homes to help people to stay in their own homes, and to rely less on keeping people in hospital. We would all sympathise with that objective. However, the downside of that strategy is that when the pressure comes, no slack and, therefore, no capacity is available. According to the health authority briefing, the bed figures
may explain why, at times of peak demand, the option to increase emergency capacity by the cancellation of surgical procedures is utilised.
In other words, no slack is available: hospitals must cancel operations. That is a source of great anxiety.
I could list many cases of people whose operations have been cancelled and who have come to see me. The Minister is well aware of the nature of the problem. It is the cruellest experience to have an operation cancelled on the day or in hospital, and that cruelty is compounded by the fact that some of my constituents have had operations cancelled two or three times. They phone me up and tell me of the cancellations and I feel completely helpless. I write to the trust, which tells me that there is a perfectly good reason, such as a sudden influx of emergencies or what are called medical outliers—that is the term for people being treated for whom there are no beds, who therefore take those that would have been used by the people due to have operations. There is always a good reason, but when will the situation end?
Cancelled operations are part of the story—one symptom of the pressure on the local NHS. Long waiting times are the other side of the coin. The Minister

39WH
responded to a previous debate of mine about a year ago on orthopaedic out-patient waiting times. It is unfortunate that I have to raise again the fact that, despite an awful lot of imagination and effort on the subject of orthopaedic out-patient waiting times in the Avon area, the waits are still unacceptable.
The problem is not only in orthopaedics. One of my constituents—I shall refer to him only as Mr. K—needed a heart bypass. He was told in March 1999 that he was on a waiting list and is still on it 15 months later. I wrote to the United Bristol Healthcare NHS trust, which said that it was sorry and that he would be seen within the absolute upper limit of 18 months. The chief executive said that the trust had
encountered numerous problems in the past year in admitting routine patients for cardiac surgery.
Of course, my constituent does not think that his is a routine case. He feels that his heart problem is getting worse with every passing month. He is unhappy to be told that his is a routine case and that 15 months is therefore acceptable. The trust does not want the situation to have dragged on so long, but it is only at 18 months that he will go to the top of the queue. One reason is the number of urgent admissions, which obviously take priority. The blackly humorous word doing the rounds in the Avon area is that the only way to receive heart treatment is to have a heart attack. That is the way to jump to the head of the queue, or the wait is 18 months. That situation is deplorable.
The chairman of the trust says that there is a shortage of theatre staff for cardiac and thoracic surgery and that that has tended to lead to a large number of cancellations. He also says that there will be seven new beds, which is welcome. He does not say where the staff will come from, which is worrying if there are not enough staff for existing operations.
All sorts of surgery are affected. Another constituent, Mr. H, needed the condition of his heart investigated through an angiogram. He was told that it would be a year before he could have that done—a year before staff could assess what treatment was needed. The trust reassures me that it monitors people and if it thinks that a situation is urgent it will carry out treatment straight away. Mr. H was told that he could wait a year, so he paid privately for an angiogram, which concluded that he needed quadruple bypass surgery. If he had not had the angiogram and the need for the surgery had not been detected, would he still have been alive to have had the surgery? How many people come off waiting lists because they die?
The key promise that I want from the Minister today is to investigate the reasons why people come off waiting lists. I want him to consider not only death, but people forced to go privately even though they have no private health insurance cover. I do not mean members of BUPA or any such organisation, but ordinary members of the public who are put on waiting lists but see their health deteriorating as month after month goes by. Many are in discomfort for months, losing earnings—not all the people involved are elderly by any means—and cannot face the wait. They are driven to raid their life savings of thousands of pounds to have private treatment.
I shall give the example of a mother of two from Thornbury in my constituency, who was told by her doctor that she should see a consultant about an ear
40WH
condition. She waited for the appointment, but time went by, so she paid privately for a consultation and was told that she needed an operation for a degenerative ear condition. It must be the worst possible scenario to be on a waiting list with a degenerative condition, because people in that situation know that each week and month that goes by makes them worse. Her NHS treatment was cancelled and she got to the stage where she was so desperate that she paid thousands of pounds, which she could ill afford, for a private operation. After being treated, she was told that if her condition had deteriorated for as long as the NHS was prepared to let it, and she had waited until the date she had been given for NHS treatment, there was a high probability that she would have suffered a stroke. She was also told that the delay between diagnosis and treatment had meant that her condition had degenerated so much that she would not recover the hearing in her ear. Had there not been such a delay, there would have been enough bone left to insert a hearing aid into the ear and her hearing might have been saved.
I wonder how many similar stories there are; we do not know because there is no evidence. I have tabled written parliamentary questions asking the Government to collect data on the people who come off NHS waiting lists by paying privately and have been told that such data are not collected. As a matter of priority, they should be. I hope that, if he says nothing else, the Minister will assure me that that data will be collected so that we can monitor how many people are being forced into that situation, over what time period, in what parts of the country, in what specialisms and how serious the situation is. If ever there was an indicator of pressure in the NHS, it is people desperately trying to buy their way out of long waiting lists.
A final constituency case is Mrs. E, from Chipping Sodbury, who was told in May 1999 that she faced an 18-month wait to see a consultant. She could not afford the £6,000 for private treatment and she badgered the hospital by ringing every week—at one stage, I gather, every day—and after 13 months she was seen and told that she was now on the in-patient waiting list for treatment. So she had waited 13 months to be told that she could be on the waiting list. She has had to give up full-time work and work part-time because of the discomfort. Her consultant was recently quoted as saying that the situation is extremely frustrating but medical staff have little control over it, that he did not know how they could get round it and that he felt very sorry for the patients. I therefore criticise not the people who work in the NHS but the system that puts them in the impossible situation of telling patients that they cannot be treated and of cancelling their operations.
Things are happening in the Avon health authority area. Money is going in and plans are afoot. We are told that there will be improvements in cardiology and orthopaedics. A hospital-at-home scheme, costing a quarter of a million pounds, will reduce the pressure on beds in hospitals—which should in turn mean fewer cancellations. Frenchay hospital is gaining 28 acute medical beds and there is work in the community to prevent people from coming into hospital in the first place. That is all part of the picture.
However, I am concerned about the conclusions of the briefing that I received from the local NHS trust. It says that it is making headway on cancelled operations and

41WH
believes that it will break the back of the problem, maintaining good performance on in-patient waiting times. However, my heart sank when I read that it is falling behind in out-patient targets. Something tells me that, unless things change dramatically, the Minister and I—the electorate permitting—may be here again another year, and another year. I may have more tales of woe and more tales of cancelled operations and unacceptable waiting times. I asked the Minister last time if he would take responsibility for the situation, because everyone always blames everyone else. Things are being done and money is being put in, yet the problems are still with us and I see no imminent prospect of a dramatic improvement.
We need hard evidence about the consequences of long waiting times and cancelled operations and of people being driven to fork out private savings for care that they should be able to get on the NHS. I hope that the Minister will promise such research and hard evidence on the scale of the problem and will reassure me that we do not need to be back here in 12 months.
12.44 pm
The Minister of State, Department of Health (Mr. John Denham): I congratulate the hon. Member for Northavon (Mr. Webb) on securing the debate. He described several problems, but I am not convinced that his proposal to divert resources from patient care into the bureaucracy of running surveys will cut waiting lists or improve the quality of care from the national health service. We need to deal with the problems of long waits and cancelled operations not only in the hon. Gentleman's part of the country but all over. That is the right way to reduce the number of cases, which I accept, from my constituency experience and his, is leading people to choose private treatment. We can reduce that number by improving service quality.
I shall describe our strategy and some of the changes occurring in Avon as a direct result of measures introduced by the Government. The hon. Gentleman will understand that he might have to wait until we publish the new national plan for the NHS next week to learn all the details. I recognise that the recent high number of cancelled operations at North Bristol NHS trust has increased the length of time that patients must wait for operations. The hon. Gentleman described clearly the effect on individuals, the disruption to their lives and families and the delay in providing their treatment, which I accept have occurred. We are investing heavily in the NHS and I shall shortly set out some of the measures that that investment has facilitated.
In common with some other trusts, since before Christmas, North Bristol NHS trust has been forced to cancel many elective in-patient operations, primarily because of the high level of emergency medical admissions, as the hon. Gentleman said. That phenomenon has continued well past the usual winter pressures period. The current level of admissions is far higher than that in previous years and has lasted longer. The significant decline in admissions that usually takes place at the end of the winter has not occurred—that is in addition to a steady underlying increase in the number of admissions to the trust hospitals in the past few years. The number of patients requiring emergency admission has made it necessary occasionally to admit those
42WH
patients to surgical beds. That has forced the cancellation of operations for the patients who would otherwise have used those beds.
It is a significant achievement that the trust has continued to meet its in-patient waiting list targets during this difficult period. Those figures represent patients successfully treated. Out-patient figures remain unacceptable, although since we last spoke, the figures have fluctuated. The numbers considerably improved but, regrettably, they slipped back again, particularly in orthopaedics. However, I understand that the trust plans to appoint an additional orthopaedic consultant from September. I hope that that will put back on track the progress that the trust had begun to make.
In response to our national initiatives, the trust has prepared a detailed management plan to reduce the number of over-13-week waiters in out-patients and to manage GP referral rates more effectively. The trust has introduced a partial-booking system for out-patients. Such systems were piloted in Basildon and Chesterfield and were shown to reduce out-patient waits significantly. We will publish a report about that project, which will roll out nationally, in the next few days. I understand that the trust's plans contain proposals for considerable work in the four specialities in which the out-patient waits are longest.
The trust and the health authority are working together to resolve the problems facing the trust. We should discuss briefly the Government's wider assistance for the NHS. A key part of our help is in providing the necessary funding to support front-line staff and services in meeting the increasing pressures on them. Like the hon. Gentleman, I pay tribute to the staff in the trust for their hard work. They work under great pressure.
As the hon. Gentleman knows, my right hon. Friend the Chancellor announced the largest ever sustained increase in NHS funding in the Budget. In the next four years, expenditure on the NHS will increase by an annual average of more than 6 per cent. in real terms. That is twice the historic rate of growth in funding. This year, the NHS will receive a total increase of £4.17 billion. Of the new money for England, £600 million has already been allocated to health authorities to meet local pressures and a further £60 million from the performance fund will be made available when they meet specified levels of performance. Additional sums of money have also been released, including investment in critical care beds, which will help to tackle some of the problems that the hon. Gentleman outlined.
The total allocation in Avon this year was nearly £642 million. That is an increase of £37.5 million or 6.3 per cent. That money will enable Avon health authority, working together with local NHS trusts, to reduce waiting lists and times for both in-patients and out-patients and to expand services. The hon. Gentleman made an important point: the provision of money on its own will not treat patients unless we have trained staff to provide the clinical services. We have seen big increases in the number of doctors and nurses employed in the NHS in the past three years. By September last year, the number of doctors employed in the trusts in the Avon health authority had increased by 14.5 per cent. Since April last year, the North Bristol NHS trust has appointed 12 new consultants and five registrar posts have been approved. In the past year, it has also employed more than 50 new qualified nursing staff.

43WH
Significant though those rises are, we still need more staff. That is why we have expanded nurse training, why we recently announced the expansion of medical school provision and why we are increasing the number of nurses and doctors that we want to employ. For the past two years we have run a national recruitment campaign aimed particularly at nurses. In the south-west region, about 183 nurses who had left the profession returned to the NHS last year, and since February this year, a further 136 nurses have returned to the NHS.
The number of nurses entering training each year in the Avon, Gloucestershire and Wiltshire training consortium area has increased by 26 per cent. since 1996–97. This year, the number of training places will be expanded further so that 41 per cent. more nurses will enter training than did so in the last year of the previous Government. The hon. Gentleman recognises that it takes time for that investment in training and training places to feed through into the supply of nurses available to the NHS.
In Avon itself the health authority received record additional levels of funding this year, with an increase of £37.5 million. The health authority is spending £11 million of that on meeting the priority of reducing waiting times for both in-patients and out-patients. The North Bristol NHS trust has agreed a £5.5 million package of investments to tackle its problems of capacity, reduce the number of cancelled operations and achieve reductions in the number of patients who are waiting too long for both in-patient treatment and out-patient appointments.
The measures in the package will mean that the trust will open an additional 90 beds this year. As the hon. Gentleman said, if one applies the conclusions of the national beds inquiry, he represents an area where there are fewer beds than in general. The opening of those additional 90 beds will be welcome. It is also important to understand how it is intended to use the beds. Those extra beds and wider changes in the way that beds are organised at the trust will allow the surgical beds at the Avon orthopaedic centre to be ring-fenced for surgical work. That means that they will not, hopefully, be occupied by medical emergencies, with the knock-on effect on cancellations that has been described. The orthopaedic centre has been most affected by the need to accommodate medical patients.
Mr. Webb: The Minister has only a few minutes left. I am interested in the key point about the evidence of people coming off lists into the private sector. He had the nerve to talk about spending money on the bureaucracy of surveys. How many millions of pounds were spent on the survey that he sent to millions of NHS users and staff, and how much would it cost to gather the information that I want, which would expose what is going on in the NHS today?
Mr. Denham: We all want shorter waiting times for out-patient and in-patient treatments. That should reduce the number of people wanting to go private rather
44WH
than go on NHS waiting lists. I see little value in spending money on studying that matter when we could use it to cut waiting times.
The involvement of patients in shaping the new national plan was essential. We want a more patient-centred NHS than we have had, and it is doubtful whether we can achieve it without some form of patient consultation. As I recall, the consultation exercise cost about £200,000 to £250,000. The exact answer is likely to be on the official record, perhaps in response to parliamentary questions tabled by the hon. Gentleman.
Mr. Webb: I am still sceptical about the exercise. Can the Minister specify three points that were learned through the consultation exercise about patients' views that were not known before it?
Mr. Denham: The hon. Gentleman may want to wait for the national plan. However, basic cleanliness and a clear management structure in the wards were given a high priority by the public, which is not always clear from talking to managers and others within the health service. Understanding how the health service appeared to patients was valuable and helped to shape the national plan. The hon. Gentleman will have to wait a few more days to establish whether we have adequately reflected the consultation in our proposals.
The trust will also use nearly £750,000 on several schemes to deal with the problems of rising medical admissions and the cancellation of operations. The aim is to prevent inappropriate admissions and to facilitate the discharge of patients back into the community. The schemes include the appointment of a specialist registrar and staff positions in cardiology at a cost of £170,000. That will improve the availability of cardiac services, which the hon. Gentleman identified as a priority area, help to manage emergency demand more effectively and reduce admissions.
More than £250, 000 will be invested in expanding the trust's existing hospital-at-home scheme, which helps to prevent unnecessary admissions and allows a speedier discharge of patients. About £170,000 will be invested in the community-based multidisciplinary stroke team and in additional outreach and rapid access occupational therapy and physiotherapy. The idea is to provide an intensive outreach rehabilitation service to enable patients to return to the community more quickly, and to support them in their homes.
I am aware of the hon. Gentleman's long-standing concern about the length of out-patient waiting times at the North Bristol NHS trust. We have had the opportunity to debate those issues in the past and I can assure him of my continuing desire to see substantial improvements. The Government have helped by making investment available in the previous and the current year, which should have an impact on the problem. I accept that some patients are waiting far too long at present. The trust has targets for improvement in the coming year, and we shall provide it and its staff with all the support that we can to achieve those targets.
Question put and agreed to.
Adjourned accordingly at two minutes to One o'clock.

DEFENCE

  PFI Contracts
  Mr. Matthew Taylor
  To ask the Secretary of State for Defence (1) what mechanisms are in place to monitor the(a) service provided by defence projects delivered under the private finance initiative and (b) performance of PFI contracts for projects already operating; [128590]

  (2) what monitoring is undertaken by his Department of Private Finance Initiative contracts; and if he will make a statement; [129202]

  (3) what the average period of time is between the completion of a full business case and signing of the final contract for PFI contracts in his Department; and if he will make a statement. [129204]

  Mr. Spellar
  MOD signs PH deals when appropriate contractual arrangements have been negotiated in order to secure best value for money. The time taken to complete such deals varies from contract to contract. Detailed records covering this particular aspect are not held centrally. Each PFI contract contains performance measures against which service provision is reviewed. MOD also seeks to apply lessons learned from its own PFI deals and from elsewhere in Government, drawing on guidance from the National Audit Office and other relevant bodies.

  HMS Orwell
  Mr. Quentin Davies
  To ask the Secretary of State for Defence what the operational status is of HMS Orwell. [129857]

  Mr. Spellar
  HMS Orwell was decommissioned on Monday 10 July 2000.

  Sierra Leone
  Mr. Hancock
  To ask the Secretary of State for Defence what steps he has taken to ensure that the 5 million rounds of 7.62 mm ammunition and the 4,081 mm mortar bombs provided to Sierra Leone by the UK Government are used only by the legitimate Government of Sierra Leone; and if he will make a statement. [130481]

  Mr. Hoon
  The issue of light weapons and ammunition provided by the UK Government to the Government of Sierra Leone, including the 5 million rounds of 7.62 mm ammunition and 4,000 81 mm mortar bombs, is controlled by a senior British military officer in Freetown. The Government of Sierra Leone has provided assurances that all weapons and ammunition will be used only by regular Sierra Leone Army soldiers and in accordance with international humanitarian law and human rights standards.

  Nuclear Weapons (Iraq and Israel)
  Mr. Savidge
  To ask the Secretary of State for Defence what recent assessment he has made of the nuclear weapons capability of(a) Iraq and (b) Israel. [130679]

  Mr. Hoon
  We remain concerned about the potential for Iraq to resume its covert programme to develop a nuclear weapons capability. Hence the importance we attach to re-establishing weapons inspections in Iraq under the relevant United Nations Security Council resolutions.

  Israel is a non-party to the nuclear non-proliferation treaty (NPT). We consistently call on Israel to join the NPT as a non-nuclear weapons state, to place all its nuclear facilities under international Atomic Energy Agency safeguards, to ratify the comprehensive nuclear test ban treaty and to engage in negotiations on a fissile material cut-off treaty.

  Electronic Test Facility
  Mr. Matthew Taylor
  To ask the Secretary of State for Defence what representations he has received from the Irish Government with regard to his Department's Electronic Test Facility, formerly sited at the British Nuclear Fuels Ltd. site at Capenhurst, Cheshire since 19 October 1999; when these were received; and from which Departments of the Irish Government. [130531]

  Mr. Spellar
  The Ministry of Defence has not received any representations from the Irish Government regarding the Electronic Test Facility since 19 October 1999.

  HMS Sheffield
  Mr. Duncan Smith
  To ask the Secretary of State for Defence what plans he has to fit HMS Sheffield with the Harpoon missile system. [130443]

  Mr. Spellar
  [holding answer 13 July 2000]: None. I refer the hon. Member to the answer I gave on 12 June 2000, Official Report, column 451W.

  RAF Gliding School
  Mr. Clifton-Brown
  To ask the Secretary of State for Defence what progress has been made with moving the RAF Gliding School from RAF Bicester to RAF Rissington. [130941]

  Mr. Spellar
  [holding answer 17 July 2000]: Options for the future basing of the Joint Services Adventurous Training (Gliding) Centre and the Royal Air Force Gliding and Soaring Association Bicester Flying Club are currently being investigated. One option being considered is a move from RAF Bicester to RAF Little Rissington.

  Until this work is completed later this year, it will not be possible to decide where these units will be located in future or to progress a move.

  Executive Agencies
  Mr. Michael Jabez Foster
  To ask the Secretary of State for Defence what key targets have been set for the Defence Evaluation and Research Agency for the financial year 2000–01. [131149]
  103W
  Dr. Moonie
  Key Targets set for the Chief Executive of the Defence Evaluation and Research Agency for the financial year 2000–01 are set out as follows:

  Key Target 1
  Consistent with Treasury requirements, to achieve at least a 6 per cent. Return on Capital Employed.

  Key Target 2
  To increase New Business income (from customers other than the UK MOD) from £137 million forecast to be achieved in 1999–2000 to £165 million.

  Key Target 3
  To increase the number of staff elected as Fellows of professional bodies by 5 per cent. from a baseline at 31 March 2000.

  Key Target 4
  To achieve on time 90 per cent. of the agreed milestones on work for MOD customers.

  Key Target 5
  To maintain the level of MOD customer satisfaction as measured by core questions.

  Key Target 6
  Over a period of three years (1998–99 to 2000–01), to achieve a 20 per cent. increase in peer reviewed publications per professional. For 2000–01, this translates into achieving a figure of 7.1 publications per 100 professionals from a baseline at 1 April 2000 of 6.3.

  Key Target 7
  Over a three year period from (1998–99 to 2000–01), to increase by 50 per cent. the number of scientific teams assessed as `world-class' in the technical assessment exercise. For 2000–01 this translates into achieving 24 from a current baseline at 1 April 2000 of 19.

  Laura Moffatt
  To ask the Secretary of State for Defence what key targets have been set for the Defence Medical Training Organisation for the Financial Year 2000–01. [131512]

  Dr. Moonie
  Key Targets have been set for the Chief Executive of the DMTO for financial year 2000–01. The targets build on the progress already made by the Agency since it formed in April 1997 and are as follows:

  Key Target 1—Academic Success (Quality and Quantity)

  To achieve the following academic success rates:

  Common Core Course (CCC)—96 per cent.

  Specialist Registrars (SpR)—96 per cent.

  Pre-Registration Nurses (Pre-Reg Nurses)—96 per cent.

  Key Target 2—Academic Success (Timeliness)

  The following percentage of trainees achieving academic success to be delivered on time, as agreed with the customer:

  CCC—96 per cent. (at first attempt. remainder at second attempt (which is normally within three months).

  SpR—96 per cent.

  Pre-Reg Nurses—98 per cent.

  Key Target 3—External Individual Medical Services Training
  Confirm with customers the baseline requirement for external medical services training by 31 March 2001.

  Key Target 4—Corporate Efficiency Index
  To achieve a 1.5 per cent. efficiency improvement demonstrated by the DMTO corporate efficiency index for 2000–01.

  Laura Moffatt
  To ask the Secretary of State for Defence what key targets have been set for the Defence Dental Agency for the financial year 2000–01. [131513]
  104W
  Dr. Moonie
  Key Targets have been set for the Chief Executive of the DDA for financial year 2000–01. The targets build on the progress already made by the Agency since it formed in March 1996 and are as follows:

  Key Target 1—The Operational Requirement
  From within available personnel resources allocated to the DDA by single Services to achieve 100 per cent. of personnel called forward, trained to required professional and military standards, at the specified readiness for deployment with the Joint Rapid Reaction Force (JRRF) and all operations.

  Key Target 2—Overall Dental Fitness

  For each Service, maintain the dental fitness level targets as follows:

  (a) RN at least 75 per cent.

  (b) Army at least 70 per cent.

  (c) RAF at least 75 per cent.

  Key Target 3—Treatment Needs

  To show a zero increase in the Treatment Needs (TN) Index as follows:

  (a) RN above 500.

  (b) Army above 755.

  (c) RAF above 340.

  Key Target 4—Dental Fitness Category D
  To limit the number of personnel in dental fitness Category D4 (those personnel who have not received a dental inspection and charting for 12 months or more) to the following percentage of the total Service population:

  (a) RN 14 per cent.

  (b) Army 17 per cent.

  (c) RAF 14 per cent.

  Key Target 5—Training

  To achieve the following success rates within the normal duration of each course:

  Vocational Dental Practitioner—90 per cent.

  Dental Hygienist—90 per cent.

  Basic Dental Support Specialist (DSS)—95 per cent.

  Key Target 6—Military Training
  To ensure that 80 per cent. of all DDA personnel, whose medical category permits, are released to undertake annual military training as specified by respective single Services.

  Key Target 7—Personnel For Exercises
  To ensure that 100 per cent. of all DDA personnel nominated to established post in the operational core requirement of their parent Service are released to attend appropriate exercises.

  Mrs. Gilroy
  To ask the Secretary of State for Defence what key targets have been set for the Defence Secondary Care Agency for the Financial Year 2000–01. [131515]

  Dr. Moonie
  Key Targets have been set for the Chief Executive of the DSCA for financial year 2000–01. The targets build on the progress already made by the Agency since it formed in April 1996 and are as follows:

  Key Target 1—The Operational Requirement
  From within the personnel resources provided to the DSCA by the single Services, to meet 100 per cent. of the requirement of the Commanders in Chief (CinCs) for secondary care personnel for operational deployments.

  Key Target 2—Outpatient Waiting Times
  To ensure that 45 per cent. of Service patients referred to the Agency are offered at first outpatient appointment within four weeks of receipt of a referral and 85 per cent. within 13 weeks.
  105W
  Key Target 3—Inpatient Waiting Times
  To ensure that 75 per cent. of Service patients are offered a treatment date which is within 13 weeks of the decision to give inpatient treatment.

  Key Target 4—Efficiency
  To obtain savings of 10 per cent. in non-project works and maintenance expenditure.

  Key Target 5—Quality
  To carry out NHS requirements for progress in clinical governance and deliver a baseline assessment of capacity and capability across all DSCA Units by 31 August 2000 and a second assessment demonstrating measurable improvement by 31 March 2001.

  Key Target 6—Military Training
  To ensure that 80 per cent. of all DSCA personnel, whose medical category permits, are released to receive their respective Service's annual mandatory military training.

  Key Target 7—Personnel For Exercises
  To ensure that 80 per cent. of DSCA based personnel nominated to established posts in their Service's operational core requirement are released to attend appropriate exercises.

  Mrs. Gilroy
  To ask the Secretary of State for Defence what key targets have been set for the Medical Supplies Agency for the Financial Year 2000–01. [131516]

  Dr. Moonie
  Key Targets have been set for the Chief Executive of the Medical Supplies Agency for financial year 2000–01. The targets build on the progress already made by the Agency since it formed in March 1996 and are as follows:

  Key Target 1—Composite Medical Matériel
  To build, completely, to time and within budget, by 31 March 2001, 100 per cent. of all modules on the agreed Operational Build Programme, as authorised by the Director Medical Operational Capability (D Med Op Cap).

  Key Target 2—The Operational Requirement
  To meet 100 per cent. of the Services requirements for blood products and scaled medical matériel, or matériel approved by D Med Op Cap to mount and sustain operations.

  Key Target 3—The Exercise and Training Requirement
  To meet 100 per cent. of the Services requirements for modularised medical matériel, blood and blood products in support of exercises, training and major events.

  Key Target 4—Response to Demands
  To meet 90 per cent. of all demands for Category B items (common used items with a unit cost of less than £100 and approved by D Med Op Cap) within the agreed timescale, expressed in working days.

  Key Target 5—Stock Issued to Stock Held Ration
  To improve the ratio of stock issued to stock held from 1.75 to 2.

  Falkland Islands
  Mr. Baker
  To ask the Secretary of State for Defence what is the total annual amount spent by his Department in respect of the Falkland Islands in the last year for which figures are available. [130417]

  Mr. Spellar
  The outturn cost to the Ministry of Defence for the Falkland Islands Garrison in financial year 1999–2000 was £71.1 million.

  This figure relates to the costs incurred by the Commander British Forces Falkland Islands only. It does not include the costs of the RAF airbridge to the Falkland Islands, nor the cost of naval deployments to the South Atlantic. These costs fall to other budgets and could be provided only at disproportionate cost.

TRADE AND INDUSTRY

  Nuclear Fuel
  Mr. Llew Smith
  To ask the Secretary of State for Trade and Industry what proportion of the respective stockpiles of reprocessed uranium from(a) magnox fuel, (b) AOR fuel, (c) SGHWR fuel and (d) fast reactor fuel have been re-cycled in new fuel to date; and if he will list the quantities and current locations of the reprocessed uranium stored to date. [129967]

  Mrs. Liddell
  Proportion(a) is approximately 50 per cent. Proportion (b) is 0 per cent. Proportions (c) and (d) cannot be calculated without incurring disproportionate cost, because UKAEA does not separately distinguish the source of the uranium which it uses for fuel manufacture.

  My Department published the figure of holdings of civil depleted, natural and low enriched uranium at 31 December 1999 on 13 June. This material is stored at licensed civil nuclear sites in the UK.

  Mr. Llew Smith
  To ask the Secretary of State for Trade and Industry which(a) Government Departments, in (i) the United Kingdom and (ii) Japan, (b) en route states, (c) nuclear regulatory bodies and (d) non-governmental groups in (1) the United Kingdom, (2) Japan and (3) en route states were consulted on the decision to return plutonium MOX fuel to Sellafield; what considerations underlay the decision to transport the plutonium fuel; what other options were considered; what his estimate is of the cost of the shipment and subsequent processing at Sellafield; and what is the basis for his estimate. [130850]

  Mrs. Liddell
  The agreements announced on 11 July on resolving the problem of the MOX fuel at Takahama in Japan followed discussions between BNFL and its Japanese customer, Kansai Electric Power Company, and between the UK and Japanese Governments.

  The Government's support for BNFL's decision followed full consultation across Departments. The cost of the return shipment and the subsequent handling of the fuel at Sellafield is a commercial matter for BNFL.

  Mr. Chaytor
  To ask the Secretary of State for Trade and Industry what estimate he has made of the total cost of returning the defective MOX fuel from Japan to the United Kingdom; and if he will break down the main components of the cost. [131301]

  Mrs. Liddell
  British Nuclear Fuels plc (BNFL) is responsible for the return of the MOX fuel in Japan. The fuel will be returned at BNFL's expense. The cost is a commercial matter for BNFL.

  Export Licences
  Mr. Chope
  To ask the Secretary of State for Trade and Industry how many export licence applications to his Department have been awaiting a decision for more than(a) three months, (b) six months and (c) a year. [130049]

  Dr. Howells
  [holding answer 11 July 2000]: At 7 July 2000, a decision had not yet been taken on 634 applications for new individual export licences received since 2 May 1997. These are broken down as follows:
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  Standard individual export licences

  Open individual export licences

  Applications received between:

  7 July 1999 or earlier

  62

  68

  8 July 1999 and 7 January 2000

  118

  52

  8 January and 7 April 2000

  242

  92

  The figures for open individual export licences do not cover amendments, extensions or OIELs for protective clothing for the media.

  However, this information should be considered in light of the answer I gave to my hon. Friend the Member for Kingswood (Mr. Berry), on 27 July 1999, Official Report, columns 307–08W.

  Mr. Cousins
  To ask the Secretary of State for Trade and Industry how often in(a) 1997, (b) 1998 and (c) 1999 an export required a licence under the weapons of mass destruction end use controls; in which states these end-users were located; and in how many cases the licence was refused. [130800]

  Dr. Howells
  [holding answer 17 July 2000]: Details of all export licensing decisions taken between 2 May 1997 and 31 December 1998 were set out in the Government's 1997 and 1998 annual reports on strategic export controls, published by the Foreign and Commonwealth Office; copies are in the Library of the House. These reports list by country of destination the numbers of export licences issued and refused in each entry in the relevant legislation under which the export of goods is controlled, which is known as their rating.

  The end use control applies to goods, not otherwise subject to control, where the exporter has been told or knows or suspects that the goods would or might be used in activities connected with weapons of mass destruction or missiles for their delivery. Goods controlled for these reasons are given the rating "End Use".

  Information on export licensing decisions taken in 1999 will be set out in the 1999 Annual Report on Strategic Export Controls, which will be published soon.

  Venture Capital
  Mr. Kidney
  To ask the Secretary of State for Trade and Industry what steps he has taken to help developers of agriculture-related projects obtain access to venture capital. [130732]

  Ms Hewitt
  The Enterprise Fund's venture capital elements, the UK High Technology Fund and the Regional Venture Capital Funds, are being established to stimulate the availability of equity finance for smaller businesses which offer significant growth potential.

  A range of agriculture-related projects will be eligible to receive equity funding through the Enterprise Fund venture capital schemes. However, all investment decisions under these programmes will be made by professional Fund Managers in pursuit of the best possible commercial returns for their funds. It is therefore not possible to pre-determine the sectors in which investments will be made.

  Sub-post Office
  Mr. Viggers
  To ask the Secretary of State for Trade and Industry if he will investigate ways of increasing the incomes of sub-post offices by(a) the payment of wages to their staff, (b) provision of swipe cards for the collection of child allowances, pensions and other benefits, (c) encouraging their use for the charging of electricity key meters, (d) the issue of vehicle excise licences and (e) other means. [131162]

  Mr. Alan Johnson
  The Performance and Innovation Unit's report on the future of the post office network identified new business opportunities for sub-post offices and the Post Office is also seeking out new commercial opportunities in order to sustain or enhance the income of sub-post offices.

  Mortgages (Insurance Products)
  Mr. Cousins
  To ask the Secretary of State for Trade and Industry what his policy is towards tying the sale of insurance products to mortgage lending; and if he will make a statement. [130810]

  Dr. Howells
  [holding answer 17 July 2000]: I consider that tying-in of mortgages with insurance often means that consumers pay uncompetitive premiums for their insurance cover. I believe that consumers should be free to shop around for the best deal.

  DTI is therefore now consulting on a proposal to ban compulsory tie-ins of mortgages with insurance products. Once I have considered fully all the responses to the consultation, I will then look at how this proposal can be taken forward.

  Intellectual Property Rights
  Mr. Baker
  To ask the Secretary of State for Trade and Industry (1) what documentation has been prepared by his Department for the TRIPS Council to demonstrate compliance of the United Kingdom's intellectual property law with the TRIPS Agreement which incorporates Article 10bis of the Paris Convention; what response his Department has received from the TRIPS Council; and if he will place a copy of both the document and response in the Library; [130410]

  (2) what discussions his officials have had with the TRIPS Council regarding the compliance of the United Kingdom's intellectual property law with the TRIPS Agreement that incorporates Article 10bis of the Paris Convention. [130411]

  Dr. Howells
  As required by the World Trade Organization (WTO) Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement the United Kingdom notified its main dedicated intellectual property laws and regulations to the WTO. These were published by the WTO during 1996 in documents with the references IP/N/l/GBR/1, IP/N/l/GBR/C/1, IP/N/1/GBR/C/2, IP/N/l/GBR/T/1, IP/N/1/GBR/T/2, IP/N/1/GBR/G/1, IP/N/1/GBR/G/2, IP/N/1/GBR/D/1, IP/N/1/GBR/D/2, IP/N/1/GBR/P/1, IP/N/1/GBR/P/2, IP/N/l/GBR/P/3, IP/N/1/GBR/L/1, IP/N/1/GBR/U/1, IP/N/2/GBR/1 and IP/N/6/GBR/1.

  The United Kingdom participated in reviews of developed country WTO members' TRIPS implementing legislation carried out by the TRIPS Council throughout

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  1996 and 1997. Records of introductory statements made by the United Kingdom delegation, questions put to the United Kingdom delegation and the responses given were published by the WTO in four documents with references IP/Q/GBR/1, IP/Q2/GBR/1, IP/Q3/GBR/1 and IP/Q4/GBR/1. All of these documents are available to the public on the WTO website, www.wto.org.

  Employment Tribunals
  Helen Jones
  To ask the Secretary of State for Trade and Industry if he will review the appointment of Mrs. J. Upshall as a member of employment tribunals taking account of the operation of Integrate Services in Warrington. [130669]

  Mr. Alan Johnson
  I am not aware of any grounds for action in relation to Mrs. Upshall's appointment.

TREASURY

  Financial Services and Markets Act 2000
  Mr. Love
  To ask the Chancellor of the Exchequer if he will publish the timetable for implementation of each part of the Financial Services and Markets Act 2000. [126975]

  Miss Melanie Johnson
  I expect the Financial Services and Markets Act 2000 to come into force in about one year's time. This will complete the process of the modernisation of financial services regulation announced by my right hon. Friend the Chancellor of the Exchequer in May 1997. The timescale provides a framework within which proper preparations can be made for the new regulatory system.

  The Government believe that both the financial services industry and consumers will benefit from a single regulator with clear statutory objectives providing a light touch where possible, protection where necessary.

  Aggregates
  Mr. Gill
  To ask the Chancellor of the Exchequer when the Quarry Products Association was informed of specific legal objections to their proposed preferential purchasing scheme for aggregates from quarry operators meeting certain environmental criteria. [131096]

  Mr. Timms
  The Quarry Products Association put forward their developed proposals for a preferential purchasing scheme in late 1999. The Government at that time made it clear that this scheme raised concerns in terms of both EU procurement law and on competition grounds.

  Mr. Gill
  To ask the Chancellor of the Exchequer when he discussed the Quarry Products Association's proposed preferential purchasing scheme for aggregates from quarry operators meeting certain environmental criteria with(a) the Office of Fair Trading, (b) the European Commission, (c) the DETR and (d) the Department of Trade and Industry. [131095]

  Mr. Timms
  Discussions with the relevant Government Departments on the Quarry Products Association's proposed preferential purchasing scheme began as soon as further details of the scheme were brought forward in late autumn 1999.

  Pesticides Tax
  Mr. Alan Simpson
  To ask the Chancellor of the Exchequer if he will list(a) the representations the Treasury has received and (b) meetings it has held on the proposed pesticides tax, giving details of meetings held with (i) the British Agrochemicals Association, (ii) UKASTA, (iii) NOAH, (iv) the National Farmers Union, (v) the Country Landowners Association, and (vi) agrochemical companies, indicating which companies; and what the duration of the meetings was in each case. [131103]

  Mr. Timms
  I refer my hon. Friend to the answer I gave him on 21 June 2000,Official Report, columns 215–16W.

  Spending Review (Devolved Administrations)
  Mrs. Lawrence
  To ask the Chancellor of the Exchequer if he will publish the funding rules for the devolved Administrations applied in the 2000 Spending Review. [131564]

  Mr. Andrew Smith
  Copies of the updated statement of funding policy, which sets out the funding arrangements for the devolved Administrations, have today been placed in the Libraries of both Houses of Parliament.

  Parliamentary Questions
  Mr. Stunell
  To ask the Chancellor of the Exchequer how many written parliamentary questions were tabled to his Department between 19 October 1999 and 20 April; and how many did not receive substantive answers citing disproportionate cost as the reason. [131201]

  Mr. Timms
  1,676 written questions were tabled to the Chancellor of the Exchequer in the period concerned. Disproportionate cost was cited in 15 instances as the reason why the information requested could not be provided. In a further 28 cases, some of the information sought was provided, but some other information would have been disproportionately costly to obtain.

  Tax Returns (Internet)
  Mr. Matthew Taylor
  To ask the Chancellor of the Exchequer how many individual taxpayers who file self-assessment tax returns have registered for the Inland Revenue service for filing tax returns on the internet in each month since the service became available; and if he will make a statement. [130564]

  Dawn Primarolo
  Since the registration service became available on 3 April, 63,301 individual taxpayers who file self-assessment tax returns have registered for the Inland Revenue service for filing tax returns on the internet. The number of registrations in each month were as follows:

  Month

  Registrations

  Cumulative total

  April

  32,937

  32,937

  May

  14,877

  47,814

  June

  10,677

  58,491

  July1

  4,530

  63,021

  July2

  280

  63,301

  1 Week one

  2 Week two

  Special Advisers
  Mr. Tyrie
  To ask the Chancellor of the Exchequer if he will update the statement on travel on Government business by the Treasury's special advisers deposited in

  Official travel overseas by Treasury special advisers: 13 July 1999-June 2000

  Date

  Destination

  Purpose

  Ian Austin

  15–17 September 1999

  New York/Washington, USA

  Chancellor's speaking engagement and bilateral meetings

  Ed Balls

  15–17 September 1999

  New York/Washington, USA

  Chancellor's speaking engagement and bilateral meetings

  24–29 September 1999

  Washington, USA

  G7 and IMF/World bank Annual Meetings, bilateral meetings

  29 November 1999

  Brussels, Belgium

  ECOFIN

  4–8 December 1999

  Washington, USA

  Chancellor's speaking engagement and bilateral meetings

  9–10 December 1999

  Helsinki, Finland

  European Council

  15–16 December 1999

  Berlin, Germany

  G20 Finance Ministers Meeting

  31 January 2000

  Brussels, Belgium

  ECOFIN

  21–23 February 2000

  New York, USA

  Chancellor's speaking engagement

  28 February 2000

  Brussels, Belgium

  ECOFIN

  13–18 April 2000

  Washington, USA

  G7 and IMF/World bank Spring Meetings, bilateral meetings

  18–20 June 2000

  Feira, Portugal

  European Council

  29 June 2000

  Paris, France

  Meeting at the Tresor

  Ed Miliband

  10–11 September 1999

  Turku, Finland

  Informal ECOFIN

  15–17 September 2000

  New York, Washington, USA

  Chancellor's speaking engagement and bilateral meetings

  24–26 September 1999

  Washington, USA

  G7 and IMF Meetings

  21–23 February 2000

  New York, USA

  Chancellor's speaking engagement

SOCIAL SECURITY

  Average Incomes
  Ms Roseanna Cunningham
  To ask the Secretary of State for Social Security, pursuant to his answer of 22 June 2000,Official Report, column 256W, on average incomes, if he will list the figures requested for single parents and disabled people. [128063]

  Mr. Bayley
  The information is not available in the format requested. Data are not available for all the years requested. The earliest and latest financial years for which data from the Family Resources Survey (FRS) data are available are 1994–95 and 1998–99 respectively.

  Year on year changes in average amounts of State benefits reflect changes in employment status, income from other sources (for income-related benefits), benefit entitlement and caseload mix.

  Results are subject to statistical variability. Comparisons of one year with the next should be treated with considerable caution.

  For the purposes of these statistics, disabled people have been defined as anyone in receipt of at least one disability benefit, i.e. Disability Living Allowance (care or mobility), Attendance Allowance, Severe Disablement Allowance, Disability Working Allowance or Incapacity or Invalidity Benefit.

  Their average weekly income from state benefits (including the State Retirement Pension) per individual was £110 in 1994–95. It remained at this level in 1995–96 then rose to £117 in 1996–97, £120 in 1997–98 and £124 in 1998–99. The same figures rebased in constant May 2000 prices to adjust for inflation were £129 in 1994–95, £125 in 1995–96, £129 in 1996–97,
  112W
  the Library on 27 July 1999 to include information about the period after 13 July 1999. [124123]

  Miss Melanie Johnson
  [holding answer 5 June 2000]Details for the period since 13 July 1999 are as follows:

  £128 in 1997–98 and £130 in 1998–99. This represented 34 per cent. of average earnings in 1994–95,33 per cent. in each of the years 1995–96,1996–97 and 1997–98, and 32 per cent. in 1998–99.

  Results for single parents are sensitive to the proportion of single parents in employment and are presented separately for those in work—defined as working 16 hours or more per week—and those not in work. The proportion of single parents in work, according to the FRS, rose from 37 per cent. in 1994–95 to 43 per cent. in 1998–99. Benefit income is of course much lower for lone parents in work, who therefore have income from earnings, than lone parents not in work. (For recipients of disability benefits the proportion in work, as recorded in the FRS, was stable over this period.)

  Average weekly income from State benefits (including the State Retirement Pension) per individual lone parent in work was £64 in 1994–95, £66 in 1995–96, £65 in 1996–97, £68 in 1997–98 and £74 in 1998–99. The same figures rebased in constant May 2000 prices to adjust for inflation were £75 in 1994–95, £75 in 1995–96, £72 in 1996–97, £73 in 1997–98 and £77 in 1998–99. This represented 20 per cent. of average earnings in 1994–95 and 1995–96 and 19 per cent. in each of the years 1996–97,1997–98 and 1998–99.

  Average weekly income from state benefits (including the State Retirement Pension) per individual lone parent not in work was £135 in 1994–95, £142 in 1995–96, £144 in 1996–97, £149 in 1997–98 and £155 in 1998–99. The same figures rebased in constant May 2000 prices to adjust for inflation were £158 in 1994–95, £162 in 1995–96, £160 in 1996–97, £160 in 1997–98 and £161 in 1998–99. This represented 41 per cent. of average earnings in 1994–95,42 per cent. in 1995–96,41 per cent. in 1996–97 and 1997–98 and 40 per cent. 1998–99.
  113W
  The amounts listed here and used in the calculation of percentages are per individual. Benefits have been assigned to the individual in receipt. For example, if Income Support is paid to a disabled person with a non-disabled partner, the full amount of Income Support is assigned to the disabled person in these tables.

  The mean has been used to calculate the average weekly income from State benefits for all individuals in the various different groups.

  Real term figures have been calculated by uprating cash term figures to reflect May 2000 prices. The headline Retail Prices Index has been used for this calculation.

  Average earnings figures, used as the base for calculation of the percentage figure, are for all full time adult employees and are based on data from the New Earnings Survey (Office for National Statistics) which is conducted in April of each year. As FRS data is for financial years the April in which the FRS financial year begins has been used as the average earnings base.

  It should be noted that benefit receipt is based on self-assessment and therefore may be subject to mis-reporting.

  All income figures have been rounded to the nearest pound and percentages rounded to the nearest integer.

  Vaccine Damage Payment Scheme
  Mr. Ian Stewart
  To ask the Secretary of State for Social Security, pursuant to his oral statement of 27 June 2000,Official Report, column 720, what additional payments will be made to people who received a (a) £10,000, (b) £20,000, (c) £30,000 and (d) £40,000 payment under the 1979 Vaccine Damage Payment Scheme; and on what basis these amounts have been calculated. [130842]

  Mr. Bayley
  Top-up payments are intended to represent the difference, in real terms, between the original payments and the proposed new £100,000 rate. Calculation of the proposed top-up payments is as follows:

  £

  Original payment

  Top-up payment

  10,000

  67,000

  20,000

  62,500

  30,000

  61,500

  40,000

  58,000

  The original payment made to past recipients has been revalued from the date that the relevant rate of that payment was introduced up to April 2000 using the Retail Prices Index (All items) and the normal method applied in revaluing Social Security benefits across successive upratings.

  Mr. Lilley
  To ask the Secretary of State for Social Security (1) where he intends to publish the criteria which will be used under the revised Vaccine Damage Payment Scheme to determine whether a person is 60 per cent. disabled; [131126]

  (2) where the criteria determining whether a child is 80 per cent. disabled are published; [131131]
  114W
  (3) if he will publish the protocols used by SEMA Group to determine whether a person's injuries were caused by a vaccine; [131132]

  (4) if he will publish the protocols used by SEMA Group to determine whether a person is 80 per cent. disabled. [131119]

  Mr. Bayley
  Section 1(4) of the Vaccine Damage Payments Act 1979 directs that the level of disablement in vaccine damage cases be assessed as for the purposes of section 103 of the Social Security Contributions and Benefits Act 1992. Assessment is further covered in Schedule 6 to the latter Act, and in the Social Security (General Benefit) Regulations 1982 (SI 1982/1408), reg 11 and Schedule 2.

  Assessment of 80 per cent. disablement is made by doctors specially trained in disability assessment medicine. They assess the degree of disablement by reference to and comparison with assessments, including guidance on percentage impairments, prescribed in the above legislation. They are assisted in this task by guidance contained in "The Severe Disablement Allowance Handbook for Medical Advisers", approved by the Department of Social Security's Chief Medical Adviser and published by Sema Medical Services, a copy of which will be placed in the Library. Because of the proposed change to the disability threshold under the scheme the need for revised guidance on the 60 per cent. disablement criterion will be considered, and made publicly available as appropriate, before the new threshold comes into force.

  Sema doctors advise on whether, on the balance of probabilities, a person's injuries were caused by a vaccine on the basis of the current consensus of informed medical opinion. The use as reference the book "Adverse Events Associated with Childhood Vaccines" by the Institute of Medicine. Sema doctors also carry out regular electronic searches of published medical research papers. The majority of such research in the past three years has been published in The Lancet. The current consensus of informed medical opinion is summarised in Sema medical Services' procedural guidance to its doctors on processing referrals for advice on vaccine damage claims, a copy of which will be placed in the Library.

  Mr. Lilley
  To ask the Secretary of State for Social Security (1) when he plans to publish regulations increasing the statutory sum available under the Vaccine Damage Payments Scheme; [131127]

  (2) if the £60 million sum for the costs of revisions to the Vaccine Damage Payments Scheme is intended to cover only the top-up payments for previous recipients of awards; [131130]

  (3) if additional funds will be made available (a) this year and (b) in future years if more people than anticipated qualify for a vaccine damage payment when the Vaccine Damage Payments Scheme is revised; [131117]

  (4) when he plans to introduce legislation on the Vaccine Damage Payments Scheme; [131118]

  (5) pursuant to his oral statement of 27 June 2000, Official Report, columns 719–20, on vaccine damage payments, if he will make a statement on the basis of the calculations that top-up payments of £58,000 to £67,000 will provide recipients with a total payment of £100,000 in real terms. [131193]
  115W
  Mr. Bayley
  The draft Vaccine Damage Payment Act 1979 Statutory Sum Order 2000 was laid on 5 July and is being debated in both Houses this week. We estimate that the costs of implementing the proposals as they affect all existing cases will be around £60 million. There is a statutory entitlement to a vaccine damage payment if the relevant criteria are met and such payments will be made regardless of the future number of awards.

  The original payment made to past recipients has been revalued from the date that the relevant rate was introduced to April 2000 using the Retail Prices Index (All items) and the normal method applied in revaluing Social Security benefits across successive upratings. The top-up payments represent the difference between this figure and the proposed new £100,000 rate.

  We will bring forward primary legislation to implement the proposed changes to the time limit and the disability threshold as soon as possible.

  Occupational Pensions Regulatory Authority
  Maria Eagle
  To ask the Secretary of State for Social Security when he expects to receive the Occupational Pensions Regulatory Authority's fourth annual report; and if he will make a statement. [131562]

  Mr. Darling
  I have received the fourth report of the Occupational Pensions Regulatory Authority which documents how the organisation has carried out its regulatory functions and worked with others to raise standards in the pensions industry. I have laid copies of the report before both Houses today.

  Widowers
  Mr. Field
  To ask the Secretary of State for Social Security how many widowers have had their claims for retrospective payment of Widow's Benefits or compensation for not receiving those benefits recently refused; and if he will make a statement on the grounds on which those claims were refused. [131184]

  Angela Eagle
  In the two months to 31 May 2000, 104 claims for Widow's Benefits were received from men. All such claims are disallowed as men are not entitled to Widow's Benefits under current legislation.

  Mr. Field
  To ask the Secretary of State for Social Security how many widowers have contacted his Department to make an inquiry about the possible payment of retrospective Widow's Benefits to men or a settlement following the European Court of Human Rights ruling. [131183]

  Angela Eagle
  There has been no ruling from the European Court of Human Rights (ECHR). The ECHR's published judgments on two cases explained that, having reached a friendly settlement, these cases have been struck out of the list.

  We have received 40 letters inquiring about Widow's Benefits for men in relation to the European Court of Human Rights.

  Mr. Field
  To ask the Secretary of State for Social Security how many widowers have claims for Widow's Benefit for men or compensation for the non-payment of those benefits before the European Court of Human Rights. [131185]
  116W
  Angela Eagle
  Fifteen applications have been referred to us by the European Court of Human Rights, including two cases which have been struck out of the list following acceptance of the Government's offer by way of friendly settlement.

  Disability Benefit
  Maria Eagle
  To ask the Secretary of State for Social Security how he intends to respond to the Social Security Commissioner's decision that telephone conversations could in certain circumstances count as attention for the purpose of giving entitlement to Attendance Allowance or the care component of Disability Living Allowance. [131563]

  Mr. Bayley
  We know that many people get support from telephone contact with friends and advisers. However, the purpose of Attendance Allowance and the care component of Disability Living Allowance (DLA) is to provide a contribution for the extra costs of people who are so severely disabled that they need another person present to help them. We must ensure that the benefits are provided for those people for whom they were intended. Subject to Parliamentary approval, we therefore intend to introduce amending regulations to ensure that benefit entitlement is not available simply where people speak over the telephone or similar media.

  Other assistance is available from social services and social work departments; they have powers to provide assistance with telephone expenses to people who are assessed as needing them for emergency situations.

  Stakeholder Pensions
  Mr. Willetts
  To ask the Secretary of State for Social Security if the Government will have access to information on stakeholder pensions to enable it to ascertain whether sales are to people outside or within its target group. [130762]

  Mr. Rooker
  We are planning to collect a range of statistical data. It is intended that this data will, in due course, include information about the level of members' earnings which will enable us to determine how many sales are to people in the target group, as part of the total market for Stakeholder Pensions.

  Mr. Field
  To ask the Secretary of State for Social Security what the basis is for his calculation that it would be advantageous for a person earning £9,500 to contract out of the state second pension into a stakeholder pension. [131326]

  Mr. Rooker
  Stakeholder pensions will be open to people at all income levels but are primarily intended for moderate earners—those earning between around £10,000 and £20,000 a year—as well as higher earners. It will be for individuals to decide whether or not to use a stakeholder pension to contract out of the state scheme, but National Insurance rebates for people who do contract out are set at a level which reflects the cost of providing the state benefits forgone. The state second pension is structured to provide extra help in the state scheme above that available from SERPS for people on earnings up to around £20,000. The new contracting-out arrangements have been designed so that members of contracted-out
  117W
  pension schemes will benefit from the extra help that the state second pension brings to low and moderate earners, either through higher rebates or a state scheme top-up.

  Maternity Pay
  Ms Harman
  To ask the Secretary of State for Social Security what percentage of women's average earnings flat rate Statutory Maternity Pay represents; and what was the highest percentage it has ever represented. [131112]

  Mr. Bayley
  The flat rate of Statutory Maternity Pay was 27 per cent. of average women's earnings in 1999–2000, the latest year for which there are figures. This percentage was at its highest in 1987–88 when it reached 28 per cent.

  Ms Harman
  To ask the Secretary of State for Social Security what the total annual cost is of Statutory Maternity Pay flat rate; and what it would be if it was increased to £100. [131113]

  Mr. Bayley
  Statutory Maternity Pay is paid at 90 per cent. of a woman's average weekly earnings for the first six weeks of her maternity leave and a flat rate of £60.20 for the following 12 weeks.

  The cost of the SMP flat rate is £210 million.

  The total full year cost of paying flat rate at £100 a week would be £350 million.

  Ms Harman
  To ask the Secretary of State for Social Security what the total extra cost of flat rate Statutory Maternity Pay would be if it were extended from 12 weeks to up to the child's first birthday. [131114]

  Mr. Bayley
  The extra full year cost in 2000–01 of extending the flat rate of Statutory Maternity Pay from 12 weeks up to the child's first birthday would be up to £495 million.

  Pensions
  Mr. Alan Williams
  To ask the Secretary of State for Social Security if he will estimate for 2000–01, the(a) gross and (b) net difference between the cost of the actual pension increase and (i) an increase of 2.5 per cent., (ii) an increase in line with earnings and (iii) the provision made in the Department's estimates. [131254]

  Mr. Rooker
  The estimated extra cost for 2000–01 of a 2.5 per cent. increase in basic pension rates would be £530 million gross, £400 million net of means-tested benefits.

  The extra cost of an increase in line with earnings would be £1,310 million gross, £1,000 million net. The estimates made in the Departments Report assume a 1.1 per cent. increase and as this was the level of increase there is no difference.

  Notes:

  1. Assumed average earnings growth is 4.6 per cent. The measure of earnings used is the annual change in the seasonally adjusted, three months to July average earnings index, which was used to uprate the Minimum Income Guarantee.

  2. Estimates are rounded to the nearest £10 million.

  3. Costs include benefits whose rates are linked by statute to the rate of basic Retirement Pension (principally Widow's Benefits and long-term Incapacity Benefit).
  118W
  4. Gross costs have been estimated by the Government Actuary's Department. Offsetting means-tested benefit savings have been estimated using the Department's Policy Simulation Model.

  Housing Benefit
  Mr. Tynan
  To ask the Secretary of State for Social Security if he will make a statement on the Government's plans for the extension of the Housing Benefit Verification Framework; and how the Government intends to achieve this extension, with particular reference to incentives or penalties for local authorities failing to(a) comply fully with the scheme or (b) commit themselves to a date. [130763]

  Angela Eagle
  We are working in partnership with local authorities in developing and implementing anti-fraud initiatives such as the Verification Framework. Local authorities are in a position to consider their specific needs and local circumstances before deciding when to take forward these initiatives.

  That said, we continue to encourage all local authorities to implement the Verification Framework. We have made £100 million available to enable all authorities to implement the Framework by 2001. In addition we have introduced changes that mean that authorities which are compliant with the Framework can claim additional subsidy under the Weekly Benefit Savings Scheme.

  Mr. Tynan
  To ask the Secretary of State for Social Security if he will list for each local authority in Great Britain, for each of the last two financial years, weekly benefit savings for(a) thresholds, (b) claimed savings, (c) amount of additional subsidy claimed and (d) amount of subsidy penalty applied. [130963]

  Angela Eagle
  The information has been placed in the Library.

  Parliamentary Questions
  Mr. Stunell
  To ask the Secretary of State for Social Security how many written parliamentary questions tabled to his Department between 19 October 1999 and 20 April did not receive substantive answers, citing as the reasons commercial or other confidentiality. [131202]

  Mr. Rooker
  Of the 1,815 questions we received during this period, we were unable to give substantive answers to three questions where we cited the information was commercial in confidence and one answer where the information was confidential.

  Correspondence
  Mr. Winnick
  To ask the Secretary of State for Social Security, pursuant to his reply of 10 July 2000,Official Report, column 389W, for what reason the Director of the Disability and Carer Benefits Directorate did not sign the reply of 4 July to the hon. Member for Walsall, North concerning a constituent; and why the letter gave no explanation of why the Director was unable to sign. [130658]

  Mr. Bayley
  [holding answer 17 July 2000]: The Director personally signs letters to right hon. and hon. Members unless he is unavailable, when a nominated deputy signs on his behalf.
  119W
  The Director was out of the office on 4 July. I regret that, in his absence, the normal procedures were not followed in this particular case.

  In future additional guidance will be given to staff about who may sign letters received by Benefits Agency Directors from Members.

  Minimum Income Guarantee
  Mr. Webb
  To ask the Secretary of State for Social Security, pursuant to his answer to the hon. Member for Southwark, North and Bermondsey (Mr. Hughes) of 25 May 2000,Official Report, column 619W, how many pensioners are in receipt of the Minimum Income Guarantee (a) in total and (b) in each parliamentary constituency, for each year for which figures are available. [131196]

  Mr. Rooker
  The total number of pensioners claiming Income Support has been reducing since 1988 as the following table shows.

  Minimum Income Guarantee claimants in Great Britain1

  Year

  Total

  2000

  1,604,200

  1999

  1,627,900

  1998

  1,650,500

  1997

  1,713,900

  1996

  1,763,640

  1995

  1,781,000

  1994

  1,764,600

  1993

  1,736,200

  1992

  1,643,100

  1991

  1,574,900

  1990

  1,674,700

  1989

  1,606,500

  1988

  1,719,300

  1 Before April 1999 this would have been expressed as Income Support

  Figures for parliamentary constituencies for the Minimum Income Guarantee which was introduced in April 1999 have been placed in the Library.

INTERNATIONAL DEVELOPMENT

  Low-income Countries
  Dr. Tonge
  To ask the Secretary of State for International Development for each low-income country, what proportion of total bilateral aid it received in(a) 1996–97 and (b) 1999–2000; and what total amount of bilateral aid it received in 1996–97. [130862]

  Clare Short
  Data for 1999–2000 are not yet available. The tables show both Department for International Development bilateral expenditure and UK Gross Public Expenditure on Aid (GPEX) for 1996–97 and 1998–99, the latest year for which figures are available. Low-income countries are defined as those with a 1995 GNP per capita of less than $766. The total figures include bilateral expenditure which cannot be attributed to individual countries, including for instance block grants and regional allocations.
  120W

  Bilateral aid to low-income countries 1996–97

  DFID

  GPEX

  £000

  %

  £000

  %

  Total all countries

  1,074,762

  —

  1,281,794

  —

  Of which low-income group countries

  Afghanistan

  8,544

  0.79

  9,444

  0.74

  Albania

  1,038

  1.10

  1,038

  0.08

  Angola

  9,787

  0.91

  9,787

  0.76

  Armenia

  1,122

  0.10

  1,122

  0.09

  Azerbaijan

  1,093

  0.10

  1,093

  0.09

  Bangladesh

  42,402

  3.95

  42,405

  3.31

  Benin

  29

  0.00

  29

  0.00

  Bhutan

  20

  0.00

  20

  0.00

  Bosnia and Herzegovina

  727

  0.07

  752

  0.06

  Burkina Faso

  204

  0.02

  204

  0.02

  Burma

  314

  0.03

  319

  0.02

  Burundi

  1,560

  0.15

  1,560

  0.12

  Cambodia

  5,552

  0.52

  5,552

  0.43

  Cameroon

  2,205

  0.21

  2,205

  0.17

  Central African Republic

  21

  0.00

  26

  0.00

  Chad

  142

  0.01

  142

  0.01

  China

  31,701

  2.95

  31,701

  2.47

  Comoros

  17

  0.00

  17

  0.00

  Congo

  —

  —

  990

  0.08

  Democratic Republic of the Congo

  107

  0.01

  1,213

  0.09

  Cote d'Ivoire

  633

  0.06

  4,915

  0.38

  Equatorial Guinea

  —

  —

  —

  —

  Eritrea

  1,210

  0.11

  1,210

  0.09

  Ethiopia

  8,078

  0.75

  8,518

  0.66

  Gambia

  1,844

  0.17

  1,844

  0.14

  Georgia

  1,851

  0.17

  1,851

  0.14

  Ghana

  25,643

  2.39

  28,339

  2.21

  Guinea

  178

  0.02

  412

  0.03

  Guinea-Bissau

  6

  0.00

  6

  0.00

  Guyana

  5,382

  0.50

  7,036

  0.55

  Haiti

  10

  0.00

  10

  0.00

  Honduras

  1,077

  0.10

  7,395

  0.58

  India

  92,393

  8.60

  112,140

  8.75

  Kenya

  26,481

  2.46

  26,491

  2.07

  Kyrgyzstan

  923

  0.09

  935

  0.07

  Laos

  729

  0.07

  729

  0.06

  Liberia

  3,006

  0.28

  3,006

  0.23

  Madagascar

  399

  0.04

  601

  0.05

  Malawi

  33,555

  3.12

  44,877

  3.50

  Mali

  523

  0.05

  8,656

  0.68

  Mauritania

  18

  0.00

  293

  0.02

  Mongolia

  378

  0.04

  378

  0.03

  Mozambique

  22,035

  2.05

  26,447

  2.06

  Nepal

  15,371

  1.43

  15,373

  1.20

  Nicaragua

  1,193

  0.11

  1,193

  0.09

  Niger

  112

  0.01

  467

  0.04

  Nigeria

  7,642

  0.71

  7,642

  0.60

  Pakistan

  27,517

  2.56

  59,367

  4.63

  Rwanda

  9,676

  0.90

  9,676

  0.75

  Sao Tome and Principe

  12

  0.00

  12

  0.00

  Senegal

  577

  0.05

  764

  0.06

  Sierra Leone

  10,619

  0.99

  10,841

  0.85

  Somalia

  1,322

  0.12

  1,322

  0.10

  Sri Lanka

  7,364

  0.69

  19,937

  1.56

  Sudan

  4,534

  0.42

  4,534

  0.35

  Tajikistan

  4,301

  0.40

  4,301

  0.34

  Tanzania

  48,208

  4.49

  56,432

  4.40

  Togo

  311

  0.03

  617

  0.05

  Tuvalu

  n/a

  n/a

  n/a

  n/a

  Uganda

  42,976

  4.00

  49,095

  3.83

  Vietnam

  5,606

  0.52

  5,606

  0.44

  Yemen

  1,975

  0.18

  2,004

  0.16

  Zambia

  17,499

  1.63

  40,629

  3.17

  Zimbabwe

  11,126

  1.04

  21,103

  1.65

  Total to low-income group of countries

  550,878

  51

  706,623

  55

  121W

  1998–99

  DFID

  GPEX

  £000

  %

  £000

  %

  Total all countries

  1,175,605

  —

  1,386,083

  —

  Of which low-income group countries

  Afghanistan

  4,123

  0.35

  4,123

  0.30

  Albania

  643

  0.05

  643

  0.05

  Angola

  4,550

  0.39

  4,550

  0.33

  Armenia

  551

  0.05

  551

  0.04

  Azerbaijan

  498

  0.04

  498

  0.04

  Bangladesh

  69,918

  5.95

  69,918

  5.04

  Benin

  88

  0.01

  88

  0.01

  Bhutan

  14

  0.00

  14

  0.00

  Bosnia and Herzegovina

  2,599

  0.22

  2,599

  0.19

  Burkina Faso

  318

  0.03

  318

  0.02

  Burma

  795

  0.07

  795

  0.06

  Burundi

  324

  0.03

  324

  0.02

  Cambodia

  5,625

  0.48

  5,625

  0.41

  Cameroon

  1,888

  0.16

  3,588

  0.26

  Central African Republic

  —

  —

  5

  0.00

  Chad

  —

  —

  —

  —

  China

  39,540

  3.36

  39,541

  2.85

  Comoros

  18

  0.00

  18

  0.00

  Congo

  6

  0.00

  3,216

  0.23

  Democratic Republic of the Congo

  552

  0.05

  1,546

  0.11

  Cote d'Ivoire

  623

  0.05

  13,453

  0.97

  Equatorial Guinea

  0

  0.00

  0

  0.00

  Eritrea

  868

  0.07

  868

  0.06

  Ethiopia

  8,850

  0.75

  9,910

  0.71

  Gambia

  976

  0.08

  979

  0.07

  Georgia

  1,265

  0.11

  1,265

  0.09

  Ghana

  54,365

  4.62

  63,844

  4,61

  Guinea

  424

  0.04

  603

  0.04

  Guinea-Bissau

  8

  0.00

  8

  0.00

  Guyana

  5,777

  0.49

  22,893

  1.65

  Haiti

  59

  0.01

  59

  0.00

  Honduras

  2,611

  0.22

  3,382

  0.24

  India

  92,275

  7.85

  113,865

  8.21

  Kenya

  34,023

  2.89

  43,011

  3.10

  Kyrgyzstan

  442

  0.04

  458

  0.03

  Laos

  546

  0.05

  546

  0.04

  Liberia

  776

  0.07

  776

  0.06

  Madagascar

  410

  0.03

  612

  0.04

  Malawi

  47,265

  4.02

  52,395

  3.78

  Mali

  331

  0.03

  831

  0.06

  Mauritania

  2

  0.00

  429

  0.03

  Mongolia

  470

  0.04

  477

  0.03

  Mozambique

  26,401

  2.25

  29,158

  2.10

  Nepal

  17,209

  1.46

  17,209

  1.24

  Nicaragua

  1,996

  0.17

  1,996

  0.14

  Niger

  172

  0.01

  870

  0.06

  Nigeria

  11,053

  0.94

  11,053

  0.80

  Pakistan

  25,180

  2.14

  28,608

  2.06

  Rwanda

  13,776

  1.17

  13,776

  0.99

  Sao Tome and Principe

  —

  —

  —

  —

  Senegal

  454

  0.04

  616

  0.04

  Sierra Leone

  9,036

  0.77

  9,241

  0.67

  Somalia

  1,617

  0.14

  1,617

  0.12

  Sri Lanka

  7,831

  0.67

  7,831

  0.56

  Sudan

  24,416

  2.08

  24,416

  1.76

  Tajikistan

  732

  0.06

  1,440

  0.10

  Tanzania

  51,433

  4.38

  78,924

  5.69

  Togo

  124

  0.01

  1,204

  0.09

  Tuvalu

  n/a

  n/a

  n/a

  n/a

  Uganda

  52,621

  4.48

  64,307

  4.64

  Vietnam

  4,699

  0.40

  4,699

  0.34

  Yemen

  1,048

  0.09

  1,048

  0.08

  Zambia

  14,986

  1.27

  33,134

  2.39

  Zimbabwe

  16,597

  1.41

  29,391

  2.12

  Total to low-income group of countries

  665,797

  57

  829,162

  60

  Notes:

  1. Countries are classified using 1995 GNP per capita estimates

  2. Data for Tuvalu are not available as bilateral assistance to the Pacific is provided under a single regional programme.

  3. 1998–99 figures are the latest available data.
  122W
  Dr. Tonge
  To ask the Secretary of State for International Development what definition her Department uses for low-income countries in relation to its performance target set out in its Public Service Agreement. [130863]

  Clare Short
  The definition of low-income countries, used in the Public Service Agreement, is those with a GNP per capita in 1995 of less than US$766. There are 64 such countries and they are listed on pages 164–166 of the latest (1999) edition of "Statistics On International Development" (a copy of which is in the House Library). The definition was developed by the World bank.

  Aid Indicators
  Dr. Tonge
  To ask the Secretary of State for International Development what the level of each of the indicators was in(a) 1996–97 and (b) 1999–2000 for each of the targets listed in her Department's Public Service Agreement for the 30 largest recipients of British aid; and what action is being taken by her Department to increase progress towards achievement of the targets for each of the targets. [130962]

  Clare Short
  The level of each of the Public Service Agreement (PSA) indicators for the baseline year and for 1999–2000 are set out in Box g (items 1 to 3) of the Department for International Development's 2000 Departmental Report. Copies of the Departmental Report and the latest public drafts of the Target Strategy Papers which set out the action necessary to achieve the International Development Targets have been deposited in the House Library. The final Target Strategy Papers will be published over the next few months. A revised PSA for DFID, covering the years 2001–04 will be published shortly as Command Paper 4808.

  Nolan Rules
  Mr. Stunell
  To ask the Secretary of State for International Development if she will list each group that is responsible to her Department, with significant and plural membership from outside the Civil Service, and to which the Nolan rules on non-departmental public bodies do not apply; and for each such group, if it(a) is a company limited by guarantee, (b) is a charity, (c) has no formal legal basis and (d) has some other legal basis, giving details. [131174]

  Clare Short
  The only body which meets these criteria is CDC Group plc. It is not a company limited by guarantee, nor is it a charity. CDC Group plc has a formal legal basis and was formerly a statutory corporation. On 8 December 1999 CDC was registered as a plc in accordance with, and by virtue of, the CDC Act 1999. CDC is presently wholly owned by Government. The Secretary of State for International Development holds the shares, less one which is held by the Treasury Solicitor. It is to these two members that CDC Group plc is responsible.

  Parliamentary Questions
  Mr. Stunell
  To ask the Secretary of State for International Development how many written parliamentary questions were tabled to her Department between 19 October 1999 and 20 April; and how many did not receive substantive answers citing disproportionate cost as the reason. [131200]
  123W
  Clare Short
  574 written parliamentary questions were tabled to my Department between 19 October 1999 and 20 April 2000. Of these, five were not answered substantively because of disproportionate cost.

  Nepal
  Mr. Bill O'Brien
  To ask the Secretary of State for International Development what plans her Department has to assist the development of the economy of Nepal; and if she will make a statement. [129553]

  Mr. Foulkes
  The objectives of the UK's development programme to Nepal are set out in the Country Strategy Paper, published in November 1998 (a copy of which I am placing in the House of Commons Library). More recently we have been working with other Donors to help the Government implement its Reform Programme which was announced at the Development Forum meeting at Paris in April. This focuses on key areas such as macroeconomic stability and fiscal administration, creating an enabling environment for private sector development, financial sector reform, and better governance (including decentralisation, anti-corruption measures, and civil service reform).

  Debt Relief
  Mr. Robertson
  To ask the Secretary of State for International Development if she will make a statement on the UK's progress towards meeting the G7 commitment on debt relief. [131188]

  Clare Short
  So far, eight countries have qualified for debt relief under the enhanced HIPC Initiative, which is fewer than we had hoped. Some countries who could benefit from HIPC debt relief are involved in conflict, or have failed to demonstrate their commitment to tackling poverty. At the Spring Meetings of the World bank and IMF in April, the Government's proposal to establish a joint World bank/IMF committee to oversee the implementation process was agreed. The committee has begun its work and should provide a focus for efforts to meet the target set by the G7 at the Cologne meeting, that three quarters of eligible countries start to receive debt relief before the end of 2000.

  We have committed over $315 million to the Trust Fund established under the Heavily Indebted Poor Countries (HIPC) debt Initiative to help the multilateral financial institutions fund their shares of HIPC costs. This is the largest contribution from any country. The figure includes our share of the substantial EC contribution for which we pressed; our contribution to the costs of the IMF delivering its HIPC debt relief is additional. We expect the whole of our commitment to be disbursed over the next three years.

  Ministerial Visits
  Mr. Streeter
  To ask the Secretary of State for International Development if she will list the overseas visits(a) she and (b) the Parliamentary Under-Secretary will make during August and September. [131319]

  Clare Short
  I shall be going to Prague for 24 and 25 September for the World bank meetings. I have no other overseas visits planned for August and September though 124W
  I do intend to visit the west of Ireland for my holiday. The Parliamentary Under-Secretary has no overseas visits planned for August and September.

NORTHERN IRELAND

  Diplock Court System
  Mr. McNamara
  To ask the Secretary of State for Northern Ireland what progress has been made on the review into the future operation of the Diplock court system; and when he expects a report to be published. [130422]

  Mr. Ingram
  On 14 December 1999, during the Second Reading of the Terrorism Bill in the House of Commons, the Home Secretary announced that in parallel with the passage of the Bill the Government would conduct a review of the Diplock court arrangements. The Review Group has now completed its work and presented its report to the Secretary of State. The report was placed in the libraries at Westminster on 4 July and I enclose a copy for information.

  While the Government's overall objective remains a return to jury trial for all offences in Northern Ireland, the Secretary of State agrees with the Review Group's recommendation that the time is not yet right for such a move. The Review Group's report also addresses a number of detailed points in relation to the operation of the Diplock court and will be considered further by the Secretary of State.

SOLICITOR-GENERAL

  Director of Public Prosecutions
  Maria Eagle
  To ask the Solicitor-General when the Director of Public Prosecutions will publish his Annual Report. [131511]

  The Solicitor-General
  I can confirm that I have today placed copies of the Annual Report in the Libraries of the House.

  Roisin McAliskey
  Mr. Goggins
  To ask the Solicitor-General if he will make a statement concerning the possible prosecution of Roisin McAliskey. [131514]

  The Solicitor-General
  Further to the statement of the Home Secretary on 10 March 1998,Official Report, column 133W, that he would not order the extradition of Roisin McAliskey to Germany, the Crown Prosecution Service, in accordance with this country's obligations under Article 7 of the European Convention on the Suppression of Terrorism, has considered whether to prosecute Roisin McAliskey in this country for the offences allegedly committed in Germany in relation to the Osnabruk bombing of 28 June 1996.

  The test applied by the Crown Prosecution Service is the test set out in the Code for Crown Prosecutors that applies to all prosecution will be commenced or proceeded with only if there is sufficient evidence to afford a realistic prospect of conviction and that prosecution is in the public interest.
  125W
  The Crown Prosecution Service, having taken the advice of Senior Treasury Counsel, has concluded that there is not a realistic prospect of convicting Miss McAliskey for any offence arising out of the Osnabruk bombing. It has reached that conclusion having taken into account the available evidence and the likely result of any argument that may be put forward by Miss McAliskey that to prosecute her now would be an abuse of process.

  The Law Officers have been consulted and we agree with the conclusion reached by the Crown Prosecution Service.

  It is not usual for the Law Officers to make announcements concerning consideration of individual cases. In this instance, the Home Secretary, in a written reply, 20 March 1998, Official Report, column 742W, said that this matter would be considered for prosecution in the United Kingdom. It is right that the House should be informed of the outcome of those considerations.

WALES

  Further Education Colleges
  Mr. Barry Jones
  To ask the Secretary of State for Wales what discussions he has had with the First Secretary concerning facilitating access to further education colleges in Wales by(a) single parents, (b) the long-term unemployed and (c) others; and if he will make a statement. [125561]

  Mr. Hanson
  My right hon. Friend the Secretary of State meets the First Secretary on a regular basis to discuss a range of issues including education and training. I also have regular discussions with the Assembly Secretary for Post-16 Education and Training.

  The new arrangements for post-16 education and training in Wales will enable a coherent system between all providers of post-16 education and training, thereby increasing choice for all our people whatever their personal circumstances. It is envisaged that the new National Council for Education and Training for Wales (CETW) will fund a wide range of learner support measures that will enable more people to participate in training.

  The National Assembly provides Access Funds for students who experience financial difficulties while studying or who are prevented from entering further education because of financial reasons. Further Education Access Funds have been substantially increased from £0.5 million in 1998–99 to a total of £13.3 million over the period 1999–2000 to 2001–02.

  Police
  Mr. Evans
  To ask the Secretary of State for Wales how many police there were in Wales in(a) May 1997 and (b) July 2000. [130981]

  Mr. Paul Murphy
  [holding answer 17 July 2000]: Figures are not held centrally for the months specified. At 31 March 1997, there were 6,593 police officers in Wales, and at 30 September 1999 there were 6,692 police officers.

  Assembly (Information Exchange)
  Mr. Evans
  To ask the Secretary of State for Wales if he will make a statement on information exchange between the United Kingdom and the Welsh Assembly. [131064]

  Mr. Paul Murphy
  [holding answer 17 July 2000]: The Memorandum of Understanding between the United Kingdom Government and the Cabinet of the National Assembly for Wales published in October 1999 says in paragraph 9 that:
  the administrations will aim to provide each other with as full and open as possible access to scientific, technical and policy information including statistics and research and, where appropriate, representations from third parties.

  Parliamentary Questions
  Mr. Stunell
  To ask the Secretary of State for Wales on how many occasions he has deposited papers in the Library in response to parliamentary questions tabled to his Department between 19 October 1999 and 20 April. [131129]

  Mr. Paul Murphy
  Six papers were deposited in the Library in response to parliamentary questions tabled between 19 October and 20 April.

AGRICULTURE, FISHERIES AND FOOD

  Over-30-months Scheme
  Mr. Levitt
  To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the efficiency and environmental standards of the Durga process for burning over-30-months scheme carcases. [129652]

  Ms Quin
  Durga were one of a number of companies contracted to provide incineration services following a competitive tender held by the Intervention Board during 1996. The company's contract required them to have all necessary planning and environmental consents in place prior to commencement of operations. Incineration services began in October 1997 and the company have operated under Environment Agency supervision successfully destroying over 43,000 OTMS carcases by the end of June 2000.

EDUCATION AND EMPLOYMENT

  Interactive Voice Response
  Mr. Ben Chapman
  To ask the Secretary of State for Education and Employment how many departmental telephone lines used by the general public are responded to by interactive voice response systems. [127404]

  Mr. Wills
  Within the Department for Education and Employment there are no departmental telephone lines used by the general public which are responded to by interactive voice systems.

  Lunchtime Exclusions
  Helen Jones
  To ask the Secretary of State for Education and Employment (1) what recent guidance his Department has issued on the exclusion of pupils at lunchtime; and if he will make a statement; [128125]
  127W
  (2) if he will make it his policy to monitor the number of fixed-term lunchtime exclusions; and if he will make a statement. [128126]

  Jacqui Smith
  [holding answer 3 July 2000]: My Department's guidance, Circular 10/99 "Social inclusion: Pupil Support", issued in July 1999, makes it clear that lunchtime exclusions are fixed period exclusions and as such are governed by the exclusion provisions in the School Standards and Framework Act 1998. This statutory framework protects the rights of pupils, parents and headteachers.

  We already collect data on all permanent and certain fixed period exclusions but collecting data on lunchtime exclusions would impose an unjustified additional burden on schools.

  Departmental Payments
  Mr. Chope
  To ask the Secretary of State for Education and Employment what percentage of correctly presented bills were paid by his Department in(a) 1998–99 and (b) 1999–2000 within 30 days of receipt of (i) goods and services, (ii) a valid invoice and (iii) other agreed payment terms. [130035]

  Mr. Wills
  [holding answer 11 July 2000]: I refer the hon. Member to the answer given to my hon. Friend the Member for Elmet (Mr. Burgon) on 23 July 1999, Official Report, columns 677–78W.

  Departments and their Agencies are currently collating this information for 1999–2000 and this will be made available to the House shortly.

  Holocaust Memorial Day
  Mr. Öpik
  To ask the Secretary of State for Education and Employment what progress his Department has made with the production of a resource pack for Holocaust Memorial Day; when the pack will be made available; and if he will make a statement. [130283]

  Jacqui Smith
  We are working with the Home Office and key organisations involved in Holocaust Education to develop the resource pack. It will comprise guidance and materials for schools, suggesting activities for teachers and pupils to follow, for example in classroom activities and assemblies, and it will be available in autumn this year.

  In June, we launched a teaching pack and guidelines to accompany the Anne Frank Declaration and to support primary and secondary school teachers in their work on Education for Citizenship and the Teaching of Democracy.

  Language Teaching
  Mr. Pike
  To ask the Secretary of State for Education and Employment what plans the Government have to increase the teaching of a second language in primary and junior schools. [130286]

  Jacqui Smith
  Around a quarter of all primary schools already offer a second language. The revised National Curriculum, published last November, contains guidance for teaching 7 to 11-year olds, covering skills, knowledge and understanding. It also contains suggested attainment 128W
  targets. Furthermore, we have published a Scheme of Work for French aimed at this age group, and will add German and Spanish later this month.

  We are piloting approaches to extending language teaching in primary schools, through our Early Language Learning initiative, in which we are gathering good practice and providing classroom materials and a draft curriculum framework. We have asked the Qualifications and Curriculum Authority (QCA) to consider the potential to extend this further in the longer term.

  Official Visits
  Mr. Matthew Taylor
  To ask the Secretary of State for Education and Employment if he will list the visits outside Britain made by his Department's Permanent Secretary on official business since 1 January 1999, indicating the date and purpose of the visit in each case. [130489]

  Mr. Wills
  Michael Bichard has made the following visits since 1 January 1999:

  13–14 January 1999—Germany

  18–19 February 1999—France

  4–5 November 1999—Netherlands

  25–26 November 1999—Finland

  29 February 2000—USA.

  In all cases the purpose was to exchange views on education and employment issues, including in the first three cases in the EU context.

  Home Education
  Mr. Coaker
  To ask the Secretary of State for Education and Employment what grants are available to parents for educating their children at home. [130975]

  Jacqui Smith
  Section 7 of the Education Act 1996 places a duty on parents to ensure that their children receive suitable full-time education, either by regular attendance at school or otherwise. Some parents opt to educate their children at home. Although local education authorities are not required to provide financial help to home educating parents, some do provide support and assistance, including free National Curriculum material. Education authorities are also under a duty to monitor home education to ensure that the education a child receives is suitable to their age, ability, aptitude and any special educational need they may have.

  Access to Work Grants
  Mr. Andrew George
  To ask the Secretary of State for Education and Employment what research his Department has completed, commissioned or co-operated in which estimates the take-up of Access to Work grants in each of the last five years. [130755]

  Ms Hodge
  [holding answer 17 July 2000]: Responsibility for the subject of this question has been delegated to the Employment Service under its Chief Executive. I have asked him to arrange for a reply to be given.

  Letter from Richard Foster to Mr. Andrew George, dated 18 July 2000:
  As the Employment Service is an Executive Agency, the Secretary of State has asked Leigh Lewis to reply to your question regarding what research his Department has completed,

  129W
  commissioned or co-operated in which estimates the take up of Access to Work grants in each of the last five years. This is something which falls within the responsibilities delegated to Mr Lewis as Chief Executive of the Agency. I am replying in his absence.
  The Employment Service commissioned independent research into Access to Work in 1996 and 1998. On both occasions the research focused on a wide range of issues within Access to Work including types of disability, age and gender of applicant, employment type, time taken to provide support and general satisfaction with the programme. Copies of both research reports have been placed in the libraries and their titles are; The Access to Work Programme - A Survey of Recipients, Employers, Employment Service Managers and Staff, the Social & Community Planning Research 1996; and Evaluation of Access to Work, the Institute for Employment Studies, 1998.
  Neither report was commissioned to look specifically into the take up and spend of the Access to Work programme but we do collect management information that gives us this information. The table shows you how many disabled people have been helped and how much has been spent through Access to Work between April 1995 and March 2000.

  Year

  Number of beneficiaries

  Total spend (£ million)

  1999–2000

  20,729

  24.3

  1998–99

  16,094

  19.5

  1997–98

  12,825

  14.6

  1996–97

  10,119

  12.5

  1995–96

  13,577

  19.9

  I hope this is helpful.

  Environment Taskforces
  Mr. Heathcoat-Amory
  To ask the Secretary of State for Education and Employment how many people took up a job with an environmental taskforce under the New Deal during(a) 1999 and (b) the first half of 2000. [130544]

  Ms Jowell
  [holding answer 17 July 2000]: During 1999, 18,000 young people took advantage of the work experience opportunities offered by the Environment Taskforce option of the New Deal for Young People. Latest available figures to April 2000, show that a further 5,800 young people have started this option.

  Higher Education Funding
  Mr. Boswell
  To ask the Secretary of State for Education and Employment what response he has sent to the Greenaway report on Higher Education Funding. [130565]

  Mr. Wicks
  The Greenaway Report was commissioned by the Russell Group of Universities, not the Government. I understand that it has been passed to the Committee of Vice-Chancellors and Principals, to form part of their wider inquiry into university funding. The Government are opposed to "top-up" tuition fees and have legislated to prevent universities from levying such charges.

  School Funding (Sheffield)
  Mr. Bill Michie
  To ask the Secretary of State for Education and Employment how much has been invested in total in Sheffield schools in the financial years 1999–2000 and 2000–01 to date; and if he will indicate the investment in each school. [131329]
  130W
  Ms Estelle Morris
  In 1999–2000, £205.3 million of revenue funding and £9.8 million of capital funding was available for use by Sheffield Local Education Authority. The corresponding figures for 2000–01 are £224.2 million of revenue funding and £10.6 million of capital funding. It is not possible to provide revenue and capital allocations for individual schools.

  Infant Class Sizes (Middlesbrough)
  Dr. Kumar
  To ask the Secretary of State for Education and Employment what progress he has made in reducing infant class sizes in the constituency of Middlesbrough, South and Cleveland East; and if he will make a statement. [131203]

  Ms Estelle Morris
  We are well on course to deliver our pledge to limit infant classes to 30 pupils. We have since January 1998 already reduced the number of children in infant classes of over 30 pupils by 300,000. £620 million is available to support the pledge, and allocations so far to Middlesbrough LEA amount to some £750,000. This has helped to reduce the size of the average Key Stage 1 class in Middlesbrough, South and Cleveland, East to 25.6. The figure in January 1998 was 26.8.

HEALTH

  NHS Estates Executive Agency
  Ms Keeble
  To ask the Secretary of State for Health if he will publish the Annual Report and Accounts 1999–2000 for the NHS Estates Executive Agency. [131479]

  Mr. Denham
  We have received the report and copies have today been laid in accordance with the requirements of section 5 of the Exchequer and Audit Departments Act 1921. Copies have also been placed in the Library.

ENVIRONMENT, TRANSPORT AND THE REGIONS

  Road Haulage Firms
  Mr. Mitchell
  To ask the Secretary of State for the Environment, Transport and the Regions what initiatives have been taken by the Council of Ministers, or Commission of the European Community, concerning the desirability and practicality of requiring registration, under commonly agreed conditions, of road haulage firms within the Community licensed to carry goods on surface or sub-surface routes across the sea between the United Kingdom and other member states of the European Community, other than the Republic of Ireland. [128851]

  Mr. Hill
  A system of registration already exists. Since the entry into force of Council Regulation (EEC) 881–92 on 1 January 1993, hauliers seeking to operate internationally within the Community must be in possession of a Community Authorisation certificate as issued by the licensing authorities in the country in which they are established. This applies to heavy goods vehicle traffic to and from the Irish Republic as well as to haulage operations on mainland Europe.

  UK/US Air Services
  Mr. Fearn
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on progress in the negotiations between the UK and the US authorities on air service agreements. [129440]

  Mr. Mullin
  A further round of talks took place in Washington on 5–6 July. The discussions were constructive and covered a wide range of issues, including ideas for phasing-in liberalisation. Negotiations will resume again in London in September.

  Housing
  Ms Buck
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the effectiveness of the HOMES scheme and similar mobility schemes for social housing tenants; and if he will make a statement. [130233]

  Mr. Mullin
  The activities of HOMES are monitored on an ongoing basis by the DETR. In particular through a requirement on HOMES to agree annual objectives with the Department; to report on their achievement of objectives; and to submit a three year business plan. The level of grant funding DETR provides to HOMES is subject to effective implementation of the plan. The Housing Green Paper "Quality and Choice: A decent home for all" sets out the Government's proposals to promote lettings and transfers policies that offer more choice for existing and prospective tenants of social housing. The role and effectiveness of mobility schemes will be an important consideration. The Government will consider responses to the Green Paper and would wish to discuss any proposals with key interested parties.

  Ms Buck
  To ask the Secretary of State for the Environment, Transport and the Regions (1) what steps he plans to take to meet the commitment in the Housing Green Paper to strengthen the obligation on registered social landlords to co-operate with local authorities in offering accommodation to households on local authority housing registers; and if he will make a statement; [130239]

  (2) what assessment he has made of the effectiveness of the obligation on registered social landlords to co-operate with local authorities in the provision of accommodation to households on local authority housing registers; and if he will make a statement. [130238]

  Mr. Mullin
  Statutory guidance issued by the Housing Corporation requires registered social landlords (RSLs) to make available at least of 50 per cent. of their lettings to local authority nominees from the housing register, in order to comply with the duty of co-operation placed on RSLs under section 170 of the Housing Act 1996. Under current arrangements, RSLs with more than 250 units of accommodation or 250 bed spaces are required to provide comprehensive data about households and properties in respect of all their lettings. The Housing Green Paper states that the Government will be reviewing—with a view to strengthening—the current obligation on RSLs to co-operate with local authorities in offering accommodation to people on authorities' housing registers. The Government will consider responses to the Green Paper before deciding how to take this forward, and would wish to discuss 132W
  any proposals with representatives of local government, the Housing Corporation, the National Housing Federation and others before introducing any changes.

  Ms Buck
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to allow social housing tenants to move across local authority boundaries; and if he will make a statement. [130234]

  Mr. Mullin
  The Housing Green Paper, "Quality and Choice; A decent home for all", sets out the Government's proposals for increasing choice in social lettings. As part of these proposals, we are interested in exploring the scope for promoting greater flexibility and more movement across local authority boundaries, and will consider responses to the Green Paper before deciding whether to develop this further. We would wish to discuss any proposals with representatives of local government, Shelter and others before taking them forward.

  Ms Buck
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to introduce a standardised monitoring system for the letting of social housing stock by registered social landlords and local authorities; and if he will make a statement. [130236]

  Mr. Mullin
  The Housing Green Paper, "Quality and Choice; A decent home for all", sets out the Government's proposals for increasing choice in social lettings. In taking these proposals forward we will wish to consider the arrangements for monitoring lettings by social landlords.

  Homelessness
  Ms Buck
  To ask the Secretary of State for the Environment, Transport and the Regions (1) what assessment he has made of the impact of stock transfer on the availability of social housing for homeless people; [130235]

  (2) what account will be taken of the need to provide housing for homeless people in the proposed selection criteria set out in the Housing Green Paper for applications for stock transfer. [130237]

  Mr. Mullin
  The Government consider that stock transfer is an important way of improving the quality and availability of affordable social housing. The proposed selection criteria do not explicitly address the issue of homelessness because, following the transfer of their housing stock, local housing authorities retain their obligations towards homeless households under Part VII of the Housing Act 1996. They must also continue to keep a register of applicants who qualify for the allocation of accommodation. To ensure they have access to accommodation to enable them to discharge their housing functions, authorities generally negotiate nomination rights with the transfer landlord of between 50 per cent. and 75 per cent. of the transferred stock.

  Brownfield Development
  Mr. Sheerman
  To ask the Secretary of State for the Environment, Transport and the Regions what his latest assessment is of the availability of brownfield land suitable for housing purposes in urban centres. [130218]
  133W
  Ms Beverley Hughes
  Estimates for 1998 of the amount of previously developed land that is unused or may be available for redevelopment, including how much may be suitable for housing, are published on the National Land Use Database website (www.nlud.org.uk). Figures are available for England and the Government Office Regions. Figures for local authority districts show amounts of previously developed land with planning allocation or permission for housing. There are no estimates for "urban centres".

  Mr. Paul Marsden
  To ask the Secretary of State for the Environment, Transport and the Regions what his targets are for the percentage of new homes in Shrewsbury and Atcham to be built on brownfield sites. [131148]

  Ms Beverley Hughes
  The Secretary of State expects Shrewsbury and Atcham Borough Council to contribute towards the regional target of 61 per cent. contained in Regional Planning Guidance for the West Midlands (RPG 11: April 1998). Local authorities are required to set their own land recycling targets in development plans which will contribute to attaining the regional target. It is understood that in its review of the local plan the borough council proposes to exceed the regional target. The Government's Planning Policy Guidance Note 3: Housing (March 2000) confirms the national target of 60 per cent. of additional housing on previously developed land and requires local authorities to give priority to the re-use of such land within urban areas in allocating sites for housing in development plans.

  Crown Exemption
  Mr. Brake
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to remove Crown exemption from the planning system. [130680]

  Ms Beverley Hughes
  Crown exemption will be removed from the planning system when a suitable legislative opportunity arises.

  Hedge Control
  Mr. Rowe
  To ask the Secretary of State for the Environment, Transport and the Regions when he will make a decision on the control of Leylandii and other hedges. [130631]

  Mr. Mullin
  We expect to make a statement, setting out our decision on the way forward on this issue and the reason for them, before the summer recess.

  Housing Projections (Suffolk)
  Mr. Ruffley
  To ask the Secretary of State for the Environment, Transport and the Regions how many new homes are currently projected to be built in(a) St. Edmondsbury Borough Council and (b) Mid-Suffolk District Council area between 2000–01 and 2015–16; and what corresponding projections were used by his Department in 1997–1998. [130739]

  Ms Beverley Hughes
  The adopted Suffolk Structure Plan provides for 540 dwellings per annum for St. Edmundsbury and 420 dwellings for Mid Suffolk over the period from 1998 to 2006. These totals are relevant to both 1997–98 and 2000–01. The structure plan is currently under review and the totals for 2006–16 will 134W
  be determined as a result of Suffolk County Council's consideration of the appropriate level of housing in the county.

  A14 (Road Accidents)
  Mr. Ruffley
  To ask the Secretary of State for the Environment, Transport and the Regions how many(a) fatal and (b) non-fatal road accidents were recorded as taking place on the A14 between Bury St. Edmunds and Stowmarket in (i) 1996–97, (ii) 1997–98, (iii) 1998–99 and (iv) 1999–2000. [130740]

  Mr. Hill
  The information requested is shown in the table.

  1996

  1997

  1998

  1999

  Fatal

  0

  1

  2

  4

  Serious

  7

  10

  2

  4

  Slight

  20

  22

  19

  19

  Injured

  27

  32

  21

  23

  Total

  27

  33

  23

  27

  Official Visits
  Mr. Matthew Taylor
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the visits outside Britain made by his Department's Permanent Secretary on official business since 1 January 1999, indicating the date and purpose of the visit in each case. [130490]

  Ms Beverley Hughes
  Sir Richard Mottram has made one overseas visit on official business. He attended the 49th Königswinter conference in Düsseldorf from 18 to 20 March 1999.

  Zoos
  Mr. Hancock
  To ask the Secretary of State for the Environment, Transport and the Regions how many zoos within the UK use(a) electric goads and (b) other weapons to discipline animals; and if he will make a statement. [130486]

  Mr. Mullin
  The information requested is not held centrally.

  Responsibility for the licensing of zoos under the Zoo Licensing Act 1981 rests with local authorities. Inspectors, appointed by the Secretary of State, assist local authorities in reaching their decisions.

  Statutory guidance to inspectors is given in the "Revised Secretary of State's Standards of Modern Zoo Practice", which came into effect on 3 April 2000. The revised Standards require that handling must be done with care in order to protect an animal's well being, and avoid unnecessary discomfort, stress or physical harm. Appendix 7 further advises that training methods should be based on positive reinforcement and that if negative reinforcement is used, it must never compromise the welfare of the animal.

  Assured Tenancies
  Mr. Hilary Benn
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to amend the law relating to assured tenancies; and if he will make a statement. [130827]

  Mr. Mullin
  We remain firmly committed to the current legal framework of assured and assured shorthold tenancies. Certainty and confidence are essential if we are to persuade reputable landlords and investors to increase the supply of decent rented housing.

  Private Finance Initiative
  Mr. Cousins
  To ask the Secretary of State for the Environment, Transport and the Regions when he received a request to provide Private Finance Initiative credits for community and leisure use aspects of an educational Private Finance Initiative programme in Newcastle-upon-Tyne; what amount of Private Finance Initiative credits was involved; and when a decision was given to the City of Newcastle-upon-Tyne authorities. [130825]

  Ms Beverley Hughes
  [holding answer 17 July 2000]: The first contact with Newcastle City Council about this proposal was in August 1999. A formal outline business case was submitted in February 2000 and supporting information provided on 31 May 2000. This was assessed in preparation for the July endorsement round. Newcastle City Council was informed of the outcome of that assessment on 14 July. Details of the sums involved are a matter for the local authorities.

  Regional Offices
  Mr. Denzil Davies
  To ask the Secretary of State for the Environment, Transport and the Regions what has been the cost to public funds in the most recent financial year of the administration of the Yorkshire and Humberside Government Regional Office. [131249]

  Ms Beverley Hughes
  Running costs for the Government Office for Yorkshire and the Humber are as follows:

  £000

  1999–2000

  Pay

  5,911.0

  Accommodation

  1,227.0

  Other

  1,749.9

  Total

  8,887.9

  Notes:

  Running costs allocations do not include any provision for pay rises. Therefore any increases in costs have to be met by efficiency savings which usually run at around 3 per cent. per year. Any additional funds provided by Departments are only given for new areas of work.

  Mr. Denzil Davies
  To ask the Secretary of State for the Environment, Transport and the Regions what has been the total cost to public funds from inception to the latest available date of administering the Yorkshire and Humberside Regional Development Agency. [131309]

  Ms Beverley Hughes
  Yorkshire Forward (Yorkshire and Humber Regional Development Agency) came into 136W
  existence on 14 December 1998 and became fully operational when it was designated on 1 April 1999. Administration costs were as follows:

  £000

  11998–99

  1999–2000

  Salaries and wages

  144

  5,645

  Other administration costs

  342

  26,692

  Total

  486

  12,337

  1 From 14 December 1998 to 31 March 1999

  2 Includes initial setting up/office costs

  Note:

  The administrative resource allocation for 2000–01 is £8.525 million.

  Further information is available in Yorkshire Forward's Annual Report and Accounts 1999–2000 which will be available as a public document, after it has been laid before Parliament before the summer recess.

  Red Ensign
  Mr. Flynn
  To ask the Secretary of State for the Environment, Transport and the Regions if he will ensure that the Red Ensign is flown from public buildings to mark Merchant Navy Day on 3 September. [130559]

  Mr. Hill
  [holding answer 17 July 2000]: The Department of the Environment, Transport and the Regions will fly the Red Ensign from its headquarter buildings on Merchant Navy Day. The day will be marked by special events to celebrate our merchant navy and to highlight the opportunities of a merchant navy career.

  Aggregates
  Mr. Gill
  To ask the Secretary of State for the Environment, Transport and the Regions what discussions he has had with the Chancellor of the Exchequer regarding the Quarry Products Association's proposed preferential scheme for aggregates from quarry operators meeting defined environmental criteria. [131092]

  Ms Beverley Hughes
  My hon. Friend the Minister for Housing and Planning held a number of discussions with my hon. Friend the Financial Secretary to the Treasury on the Quarry Products Association's proposals for a voluntary alternative to a levy on primary aggregates, including their scheme for preferential procurement of aggregate by the public sector.

  Mr. Gill
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement about the green purchasing commitments set out in the document entitled, "Building a better quality of life—a strategy for more sustainable construction". [131093]

  Ms Beverley Hughes
  In "Building a better quality of life—a strategy for more sustainable construction", which I launched during National Construction Week this year, we recognised the Government's responsibilities, as the industry's leading client, to set an example in the sustainable procurement, maintenance and operation of its built assets.

  On 10 July my hon. Friend the Minister for Housing and Planning launched the sustainability action plan of the Government Construction Clients' Panel—"Achieving sustainability in construction procurement". The plan's framework is based upon the 10 themes for action from

  137W
  "Building a better quality of life". It supports other cross-government initiatives such as "Achieving Excellence", sets milestones, and outlines a collective programme for implementation. The plan also commits Departments, agencies and NDPBs to assess their current situation, and develop their own action plans (or update existing plans). These would be in line with overall objectives, but specific to individual Departments' activities. The Local Government Task Force is developing a similar approach for local authorities to apply to their construction procurement.

  Disabled Drivers
  Mr. Shepherd
  To ask the Secretary of State for the Environment, Transport and the Regions how many disabled drivers are awaiting an on-road assessment; how many have been waiting since November 1998; and when he will amend the regulations to allow the Driver and Vehicle Licensing Centre to authorise applicants to drive for one day for the purposes of assessing whether they are fit to resume driving. [130562]

  Mr. Hill
  [holding answer 17 July 2000]: There are currently 51 drivers awaiting on-road assessments. Of these, three have been waiting since November 1998. The process of amending the regulations is at an advanced stage and we hope to implement the changes later this year.

  Planning Consultations
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions how many representations have been received to the consultations initiated by GOSE on PPG3 and RP69; how many of these were(a) on the official response form and (b) in other forms; and what weight was given to each such type of response. [131320]

  Ms Beverley Hughes
  My Department consulted on PPG3 last year and received 620 responses, of which the majority were supportive. Final PPG3 was published in March of this year. The Government Office for the South East led the consultation on draft RPG9 this year and have received 922 responses, all of which are being considered very carefully irrespective of the form in which they were made.

  Car Registrations
  Mrs. Browning
  To ask the Secretary of State for the Environment, Transport and the Regions how many new motor cars were registered at the DVLA in each month from January 1999 to May 2000 using(a) the DVLA form V55/1 and (b) the DVLA form V55/5. [131323]

  Mr. Hill
  Figures for the first registration of new motor cars categorised by the type of application form used are not readily available. Vehicles registered on form V55/1 include all types of new vehicles. Vehicles first registered on form V55/5 include vehicles that are not new. Many new vehicles are registered by motor dealers using an electronic system, known as AFRL (automated first registration and licensing). These cases do not use a paper form, but would have used the V55/1 form if they had not been processed through the AFRL system. The table 138W
  shows the number of registrations recorded at DVLA for all vehicles by type of form and the number of AFRL registrations.

  V55/1

  V55/5

  AFRL

  Total

  1999

  January

  101,150

  12,372

  74,529

  188,051

  February

  93,006

  14,491

  60,777

  168,274

  March

  173,928

  20,944

  155,647

  350,519

  April

  152,052

  16,718

  82,752

  251,522

  May

  126,939

  17,233

  80,145

  224,317

  June

  128,049

  21,522

  96,530

  246,101

  July

  124,793

  20,949

  88,202

  233,944

  August

  89,761

  18,399

  67,083

  175,243

  September

  141,313

  22,529

  216,339

  380,181

  October

  117,483

  20,060

  89,033

  226,576

  November

  77,856

  19,203

  98,825

  195,884

  December

  58,932

  14,655

  59,886

  133,473

  2000

  January

  68,161

  17,654

  127,551

  213,366

  February

  55,847

  18,768

  90,775

  165,390

  March

  118,404

  26,142

  259,478

  404,042

  April

  82,651

  19,657

  121,685

  223,993

  May

  80,401

  23,166

  151,256

  254,823

  Declaration of Interest
  Mr. Robathan
  To ask the Secretary of State for the Environment, Transport and the Regions if he made a declaration in relation to the Rail and Maritime Transport Union of his interest in accordance with paragraph 110 of the Ministerial Code, at the meeting he held with the Department of Trade and Industry and unions to discuss ship building on 13 July. [131194]

  Ms Beverley Hughes
  No declaration was made as my right hon. Friend the Secretary of State has no private interest in the business discussed.

  Parliamentary Questions
  Mr. Stunell
  To ask the Secretary of State for the Environment, Transport and the Regions how many parliamentary questions were tabled to his Department between 19 October 1999 and 20 April which requested information pursuant to previous answers. [131125]

  Ms Beverley Hughes
  For the period in question, 48 parliamentary questions were tabled to my Department which requested information pursuant to previous answers out of a total of 2,865 questions.

  Mortgages
  Mr. Matthew Taylor
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer of 13 July 2000,Official Report, column 567W, what proportion of (a) all mortgages and (b) the total value of mortgages, were new mortgages on (i) fixed, (ii) discounted variable and (iii) other variable rates in each year from 1994 to 1998. [131325]

  Mr. Mullin
  The proportion of new mortgages that were fixed rate, discounted variable rate and other variable rate is provided in the table.
  139W

  1994

  1995

  1996

  1997

  1998

  Percentage of new mortgages by number

  Fixed

  49.4

  30.7

  20.5

  41.2

  49.9

  Discounted variable

  28.5

  49.1

  47.2

  30.3

  28.8

  Other variable

  22.2

  20.2

  32.3

  28.4

  21.3

  Percentage of new mortgages by value

  Fixed

  51.5

  33.8

  18.2

  45.4

  53.1

  Discounted variable

  26.0

  45.3

  47.9

  27.2

  26.0

  Other variable

  22.5

  20.9

  33.9

  27.4

  20.9

  Note:

  Figures may not sum to 100.0 due to rounding

  Source:

  DETR 5 per cent. Survey of Mortgage Lenders

  Most fixed rate mortgages will revert to variable rate mortgages after an agreed period of anything from six months up to 10 years.

  House Prices
  Mr. Woodward
  To ask the Secretary of State for the Environment, Transport and the Regions what were the average house prices in(a) South East England, (b) London, (c) North East England and (d) the West Midlands, in (i) 1995, (ii) 1996, (iii) 1997, (iv) 1998 and (v) 1999. [131065]

  Mr. Mullin
  The figures for average house prices are as follows:

  £

  South East

  London

  North East

  West Midlands

  1995

  83,030

  89,528

  46,565

  62,123

  1996

  87,644

  94,065

  51,009

  64,320

  1997

  94,842

  105,819

  52,824

  67,803

  1998

  106,378

  114,760

  55,957

  71,864

  1999

  121,654

  142,321

  61,620

  79,757

  Source:

  DETR five per cent. survey of mortgage lenders

FOREIGN AND COMMONWEALTH AFFAIRS

  Iraq
  Mr. Galloway
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will meet Mr. Scott Ritter to discuss progress made on the disarmament of Iraq; and if he will make a statement. [129556]

  Mr. Hain
  The responsibility for ensuring the destruction of Iraq's weapons of mass destruction capability lies with the United Nations Monitoring, Verification and Monitoring Commission (UNMOVIC) and the International Atomic Energy Agency (IAEA), under relevant United Nations Security Council resolutions. We are in close touch with both organisations. I shall be discussing this important issue with the Executive Chairman of UNMOVIC, Dr. Hans Blix, on 27 July.

  Mr. Llew Smith
  To ask the Secretary of State for Foreign and Commonwealth Affairs how many British companies are listed in United Nations reports of inspection visits to Iraq since 1991 as having provided technology used in the Iraqi programmes of weapons of mass destruction. [130851]
  140W
  Mr. Hain
  It is not our practice to comment on information that was given to us in confidence by the United Nations Special Commission (UNSCOM). In any case, UNSCOM did not share information from inspection reports with the UK except when seeking our help to follow up that information.

  Copies of UNSCOM's reports to the UN Security Council are held in the Libraries of the House.

  Germany
  Mr. Bradshaw
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of bilateral relations between the UK and Germany; and if he will make a statement. [129557]

  Mr. Vaz
  As my right hon. Friend the Prime Minister said at this year's Königswinter Conference our relations with Germany are as excellent as any bilateral relations can be. Three weeks ago my right hon. Friend the Prime Minister visited the German Chancellor in Berlin, and just this morning my right hon. Friend the Foreign Secretary met the German Foreign Minister to discuss a range of EU issues where we have many important common interests. I invited the German Minister for Europe Herr Christoph Zopel to London on 14–15 April and I visited him in Berlin in March.

  Italy
  Mr. Casale
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement about recent progress in strengthening British-Italian bilateral relations. [R] [129559]

  Mr. Vaz
  British-Italian relations are strong both in bilateral and the EU and NATO contexts. President Ciampi visited Britain for a brief visit on 1 June when he attended a lunch hosted by HM the Queen and Prince Philip. During the visit my right hon. Friend the Foreign Secretary held bilateral meetings with Foreign Minister Lamberto Dini.

  Her Majesty the Queen will make a State Visit to Italy 16–19 October, visiting Rome and Milan.

  International Criminal Court
  Tony Wright
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on progress in establishing the International Criminal Court. [129560]

  Mr. Hain
  To date the Rome Statute of the International Criminal Court has been signed by 97 States and ratified by fourteen. The Court will be established once 60 states ratify. A Preparatory Commission completed two important subsidiary documents to the Statute at its last session in June.

  Kosovo
  Mr. Coaker
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the progress being made by UNMIK in Kosovo. [129562]

  Mr. Vaz
  UNMIK has made significant progress in the last year. Over one million refugees and internally displaced persons have returned, the KLA has
  141W
  demilitarised, schools and hospitals have reopened, a functioning judiciary is being established, houses are being reconstructed, joint administrative structures have been set up and over 800,000 people have registered for the forthcoming local elections. The UK has played an important part in pushing all this forward. But I do not want to minimise the difficulties we still face in restoring normal economic life in Kosovo and bringing about ethnic reconciliation. It will take time but we are determined to get the job done.

  Mr. Mackinlay
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he expects the municipal elections in Kosovo to take place. [130660]

  Mr. Vaz
  UNMIK have confirmed that municipal elections in Kosovo will be held during this coming October. An exact date in October has not been decided.

  Middle East
  Dr. Iddon
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the Middle East peace process. [129563]

  Mr. Clapham
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on progress in the Middle East peace process. [129571]

  Mr. Hain
  The Middle East could soon see further steps towards lasting peace. The summit between the Israelis and Palestinians called by President Clinton at Camp David is a crucial event in the search for Permanent Status Agreement. My right hon. Friend the Prime Minister saw Ehud Barak on 3 July and sent a message to President Arafat on the eve of the summit. We wish both parties and President Clinton every success in making progress in the talks.

  On the Syrian track, we welcome statements by the new Syrian Government that they are keen to restart negotiations with Israel. We hope that this can happen as soon as possible.

  We welcome UN confirmation of Israeli withdrawal from Lebanon. This too is an important step towards a comprehensive peace in the region.

  Yugoslavia
  Mr. Wilkinson
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the UK's relations with Yugoslavia. [129564]

  Mr. Vaz
  The Federal Republic of Yugoslavia broke off diplomatic relations with the UK on 25 March 1999. Since then relations have been conducted through the British Interests Section of the Brazilian Embassy in Belgrade and the Federal Republic of Yugoslavia Interests Section of the Cypriot High Commission in London.

  Syria
  Sir David Madel
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to meet the President of Syria; and if he will make a statement. [129565]
  142W
  Mr. Hain
  I met Bashir al-Asad during my visit to Syria in May. My right hon. Friend the Foreign Secretary met him at the condolence ceremony for his father on 13 June. We look forward to continuing our dialogue soon, both to improve bilateral relations and as part of our continuing support for all parties seeking a comprehensive peace in the region.

  Drugs Trade
  Mrs. Ann Winterton
  To ask the Secretary of State for Foreign and Commonwealth Affairs what discussions he has had with his counterparts abroad on tackling the international illegal drugs trade. [129567]

  Mr. Battle
  I take every opportunity to discuss, with our counterparts, the UK's international activities to combat the trade in illicit drugs. We take the lead in co-ordinating and prioritising such activities across Government in close co-operation with the UK anti-drugs co-ordinator Keith Hellawell. The UK plays an active role in international forums dealing with the threat posed by illicit drugs, including in the UN G8 and EU. Last year the Foreign and Commonwealth Office spent over £6.5 million on international counter-drugs activities.

  Single Currency
  Miss McIntosh
  To ask the Secretary of State for Foreign and Commonwealth Affairs what recent discussions he has had with the Chancellor of the Exchequer on progress towards joining the European single currency. [129568]

  Mr. Vaz
  My right hon. Friend the Foreign Secretary meets Cabinet colleagues to discuss a range of issues. The Government's policy towards the single currency has not changed and will not change. We will only recommend joining a successful single currency if it is in our national economic interest to do so, and if the economic case for the UK joining is clear and unambiguous. The Treasury will make another assessment of the five economic tests early in the next Parliament.

  Colombia
  Ms Osborne
  To ask the Secretary of State for Foreign and Commonwealth Affairs what steps the Government propose to take to support the Colombian peace process following the conference in Madrid on 6 and 7 July on Plan Colombia. [129569]

  Mr. Battle
  I refer my hon. Friend to the answer I gave to my hon. Friend the Member for Wythenshawe and Sale, East (Mr. Goggins) on 18 July 2000,Official Report, columns 210–11.

  Luxembourg
  Mr. Healey
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on his recent bilateral contacts with Luxembourg. [129570]

  Mr. Vaz
  My right hon. Friend the Foreign Secretary held bilateral talks with the Luxembourg Foreign Minister in September 1999. In the last six months there have been bilateral meetings with the Luxembourg Prime Minister
  143W
  and the Ministers of Budget, Justice and Social Affairs. These contacts form part of our Step Change initiative to increase contacts with our EU partners.

  Brigadier Saunders
  Mr. Paul Marsden
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on progress made to bring to justice those responsible for the murder of Brigadier Saunders in Greece. [129572]

  Mr. Battle
  Since the incident Her Majesty's Government has been in close contact with the Greek authorities at the highest level. At their request, a team of specialists from the Metropolitan police flew to Athens on the day of the murder. They are still there, working closely with the Greek police. The House must understand that the operational aspects must remain confidential. However, we remain committed, as do the Greek Government, to bringing the perpetrators to justice.

  Fiji
  Mr. Borrow
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on his discussions with the administration in Fiji. [129574]

  Mr. Battle
  We have kept in close touch with the Fijian authorities since the beginning of the current crisis. On 23 May my right hon. Friend the Foreign Secretary spoke personally to the then President Mara to assure him of our support for a peaceful negotiated solution to the hostage situation. Our High Commission in Suva have been in constant touch with the Fijian authorities since then. In parallel we are keeping in close touch with the Commonwealth Secretariat and with key international partners over a coordinated response to the latest interim administration, announced on 18 July.

  Angola
  Ms Buck
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to visit Angola to assess the situation there. [129575]

  Mr. Hain
  I visited Angola from 4–6 July when I met President Dos Santos and other senior members of the Angolan Government. I also met representatives of the opposition including UNITA and representatives of the Aid Agencies, Civil Society and the Church. I visited a refugee camp at Huambo and signed a UK/Angola Memorandum of Understanding on Air Services and an Investment Promotion and Protection Agreement.

  Departmental Presentation
  Sir Teddy Taylor
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the effectiveness of procedures for informing the public about his Department's policies. [129576]

  Mr. Hain
  Members of the public may access information on Her Majesty's Government's foreign policy via the Foreign and Commonwealth website—http://www.fco.gov.uk—which includes an archive of ministerial policy speeches dating back to May 1997 and other key policy statements and documents. "Briefing Papers" are published on topical areas of foreign policy 144W
  and the "Key Foreign Policy Issues" section includes detailed contributions from many Departments on specific policy work, for example "Britain and the EU", "Human Rights in Foreign Policy", "UK and the United Nations" and "UK and the Commonwealth".

  The Foreign and Commonwealth Office website is one of the most heavily accessed sites in Whitehall, with around 350,000 page impressions to the site per week. The majority of visitors to the website are from the UK. The "Britain and the EU" home page has been accessed over 8,800 times since the beginning of June. Users may also register their personal foreign policy interests with the website and receive notification by e-mail of the latest news updates. To date, 12,500 UK-based users have registered their interest this way.

  As part of the London String of Pearls Millennium Festival, the Foreign and Commonwealth Office is open to the public every Tuesday between 9 May and 25 July. In addition to viewing the Foreign and Commonwealth Office historic rooms, an average of 3,000 visitors per week have seen displays on the Foreign and Commonwealth's work in particular areas, such as Europe, International Security, Global Issues and the Americas. Feedback from the visitors has been very positive.

  Diplomatic Bags
  Mr. Gordon Prentice
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the impact of new technology on the use of the diplomatic bag. [129577]

  Mr. Battle
  Frequency of bag service has reduced marginally over the last 4 years by 1 per cent. week per post.

  Volume of material for the years 1997–99 has remained within 0.1 per cent.

  World Service
  Mr. Öpik
  To ask the Secretary of State for Foreign and Commonwealth Affairs what recent meetings he has held with ministerial colleagues to discuss funding for the BBC World Service; and if he will make a statement. [129578]

  Mr. Hain
  There have been numerous contacts between the Foreign and Commonwealth Office and other ministerial colleagues in the context of the current Spending Review. We have presented a strong case for increased funding for the BBC World Service, as for the Foreign and Commonwealth Office as a whole.

  Lord Levy
  Mr. Baker
  To ask the Secretary of State for Foreign and Commonwealth Affairs what mechanism exists for his Department to receive reports from Lord Levy when he is acting as the Prime Minister's personal envoy on foreign affairs. [129566]

  Mr. Hain
  Lord Levy's visits are reported to my right hon. Friends the Prime Minister and the Foreign Secretary, in person by Lord Levy, and by telegram from the Ambassador in the country concerned.

  India
  Mr. Oaten
  To ask the Secretary of State for Foreign and Commonwealth Affairs what recent representations he has made to the Indian Government about upholding the rule of law for social and religious minority groups in India. [129573]

  Mr. Hain
  My right hon. Friend the Foreign Secretary raised our concerns over incidents of religious intolerance with the Indian Home Minister, L. K. Advani, during talks in London in June and with Indian Foreign Minister, Jaswant Singh, during his visit to India in April.

  Mrs. Brinton
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the Government's policy towards India's claim to a permanent seat on the UN Security Council. [131110]

  Mr. Hain
  Our policy is for each regional group to recommend who should occupy any permanent seat allocated to them in an enlarged Security Council. My right hon. Friend the Foreign Secretary reiterated this point when he visited India earlier this year. India would clearly be a contender for any eventual Asian Group seat.

  Afghanistan
  Ms Buck
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the application for an export licence for mine-clearance equipment to Afghanistan. [131317]

  Mr. Hain
  Following consultations with this Department and the Ministry of Defence, the Department of Trade and Industry recently issued a licence for the export of mine clearance equipment for the use by the HALO Trust to aid their demining activities in Afghanistan. This licence was granted for humanitarian purposes. This decision does not affect the Government's continued support for the EU Common Position on arms exports to Afghanistan.

  British Indian Ocean Territory
  Mr. Coleman
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on policy towards the British Indian Ocean Territory. [131318]

  Mr. Battle
  The territory's immigration laws and policy are currently the subject of an action in the High Court. We are aware that some of the Ilois community have expressed an interest in returning to settle on the outer islands of the archipelago. We have been studying the feasibility of settlement on the outer islands, which have been uninhabited for 30 years, and the potential environmental impact. This work is not complete and we will continue it.

  Recently we have sponsored a group of Ilois to visit the outer islands to see conditions there for themselves.

  We shall maintain our sovereignty over the BIOT for as long as our treaty obligations require it. Thereafter, we stand by the undertaking we have made that we would cede sovereignty of the territory to Mauritius.

  Lebanon
  Dr. Starkey
  To ask the Secretary of State for Foreign and Commonwealth Affairs what proposals his Department 146W
  has discussed for development aid to Lebanon for reconstruction in Southern Lebanon with (a) the Lebanese Government, (b) other EU member states and (c) the EU' s High Representative, Sr. Javier Solana. [130426]

  Mr. Hain
  We have discussed proposals for development aid for southern Lebanon with the Lebanese Government, with other EU member states in regular meetings of the relevant EU working groups, and with the European Union Special Envoy, Miguel Moratinos. These proposals focus on the rehabilitation of southern Lebanon into the infrastructure of Lebanon and the effective disbursement of international aid to the area.

  Dr. Starkey
  To ask the Secretary of State for Foreign and Commonwealth Affairs what proposals his Department has discussed for resolving the issue of Palestinian refugees in Lebanon with(a) the Lebanese Government and (b) other EU member states. [130427]

  Mr. Hain
  The issue of Palestinian refugees in Lebanon is part of the wider permanent status negotiations between the Israeli Government and the PLO. We support for all Palestinian refugees the implementation of UNGA Resolution 194 through negotiation and agreement between the parties. We discuss this issue regularly with the Lebanese Government, as host country of this refugee group, and wither other EU member states, as well as with Israel and the Palestinian Authority.

  Indonesia
  Mr. McGrady
  To ask the Secretary of State for Foreign and Commonwealth Affairs what recent reports he has received on the level of violence in Indonesia; and if he will make a statement. [131191]

  Mr. Battle
  We receive regular reports on Indonesia from our Embassy, NGOs and others. We are particularly concerned by the sharp escalation of violence in Maluku, and the extensive loss of life and serious injury. I discussed this with the Indonesian Ambassador on 3 July and the Head of the Diplomatic Service raised our concerns directly with President Wahid on 4 July. There is an urgent need to respond to the growing humanitarian crisis. We are working closely with the United Nations Development Programme (UNDP) to establish mechanisms for managing the international humanitarian response. The UNDP has recently despatched three teams to Maluku to assess current needs.

  Helsinki Final Act
  Mr. Mackinlay
  To ask the Secretary of State for Foreign and Commonwealth Affairs how the Government intend to commemorate the 25th Anniversary of the Helsinki Final Act; and if he will make a statement. [130665]

  Mr. Vaz
  To mark the 25th Anniversary of the signing of the Helsinki Final Act, the Austrian Chairmanship of the OSCE will host a Commemorative Meeting of the OSCE Permanent Council in Vienna on 19 July to which leading academic and NGO representatives (and others) have been invited. Her Majesty's Government will be represented by an FCO official, who has published a history of the negotiations leading up to the signing of the Act on 1 August 1975.

  EU Enlargement
  Mr. Mackinlay
  To ask the Secretary of State for Foreign and Commonwealth Affairs what advice has been given to applicant countries with EU candidacy status about the need to have institutions charged with promoting awareness about equal opportunities which are empowered to seek aid and assistance and to enforce rights consistent with European Union norms; and if he will make a statement. [130661]

  Mr. Vaz
  Before negotiations for accession can begin, the EU requires that applicant states achieve stability of institutions guaranteeing human rights and respect for and protection of minorities.

  Article 13 of the Treaty of Rome requires member states to take action on discrimination whether based on sex, racial origin, religious belief, disability, age or sexual orientation. The issue of discrimination is a prominent part of the Social Policy and Employment acquis of the EU. Applicant states are expected to implement the acquis and treaty obligations by accession. The Commission monitors applicant states implementation of these requirements in its annual progress reports and makes specific recommendations to each applicant.

  The EU currently operates a programme on equal opportunities for men and women. This programme is open to all applicant states and has a budget of 30 million euro. The Community is to adopt an action programme to combat discrimination based on race, sex, religious belief, disability, age or sexual orientation. This programme will be open to applicant states. It will have a budget of 98 million euro. The programme objectives include improving the understanding of discrimination and developing the capacity of applicant states to address it.

  Separately, the Home Office meets regularly with Government officials from applicant states to discuss race equality matters. This includes advice on the function of the Commission for Racial Equality.

  Gibraltar
  Mr. Mackinlay
  To ask the Secretary of State for Foreign and Commonwealth Affairs what consultations his Department is having with(a) other Government Departments, (b) the Government of Gibraltar, (c) trade unions in Gibraltar and (d) representatives of the maritime industry operating in Gibraltar, prior to the United Kingdom formulating its response to the proposals about the future of competition in European ports outlined by the Commissioner for Energy and Transport; and if he will make a statement. [130859]

  Mr. Vaz
  The Commission have not yet made any concrete proposals on this subject and we do not expect them to do so until the end of the year. There will be full consultation with interested parties once these proposals emerge.

  British Council
  Mr. Streeter
  To ask the Secretary of State for Foreign and Commonwealth Affairs which country directorates in the British Council will be assessed for closure over the next five years; and if he will make a statement. [131255]
  148W
  Mr. Hain
  The British Council is conducting a strategic review to ensure the sustainability of its overseas network and maximise the impact of its work, for example by taking full advantage of new information technology. This review may recommend reallocation of resources to the new priorities and the closure of some country directorates on the basis of their relative importance to the UK. As yet no decisions have been taken; my right hon. Friend the Foreign Secretary will be consulted over any closures.

  General Affairs Council
  Mr. Jim Marshall
  To ask the Secretary of State for Foreign and Commonwealth Affairs what was the outcome of the General Affairs Council held in Brussels on 10 and 11 July; and if he will make a statement. [130428]

  Mr. Vaz
  The General Affairs Council in Brussels on 10 July adopted the A points in document 10051/00 and noted the resolutions, decisions, and opinions adopted by the European Parliament at its part-session in Strasbourg listed in document 8849/00. Copies of these documents will be placed in the House Libraries as soon as they become available.

  Western Balkans

  The Council held an open debate on the Western Balkans, but also discussed it as a formal agenda item, and adopted conclusions.

  The Council confirmed the EU's intention to hold a summit between the EU and the Western Balkans this autumn. This will confirm that these countries are bound to Europe, will clarify the reciprocal commitments between them and the EU, and will reiterate that the door will also be open to a democratic FRY.

  The Council noted with great concern the revision of the FRY constitution. The Council reiterated its support for the democratically elected authorities in Montenegro and urged them not to yield to provocation from Belgrade.

  The Council extended the suspension of the ban on flights between the territories of the European Community and the FRY until 31 March 2001, and welcomed the Commission's intention to increase the number of companies on the financial sanctions "white list".

  Follow-up to Feira

  The Presidency announced its work programme for the various items following up the Feira European Council, notably on enlargement and European defence.

  Ministers agreed that continued work on the latter should be a priority for the French Presidency, and took note of Presidency papers outlining future work on permanent structures within the EU; EU/NATO working groups; and elaboration of the headline goal for military capabilities. They looked forward to the Capabilities Commitment Conference in November, which would represent an important measure of progress on enhancing military capabilities; and also to continued work on the relationship between the EU and the six European members of NATO outside the EU.

  Russia

  The Council adopted conclusions on Russia which underline the importance of the Common Strategy in developing a strategic partnership with Russia; orient the work plan on the Common Strategy towards institutional/

  149W
  economic reform, democratization, and the strengthening of civil society and the independent media; and urge the Commission to resume preparation of the TAXIS indicative programme for 2000–03 and to propose a targeted action plan for 2000. The Council emphasized that a long-term relationship with Russia must be based on common values, that it remained concerned by the situation in Chechnya, and that it would remain vigilant to ensure that Russia respected its commitments to the Council of Europe and the OSCE.

  Zimbabwe

  The Council agreed Conclusions on the recent elections in Zimbabwe. These call on the Zimbabwean Government to take steps to bring those responsible for the pre-election violence to justice; to tackle urgently Zimbabwe's economic and social problems; and to work for a rapid solution to the problem of land reform on the basis of the principles of the 1998 Land Conference.

  Bananas

  The Council invited the Commission to examine the possibility of a quota-based regime based on the "first-come first-served" licensing system. It also asked the Commission, once it had done this, to report back on possible solutions, including a tariff-only regime and its implications. The Council highlighted its desire to reach a solution as quickly as possible, having regard to WTO rules, the interests of Community procedures and the commitments of the Union to the ACP, especially the most vulnerable.

  Institute for European-Latin American Relations

  Under Any Other Business, the Council supported a Spanish proposal to create a working party to seek a solution to IRELA's financial difficulties.

  Inter-governmental Conference

  Ministers held a general exchange of views with the EP President Fontaine and Commission President Prodi, following which the Presidency set out its work programme for the next six months.

  The Council was followed by Association Councils with Kazakhstan and Kyrgyzstan.

CULTURE, MEDIA AND SPORT

  National Lottery
  Mr. Oaten
  To ask the Secretary of State for Culture, Media and Sport what recent discussions he has had with the National Lottery Commission concerning the Lottery Operator's policy on withdrawing Lottery contracts from post offices which do not meet sales targets. [129660]

  Kate Hoey
  [holding answer 7 July 2000]: None. Decisions on the locations of terminals are a matter for the operator of the National Lottery, subject to the minimum requirements set out in the licence.

  Tennis
  Mr. Sarwar
  To ask the Secretary of State for Culture, Media and Sport if he will make a statement on the Government's support for young tennis players in(a) Scotland and (b) the United Kingdom. [129917]
  150W
  Kate Hoey
  Government support for tennis in Scotland is channelled through SportScotland, who have provided the following information.

  Funding is available to tennis through the Lottery, one of whose priorities is young people. Lottery funding for tennis facilities has been made to 312 projects, worth a total of £2,324,802. In addition Lottery funding has been made to young tennis players under the Talented Athletes Programme to the value of £56,015 in 1999–2000. Over the same period the estimated value of the tennis element of local authority junior groups programme is in the region of £20,000. £12,000 was provided under the UK World Class Performance Programme to assist talented young tennis players.

  SportScotland has provided £64,000 Exchequer funding to the Scottish Lawn Tennis Association in 2000–01.

  Junior tennis is eligible for funding from Sportsmatch, the Government's sports sponsorship incentive scheme.

  Sportsmatch in Scotland has made 25 awards worth a total of £86,304 since its inception in 1992, to grass roots and junior tennis projects.

  In addition, Government support for young tennis players in the rest of the United Kingdom, is set out.

  England

  Sportsmatch in England has made 194 awards worth a total of £1.15 million since its inception in 1992, to grass roots and junior tennis projects.

  Funding is also available to tennis through the Lottery Sports Fund, one of whose priorities is young people. The Fund has made 473 awards to tennis projects, worth a total of over £54 million. In addition, the Fund made World Class Performance Programme awards totalling £8,574, to disabled tennis players in 1999–2000.

  Tennis is also one of the nine sports selected by Sport England for a five year sports development programme aimed at young people. The programme is England-wide, delivered at local level and involves local clubs, local authorities, education services, schools and the Lawn Tennis Association (LTA) working in partnership. Sport England is allocating a total of £10 million Lottery funding each year for all nine sports involved in the programme.

  Wales

  In Wales funding for tennis is channelled through the Sports Council for Wales, who have provided the following information.

  Funding is available to tennis through the Lottery, one of whose priorities is young people. Lottery funding for tennis facilities has been provided to the value of £2,050,982, and to individual competitors through the Elite Cymru programme to the value of £6,500 in 1999–2000. The Council provided £86,886 exchequer funding to "Tennis Wales", the governing body for tennis in 2000–01.

  Sportsmatch in Wales has made 32 awards worth a total of £92,260 since its inception in 1992, to grass roots and junior tennis projects.

  Northern Ireland

  Funding for tennis in Northern Ireland is channelled through the Sports Council for Northern Ireland, who have provided the following information.
  151W
  Funding is available to tennis through the Lottery, one of whose priorities is young people. Lottery funding for tennis has been provided to the value of £1,479,650 over the period 1995–2000. Over the same period £8,000 has been provided towards the development of talented young individuals. In 1999–2000 Exchequer funding of £11,500 was provided to the governing body responsible for tennis in Northern Ireland.

  Museums
  Mr. Fearn
  To ask the Secretary of State for Culture, Media and Sport what criteria he uses in deciding whether a museum is eligible(a) for Government funding and (b) to reclaim VAT. [130677]

  Mr. Alan Howarth
  My Department funds the 12 national museums in England, and provides varying degrees of grant-in-aid to seven other museums or museum services, partly for historical reasons and partly in recognition of the importance of their collections. Other funding is generally project related challenge funding, distributed in response to applications made in published criteria (for instance, the £15 million being made available over three years to designated museums through the Designated Museums Challenge Fund).

  To the extent that museums are businesses, they are subject to the same VAT rules as other businesses. These rules are a matter for HM Customs and Excise.

  Official Visits
  Mr. Matthew Taylor
  To ask the Secretary of State for Culture, Media and Sport if he will list the visits outside Britain made by his Department's Permanent Secretary on official business since 1 January 1999, indicating the date and purpose of the visit in each case. [130488]

  Mr. Chris Smith
  My Permanent Secretary made two visits outside Britain in the specified period.

  From 13 to 15 October 1999 inclusive he visited Paris and Berlin.

  From 16 February to 18 February 2000 inclusive he visited Portugal and Madrid.

  My Department is committed to improved collaboration with other Governments within the EU; and my Permanent Secretary has undertaken these visits to establish contact and good relations with his opposite numbers in a range of EU countries.

  Correspondence
  Mr. Wyatt
  To ask the Secretary of State for Culture, Media and Sport, pursuant to his answer on 5 May 2000,Official Report, column 229W, when he will write to the hon. Member for Sittingbourne and Sheppey. [131155]

  Kate Hoey
  I wrote to my hon. Friend with a full response on 13 July. Copies of the letters have been placed in the Libraries of the House.

  Appointments (Women)
  Mr. Allan
  To ask the Secretary of State for Culture, Media and Sport how many and what percentage of the 152W
  (a) paid and (b) unpaid appointments which he has made to non-departmental public bodies since 1 May 1997 were women. [129856]

  Mr. Chris Smith
  [holding answer 12 July 2000]: The information is as follows:

  Total

  Paid

  Unpaid

  Number of appointments

  358

  123 (33.2%)

  235 (66.8%)

  Number of women appointed

  133

  50 (40.6%)

  83 (35.5%)

  My Department is committed to increasing the representation of women in public life. In support of this, the Department has drawn up an action plan for increasing the number of women, people from ethnic minorities and people with disabilities holding public appointments. The latest plan, together with the Government's overall plan, was published on 24 May 2000 in "Quangos: Opening up Public Appointments 2000–03", copies of which are in the Libraries of the House.

  Football Association Premier League Funds
  Mr. Peter Ainsworth
  To ask the Secretary of State for Culture, Media and Sport what powers are available to him to allocate Football Association Premier League funds to activities other than football. [130845]

  Mr. Chris Smith
  None. The FA Premier League and the Football Association are fully responsible for their own decisions on funding.

  The Government will shortly announce details of a new body to distribute funds for the development of football—the Football Foundation—to which the Premier League, the FA and Sport England will make substantial contributions. It will be for the new body to decide on its funding criteria. In dealing with applications, though, the Foundation may wish to consider whether proposed football facilities may be used for other sports.

  Royal Parks Agency
  Mr. Goggins
  To ask the Secretary of State for Culture, Media and Sport what targets he has set for the Royal Parks Agency. [131303]

  Mr. Alan Howarth
  The following targets have been set for the Royal Parks Agency for 2000–01:

  Financial and Efficiency
  To increase income by 10 per cent. from the 1999–2000 level, from all sources except recharges and VAT refunds.
  Stay within the flat running costs allocation of £8.235 million.
  Keep hourly costs of a Royal Parks Police Constable on duty down to 1999–2000 levels in real terms.

  Visitor satisfaction
  Achieve an overall quality rating of 89 per cent. from visitors to the parks, compared to a rating of 88 per cent. in 1999–2000. The minimum rating for any one park should be no lower than 83 per cent.

  Fabric
  Achieve an average rating from visitors of at least 89 per cent. on cleanliness in the parks, compared with a rating of 88 per cent. in 1999–2000. The minimum rating for a park should be no lower than 85 per cent.

  153W
  Maintain an average score of 88 per cent. for soft landscape presentation, compared with a score of 87 per cent. achieved in 1999–2000. The minimum score for a park should be no lower than 82 per cent.
  Complete the refurbishment works of White Lodge in Bushy Park by December 2000, with a view to the building being removed from English Heritage's "Buildings at Risk" register in 2001.
  Carry out a condition survey of all the lodges in the Parks to establish maintenance requirements and future levels of refurbishment.

  £

  1999–2000 Exchequer funding (outturn)

  2000–01 Exchequer funding (plans)

  Percentage increase

  England/Sport England

  37,900,000

  37,973,000

  +0.2

  Scotland/SportScotland

  10,100,000

  10,309,000

  +2.1

  Wales/Sports Council for Wales

  6,799,000

  7,417,000

  +9.1

  Northern Ireland/Sports Council for Northern Ireland

  2,380,000

  2,322,000

  -2.4

  Mr. Breed
  To ask the Secretary of State for Culture, Media and Sport how much direct Exchequer funding per head was spent on supporting sport in(a) England, (b) Wales, (c) Scotland and (d) Northern Ireland in

  1999–20001,3,4

  2000–012,3,4

  Population (1998 Census)

  Exchequer funding (£)

  Per capita

  Exchequer funding (£)

  Per capita

  England/Sport England

  49,495,000

  37,900,000

  0.77

  37,973,000

  0.77

  Scotland/SportScotland

  5,120,000

  10,100,000

  1.97

  10,309,000

  2.01

  Wales/Sports Council for Wales

  2,933,000

  6,799,000

  2.32

  7,417,000

  2.53

  Northern Ireland/Sports Council for Northern Ireland

  1,689,000

  2,380,000

  1.41

  2,322,000

  1.37

  1 Outturn

  2 Plans

  3 In 1999–2000 and 2000–01, UK Sport received Exchequer funding of £12.6 million to provide support to those sporting programmes and policies that are of benefit for the United Kingdom as a whole. It is not possible to determine the amount of benefit provided by UK Sport to sport in individual home countries. Funding of £0.9 million per annum is also provided to the Football Licensing Authority.

  4 The local authority estimated outturn on current and capital expenditure on sport and recreation activities in 1999–2000 totalled £767 million in England and £55 million in Wales. Expenditure details for 1999–2000 for Scotland and Northern Ireland and Planning figures for 2000–01 are not available.

  World Cup
  Mr. Robertson
  To ask the Secretary of State for Culture, Media and Sport what discussions he has had with the(a) officials and (b) members of FIFA regarding (i) the awarding of the 2006 World Cup to Germany and (ii) reported attempts to influence improperly the voting of the members of FIFA; and if he will make a statement. [131376]

  Kate Hoey
  Neither my right hon. Friend the Secretary of State nor I have discussed the decision to hold the 2006 World Cup in Germany, or the circumstances of the voting on 6 July, with FIFA officials or members.

  Television Inquiry
  Ms Rosie Winterton
  To ask the Secretary of State for Culture, Media and Sport when he intends to publish the Government's response to Phase I of the Creative Industries Task Force Television Inquiry; and what Phase II will cover. [131480]

  Mr. Chris Smith
  I have today written to the three sub group chairs involved in Phase I of the Inquiry thanking

  Sport (Funding)
  Mr. Breed
  To ask the Secretary of State for Culture, Media and Sport what the percentage increase in direct Exchequer funding for sport was in(a) England, (b) Wales, (c) Scotland and (d) Northern Ireland between 1999–2000 and 2000–01. [130519]

  Kate Hoey
  The information requested by the hon. Member is as follows:

  1999–2000; and what the planned figures are for 2000–01. [130518]

  Kate Hoey
  The information requested by the hon. Members is as follows:

  them for their report, "UK Television Exports Inquiry", which was published in November 1999. The report makes valuable recommendations both for the industry and for Government and we have responded by drawing up a joint Action Plan. Government remain committed to working in partnership with the industry to improve the UK's export performance, not only in television but in all the creative industries.

  I have also today announced the Terms of Reference for Phase II. This stage of the Inquiry will look at how the UK television programme supply market could best be adapted to realise the potential of UK creative talent to satisfy the growing audio-visual economy. We are currently tendering for a consultant to undertake this work which will feed into the Communications White Paper.

  Copies of the Action Plan and Terms of Reference will be placed in the Library of the House and made available on my Department's website: www.culture.gov.uk/ creative/forms—documents.html.

CABINET OFFICE

  British-Irish Council
  Mrs. Ewing
  To ask the Minister for the Cabinet Office if she will make a statement on the establishment of the British-Irish Council, its composition, and the consultations held with the executives and presiding officers of the Scottish Parliament and Welsh Assembly prior to its establishment. [128622]

  Marjorie Mowlam
  The inaugural summit meeting of the British-Irish Council was held at Lancaster House, London, on Friday 17 December 1999. The next meeting is expected in the autumn of this year.

  As envisaged in the Belfast Agreement, the British-Irish Council comprises representatives of the British and Irish Governments, the devolved Administrations in Northern Ireland, Scotland and Wales, together with representatives of the Isle of Man, and the Baliwicks of Jersey and Guernsey.

  Special Advisers
  Mrs. Virginia Bottomley
  To ask the Minister for the Cabinet Office what criteria are used to distinguish between a special adviser and Civil Service appointment; and who approves an increase in numbers in either category. [128806]

  Marjorie Mowlam
  Recruitment into the Home Civil Service is governed by the Civil Service Order in Council. Appointments are made on merit on the basis of fair and open competition unless covered by one of the exemptions set out in the Civil Service Order in Council. Special Adviser appointments are one such exemption.

  With the exception of the most senior (SASC) posts, Ministers and office holders in charge of Departments determine the number of permanent Civil Service posts within their organisation. All appointments to the SASC group are approved by the Prime Minister.

  Under the terms of the Ministerial Code, the Prime Minister approves the appointment of Special Advisers.

  Departmental Initiatives
  Dr. Lynne Jones
  To ask the Minister for the Cabinet Office if she will list each departmental initiative since May 1997 requiring bids for funding together with the total resources available, the number of successful bids and the proportion this represents of total bids received; and what data she collects on the average expenditure of organisations bidding for funding through each initiative. [131083]

  Mr. Stringer
  I refer my hon. Friend to the answer given by my right hon. Friend the Chief Secretary to the Treasury on 17 July 2000,Official Report, column 93W.

  Parliamentary Questions
  Mr. Stunell
  To ask the Minister for the Cabinet Office on how many occasions she has deposited papers in the Library in response to parliamentary questions tabled to her Department between 19 October 1999 and 20 April. [131128]
  156W
  Mr. Stringer
  Between 19 October 1999 and 20 April 2000 there have been 35 parliamentary questions tabled to the Cabinet Office which received full answers including a commitment to place documents in the Libraries of the House.

  Sickness Absence
  Mr. Matthew Taylor
  To ask the Minister for the Cabinet Office when she will publish statistics on progress towards reducing sickness absence in the civil service in 1998 and 1999; and if she will make a statement. [130715]

  Mr. Stringer
  The civil service is collectively working towards reducing sickness absence by 20 per cent. by 2001 and 30 per cent. by 2003, against a 1998 baseline. Details of sickness absence in the civil service for 1998 were given in the answer my right hon. Friend the Minister for the Cabinet Office gave to my hon. Friend the Member for Stevenage (Barbara Follett) on 11 May 2000,Official Report, columns 433–34W. Figures for 1999 will be available shortly.

LORD CHANCELLOR'S DEPARTMENT

  Queen's Counsel
  Mr. Gordon Prentice
  To ask the Parliamentary Secretary, Lord Chancellor's Department if he will make it his policy for Queen's Counsel who have not practised at the bar for five years to be examined to establish their fitness to return to practise as a Queen's Counsel; and if he will make a statement. [130629]

  Mr. Lock
  The Lord Chancellor recognises the need to ensure that all lawyers are competent to do the job. He has no plans, however, to introduce the policy proposed for QCs, the regulation of whose professional standards is primarily for their professional bodies.

  Community Legal Service
  Mr. Kidney
  To ask the Parliamentary Secretary, Lord Chancellor's Department what research his Department(a) has commissioned and (b) intends to commission to assist him in evaluating the effectiveness of the introduction of (i) the new civil court rules and (ii) the Community Legal Service in widening access to justice. [130731]

  Mr. Lock
  Three research projects have been commissioned which fall within the first topic area: Monitoring the Rise in the Small Claims Limit; Cross-Jurisdictional Issues in Case Management; The Impact of Conditional Fees on the Selection, Handling and Outcomes of Personal Injury Cases. In addition, the Court Service conducts locally run customer satisfaction surveys at courts and tribunals in a two-year rolling cycle. The surveys identify trends and changes in customer requirements as well as providing information on delivery of service. The Department is currently discussing the possibility of commissioning a research project which might look at further improvements to case management and the use of joint experts in court proceedings.
  157W
  A project to examine Local Legal Need, which aims to measure the effectiveness of the Community Legal Service, is being undertaken by Legal Services Research Centre. Currently, there are no plans to commission further research on the Community Legal Service.

  The Department carries out a review of its requirements in formulating its priorities for research in its annual programme of work. This is currently under way.

  Dr. Kumar
  To ask the Parliamentary Secretary, Lord Chancellor's Department if he will make a statement on the relationship between the community legal services and debt and money advice services. [131210]

  Mr. Lock
  The provision of debt and money advice will be an important part of the local networks of legal services we are developing, and which will be supported by local Community Legal Service Partnerships.

  For example, there are 430 solicitors' firms and 171 not-for-profit agencies with contracts from the Legal Services Commission (LSC) to provide debt advice services. In addition, the LSC is running six pilot projects to look at alternative methods of delivering debt advice, including outreach services in Carlisle, Stoke-on-Trent and Birmingham, and telephone services in Sheffield, Norfolk and Northumberland.

  Advisory Committee on Public Records
  Mr. Cohen
  To ask the Parliamentary Secretary, Lord Chancellor's Department what the current composition and role is of the Advisory Committee on Public Records; who appoints its members and for how long they remain on the Committee; how frequently the Committee meets and when it last met; who decides which matters are on its agenda; how its activities will be affected by the implementation of the Freedom of Information Bill; and if he will make a statement. [130686]

  Mr. Lock
  The current composition of the Advisory Council on Public Records is as follows:

  Chairman: the Master of the Rolls (ex officio)

  Miss Amanda Arrowsmith, Director of Libraries and Heritage, Suffolk county council

  Professor David Cannadine, Director of the Institute of Historical Research, University of London

  Sir John Chilcot GCB, retired, formerly Permanent Under-Secretary of State, Northern Ireland Office

  Professor Peter Clarke, Professor of Modem British History, University of Cambridge and Fellow of St. John's College, Cambridge

  Mr. Ian Coulson, teacher, schools inspector in Kent

  Miss Rosemary Dunhill, County Archivist of Hampshire

  Professor Ralph Griffiths, Professor of Mediaeval History, University of Wales, Swansea

  Mrs. Anne Hanford, film librarian and consultant in the management of media collections

  Mrs. Gillian Hughes, a professional researcher and record agent

  Professor Rodney Lowe, Professor of Contemporary History, University of Bristol

  Professor the Earl Russell, Professor of British History, Kings College London. Represents the Liberal Democrats on the Council

  158W

  Mrs. Shahwar Sadeque, educational and information technology consultant

  Mr. Andreas Whittam Smith, Journalist, former editor of The Independent, chairman of the Sir Winston Churchill Archive Trust and president of the British Board of Film Classification

  Dr. Anne Thurston, executive director of the International Records Management Trust

  Right hon. Lady Trumpington, former Baroness in Waiting, House of Lords. Represents the Conservative Party on the Council

  Right hon. Alan J. Williams, Labour MP for Swansea West. Member of the Public Accounts Committee.

  The role of the Council is set out in the Public Records Act 1958 s1(2), as being:
  to advise the Lord Chancellor on matters concerning public records in general and, in particular, on those aspects of the works of the Public Record Office which affect members of the public who make use of the facilities provided by the Public Record Office.

  The Council's current terms of reference were set by the Lord Chancellor on 22 January 1998 and were published with the Council's annual report for 1997–98 in the Keeper's Report for that year (HC 840).

  In accordance with the terms of the Public Records Act 1958, members are appointed by the Lord Chancellor. They normally serve for a three-year term, which is renewable once.

  The Council meets four times a year, normally in February, June, October and December. It last met on 15 June 2000. Much of the Council's agenda is determined by the timetables for applications by Departments for the retention or extended closure of public records. Other items appear on the agenda at the request of members of the Council, of members of the public, or of the Keeper of Public Records. The agenda is approved by the Master of the Rolls.

  The Freedom of Information Bill is expected to give the Council a statutory role in advising on the availability to the public of information in public records once they are more than 30 years old. This will be much the same function as it has exercised for the last 40 years in advising the Lord Chancellor on the operation of s5(1) of the Public Records Act 1958. The Bill currently before Parliament provides for extension of the Advisory Council's role by inserting S1(2A) as follows:
  The matters on which the Advisory Council on Public Records may advise the Lord Chancellor include matters relating to the application of the Freedom of Information Act 2000 to information contained in public records which are historical records within the meaning of Part VI of that Act.

  The Advisory Council's involvement in the release of information in public records will be set out in some detail in Part II of the Lord Chancellor's code of practice on the management of records under Freedom of Information, a working draft of which will be published shortly.

  Royal Family
  Mr. Cohen
  To ask the Parliamentary Secretary, Lord Chancellor's Department, what public records concerning(a) the Royal Family and (b) other matters, relating to events prior to the First World War, have not been made publicly available; and for what reasons. [130687]
  159W
  Mr. Lock
  There are two public records concerning the Royal Family dating from before the First World War which have not been opened. These are both Treasury records. The first concerns the taxation and property rating of members of the Royal Family for the period 1899–1904 and is due for release in 2005; the second concerns Queen Alexandra's annuity and income tax in the period 1910–1914 and is due to be opened in 2015. (They are closed in accordance with Lord Chancellor's Instruments 5 and 6 respectively.) The guidance under which these records were closed for 100 years is currently being re-examined by the Cabinet Office and Public Record Office.

  Records concerning other matters dating from before the First World War and not yet opened are as follows:

  The decennial censuses of 1901 and 1911 are closed for 100 years in order to protect the confidentiality of the information given by the public. They are closed in accordance with Lord Chancellor's Instrument 12. There are approximately 65 items originating from the predecessors of the Crown Estate dating from 1900–1914 which are still closed. These concern leases or other property assignments which are still current. There are three records dating from 1876–1914 concerning activities of the Secret Service in Ireland and Irish terrorist organisations which are currently retained. The sensitivity of these records is currently being reassessed.

  Legal Services (Teesside)
  Dr. Kumar
  To ask the Parliamentary Secretary, Lord Chancellor's Department, what assessment he has made of the extent of the needs for assistance in respect of legal services in(a) Teesside and (b) Middlesbrough, South and Cleveland, East; and if he will make a statement. [131212]

  Mr. Lock
  The Northern Regional Legal Services Committee of the then Legal Aid Board carried out an assessment of the need for legal services in Middlesbrough, Redcar and Cleveland, Hartlepool and Stockton during the course of 1998. The results of this assessment were published by the Legal Aid Board in February 1999.

  Following the launch of the Community Legal Service in April 2000, Community Legal Service Partnerships (CLSPs) have been formed in each of the four local authority areas. Further assessments of legal needs are being carried out as part of the work of these Partnerships. In Middlesbrough, the needs assessment has been completed and will be discussed by the Partnerships on 18 July 2000. In Hartlepool the needs assessment is currently underway and in Redcar and Cleveland and Stockton the needs assessment will be carried out later this year.

  Dr. Kumar
  To ask the Parliamentary Secretary, Lord Chancellor's Department, what plans he has to create a community legal service partnership in the Teesside Region; and if he will make a statement. [131211]

  Mr. Lock
  Community Legal Service (CLS) Partnerships have been formed in Middlesbrough, Stockton-on-Tees, and Hartlepool. The Legal Services Commission is also looking to establish a Community Legal Service Partnership in Redcar and Cleveland, but this is still subject to further discussions with the local authority.160W
  We hope that Redcar and Cleveland will form a CLS Partnership by Spring 2001. If it proves possible to form a CLS Partnership in this area earlier, we would be delighted.

  Advocates
  Mr. Baker
  To ask the Parliamentary Secretary, Lord Chancellor's Department what assessment he has made of the relative work load per case for(a) prosecution advocates and (b) defence advocates. [130412]

  Mr. Lock
  None. In developing a unified fee scheme my officials will work together with the Crown Prosecution Service; the General Council of the Bar; and the Law Society to identify areas where the work undertaken by the prosecution differs fundamentally from that undertaken by the defence.

  Legal Aid
  Mr. Baker
  To ask the Parliamentary Secretary, Lord Chancellor's Department how many(a) legal practices and (b) solicitors in England and Wales were undertaking legal aid work in (i) 1990, (ii) 1995, (iii) 1999 and (iv) 2000. [130413]

  Mr. Lock
  The Legal Services Commission and its predecessor, the Legal Aid Board have always made payments to solicitors' offices, not to individual solicitors, or practices. It is therefore not possible to provide details of the numbers of individual solicitors undertaking legal aid work. The statistical information collected also relates to the financial year rather than the calendar year. The numbers of solicitors' offices receiving payment for undertaking legal aid work during the years in question were as follows:

  Number

  1989–90

  11,455

  1994–95

  11,062

  1998–99

  11,263

  1999–2000

  11,099

  Mr. Baker
  To ask the Parliamentary Secretary, Lord Chancellor's Department how many applications for legal aid were(a) accepted and (b) rejected in each year since 1990. [130416]

  Mr. Lock
  The numbers of legal aid applications granted and rejected, in each year for which information is available, were as follows:

  Civil legal aid1

  Assistance by way of representation 1

  Accepted

  Rejected

  Accepted

  Rejected

  1990–91

  333,444

  84,347

  73,948

  12,284

  1991–92

  339,306

  100,030

  67,505

  12,870

  1992–93

  349,619

  126,271

  49,735

  10,621

  1993–94

  335,422

  125,716

  26,503

  5,553

  1994–95

  362,591

  123,453

  22,276

  3,329

  1995–96

  356,138

  124,947

  19,473

  2,646

  1996–97

  315,502

  133,631

  18,149

  2,167

  1997–98

  285,959

  133,735

  17,991

  2,052

  1998–99

  278,709

  98,122

  19,918

  1,034

  1999–2000

  227,494

  65,270

  16,882

  644

  161W

  Criminal magistrates2

  Criminal higher courts2

  Accepted

  Rejected

  Accepted

  Rejected

  1990

  n/a

  n/a

  7,883

  3,981

  1991

  n/a

  n/a

  6,885

  4,650

  1992

  n/a

  n/a

  7,579

  4,569

  1993

  n/a

  n/a

  10,567

  4,796

  1994

  n/a

  n/a

  12,998

  5,591

  1995

  n/a

  n/a

  14,203

  6,377

  1996

  n/a

  n/a

  13,795

  6,710

  1997

  380,430

  42,030

  15,109

  6,766

  1998

  423,314

  42,058

  15,772

  5,887

  1999

  444,955

  35,907

  14,608

  6,122

  n/a = not available

  1 Financial years

  2 Calendar years

  Mr. Baker
  To ask the Parliamentary Secretary, Lord Chancellor's Department what was the total amount(a) paid and (b) received in respect of legal aid, broken down by (i) costs recouped under orders for costs, (ii) value-added tax, (iii) savings on national insurance payments and (iv) other income in the last year for which figures are available. [130414]

  Mr. Lock
  The Legal Aid Board (which was replaced by the Legal Services Commission on 1 April 2000) recovered costs totalling £318,366,000, overwhelmingly from matters dealt with in the civil courts. The Board paid costs to the opponents of funded clients totalling £2,229,000. It is not possible to separate out the proportion of either the receipts or payments that were paid under the orders for costs.

  The Legal Aid Board was not required to account separately for VAT and some payment systems that it operated do not recognise VAT as a separate item. Since not all disbursements attract VAT, and not all solicitors and counsel are registered for VAT, it is not possible to calculate the amount of VAT that was paid out of, or into the legal aid Fund.

  There are no national insurance savings that the Commission is aware of that had an effect on the Fund.

  Other income to the legal aid Fund during 1999–2000 totalled £159,820,000. This includes such items as contributions paid by funded clients, moneys recovered through statutory charges placed on property gained or kept by funded clients with the benefit of legal aid, and interest on these charges.

  Mr. Baker
  To ask the Parliamentary Secretary, Lord Chancellor's Department for what reason the Legal Aid Board was renamed; and what estimate he has made of the costs arising from this change. [130415]

  Mr. Lock
  The Legal Aid Board has not been renamed. It was replaced on 1 April 2000 by a new executive non-departmental public body—the Legal Services Commission—established under Part I of the Access to Justice Act 1999. The Commission is charged with establishing, maintaining and developing two new services for the provision of publicly funded legal services—the Community Legal Service and the Criminal Defence Service. The Commission has also taken over the functions of the Legal Aid Board in relation to any cases being conducted under the provisions of the Legal Aid Act 1988. The appointments of the Chair and members of the Commission were announced on 17 December 1999 and 9 March 2000 respectively. However, costs directly 162W
  attributable to the naming of the Legal Services Commission are: Design and development of logotype, including tender (£6,587.13); Regulations on usage of logotype (£6,431.95); Nameplates for Regional offices (£3,666.00); Internet domain name registration (£141.00); Corporate seal (£120.00).

  Owen McMahon
  Mr. McNamara
  To ask the Parliamentary Secretary, Lord Chancellor's Department, how many files he retains concerning activities of the RIC in Northern Ireland in 1922; for what reason files relating to the murder of Owen McMahon in March 1922 are withheld from public access; and when the last review of documents of this period was held and what its outcome was. [131380]

  Mr. Lock
  The Northern Ireland Court Service does not hold any records concerning the activities of the RIC or the murder of Owen McMahon in 1922. There is a Ministry of Home Affairs file on the case which is held by the Public Records (Northern Ireland) Office and which is open to the public. All records listed and indexed by the Public Records (Northern Ireland) Office for review have been completed up to 1970.

  Parliamentary Questions
  Mr. Stunell
  To ask the Parliamentary Secretary, Lord Chancellor's Department, how many of the written parliamentary questions tabled to his Department between 19 October 1999 and 20 April did not receive substantive answers, citing as the reason that the information was(a) not held centrally, (b) not held in the form requested and (c) not available. [131198]

  Mr. Lock
  According to departmental records of the relevant period:

  (a) four parliamentary questions did not receive substantive answers because the information was not held centrally and a further 12 received partial answers for this reason;

  (b) one parliamentary question did not receive a substantive answer because the information was not held in the form requested and a further two received partial answers for this reason; and

  (c) five parliamentary questions did not receive a substantive answer because the information was not available and a further four received partial answers for this reason.

HOME DEPARTMENT

  Animal Experiments
  Mr. Bradshaw
  To ask the Secretary of State for the Home Department when his review of section 24 of the Animals (Scientific Procedures) Act 1986 will be completed. [130533]

  Mr. Mike O'Brien
  Section 24 of the Animals (Scientific Procedures) Act 1986 prevents the disclosure of information about the use of animals in scientific procedures that has been provided in confidence. Under the proposals for the Freedom of Information Bill, all statutory bars are being reviewed, including section 24.

  The maintenance of the necessary protection for individual scientists and their research institutions from animal rights extremists is a priority in the review of section 24 and I am considering very carefully how best

  163W
  it can be achieved. The extremists and the violence make openness more difficult than it would be otherwise. In view of this, a decision on whether to repeal or amend section 24 will not now be made until later this year.

  Mr. Hancock
  To ask the Secretary of State for the Home Department (1) if he will take steps to reduce the number of experiments on dogs conducted in UK research laboratories and breeding centres; and if he will make a statement; [130476]

  (2) if he will take steps to prohibit experiments on dogs that do not provide researchers with new information; and if he will make a statement. [130483]

  Mr. Mike O'Brien
  Dogs are primarily used in medicinal drug research and development and in pharmaceutical safety and efficacy evaluations. They are also used, when no other species is suitable, in the evaluation of cardiovascular and cardiorespiratory problems in humans. Such work contributes to advances in human healthcare. Dogs are also used in the development of veterinary medicines and techniques.

  In my replies I gave the hon. Member on 17 April 2000, Official Report, column 380W and on 12 July 2000, Official Report, column 595W, I stated that members of the public often find it particularly difficult to accept that species that are kept as domestic pets or companion animals, such as dogs, are also used in research to find cures for illnesses. Such animals must be purpose bred and supplied by designated establishments and can be used only if there is no viable alternative for that particular procedure.

  Dogs are used in regulated procedures where their use is justified under the Animals (Scientific Procedures) Act 1986. There are no current plans to change the legislation. All applications to use protected animals in research are subjected to a detailed cost/benefit assessment by Home Office inspectors. The likely adverse effects on the animals concerned must be weighed against the benefit likely to accrue as a result of the proposed programme of work.

  We are continuing to work to ensure that animals are only used where it is fully justified and where there are no alternatives which replace the use of animals, reduce the numbers of animals used, or refine the procedures in which they are used.

  Figures in recent years reflect a downward trend in the use of dogs in research. I should emphasise that dogs are used only in about a quarter of one per cent. of all procedures.

  Trafficking in Women and Girls
  Mr. Cohen
  To ask the Secretary of State for the Home Department what recent assessment the Government have made of the extent of trafficking in women and girls; from which areas of the world this trafficking is most extensive; and what measures Her Majesty's Government are supporting to tackle this. [130694]

  Mr. Charles Clarke
  The Home Office has recently published a ground-breaking study, which establishes for the first time the possible extent of trafficking in women into this country: 'Stopping Traffic: Exploring the extent of, and responses to, trafficking in women for sexual exploitation in the United Kingdom.' That study indicates 164W
  that 18 trafficking cases were identified by the police during 1998, involving 71 women. The majority of those women claimed to come from Europe and the remainder from Brazil and Thailand. The study indicates that these figures do not reveal the full extent of this phenomenon and makes a number of recommendations about tackling it. These are currently being considered by the Government.

  Criminal Cases (Police Conduct)
  Mr. Cotter
  To ask the Secretary of State for the Home Department (1) what action is taken against constabularies that are reported as failing to comply with the Criminal Procedure and Investigations Act 1996 by withholding unused material from defence lawyers in criminal cases; [130537]

  (2) what steps he is taking to ensure the full implementation of the Criminal Procedure and Investigations Act 1996, with particular reference to full disclosure of evidence by police to defence lawyers; [130639]

  (3) what recent representations he has received about non-disclosure of information to defence lawyers; and if he will make a statement; [130640]

  (4) if the implementation of the Criminal Procedure and Investigations Act 1996 is being monitored; and if he will make a statement. [130638]

  Mr. Charles Clarke
  The Government are aware of concerns about the operation of the disclosure provisions of the Criminal Procedure and Investigations Act 1996. Since the beginning of this year, my right hon. Friend the Home Secretary has received three letters from Members of Parliament and one from a member of the public on this issue. Action is well underway to address these concerns.

  The Director of Public Prosecutions (DPP) has made disclosure a business priority for the Crown Prosecution Service (CPS) and has initiated a programme of work focusing on the basic principles of disclosure, with a special emphasis on the prosecutor's duty to ensure a fair trial. He has asked Chief Crown Prosecutors to take up with Chief Constables any concerns that they may have with police disclosure practice in their area. Last year, the Crown Prosecution Service Inspectorate undertook a thematic review of disclosure and its report was published in March. The recommendations in that report are being considered and taken forward in the form of an action plan as part of the DPP's programme of work. The Association of Chief Police Officers has also established a working party to look into the working of the disclosure provisions in relation to the police.

  The Attorney-General is developing guidelines on disclosure. In February, these were issued in draft for consultation and the responses are now being considered. The Attorney-General is aiming to issue the final version of the guidance in the summer.

  In addition, as part of its general responsibility to evaluate new legislation the Government have commissioned an independent research study to evaluate all aspects of the disclosure provisions. The study will build on the CPS Inspectorate's report and draw on surveys of the legal profession carried out by the Criminal Bar Association and the Law Society. The

  165W
  work began in January 2000 and is expected to be completed in 12 months. In the light of the research, we will consider what further action needs to be taken.

  Cycling on Pavements
  Mr. Cox
  To ask the Secretary of State for the Home Department how many prosecutions there have been within the Greater London area for the offence of cycling on pavements during the last 12 months. [130536]

  Mr. Charles Clarke
  Available information taken from the Home Office Court Proceedings Database shows that provisionally in 1999 there were 42 prosecutions for the offence of cycling on the pavement in the Greater London area (prosecutions at courts within areas policed by the Metropolitan Police Service and the City of London police). In 1998, there were 67 prosecutions.

  The fixed penalty system for this offence was introduced on 1 August 1999 and up to, and including, 31 December 1999 a combined total of 39 fixed penalty notices were issued by the Metropolitan and City of London police forces.

  Asylum Seekers
  Fiona Mactaggart
  To ask the Secretary of State for the Home Department how many people have applied under the regularisation scheme set up under section 9 of the Immigration and Asylum Act 1999; what their nationalities are; how many applications(a) have been granted, (b) have been refused and (c) are still pending; and how many applicants had been in the United Kingdom (i) more than and (ii) fewer than seven years at the time of application. [130535]

  Mrs. Roche
  On 13 July, the number of applications received under the regularisation scheme was 1,653. Approximately 175 of these applications have been granted. Most are awaiting substantive consideration. I regret that further information could be obtained only by examination of individual case records and is, therefore, available only at disproportionate cost.

  Mr. Stinchcombe
  To ask the Secretary of State for the Home Department (1) in each of the last four years for which figures are available,(a) how many people were detained for more than 24 hours under immigration powers who (i) were and (ii) claimed to be under the age of 18 at the time of their detention, (b) what the average length of time was for which they were detained and (c) what the longest period of time was for which any such person was detained; [130734]

  (2) in each of the last four years for which figures are available, (a) how many asylum applicants detained for more than 24 hours under immigration powers, were subsequently accepted to be under the age of 18 at the time of their detention, (b) what the average length of time was for which they were detained and (c) what the longest period was for which any such person was detained; [130735]
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  (3) in each of the last four years for which figures are available, (a) how many asylum applicants detained for more than 24 hours under immigration powers (i) were and (ii) claimed to be under the age of 18 at the time of their detention, (b) what was the average length of time for which they were detained and (c) what was the longest period of time for which any person was detained; [130738]

  (4) in each of the last four years for which figures are available, (a) how many people were detained for more than 24 hours under immigration powers who were subsequently accepted to be under the age of 18 at the time of their detention, (b) what the average length of time was for which they were detained and (c) what the longest period was for which any such person was detained. [130733]

  Mrs. Roche
  Information on the age of persons detained under Immigration and Asylum Act 1999 powers is not held centrally. Nor is a central record kept of cases where age is disputed, whether or not the person is detained. The information requested is, therefore, available only at disproportionate cost.

  Our policy, however, is that where we are satisfied a person is under 18 he or she should be detained only in very limited circumstances. The detention of minors using immigration powers is always regrettable. Unaccompanied children should never be detained other than in the most exceptional circumstances and then only overnight with appropriate care if they, for example, arrive alone at an airport. Where he or she cannot be cared for by responsible family or friends in the United Kingdom, an unaccompanied child should be placed in the care of the local authority while the circumstances of the case are determined.

  Children are also sometimes cared for in detention facilities as part of a family unit in preference to separating them from their parents. In addition to existing facilities for detaining families, extra family accommodation has recently been made available at Oakington Reception Centre, where families may be held together for around seven days if it appears that their applications can be decided quickly. Occasionally, the detention of families is necessary to effect the removal of those who have no authority to remain in this country but who refuse to leave voluntarily. In such circumstances, detention should be planned to be effected as close to removal as possible so that families are not normally detained for more than a few days.

  Mr. Stinchcombe
  To ask the Secretary of State for the Home Department (1) for each of the last four years for which figures are available,(a) how many persons under the age of 18 years have been detained with their parents in Tinsley House Reception Centre, (b) what was the average length of time for which they were detained and (c) how many of those persons were (i) 0 to 5, (ii) 6 to 11, (iii) 12 to 16 and (iv) 17 to 18 years old; [130737]

  (2) how many persons under the age of 18 have been detained with their parents in Oakington Reception Centre since 20 March; and how many of those persons were (a) 0 to 5, (b) 6 to 11, (c) 12 to 16 and (d) 17 to 18 years old. [130736]
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  Mrs. Roche
  I regret that the information held centrally on persons detained under the Immigration and Asylum Act 1999 powers at Tinsley House Detention Centre is available only in the form of a snapshot at a point in time. Nor is it possible to identify from these data the age of detainees. The information requested is, therefore, available only at disproportionate cost.

  The most recent data available for persons detained at Oakington show that up to 2 July 2000, a total of 538 principal asylum applicants and 50 dependants of asylum seekers have been detained at various times since it opened on 20 March 2000. Oakington has accommodated family groups since 10 May 2000. A total of 36 children have been accommodated with one or both of their parents in dedicated family accommodation up to 2 July 2000. Further information regarding the age ranges of the children is available only at disproportionate cost.

  Police (Sick Days)
  Mr. Matthew Taylor
  To ask the Secretary of State for the Home Department if he will make a statement on the progress made by police forces since 1997 in reducing sick days per officer; and if he will make a statement. [130714]

  Budget requirements (£ million)

  Increase in net budget requirements (£ million)

  Increase in net budget requirements (percentage)

  2001–01 net

  1999–2000 net

  2000–01

  2000–01

  Shire force authorities

  Avon and Somerset police

  181.2

  173.3

  7.9

  4.5

  Bedfordshire police

  66.8

  63.4

  3.4

  5.3

  Cambridgeshire police

  79.5

  75.2

  4.3

  5.8

  Cheshire police

  115.1

  111.1

  4.0

  3.6

  Cleveland police

  86.5

  83.3

  3.2

  3.8

  Cumbria police

  67.4

  64.5

  2.9

  4.5

  Derbyshire police

  111.1

  106.5

  4.6

  4.3

  Devon and Cornwall police

  182.4

  175.9

  6.5

  3.7

  Dorset police

  81.0

  77.4

  3.6

  4.6

  Durham police

  84.0

  81.3

  2.7

  3.4

  Essex police1

  183.1

  169.5

  13.6

  8.1

  Gloucestershire police

  68.6

  66.0

  2.6

  3.9

  Hampshire police

  204.7

  196.5

  8.2

  4.1

  Hertfordshire police1

  121.2

  101.6

  19.6

  19.3

  Humberside police

  118.9

  114.3

  4.6

  4.0

  Kent police

  193.1

  184.2

  8.9

  4.8

  Lancashire police

  189.6

  181.3

  8.3

  4.6

  Leicestershire police

  110.2

  106.3

  3.9

  3.6

  Lincolnshire police

  72.6

  69.7

  2.9

  4.1

  Norfolk police

  91.5

  86.9

  4.6

  5.3

  North Yorkshire police

  81.0

  78.0

  3.0

  3.8

  Northamptonshire police

  73.4

  70.4

  3.0

  4.2

  Nottinghamshire police

  133.8

  129.6

  4.2

  3.2

  Staffordshire police

  127.0

  122.2

  4.8

  3.9

  Suffolk police

  72.9

  69.9

  3.0

  4.3

  Surrey1

  119.9

  93.4

  26.5

  28.4

  Sussex police

  174.5

  168.0

  6.5

  3.9

  Thames Valley police

  238.3

  229.1

  9.2

  4.0

  Warwickshire police

  58.9

  55.9

  3.0

  5.4

  West Mercia police

  125.7

  116.5

  9.2

  7.9

  Wiltshire police

  72.0

  68.9

  3.1

  4.4

  Total

  3,685.9

  3,490.1

  195.8

  5.6

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  Mr. Charles Clarke
  The average number of days taken on sick leave per police officer in England and Wales has reduced over the last three years, as given in the table. The figures for 1999–2000 are not yet available.

  Average number of days

  1996–97

  12.5

  1997–98

  12.7

  1998–99

  11.7

  The Comprehensive Spending Review set police a two per cent. year on year efficiency target, including the reduction of sickness absence in police forces in England and Wales and nearly all forces now have targets to reduce sickness absence as part of their efficiency plans.

  Police Budgets
  Mr. Lidington
  To ask the Secretary of State for the Home Department if he will break down the police funding statistics used to calculate the statement in the Government's Annual report 1999–2000 that police budgets have risen on average by 3.6 per cent.; and if he will make a statement. [131367]

  Mr. Charles Clarke
  The figures requested are given in the table.
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  Budget requirements (£ million)

  Increase in net budget requirements (£ million)

  Increase in net budget requirements (percentage)

  2001–01 net

  1999–2000 net

  2000–01

  2000–01

  Metropolitan forces

  Greater Manchester police

  393.6

  382.5

  11.1

  2.9

  Merseyside police

  253.7

  247.0

  6.7

  2.7

  Northumbria police

  218.4

  212.6

  5.8

  2.7

  South Yorkshire police

  179.7

  173.3

  6.4

  3.7

  West Midlands police

  394.6

  380.9

  13.7

  3.6

  West Yorkshire police

  301.4

  289.1

  12.3

  4.3

  Total

  1,741.4

  1,685.4

  56.0

  3.3

  City of London

  57.9

  57.1

  0.8

  1.4

  Metropolitan police1

  1,830.0

  1,836.2

  -6.2

  -0.3

  Welsh Forces

  Dyfed Powys

  59.0

  55.7

  3.3

  5.9

  Gwent

  76.1

  71.4

  4.7

  6.6

  North Wales

  84.0

  79.6

  4.4

  5.6

  South Wales

  179.1

  170.0

  9.1

  5.4

  Total

  398.2

  376.7

  21.5

  5.7

  Total

  7,713.4

  7,445.5

  267.9

  3.6

  1 Essex, Hertfordshire, Surrey and the Metropolitan police were subject to boundary changes

  Source:

  English forces—Forces returns from DETR

  Welsh forces—Forces returns from the Welsh Assembly

  Immigration Advisers
  Mr. Darvill
  To ask the Secretary of State for the Home Department what progress the Immigration Service Commissioner has made in establishing the scheme of regulation for immigration advisers and service providers; and if he will make a statement. [131481]

  Mrs. Roche
  As I indicated in my reply to my hon. Friend the Member for Ellesmere Port and Neston (Mr. Miller) on 22 May 2000,Official Report, column 370W, the Immigration Services Commissioner took up post on that date. The Commissioner is in the process of consulting widely within the advice sector in order to formulate the rules and standards which will govern the regulatory scheme. The Commissioner expects to have published the documents required by Part V of the Immigration and Asylum Act 1999 and to be ready to consider exemptions and applications for registration from 30 October 2000. We expect the full regulatory scheme to come into force in April 2001.

  Animal Procedures Committee
  Mr. Fitzpatrick
  To ask the Secretary of State for the Home Department when he will publish the latest annual report of the Animal Procedures Committee. [131482]

  Mr. Mike O'Brien
  I have today placed a copy of the Animal Procedures Committee's annual report for 1999 in the Library. I welcome the progress the Committee has made on its extensive programme of work.

  Hieratic Disqualification
  Mr. Mackinlay
  To ask the Secretary of State for the Home Department (1) if he will seek an early legislative opportunity to relieve priests of the Church of England 170W
  and the Roman Catholic Church from disqualification as hon. Members of the House; and if he will make a statement; [130663]

  (2) what assessment he has made of the compatibility of the disqualification of priests of the Church of England and the Roman Catholic Church from membership of the House with the United Kingdom's obligations under the European Convention on Human Rights. [130664]

  Mr. Mike O'Brien
  The disqualification of priests from standing or acting as Members of Parliament was the subject of a Private Member's Bill in June 1999. Since this measure was lost, we have been sounding out opinion of the relevant churches in England, Scotland, Wales and Northern Ireland. However, there is no immediate prospect of legislation being brought forward by the Government.

  The question of compatibility with the European Convention on Human Rights would be a matter for those bringing forward a relevant Bill.

  Blue Travel Documents
  Ms Ward
  To ask the Secretary of State for the Home Department what representations he has made to the French Government about allowing blue travel documents to be accepted at French ports. [129561]

  Mrs. Roche
  We are not aware of any difficulties for those using 1951 Convention travel documents (blue) when travelling to France and have not, therefore, had cause to discuss this with the French authorities. However, we are aware that a number of European Union partners will no longer accept the Certificate of Identity (CID) issued by the Immigration and Nationality Directorate. This is a brown travel document issued to
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  certain foreign nationals, other than refugees, who are resident in the United Kingdom and cannot obtain a national passport on which to travel. This type of document is not issued under international convention but has been widely accepted for travel in the past. It is for the authorities of each country to decide whether they will accept the CID as a valid form of travel document. However, my officials are in discussion with colleagues in the various European Union countries in order to identify their particular concerns and if possible provide any reassurance which might encourage them to accept the CID for travel.

  Police Pay
  Mr. Woodward
  To ask the Secretary of State for the Home Department what plans he has to introduce a pay-weighting scheme for police officers in the South East of England; and what recent representations have been made to him on this matter. [131066]

  Mr. Charles Clarke
  I refer my hon. Friend to the reply given by my right hon. Friend the Home Secretary to the hon. Member for Guildford (Mr. St. Aubyn) during the debate on the Policing of London on 23 June 2000,Official Report, columns 563–64.

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Derby

Lord Scott of Foscote
The Right Honourable Sir Richard Rashleigh Folliott Scott, Knight, Vice-Chancellor, having been appointed a Lord of Appeal in Ordinary and created Baron Scott of Foscote, of Foscote in the County of Buckinghamshire, for life—Was, in his robes, introduced between the Lord Browne-Wilkinson and the Lord Woolf.

UK Population Growth Pressures
2.42 p.m.
Lord Renton Lord Renton asked Her Majesty's Government:
By approximately how many people the population of the United Kingdom has increased since 1st January 1960; and how many square miles of countryside have been used for (a) housing and (b) industrial development since that date.
The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty): My Lords, between 1960 and 1998, the latest years for which estimates are available, the population of the United Kingdom increased by approximately 6.9 million people, or 13 per cent. Over a similar period the number of households in the UK increased by 47 per cent. Figures on land changing to residential and industrial uses are available for England only from 1985 to 1994. On average over that period, about 3,000 hectares per annum changed from rural to residential use and 550 hectares per annum to industrial use.
Lord Renton: My Lords, I thank the Minister for that information, within its limitation. Why cannot he give, even approximately, the area of land developed for housing and industrial uses in the past 40 years? Those figures are available. Why cannot he give them? Is not the very large increase in population in the past 40 years—the Minister said 6.9 million but I believe it is more—due not so much to the high birth rate but, to a great extent, immigration? Are not the Government fully entitled to the maximum support in controlling asylum seekers who are not genuine?
Lord Whitty: My Lords, I do not really believe that the relatively small figures for asylum seekers have much effect on the figures. It is true that net immigration to this country has been on the positive side since the early eighties. However, the figures for growth of households reflect internal, domestic and
768
demographic trends rather than international ones. The pressure of international immigration has been almost entirely on London rather than the rural areas to which I thought the noble Lord referred.
Earl Russell: My Lords, is the Minister aware that according to the current Social Trends, the increase in population by net inward migration since 1991 is 93,000 per annum; less than enough to fill Wembley stadium in the days of its glory? Does he agree that the increase in population is primarily a result of people living longer, among whom I congratulate the noble Lord, Lord Renton, on being a distinguished example?
Lord Whitty: My Lords, I join the noble Earl in congratulating the noble Lord, Lord Renton, and many others who help contribute to the population increase by surviving, and congratulate others who have contributed in other ways. The noble Earl is correct. The contribution of net immigration has been relatively small. I believe that the figure about which the noble Lord, Lord Renton, inquires is the differential between the growth of households and the growth of population. It is certainly true that with smaller households the pressure on housing and therefore, to some extent land, has changed due to internal demographic factors.
Earl Ferrers: My Lords, perhaps I may declare a minor interest before asking this question. Does the Minister agree that what used to be described as "the march of bricks and mortar over the fair plains of England" is more responsible for the destruction of the environment than agriculture has ever been?
Lord Whitty: My Lords, there has been an increase in urbanisation but it is not as great as is sometimes alleged. Both residential and agricultural developments contribute to environmental problems in different ways. We need to ensure that environmental standards and the impact of all developments are taken into account in our planning decisions.
Baroness Gardner of Parkes: My Lords, can the Minister tell us the proportion or quantity of brownfield sites and redevelopment? The Question refers to the countryside. Presumably his Answer relates to brand new greenfield sites. Is that correct?
Lord Whitty: My Lords, not necessarily. On balance, the take of rural land will have been on greenfield sites. There has been a net increase in the green belt over the past few years. The take of rural land for development has been a relatively small part of the increase in new housing. Perhaps I may write to the noble Baroness.
Lord Elton: My Lords, is there now in place a complete register of brownfield sites available for development in urban areas made by local authorities? If so, what proportion of development takes place on those sites?
Lord Whitty: My Lords, local authorities are being asked to draw up a comprehensive register. The present level of development is approximately 50 per cent on strictly brownfield sites, although there may be other urban developments. It is the intention of the Government that that figure should be raised to 60 per cent by 2008.
Baroness Thomas of Walliswood: My Lords, is the Minister aware of the CPRE map of silence in the countryside, or rather the lack of it, which shows where one can be without hearing loud noise, mostly from motor cars? Does he agree that in south-east England the growth of road traffic has probably had one of the worst effects on the environment?
Lord Whitty: My Lords, it is certainly true that stress from development in the South East has been greater than in other areas of the country and traffic levels have been higher. Nevertheless, there are still quiet and beautiful places in the South East well away from traffic and other noise.
Viscount Cranborne: My Lords, I too should declare an interest in this subject before asking the noble Lord whether he feels that the present VAT regime on greenfield development sites, contrasted with the treatment of urban sites and existing buildings, will encourage greenfield development as opposed to brownfield development or indeed redevelopment of existing urban areas. Do the Government feel that the time has come to readjust that position?
Lord Whitty: My Lords, I am sure my right honourable friend the Chancellor is keeping that matter under review, along with other aspects of VAT.
Lord Dixon-Smith: My Lords, does the Minister agree that one of the factors that has made necessary the increase in housing is not the fortunate one already mentioned but the unfortunate one of the break-up of households? Sadly, that is having an equally potent effect. Can the Minister say whether the Government have in mind any steps which might arrest that unfortunate modern tendency?
Lord Whitty: My Lords, it is certainly the case that the number of single person households, for various reasons, has increased. Those reasons include the break-up of marriages and the split of relationships into two. But that is not the total explanation. The Government have indicated a number of measures in their social and employment policies which support families staying together. There is a secular trend—if I can use that word in the statistical sense in this regard—which suggests both here and in other countries that there will be an increase in single person households irrespective of the degree of break-up of stable relationships.

European Air Traffic Services
2.52 p.m.
Lord Lea of Crondall Lord Lea of Crondall asked Her Majesty's Government:
What is the scope of the European Union High Level Group on a Single European Sky, which is to present its final report in the first half of 2001.
The Minister of State, Department of the Environment, Transport and the Regions (Lord Macdonald of Tradeston): My Lords, the scope of the High Level Group of civil and military officials from EU states is to study the main causes for the growing delays in skies over Europe and how they might be overcome. Its interim findings point towards the need for air traffic services to be more responsive to the needs of customers, less constrained by governments and to work within the framework of strong, independent planning and regulation to make the best use of the air space. The high level group is expected to present its proposals by the end of 2000.
Lord Pearson of Rannoch: My Lords—
Noble Lords: No!
Lord Lea of Crondall: My Lords, I thank my noble friend for that reply. Air traffic delays are a growing problem which can only be resolved on a European basis. But two questions arise. First, we in this country are clearly now forcing the pace on a commercial basis. How does that tie in with the intergovernmental and regulatory agenda of the high level group? Secondly, rationalising the number of air traffic control centres in Europe down to single figures will sound like job losses to a number of people. If that is so, does my noble friend agree that social dialogue is very important in looking at that matter both at national and European level?
Lord Macdonald of Tradeston: My Lords, the Commission wants a single sky initiative following serious aviation delays last year. The high level group is concentrating its efforts on improved performance through co-ordination of the existing, somewhat fragmented systems across Europe. The inefficiency is caused by the large number of control centres, largely dictated by land frontiers. It seems inevitable that we must move towards consolidating air traffic services in Europe through a process of gradual rationalisation. That will take many years to complete but there are signs that it is under way. It will provide opportunities to bring commercial expertise and resources while safeguarding safety and the public interest. The rapid growth in air travel and related developments are likely to produce in Europe opportunities for a powerful British-based NATS company. The prospect is clearly unsettling for staff and it is desirable for management to involve staff as frequently as possible in the process of change. The high level group has been in dialogue with European controllers and its

771
proposals reflect their concerns. The controllers are very much part of the solution and our skies will be better managed with their co-operation.
Lord Pearson of Rannoch: My Lords, I apologise to the House and the noble Lord for my earlier intervention.
Can the Minister tell the House whether the single European sky will cover NATO aircraft in British airspace and in British bases? If so, do the Government believe that our US allies will be entirely happy if their aircraft are thus subject to the brilliant strategists in Brussels?
Lord Macdonald of Tradeston: My Lords, NATS and the Ministry of Defence have always enjoyed a good working relationship at managerial and operational levels. They provide a joint and integrated service to the aviation industry. That will continue post-PPP. The Ministry of Defence relationship works well as both organisations are at present in the public sector. However, when the PPP is in place it is important that NATS and the MoD have a proper contractual relationship. They are currently negotiating a contract, which should be concluded in the next few weeks, and I am sure it will take account of the issues the noble Lord raises.
Lord Clarke of Hampstead: My Lords, is my noble friend satisfied with the number and quality of expressions of interest that have been shown from potential strategic partners in the NATS PPP?
Lord Macdonald of Tradeston: My Lords, we are pleased with the quality and level of response and the expressions of interest from potential strategic partners for the NATS PPP. We will have to evaluate those further and decide which might be taken forward in the process. We do not want to release the names of those involved, for reasons of confidentiality, though some have already declared. We should finish the evaluation exercise and hope to be in a position to pre-qualify bidders in a matter of weeks. We intend to complete the PPP—after bidders put in their preliminary offers in September—by the end of March 2001. Those noble Lords who were up until 2.30 this morning will know that the progress of the Transport Bill through your Lordships' House should support us in that aim.
Lord Brabazon of Tara: My Lords, does the Minister agree that one of the principal causes of delay in European skies is the fact that some countries—notably France—still prohibit civil aircraft over vast swathes of their airspace? What representations are the Government making to those countries to ask them to minimise the areas involved?
Lord Macdonald of Tradeston: My Lords, as I said, this will be a gradual process. We are in discussions with our French counterparts on this issue, as on many others in the field of transport. The exercise in which we are engaged is an attempt to try to rationalise both
772
commercial and military use of the skies. There have certainly been delays in Europe in countries such as France. The delays in the European countries are running at twice the level of those in the UK. We obviously had a set-back with the problems we experienced in June, but in general over the past few years our air traffic services have had only half the delays experienced by mainland Europe.
Baroness Thomas of Walliswood: My Lords, can the Minister clarify some of the stories in the press recently about a major breakdown in the contracting process for new equipment for NATS? Can he tell us what effect that will have on the need to modernise our part of the European airspace traffic control system?
Lord Macdonald of Tradeston: My Lords, one of the reasons we want to take forward the PPP solution for air traffic services is to involve expertise from other quarters, particularly from the private sector. We have had experiences which are regrettable in the development of the Swanwick centre, which is some six years delayed and very much over budget. We had delays in the new Scottish centre at Prestwick. Again, that involved difficulties with budgets and with project management. And the most recent example of the problem we had with the development of a computer system in Scotland underscores the need to try to bring in a new way of making things happen more quickly in the air traffic services area. The NAT'S management is now very much behind the initiative. We look forward to a solution to the problem that was identified in Scotland in good time for it to meet the requirements of the system for which it is being designed.

Helicopter ZD576: Mull of Kintyre Accident
3 p.m.
Lord Chalfont Lord Chalfont asked Her Majesty's Government:
Whether they have any doubts about the cause of the accident involving helicopter ZD576 on the Mull of Kintyre on 2nd June 1994.
The Minister of State, Ministry of Defence (Baroness Symons of Vernham Dean): My Lords, the investigation into this tragic accident was very thorough. It involved the independent Air Accidents Investigation Branch and the aircraft components manufacturers, as well as MoD specialists. All possible causes were examined, but no evidence of technical malfunctioning was found. The RAF board of inquiry did establish that the Chinook was travelling too fast and too low and, crucially, outside both visual and instrument flight rules. However, I assure the noble Lord, that Her Majesty's Government are ready to consider any new evidence; but, without such new evidence, it is very difficult to justify reopening the inquiry.
Lord Chalfont: My Lords, I was going to thank the Minister for her Answer, but my Question has not

773
been answered. The facts that the noble Baroness just gave to the House are well known. The question is whether there is any doubt. Is the Minister aware—indeed, will she accept—that the regulations of the Royal Air Force that were in force at the time of the accident required that, in order to find dead pilots guilty of gross negligence—I quote from the regulations—there must be "absolutely no doubt whatsoever" about the cause of the accident? That is why I tabled this Question. I should be grateful to receive an Answer.
Baroness Symons of Vernham Dean: My Lords, as the noble Lord, Lord Chalfont, knows, I am aware of the regulations; indeed, we have discussed them in your Lordships' House before. Moreover, I hope that the noble Lord will not mind me telling the House that both he and I have also discussed the matter privately. I must point out to the noble Lord that, under the regulations, it is the reviewing officers who must be in no doubt. Ministers, properly, are not a part of that process. Those who investigated the accident at the most senior level examined literally hundreds of pages of evidence. They had the expertise to make the judgment and were in no doubt about their conclusion.
If the noble Lord presses me personally, he knows—I have already said it, so I will say it again—that I find his Question philosophically impossible to answer. However, I can tell him that I believe that I have been honestly briefed. Sadly, I also believe that the conclusions of the board of inquiry were right.
Lord Eden of Winton: My Lords, can the Minister confirm that, before being released into service, this aircraft was fully checked out and properly tested?
Baroness Symons of Vernham Dean: My Lords, I can confirm that the aircraft was serviceable. The noble Lord may be thinking of an incident that occurred some years before in relation to the FADEC system, which has been the cause of some concern not only in your Lordships' House but also elsewhere. I must say that the FADEC software, which was the subject of litigation, was software in a test aircraft that was a preproduction version. It was comprehensively re-designed prior to the introduction of the Mark 2 Chinook into service in 1994. I hope that that covers the noble Lord's point.
Lord Mackay of Ardbrecknish: My Lords, does it give the Minister any cause for concern that the Secretary of State at the time, Sir Malcolm Rifkind, now thinks that there ought to be another look at this accident and at the findings of the inquiry?
Baroness Symons of Vernham Dean: My Lords, I can tell the noble Lord that I have had enormous concerns over this matter. Indeed, I do not believe that anyone with a conscience, knowing what is at stake for the families of the two pilots involved, would have anything other than concern. But Sir Malcolm expressed his concern some two-and-half years ago
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when he said that he and Ministers in his administration might not have been fully briefed about certain aspects of the crash. The MoD's Permanent Secretary wrote to him at that time and invited him to come back into the department, if he wished, to refresh his memory. I understand that Sir Malcolm did not repeat those concerns when he met the Secretary of State and the Permanent Secretary last month.
Lord Craig of Radley: My Lords, I do not doubt that those who have consistently sought to have the findings of negligence set aside in this most tragic of accidents do so for the most honourable of reasons. But, is it not the case that the board faced a choice between two presumptions? Either the crew were able to follow one of the safe options as they approached the cloud-covered Mull, but failed to do so and were negligent; or the crew could not maintain safe flight because they faced an unidentifiable emergency so serious that they could not discharge their primary responsibility for the safety of their passengers and the helicopter but which left no trace of having happened? Can the noble Baroness confirm that there is no new evidence that could affect the key conclusion of the board that the crew did have control of the aircraft up to the point of impact?
Baroness Symons of Vernham Dean: My Lords, I thank the noble and gallant Lord, Lord Craig of Radley, for putting the position so clearly and, if I may say so, from a position of unique authority on these issues. I can tell the House that I have not seen any new evidence that would prompt us to revisit the conclusions of the board of inquiry. However, that is not to say that no such new evidence exists. I fully accept that. That is why I cannot answer the noble Lord, Lord Chalfont, in the unambiguous terms that he is pressing me to do.
However, I can tell the noble and gallant Lord, Lord Craig, and, indeed, the noble Lord, Lord Chalfont, that I am able to repeat an offer that was made only last week by MoD officials to the father of one of the pilots involved. If there are serious doubts still remaining, the evidence should be collected together as one body of evidence—if it is new evidence that those who are concerned believe they have—and presented to the MoD. As the Prime Minister has said, the MoD will analyse such evidence thoroughly with, I hope, a degree of compassion, given what I know is the real concern of the families involved, and will provide as full a response as possible.

Bowman Radio Project
3.7 p.m.
Earl Attlee Earl Attlee asked Her Majesty's Government:
When they expect the Bowman project to provide in service an effective replacement for the Army's Clansman range of radios that is both secure and resistant to electronic warfare.
Baroness Symons of Vernham Dean: My Lords, the Bowman radio will incorporate electronic protection

775
measures and will provide the Armed Forces with a secure communications system. It is one of our highest priority equipment projects. Archer Communications Systems Ltd, the prime contractor for Bowman, recently submitted its bid which we are considering, along with information that has been received following alternative fall-back studies that we commissioned. We are currently considering the way ahead on this very important project. We hope to make an announcement soon.
Earl Attlee: My Lords, I thank the Minister for her reply. Does the noble Baroness recall her delight in reminding the House of the previous government's efforts over seven years in this respect? However, does she agree that, in three years, she has achieved nothing herself, apart from a budget reduction in the Bowman project that must equate to reduced equipment, or reduced equipment capabilities? She has ordered the personal role radio, but does she agree that that is only a short-range radio with none of the Bowman complexities? When will the noble Baroness make a decision on this matter?
Baroness Symons of Vernham Dean: My Lords, if I may use the colloquial term, I must say to the noble Earl that that is "really going it a bit". I have to remind noble Lords that this project was under way for nine years under the previous administration and that, so far, I have not yet been the Minister for Defence Procurement for one year. However, I should point out to the noble Earl that it is really a matter for the previous administration to describe why they failed to meet the in-service date of 1995.
I have told the noble Earl that I expect to make an announcement on the project soon. By that, I mean very soon indeed. I hope that that might be by way of a Statement. I also hope that, on this occasion—unlike the last time when we offered the party opposite a Statement on the Type 45—the party opposite would like to hear that Statement.
Lord Burnham: My Lords, I thought that my noble friend made it clear that it was accepted that the former Conservative government had a slippage, which this Government inherited, of 75 months. Does the noble Baroness accept that there has been a further slippage of 24 months in the three years that this Government have been in power, for which I can find no explanation? Does the noble Baroness further accept that Archer Communications Systems Ltd produced a submission for £4 billion, which was double the amount of money available? The project has been brought back into budget; what has suffered as a result?
Baroness Symons of Vernham Dean: My Lords, I certainly accept that when this Government came into office the declared slippage was some 75 months, which was found to have been something of an underestimate. Since that time, there has had to be an adjustment to that. If the noble Lord cares to read the National Audit Office report, he may find some
776
interesting judgments there about how Smart Procurement, which this Government have introduced, might have prevented the delays because the project would have been better assessed at the outset and some of the risks involved with it would have been better identified. The noble Lord will find that at paragraph 327 on page 47 of the National Audit Office report.
I hope to be able to make an announcement on this project soon. I hope that then we shall be able to discuss the detail of what has happened in the recent past. I shall be open about that. I hope that the party opposite will also be open about its period in office. However, what is important is that we shall discuss the way forward.
Lord Carver: My Lords, how does the noble Baroness intend to ensure that, with the fantastic technological developments in this field, when Bowman eventually comes into service it is not already out of date?
Baroness Symons of Vernham Dean: My Lords, of course that is one of the crucial issues and one of the reasons why the Smart Procurement initiatives have been designed to ensure that there is sufficient flexibility to build into the system—after all, this is not the only system where such technological advances are of such enormous importance—to enable us to adjust and have in the specification sufficient room to make those adjustments and to give ourselves sufficient headroom for possible future developments in this rapidly moving area of technology.
Earl Ferrers: My Lords, may I ask the noble Baroness the Leader of the House—
Lord Marlesford: My Lords—
Earl Ferrers: My Lords, does not the noble Baroness the Leader of the House think that if questions and answers were shorter, Question Time would be much more fun and many more questions could he asked by people who want to ask them but cannot do so?
The Lord Privy Seal (Baroness Jay of Paddington): My Lords, the simple answer to that is "Yes".
Lord Elton: My Lords, does the Minister—
Noble Lords: Lord Marlesford!

Business
3.13 p.m.
Lord Carter: My Lords, after consideration of Commons amendments to the Learning and Skills Bill, my noble friend Lord McIntosh of Haringey will, with the leave of the House, repeat a Statement which is being made in another place on the Comprehensive Spending Review.

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Before we begin proceedings on the Learning and Skills Bill this afternoon, I draw noble Lords' attention to the fact that a revised Marshalled List has been issued. In the original Marshalled List some amendments were numbered wrongly. It is crucial to ensure that we are all working from the revised list. The revised Marshalled List is headed helpfully, "Revised Marshalled List".
Lord Strathclyde: My Lords, before the Chief Whip sits down, the noble Baroness, Lady Symons, accused the Opposition of having turned down a Statement on the Type 45 Frigates. It is, however, always open to the Government to insist on having a Statement read.
Lord Carter: My Lords, that is absolutely correct, but it has become the convention that if the Opposition do not require the Statement, it is not normally taken.

Business of the House: Consolidated Fund (Appropriation) Bill
Baroness Jay of Paddington: My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That Standing Order 46 (No too stages of a Bill to be taken on one day) be dispensed with to allow the Consolidated Fund (Appropriation) Bill to be taken through its remaining stages tomorrow.—(Baroness Jay of Paddington.)
On Question, Motion agreed to.

Learning and Skills Bill [H.L.]
3.14 p.m.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, I beg to move that the Commons amendments be now considered.
Moved, That the Commons amendments be now considered.—(Baroness Blackstone.)
On Question, Motion agreed to.

Learning and Skills Bill [H.L.]
  COMMONS AMENDMENTS
  [The page and line refer to Bill 96 as first printed for the Commons.]

  COMMONS AMENDMENTS
  1 Clause 2, page 2, line 20, at end insert—
  ("(3A) Provision is not to be considered as giving rise to disproportionate expenditure only because that provision is more expensive than comparable provision.")
  2 Page 2, line 29, leave out paragraph (e)
  3 Clause 3, page 3, line 12, at end insert—
  ("(3A) Provision is not to be considered as giving rise to disproportionate expenditure only because that provision is more expensive than comparable provision.")
  4 Clause 5, page 3, line 41, after ("receiving") insert ("or proposing to receive")
  5 Page 4, line 1, leave out paragraph (e) and insert—
  ("(e) institutions within the further or higher education sector (within the meaning of section 91 of the Further and Higher Education Act 1992) which provide or propose to provide secondary education (other than post-16 education);")
  6 Page 4, line 3, after ("undertaking") insert ("or proposing to undertake")
  7 Page 4, line 20, after ("receiving") insert ("or proposing to receive")
  8 Clause 6, page 4, line 29, leave out ("providing post-16 education or training") and insert ("to whom financial resources are provided")
  9 Page 4, line 32, leave out ("post-16") and insert ("or proposing to provide")
  10 Page 4, line 47, leave out ("post-16") and insert ("or proposing to provide")
  11 Page 5, line 1, leave out ("post-16")
  12 Clause 7, page 5, line 23, leave out ("and "maintained school" have") and insert ("has")
  Baroness Blackstone: My Lords, with the leave of the House, I beg to move that the House do agree with the Commons in their Amendments Nos. 1 to 12 en bloc.
  In speaking to these amendments, I shall speak also to Commons Amendments Nos. 16 to 21, 30 to 41, 45 to 50, 195, 196 and 202 to 204 and to the Liberal Democrat Amendment No. 20A.
  This large group of amendments consists largely of minor technical amendments in respect of the learning and skills council for England and the national council for education and training for Wales. Given the weight of business before us today, I do not propose to go into the detail of the minor amendments in order that I can deal with the small number of rather more important points.
  Throughout the passage of the Bill through this House there was concern about the meaning of "disproportionate expenditure". There was no disagreement about the policy that should inform its meaning. We entirely agree with what the noble Lord, Lord Pilkington, said at Third Reading of the Bill on 23rd March that the cost of the provision should not be,
  "the total guide to the operation of the councils".—[Official Report, 23/3/00; cols. 416.]
  This concern was expressed in respect of both sixth-form provision and for students with learning difficulties and disabilities.
  We entirely accept this point. Incidentally, there is a misprint in Amendment No. 2 which should state,
  "Page 2, line 29, leave out paragraph (e)".
  Amendment No. 2 simply removes the amendment added at Third Reading in this House in order to address its technical defects and replace it with a similar provision. Amendment No. 1 expresses in plain words that expenditure by the LSC must not be considered disproportionate simply where it is more expensive than comparable provision. We believe that this deals fairly, squarely and in a non-partisan manner with the concerns that were expressed.

  779
  Amendments Nos. 3, 30 and 31 make the equivalent additions in Clause 3 for the LSC's adult duty and Clauses 31 and 32 for the CETW's main duties.
  We have been aware, not least through Liberal Democrat amendments, for which we thank them, that some people have been confused not to find reference in the Bill to the LSC's wider remit, as set out in the Learning to Succeed White Paper for workforce development. Such, perhaps, is the nature of primary legislation: we had tested and were content that the Bill as it stood provided for the full range of the LSC's functions. However, we have been keen to respond to the concerns expressed. Amendment No. 20 provides that, at the national level, the LSC's strategy must set out how the LSC intends to develop the skills of people in the workforce. This reflects in the legislation what we have already set out explicitly in the LSC prospectus—that the LSC will have an important contribution to make to workforce development issues within its overall remit.
  I shall return to this amendment in due course, once the noble Baroness, Lady Sharp, has had a chance to set out what lies behind her amendment to it. In the meantime, I simply say that I shall be able to offer her considerable assurances about how the LSC will work with higher education institutions in taking forward its workforce development proposals. I hope that the noble Baroness will feel able to withdraw her amendment on the basis of those assurances.
  Amendment No. 201 is the result of a commitment I made during debate at Third Reading in this House to the noble Lord, Lord Northbourne. He said then that he was concerned with the,
  "desirability of having on the face of the Bill a better balance between the duty of the learning and skills council to provide vocational education—education for work—and providing a broader category of education—education for life".—[Official Report, 23/3/00; col. 414.]
  Noble Lords may remember that I set out at that time the value that the Government place on enrichment and personal development activities, especially for young people, and the personal, family and community benefits they bring with them. I suggested that we might make the point more explicit by specifying that the young people's learning committee must advise the LSC on such issues. Amendment No. 201 will secure that. Its composition draws on the wording favoured by the noble Lord, whom I thank for his interest and commitment. I am not sure whether he is in his place.
  Amendments Nos. 48 and 49 are the results of further deliberations by the National Assembly for Wales following debates on the Bill both here and in another place. The National Assembly has concluded that statutory planning requirements should be a part of the post-16 reforms for Wales. Amendment No. 48 therefore introduces a new clause which imposes a duty on the CETW to submit to the National Assembly a plan for each of its financial years. A similar duty is placed on the LSC under Clause 15. The CETW's plan must be approved by the National Assembly, which will have the power to require alterations.
  780
  The new clause contained in Amendment No. 49 places a duty on the CETW to prepare a strategy which is equivalent to the duty on the LSC under Clause 16. The National Assembly may require the council to make alterations to the strategy. In this way the amendment provides for a valuable forward planning measure for the council as well as for the National Assembly to bring its overarching priorities to bear on the council's remit.
  As I said in opening, in the light of the need to make progress—including towards groups about which I suspect noble Lords may have a good deal to say later—I do not propose to deal with the further technical amendments. I should mention also that I have already supplied a lengthy note of explanation of all the government amendments to both the noble Baronesses, Lady Blatch and Lady Sharp. I hope it goes without saying, however, that if noble Lords would find helpful an explanation of any particular amendment in this group with which I have not already dealt, I shall be happy to give one. I beg to move.
  Moved, That the House do agree with the Commons in their Amendments Nos. 1 to 12.—(Baroness Blackstone.)
  Lord Pilkington of Oxenford: My Lords, as the proposer of the original amendment, I wish to thank Her Majesty's Government for accepting the principle of my amendment on Clause 2. I am delighted—as are others—that the Government have seen fit to give support to school sixth forms, which is what the amendment is all about. As the noble Baroness knows, they cost more compared to colleges but they give more in pastoral help. I am extremely grateful that, for the first time during my time in this House, the Government have accepted an amendment of mine.
  Baroness David: My Lords, perhaps I may comment on Amendment No. 3. No one would want anyone to spend disproportionately, but can the Minister look forward to the day when Clause 3 will include an entitlement for all adults which is the same as the welcome entitlement for young people in Clause 2? If we had a goal to work towards in adult entitlement, we could look forward to life-long learning for all. Perhaps the Minister would comment on that.
  Lord Roberts of Conwy: My Lords, perhaps I may speak very briefly to Amendments Nos. 48 and 49 and to the other, what I call, Welsh amendments. Amendments Nos. 48 and 49 are two of the 16 new clauses relating to Wales that have been introduced into the Bill since it left this place. There are at least three others which partially relate to Wales, along with numerous changes in schedules and amendments which we shall come to later.
  This is a very late stage for the House to have a first sight of some of these changes to the Bill, which, after all, began in your Lordships' House. Your Lordships' may take a somewhat dim view of this method of proceeding. Be that as it may, I thank the Government, civil servants and draftsmen who have clearly been

  781
  working hard to remedy the worrying defects in the Bill so far as concerned Wales which were pointed out in Committee. The new clauses go far towards making up the paucity of Welsh clauses in the original Bill. We now have a more complete and workable measure for the National Assembly to implement in Wales. The gratitude I express now extends to all the changes for which we asked. I trust that any abstention on my part of any further acknowledgement will not be taken as a discourtesy but as a kindness to the House because we all want to press on.
  I still believe that the regional structure proposed for Wales is not prescriptive enough. This lack of firm direction in primary legislation will give rise only to further dilatory discussion in the Assembly. It is very clear from our experience of the Bill in relation to Wales that there is a proven need for a protocol which specifies very clearly the various steps by which the legislative needs of Wales are translated through the Assembly to central government and this Westminster Parliament. The Government are well aware of that. A draft protocol was tabled in January this year, but here we are in July and the protocol has still not been finalised. I have at long last been able to obtain a copy of the draft, which may be a suitable subject for a short debate in your Lordships' House at a later stage.
  The protocol should cover the relationship between the Assembly and this Parliament—and provide for a two-way flow of information—as well as the relationship between the Labour administration of the Assembly in Cardiff and the Government here in Whitehall.
  Baroness Sharp of Guildford: My Lords, I was not going to speak until the next group of amendments was called, but I think it is appropriate that I should speak now to Amendment No. 20A.
  I thank the Minister for her remarks about workforce development. She is right that during the Bill's progress through the House we pressed amendments for workforce development to be included within the remit of the Bill and on the face of the Bill. I am delighted to see that the amendments have now been included. Amendment No. 20 to Clause 16 puts in place precisely what we seek.
  Behind the scenes, Mr Chris Humphries, who has been the chairman of the National Skills Task Force, has been talking at some length to the Minister and has had some influence in these matters. The final report of the task force was published recently and expresses concern about the overall development of skills in this country. The purpose of the amendment is to ensure that the higher education sector is included in the plans for workforce development.
  This Bill focuses very largely on post-16 training and education which does not lead to degree level qualifications. But increasingly the distinction between further education, vocational qualifications and degree-type qualifications is becoming untenable. If we look to the future, we may see degrees increasingly put together on what I call a "mix-and-match" basis, particularly for mature students.
  782
  Distance learning through the Open University and through the Internet will become an increasingly important part of further and higher education.
  But we also know from our experience with the Open University that teaching within a small tutorial group is very important. Therefore, we will see degrees taken sometimes through Open University-type distance learning, sometimes through attending the local further education college and sometimes through attending the local higher education institution, with different parts of the degree being put together on a credit unit basis. I suspect that this is the way we shall see many degrees coming together in the future, particularly for mature students. But even without looking to the future, the higher education sector plays a vital role in training within the knowledge-based economy. We need to look to the model in the United States, where the universities are very much integrated into the local community. They work with their local community colleges and often form growth points within their local economies, both in terms of spinning off innovative new firms and in terms of training the high-quality workers for the high value added jobs. We feel that higher education must be integrated into the functions of the local learning and skills councils. We have put forward the amendment for that purpose.
  3.30 p.m.
  Baroness Blackstone: My Lords, I shall respond to the points made by noble Lords opposite and by my noble friend Lady David and then come back to the amendment standing in the name of the noble Baroness, Lady Sharp.
  I am grateful to the noble Lord, Lord Pilkington, for what he said. I am grateful, too, to the noble Lord, Lord Roberts. He said that it was rather late for the amendments to come before the House. However, when the Bill was going through the House we said that we would make amendments in another place to improve the Bill. I am glad that he recognised that the amendments are improvements. I hope that he is wrong in his pessimism about how the National Assembly will operate in relation to his view that regional structures are not prescriptive enough. As to the noble Lord's point about protocols, it is up to him to raise the question of a possible debate in the House at a later date.
  Perhaps I may respond to my noble friend Lady David. At this stage I am not able to make any commitment about there being an entitlement to adult learning. However, I shall certainly take away her suggestion, which may in the longer term be desirable.
  I should like to respond to what the noble Baroness, Lady Sharp, said about her Amendment No. 20A. Both Clause 16 and our government amendment to it are expressed in deliberately broad terms. The LSC will work with a wide range of partners and we would certainly expect that to be reflected in its strategy. That there is no reference to higher education institutions in the clause should not be a surprise, given that there is no reference to any of what will be the LSC's key partners. But that does not mean that the HE sector

  783
  will have no role in relation to the LSC's overall remit or its workforce development activities in particular; very far from it.
  We entirely recognise that higher education has an important role to play in the education and training of our workforce, not least because it offers an important progression route for those moving on from further education and work-based learning. In particular, we shall expect the LSC to continue the good work of TECs in encouraging the progression from modern apprenticeships to foundation degrees and vocational honours degrees in subjects such as engineering. It is only by addressing the skills deficit at the intermediate skills level that we can boost the supply of technicians and associated professionals, including at the higher levels, in order to increase our national competitiveness in the development of a knowledge economy. All this means that there must and there will be a strong and productive relationship between the LSC' and the HE sector.
  That is why I am glad to say that the appointments to the LSC at both national and local level which we have announced include individuals with a strong interest in, and experience of, higher education. The national chair, Bryan Sanderson, is vice-chair of the court of governors of the LSE. His chief executive, John Harwood, is a member of the court of Oxford Brookes University. Of the 36 local chairs so far announced, six have been or remain involved with the HE sector in one capacity or another.
  On top of this, and as we have already set out, the national LSC will invite to its meetings the HEFCE chief executive. That will further ensure that a powerful HE voice is present at the heart of the LSC's decision making. The national LSC will also draw together authoritative advice on skills supply and demand by convening, with the Higher Education Funding Council for England and other agencies, an advisory group of leading experts in the field of skills research and information.
  Local learning partnerships will also be important as they provide a forum in which providers, including higher education institutions, can work together to fill gaps and improve quality. Universities and colleges are already involved in some 67 per cent of partnerships.
  Finally, there will also be important collaborative work involving both sectors at the level of delivery. When illustrating this point in another place, my honourable friend the Parliamentary Under-Secretary of State mentioned the York Progression Partnership initiative which provides enhanced support to targeted HE and FE students in their first term and trains a team of "role model" students to act as mentors to FE students. He also referred to the Birmingham project which aims to open up access for Muslim women to higher education opportunities within their local communities, including through local FE colleges. We want more work of this kind, not less.
  With those assurances, I hope that the noble Baroness will in due course withdraw her amendment and will join me and others in supporting the Commons amendments. I beg to move.
  784
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  13 Clause 10, page 6, line 6, after ("promote") insert ("—
  (a)")
  14 Page 6, line 7, at end insert—
  ("(b) the making of arrangements which qualify under section (Qualifying arrangements).")
  15 Page 6, line 8, at end insert—
  ("( ) may be specified as a body with which arrangements under section (Qualifying arrangements) may be made;
  ( ) may be designated by the Secretary of State under section (Qualifying arrangements: further provision)(1) or (3) and may act in accordance with such a designation;")
  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 13 to 15. In moving these amendments, I shall speak also to Commons Amendments Nos. 42 to 44 and 128 to 135. This group of amendments can be considered in two parts. First, Amendments Nos. 129 and 131 provide for a new model for the provision of individual learning accounts. In this set, I include Amendments Nos. 13 to 15, 42 to 44 and 132 and 133, which are consequential on this new model.
  Amendment No. 129 provides for administrative arrangements by which individuals can simply register as account holders with a central provider—rather like a membership scheme. This new approach follows extensive market research which pointed up the benefits and attractions of more flexible arrangements. Clause 96, which provides for the original model based on dedicated savings accounts, is being retained against possible future development as a learning account option. Amendment No. 131 inserts a new clause which enables the Secretary of State to contract with the central provider and to arrange for the LSC to manage the contract on his behalf, though that is not something we envisage happening before April 2002.
  The other amendments I have already listed in connection with this new model make consequential changes to the LSC and CETW's powers in respect of learning accounts and to the clause which governs the payment of learning account grants. The remaining amendments in this group are concerned with territorial matters in relation to learning accounts and follow two principles: that responsibility for policy and implementation should be dealt with on a devolved basis; and that the national framework should be implemented as rapidly as possible in a co-ordinated manner across the UK.
  Amendments Nos. 130 and 135, together with the second half of Amendment No. 131, give Northern Ireland regulation-making powers for the devolved elements of the learning account legislative package. With the resumption of devolution, the Assembly would normally prepare its own legislation for these elements, just as Scottish Ministers have done. However, in the interests of ensuring that implementation in Northern Ireland does not lag behind that in the rest of the UK, we propose that the

  785
  Bill makes direct provision for that. The relevant committee of the Northern Ireland Assembly has approved the approach.
  Amendment No. 128 devolves to Scottish Ministers the regulation-making powers under Clause 96 which, as it deals with financial services and therefore reserved matters, covers Scotland. We and the Scottish Ministers believe that they should make their own regulations under this clause, just as they are responsible for the other learning accountlegislation for Scotland. Making provision directly in the Bill ensures that implementation in Scotland can progress to the timetable for the rest of the UK. The Scottish Parliament has approved this approach.
  Amendment No. 134 removes the "Welsh" subsection of Clause 97. Amendment No. 183, which we will discuss in due course, makes provision for the whole of Part V of the Bill in respect of Wales.
  There are other amendments of a technical and consequential nature with which I have not dealt. If noble Lords want explanations of them, I shall be happy to oblige.
  Moved, That the House do agree with the Commons in their Amendments Nos. 13 to 15.—(Lord Bach.)
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  16 Clause 12, page 6, line 30, at end insert—
  ("(3A) The Council may provide any person designated by the Secretary of State with such information as the Council thinks fit about any matter in relation to which it has a function.")
  17 Clause 13, page 6, line 37, after ("3") and insert (", 5(1)(a) to (d) and (g)")
  18 Page 7, leave out lines 2 to 9 and insert ("facilities for education or training which are sufficient in quantity and adequate in quality for a person with a learning difficulty who is over compulsory school age but who has not attained the age of 19 unless it also secures the provision of boarding accommodation for him, the Council must secure the provision of boarding accommodation for him.
  ( ) If the Council is satisfied that it cannot secure the provision of reasonable facilities for education or training for a person with a learning difficulty who has attained the age of 19 but not the age of 25 unless it also secures the provision of boarding accommodation for him, the Council must secure the provision of boarding accommodation for him.
  ( ) If the Council is satisfied that it cannot secure the provision of reasonable facilities for education or training for a person with a learning difficulty who has attained the age of 25 unless it also secures the provision of boarding accommodation for him, the Council may secure the provision of boarding accommodation for him.")
  19 Clause 15, page 8, line 8, leave out from ("year") to end of line 9
  Baroness Blackstone: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 16 to 19.
  Moved, That the House do agree with the Commons in their Amendments Nos. 16 to 19.—(Baroness Blackstone.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  20 Clause 16, page 8, line 13, at end insert—
  ("(2A) The strategy must include proposals as to how the Council intends to develop the skills of persons in employment; but this does not affect the generality of subsection (1).")
  Baroness Blackstone: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 20. I spoke to this amendment with Amendment No. 1.
  Moved, That the House do agree with the Commons in their Amendment No. 20.—(Baroness Blackstone.)
  [Amendment No. 20A, as an amendment to Commons Amendment No. 20, not moved.]
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  21 Clause 18, page 8, line 35, leave out ("hold shares in a company, or otherwise become a member") and insert ("subscribe for or otherwise acquire shares in or securities")
  Baroness Blackstone: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 21.
  Moved, That the House do agree with the Commons in their Amendment No. 21.—(Baroness Blackstone.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  22 Clause 20, page 9, line 19, at end insert—
  ("(2) A local council—

  (a) must perform in relation to such places outside its area as the Council specifies such of the Council's duties as the Council specifies;

  (b) may exercise in relation to such places outside its area as the Council specifies such of the Council's powers as the Council specifies.")

  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 22. In speaking to this amendment, I shall speak also to Amendments Nos. 23 to 29 and 197 to 200.
  There are only four government amendments about which I should like to speak in this group. The other amendments are all minor, technical points, although, of course, I shall be happy to provide explanations if required.
  Amendment No. 22 extends the provisions of Clause 20 to enable a local LSC to perform duties and exercise functions outside its own area. This builds on a helpful debate and constructive suggestions from the Opposition Benches in another place about the funding of designated institutions, but the general point is relevant to a great many other providers. During that discussion, the Government agreed to consider how we might ensure that a provider operating in more than one location need not be burdened by having to liaise with several different local LSCs. This amendment provides for exactly such situations, by enabling a single local LSC to work with such a provider on behalf of any number of other local LSCs. The flexibility which this provision secures

  787
  would also allow other sensible co-operation between local LSCs where, for instance, a particular local LSC might fund a provider in its locality which was a regional centre of excellence—perhaps an agricultural or other specialist college—attracting students from outside the local LSC's area.
  Noble Lords on the Benches opposite, as well as their colleagues in another place, have questioned our commitment to flexibility and decision-making at a local level. We believe that this amendment provides another example of how, on the contrary, the Government are committed to sensible bottom-up arrangements with co-operation between local LSCs where this is sensible.
  Amendments Nos. 23 and 24 owe a great deal to debates we had during earlier stages in this House. Amendment No. 23 requires local LSCs to include in their plans a statement of the needs of local employers with regard to the skills available in the local workforce; that is, both existing and potential employees. Amendment No. 24 further requires that a local LSC plan should set out how the council proposes to exercise its functions to meet those needs.
  These amendments therefore complement at the local level what Amendment No. 20 achieves at the national level, as has already been set out they put on the face of the Bill, and beyond any doubt, that local LSCs must and will engage in important workforce development activity in their area.
  We have discussed this matter with the CBI, which has warmly welcomed our approach. I hope that noble Lords, too, will welcome this as a positive move forward, building on what the LSC prospectus has made clear—that local LSCs will have a vital role to play in:
  "analysing local labour market and skill needs;
  deploying locally-managed development budgets to meet learning, skills and workforce development needs; [and]
  drawing up local workforce development strategies which will complement the direction of wider economic strategies".
  With Amendment No. 26 we remain in the territory of local LSC plans and the wider remit of local LSCs beyond post-16 learning. It is also another amendment inspired in some part by debates both here and in another place, together with suggestions raised by the TEC National Council. It provides that a local LSC's plan must include a statement of the likely effect of its activities on the wider economic development and regeneration of its area. In this way, the amendment is proof positive of our commitment to economic development and regeneration and the important local LSC role in relation to such matters.
  As is already set out in Clause 22, local LSCs will consult and develop close links with regional development agencies and local authorities—but build on the best work of many TECs by liaising closely with the Employment Service, UfI Ltd, local learning partnerships, local economic development partnerships and the Small Business Service. Amendment No. 26 simply underlines that economic development and regeneration will be an important element within the LSC's broad remit.
  788
  I shall want to return to the amendment tabled by the noble Baroness, Lady Sharp, when I have heard what she has to say in moving it. However, let me say straight away that we share her view that the relationship between the RDAs and the local and national LSCs must be extremely close, but that I believe that our proposals already ensure the close cooperation she seeks. In the mean time, I commend the Commons amendments to the House.
  Moved, That the House do agree with the Commons in their Amendment No. 22. — (Lord Bach.)
  3.45 p.m.

  AS AN AMENDMENT TO COMMONS AMENDMENT NO. 22
  22A Line 8, at end insert—
  ("(c) must liase with the Regional Development Agency and agree a common operational framework and guidelines with other local councils operating within the area covered by the Agency.").
  Baroness Sharp of Guildford: My Lords, I beg to move Amendment No. 22A. As the noble Lord, Lord Bach, made clear, Clause 20 deals with the functions of the local learning and skills councils, while Amendment No. 22 deals with cases where the national learning and skills council wants the local council to perform certain functions "out of area".
  Clause 21 makes it clear that in drawing up the guidance for each local learning and skills council, the national LSC shall consult with the local regional development agencies. Likewise, Clause 22, which has already been mentioned by the noble Lord, Lord Bach, makes it clear that in drawing up their own plans the local LSCs must have regard to the strategy of the local RDAs. Amendment No. 26 makes it clear that in drawing up such a plan, they must keep their eye on the economic development and regeneration of their particular local area.
  Nevertheless, each local learning and skills council covers only sometimes as little as one-tenth of the area covered by the regional development agency. Usually five or six learning and skills councils will be contained in each RDA, and sometimes more than that. I shall put once more the issue that the Liberal Democrats have stressed many times: given their functions in relation to workforce development and local regeneration, the links between the regional development agencies and the local learning and skills councils must be very close. It is vital that those local learning and skills councils work together—this is a part of the function of Amendment No. 22—but also work together with the local regional development agency. On many occasions we have highlighted the absurdity of the London situation where no co-ordinating committee exists. However, we are delighted to see on the record a commitment from the Minister which implies that some element of co-ordination will be established in that case.
  However, the problem does not apply only to London, it applies in many other regional areas such as the North East and the North West. The aim of this

  789
  amendment is to ensure that such liaison does take place and that the requirement is written on to the face of the Bill.
  Moved, That Amendment No. 22A, as an amendment to Commons Amendment No. 22, be agreed to.—(Baroness Sharp of Guildford.)
  Lord Bach: My Lords, perhaps I may attempt to deal with the amendment moved by the noble Baroness, Lady Sharp. We agree with her that RDAs' responsibilities for skills and economic development at the regional level should be woven into the work of the local LSCs. We must draw the link between the regional and the local. That is why the Bill already requires extensive co-operation and consultation in at least four ways: first, RDAs must be consulted by the national council on its draft guidance to local LSCs, as required in Clause 21(4). Secondly, the strategy of the relevant RDA must be taken into account by the local LSC when it is drawing up its annual plan, as required by Clause 22(4)(b). Thirdly, RDAs must be consulted by the local LSCs on their draft annual plans, as required by Clause 22(5)(a). Fourthly, the RDA must even be consulted by the national council on whether the local LSC's plan should be approved, as required by Clause 22(6).
  By any reckoning, these extensive requirements mark out how important the regional dimension is to our proposals and underline how influential will be the role of the regional development agencies and their regional skills strategies in the new arrangements.
  We do not believe that it is necessary to add yet a further layer of requirements in the Bill to ensure agreement on a common operational framework. Many noble Lords have urged us to avoid bureaucracy and we remain very mindful of that sensible advice. But if the noble Baroness's concern is that there should be effective co-ordination of all the neighbouring LSCs operating within a region, I hope I can reassure her further on that point. When these issues were discussed extensively in Standing Committee in another place, there was a broad recognition of the importance of effective consultation across borders. The Government made a commitment that the Secretary of State in his initial guidance to the national council would stress the need for the LSC to consult widely and to take full account of the activities of other partners at both the local and regional level in the planning and delivery of its functions. Consulting widely will, of course, mean that neighbouring local LSCs will maintain an ongoing and productive dialogue with each other at all times. I am happy to reaffirm that commitment today. The Secretary of State's guidance will stress the importance of neighbouring local LSCs within a region working together within a framework which supports the relevant regional development agency's strategy.
  I hope, therefore, that the noble Baroness will agree that the Bill already guarantees the regional dimension that she seeks, and has done since the Bill's early stages
  790
  in this House. I hope, too, that the further reassurances that I have attempted to give will enable her to feel that she need not press her amendment.
  Baroness David: My Lords, I wanted to make a comment on Commons Amendments Nos. 22 to 26. Something that the noble Baroness said about a London co-ordinating body makes me feel that it is right to do so now, and I hope that I am in order in doing so. I thought that the noble Lord, Lord Tope, who raised the matter in this House with the noble Lord, Lord Harris of Haringey, would probably speak to this amendment, but he did not.
  There was quite a discussion on this matter at Report stage in another place. Mr. Brooke, the MP for Cities of London and Westminster, raised the subject. It is important that there should be a co-ordinating body for the five LSCs in the capital. I need not go into the reasons for that. They relate to transport, business, labour management, and so on.
  The Minister, Malcolm Wicks, gave a reassurance on the matter. Although there is nothing on the face of the Bill, it would be helpful if in this House the Minister could give a similar reassurance that there will be an opportunity for a London co-ordinating body.
  Lord Tope: My Lords, as always, I find the noble Baroness irresistible. As the matter of London has been raised, perhaps I may return to it. I read with great interest the report of the debate in another place when the matter was raised by the right honourable Member for Cities of London and Westminster, including the response from the Minister, Mr Wicks.
  I raised the subject in February, as did the noble Lord, Lord Harris of Haringey. Since then, we have elected a Mayor and a Greater London Assembly, and we have appointed a London Development Agency which is now up and working and has assumed its powers. At each stage, the Government have moved a little further in their reassurances. I noted that the right honourable Member in another place hoped that the Minister might write to him giving further details and placing more emphasis on the matter. I do not know whether such a letter has been written. It would be of great help and interest to us all if the Minister is able to say a little more today about what is envisaged specifically for London, given that the other players, including the chairman and the chief executive, are in place. That said, I welcome the commitment from the Government, as far as it goes.
  Lord Bach: My Lords, I am grateful to my noble friend Lady David and to the noble Lord, Lord Tope. Since we last discussed these matters, the noble Lord has been elected to the new Assembly and continues to take an active interest in matters relating to the Bill.
  The answer to my noble friend is: yes, I give the same reassurance as the Minister gave on Report in another place. The Government Office for London is beginning discussions about the establishment of the co-ordinating body as recommended by the London Development Partnership. When the local chairman

  791
  and executive directors are in place, we can take forward the arrangements. That is as far as I can go today. I hope that my reply gives satisfaction to noble Lords who have spoken.
  Baroness Sharp of Guildford: My Lords, I thank the Minister for his response. It is good that we have arrived at a satisfactory arrangement in relation to London. I hope that similar arrangements, perhaps slightly less formal, will obtain in other regional development agency areas. The question of coordination is, as the Minister stressed, extremely important. In the light of his reassurances, I beg leave to withdraw my amendment.
  Amendment No. 22A, as an amendment to Commons Amendment No. 22, by leave, withdrawn.
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  23 Clause 22, page 9, line 37, at end insert—
  ("(aa) a statement of the needs of employers in the local council's area regarding education and training of their employees and potential employees;")
  24 Page 9, line 39, leave out ("those needs") and insert ("the needs mentioned in paragraphs (a) and (aa)")
  25 Page 10. line 5, leave out from ("year") to ("guidance") in line 7 and insert ("taking account of")
  26 Page 10, line 7, at end insert—
  ("(e) a statement of the likely effect of the local council's activities on the economic development and regeneration of its area.")
  27 Page 10, line 9, after ("training") insert ("(and connected organised leisure-time occupation)")
  28 Page 10, line 15, after ("training") insert ("(and connected organised leisure-time occupation)")
  29 Clause 23, page 11, line 10, after ("training") insert ("(and connected organised leisure-time occupation)")
  30 Clause 31, page 14, line 2, at end insert—
  ("(3A) Provision is not to be considered as giving rise to disproportionate expenditure only because that provision is more expensive than comparable provision.")
  31 Clause 32, page 14, line 33, at end insert—
  ("(3A) Provision is not to be considered as giving rise to disproportionate expenditure only because that provision is more expensive than comparable provision.")
  32 Clause 34, page 15, line 19, after ("receiving") insert ("or proposing to receive")
  33 Page 15, line 24, leave out paragraph (e) and insert—
  ("(e) institutions within the further or higher education sector (within the meaning of section 91 of the Further and Higher Education Act 1992) which provide or propose to provide secondary education (other than post-16 education);")
  34 Page 15, line 26, after ("undertaking") insert ("or proposing to undertake")
  35 Page 15, line 44, after ("receiving") insert ("or proposing to receive")
  36 Clause 35, page 16, line 8, leave out ("providing post-16 education or training") and insert ("to whom financial resources are provided")
  37 Page 16, line 11, leave out ("post-16") and insert ("or proposing to provide")
  38 Page 16, line 26, leave out ("post-16") and insert ("or proposing to provide")
  39 Page 16, line 27, leave out ("post-16")
  40 Clause 36, page 17, line 3, leave out ("6)") and insert (" 35)")
  41 Page 17, line 4, leave out ("and "maintained school" have") and insert ("has")
  42 Clause 38, page 17, line 16, after ("promote") insert ("—(a)")
  43 Page 17, line 17, at end insert—
  ("(b) the making of arrangements which qualify under section (Qualifying arrangements).")
  44 Page 17, line 18, at end insert—
  ("( ) may be specified as a body with which arrangements under section (Qualifying arrangements) may be made;
  ( ) may be designated by the National Assembly under section (Qualifying arrangements: further provision)(1) or (3) and may act in accordance with such a designation;")
  45 Clause 40, page 17, line 40, at end insert—
  ("(3A) The Council may provide any person designated by the National Assembly with such information as the Council thinks fit about any matter in relation to which it has a function.")
  46 Clause 41, page 18, line 7, leave out (" 34(1)(g)") and insert (" 34(1)(a) to (d) and (g)")
  47 Page 18, leave out lines 13 to 20 and insert ("facilities for education or training which are sufficient in quantity and adequate in quality for a person with a learning difficulty who is over compulsory school age but who has not attained the age of 19 unless it also secures the provision of boarding accommodation for him, the Council must secure the provision of boarding accommodation for him.
  ( ) If the Council is satisfied that it cannot secure the provision of reasonable facilities for education or training for a person with a learning difficulty who has attained the age of 19 but not the age of 25 unless it also secures the provision of boarding accommodation for him, the Council must secure the provision of boarding accommodation for him.
  ( ) If the Council is satisfied that it cannot secure the provision of reasonable facilities for education or training for a person with a learning difficulty who has attained the age of 25 unless it also secures the provision of boarding accommodation for him, the Council may secure the provision of boarding accommodation for him.")
  48 After Clause 42, insert the following new clause—

  PLANS
  (" .—(1) The Council must make a plan for each of its financial years.
  (2) The Council must send its plan for its first financial year to the National Assembly as soon as is reasonably practicable after the year starts.
  (3) The Council must send its plan for any subsequent financial year of the Council to the National Assembly before the year starts.
  (4) A plan for a financial year must include—

  (a) proposals as to how the Council intends to achieve in the financial year any objectives which should be achieved in the year in conformity with directions of the National Assembly or with conditions imposed under section 47;

  (b) the Council's financial proposals for the year;

  (c) such other matters as the National Assembly specifies.

  (5) The National Assembly must approve the plan or require the Council to make specified alterations of it; and if alterations are required the Council must make them.
  (6) The Council must publish the plan as approved by the National Assembly or as altered in accordance with the National Assembly's requirements; and publication must be made at such time and in such manner as the National Assembly specifies.
  (7) The Council may make and publish such other plans as it thinks fit; but any such plan must not conflict with a plan for a financial year.")
  49 Insert the following new clause—

  STRATEGY
  (" .—(1) The Council must formulate a strategy in relation to its functions and keep it under review.
  (2) The Council must incorporate in the strategy proposals as to—

  (a) how it intends to achieve any objectives contained in directions of the National Assembly;

  (b) how it intends to achieve such objectives within any time limits contained in such directions.

  (3) The strategy must include proposals as to how the Council intends to develop the skills of persons in employment; but this does not affect the generality of subsection (1).
  (4) The Council—

  (a) may at any time send to the National Assembly a copy of the strategy as it subsists for the time being;

  (b) must at such times as the National Assembly indicates send to the Assembly a copy of the strategy as it subsists for the time being.

  (5) The National Assembly must approve the strategy sent to it or require the Council to make specified alterations of it; and if alterations are required the Council must make them.
  (6) In exercising its functions the Council must have regard to the strategy as approved by the National Assembly or as altered in accordance with its requirements.")
  50 Clause 44, page 19, line 22, leave out paragraphs (c) and (d) and insert—
  ("(c) to subscribe for or otherwise acquire shares in or securities of a company unless the National Assembly consents.")
  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 23 to 50.
  Moved, That the House do agree with the Commons in their Amendments Nos. 23 to 50.—(Lord Bach.)
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  51 Clause 53, page 23, line 19, leave out subsections (6) and (7)
  52 Clause 54, page 23, line 34, leave out ("any report under this section") and insert ("a report of an inspection conducted under this section otherwise than as a result of a request under subsection (3)")
  53 Page 24, line 2, at end insert—
  ("( ) The Inspectorate may arrange for a report of an inspection carried out as a result of a request under subsection (3) to be published.")
  54 Page 24, line 3, leave out subsections (8) and (9)
  55 Clause 56, page 25, line 1, leave out ("person providing") and insert ("provider of")
  56 Clause 58, page 25, line 27, leave out from beginning to ("in") and insert ("secondary education provided")
  57 Page 25, line 38, at end insert—
  ("( ) "Secondary education" and "further education" have the same meaning as they have in the Education Act 1996.")
  58 Clause 59, page 26, line 15, after ("teachers") insert ("or lecturers")
  59 Clause 60, page 26, line 19, leave out ("which fall") and insert ("providing education or training falling")
  60 Page 26, line 33, leave out ("person providing") and insert ("provider of")
  61 Page 26, line 38, leave out subsections (8) and (9)
  62 Clause 61, page 27, line 2, leave out ("and any inspector taking part in the inspection")
  63 Page 27, line 6, leave out ("person providing") and insert ("provider of")
  64 Page 27, line 10, leave out ("inspector") and insert ("Chief Inspector")
  65 Page 27, line 21, leave out ("or any inspector")
  66 Page 27, line 23, leave out ("any person exercising") and insert ("the Chief Inspector in the exercise of")
  67 Page 27, line 27, leave out subsection (7)
  68 Clause 62, page 27, line 32, leave out ("66") and insert (" 66(2)")
  69 Page 27, line 33, leave out ("person providing") and insert ("provider of")
  70 Clause 63, page 28, line 6, leave out from ("may") to end of line 7 and insert (", without being asked to, conduct such an inspection")
  71 Page 28, line 8, leave out from ("If") to ("in") in line 9 and insert ("financial resources have been applied by the Learning and Skills Council or a local education authority")
  72 Page 28, line 11,1eave out from ("which") to end of line and insert ("those resources have been applied")
  73 Page 28, line 26, leave out ("person providing") and insert ("provider of")
  74 Clause 64, page 29, line 10, leave out subsections (5) and (6)
  75 Clause 69, page 31, line 21, leave out subsections (4) and (5)
  76 After Clause 69, insert the following new clause—

  DEFAMATION
  .—(1) For the purposes of the law of defamation a report published under a provision of, or made as a result of, this Part is privileged unless its publication is shown to have been made with malice.
  (2) Nothing in subsection (I) limits any privilege subsisting apart from that subsection.")
  77 Clause 71, page 32, line 2, leave out ("body known as the")
  78 Page 32, leave out lines 5 to 9
  79 Clause 72, page 32, line 29, leave out from ("1998") to end of line 31
  80 Clause 73, page 33, line 20, at end insert—
  ("( ) In exercising functions under this Part, the Chief Inspector for Wales must have regard to—

  (a) advice given by the National Assembly; and

  (b) such aspects of the National Assembly's policy as the National Assembly may specify.")

  81 Clause 74, page 33, line 21, leave out ("secure that") and insert ("inspect")
  82 Page 33, line 23, leave out ("is inspected by a member of the Inspectorate")
  83 Page 33, line 25, leave out from first ("The") to ("must") in line 26 and insert ("Chief Inspector for Wales")
  84 Page 33, line 26, leave out ("to the Chief Inspector for Wales")
  85 Page 33, line 35, leave out ("On receipt of a report under subsection (3),")
  86 Page 33, line 36, leave out ("it") and insert ("the report under subsection (3)")
  87 Clause 75, page 34, line 8, leave out ("arrange for") and insert ("inspect, and report on,")
  88 Page 34, line 9, leave out from ("kind") to end of line
  89 Page 34, line 10, leave out ("arrange for") and insert ("inspect")
  90 Page 34, line 15, leave out from beginning to ("if")
  91 Page 34, line 19, leave out subsection (5) and insert—
  ("( ) Subsections (5) to (8) of section 74 apply to a report under subsection (2) as they apply to a report under that section.
  ( ) The Chief Inspector for Wales may arrange for a report of an inspection carried out as a result of a request under subsection (3) to be published.")
  92 Clause 76, page 34, line 21, leave out from ("Part") to ("has") in line 23 and insert ("the Chief Inspector for Wales")
  93 Page 34, line 26, leave out ("person providing") and insert ("provider of")
  94 Page 34, line 39, leave out ("require") and insert ("such assistance from")
  95 Page 34, line 44, leave out from beginning to end of line 1 on page 35 and insert ("as the Chief Inspector for Wales")
  96 Page 35, line 3, leave out ("a person exercising") and insert ("the Chief Inspector for Wales in the exercise of")
  97 Clause 77 page 35, line 8, leave out from ("inspection") to end of line and insert—
  ("( ) But it does not apply to a report of an inspection conducted—

  (a) as a result a request under section 75(3); or

  (b) under section 80.")

  98 Page 35, line 9, leave out ("person providing") and insert ("provider of")
  99 Clause 78, page 35, line 28, after ("Assembly") insert ("for Wales")
  100 Page 35, line 38, after ("Assembly") insert ("for Wales")
  101 Page 35, line 41, leave out ("(5) to (8) of section 34") and insert ("(6) to (6C) of section 35")
  102 Clause 79, page 36, line 6, leave out ("arrange for an inspection of") and insert ("inspect")
  103 Page 36, line 7, after ("Wales") insert ("by the Secretary of State")
  104 Page 36, line 9, leave out ("to be conducted by a member of the Inspectorate")
  105 Page 36, line 10, leave out subsection (2)
  106 Page 36, line 15 leave out from second ("State") to end of line 16
  107 Page 36, line 20, leave out from second ("Inspectorate") to end of line 21
  108 Clause 80, page 36, line 36, leave out from ("being") to end of line 37 and insert ("asked to, conduct such an inspection")
  109 Page 36, line 37, at end insert—
  ("( ) If financial resources have been applied by the Council or a local education authority in respect of education or training which is being inspected under this section, the inspection may extend to considering the manner in which those resources have been applied and whether they have been applied in a way which provides value for money.")
  110 Page 36, line 42, leave out ("person providing") and insert ("provider or)
  111 Page 36, line 43, leave out from ("provide") to end of line 45 and insert ("such information as the Chief Inspector for Wales may reasonably require in connection with the inspection")
  112 Page 37, line 2, leave out from ("provide") to ("in") in line 4 and insert ("such information as the Chief Inspector for Wales may reasonably require")
  113 Page 37, line 6, at end insert—
  ("( ) On completing an area inspection, the Chief Inspector for Wales must make a written report.")
  114 Page 37, line 7, leave out ("(3)") and insert ("(4), (5)(a) to (c) and (6)")
  115 After Clause 80, insert the following new clause—

  ACTION PLANS FOLLOWING SECTION 80 INSPECTIONS
  (" .—(1) This section applies if the Chief Inspector for Wales publishes a report of an area inspection conducted under section 80.
  (2) The National Assembly may direct the Council to prepare a written statement of the action which it proposes to take in the light of the report and the period within which it proposes to take it.
  (3) The National Assembly may direct a local education authority whose area is wholly or partly in the area covered by the report to prepare a written statement of the action which they propose to take in the light of the report and the period within which they propose to take it.
  (4) In preparing the statement the Council or the authority must consult such persons as the National Assembly may direct.
  (5) The person making the statement must—

  (a) publish it within such period, and in such manner, as may be prescribed by regulations made by the National Assembly; and

  (b) send copies of it to such persons as may be so prescribed.")

  116 After Clause 82, insert the following new clause—

  ANNUAL PLAN OF THE CHIEF INSPECTOR FOR WALES
  (" .—(1) The Chief Inspector for Wales must, for the purposes of the consultation required under section 104(4) of the 1998 Act (funding of HM Chief Inspector of Education and Training for Wales), prepare a plan for each financial year.
  (2) The plan must be submitted to the National Assembly by such time before the beginning of the financial year to which it relates as the National Assembly may direct.
  (3) The plan must contain estimates of—

  (a) the expenditure necessary, in the financial year to which the plan relates, in order to secure that the functions of the Chief Inspector for Wales are discharged effectively; and

  (b) the income which the Chief Inspector for Wales will receive in that financial year and which may be applied towards meeting the expenses of the Chief Inspector for Wales.

  (4) The plan must also contain proposals for the management of any funds which may be provided by the National Assembly for that financial year.
  (5) The Chief Inspector for Wales may, after the plan has been approved under section 104(4A) of the 1998 Act, publish it in such manner and at such time as appear to the Chief Inspector for Wales to be appropriate.
  (6) "The 1998 Act" means the Government of Wales Act 1998.")
  Baroness Blackstone: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 51 to 116. I shall speak also to Amendments Nos. 184, 185, 205 to 209, 262, 263 and 276.
  I should like to explain a few of the more important amendments in this group. Amendment No. 51 and the majority of the others in the group are minor or drafting amendments with little real effect in substance and I shall take up the time of the House on such amendments only if noble Lords would like any further explanation.
  I turn first to Amendments Nos. 52 and 53, which are linked. Under Clause 54, a private employer may enter into a contract with the Adult Learning Inspectorate (ALI) to evaluate the quality of its training provision—that is, training which is paid for privately by the company itself, without government support. In these circumstances, we do not want the ALI to have a duty to publish the report. Such inspections will be a private matter between the employer and the ALI and it would be quite inappropriate for the ALI to be under a duty to publish the results of the inspection, especially where the employer might be reluctant for the results to be published. But the important issue is that the ALI may

  797
  do so under arrangements it reaches with employers—for example, to publicise and promote good practice. Amendments Nos. 52 and 53 achieve this position.
  Amendments Nos. 56 and 57 also need to be considered together. Although technical, they are important in reflecting our policy of promoting collaboration between schools and FE colleges in the provision of secondary education. Such collaboration can only be of benefit to those young people for whom learning solely in schools may not be the best option. Clause 58(a), as originally drafted, did not allow for the inspection by Ofsted of 16 to 18 year-olds undertaking such collaboratively provided secondary education within an FE college.
  Clearly, all such education must be inspected and secondary education should be a matter for Ofsted. Amendment No. 56 provides that secondary education offered at an FE sector institution will fall within Ofsted's remit both for those of compulsory school age and those over 16 but under 19. Amendment No. 57 defines the terms "secondary education" and "further education" by reference to the Education Act 1996. Noble Lords will also wish to note that this Act's definition of "secondary education" is extended by Clause 99 of the Bill to include provision made partly at a school and partly at another institution, such as an FE college.
  Amendment No. 116 introduces a new provision at the request of the National Assembly. It places a duty on the chief inspector for Wales to prepare an annual plan for the forthcoming financial year and submit it to the National Assembly. The plan has to be submitted before the beginning of each financial year to which it relates. The plan must set out the chief inspector's proposals as to how she intends to use the funds made available to her to carry out her inspection and other functions. It should also set out her expected budget and contain proposals as to her spending plans for that year. The chief inspector will have the power to publish the plan as she considers appropriate.
  Amendment No. 115 introduces a new clause but it is not a new policy direction for the Bill. It ensures that the report of an area inspection is carried through to its logical conclusion by requiring a plan to be prepared detailing the action to be taken and in a specified time period. The action plan should either be prepared by the CETW or an LEA, as necessary, and the person preparing the statement must consult such persons as the Assembly may direct.
  Finally, Amendment No. 263 is needed in order to provide a short-lived but vital transitional arrangement for the Adult Learning Inspectorate. The key insertion will be within Schedule 9 to the Bill.
  Under Clause 50 of the Bill, the Adult Learning Inspectorate will consist of nine members. We have already appointed the chairman and the chief inspector will be appointed soon after Royal Assent. But all nine members of ALI may not be appointed until much later in the year, and meanwhile certain key tasks will need to be carried out. For instance, the common inspection framework will need to be agreed
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  with Ofsted before it is put out to consultation for three months. The inspectorate will need to secure premises in September and to start recruiting and training staff. There will be significant planning arrangements which will need executive decisions—for example, agreeing with Ofsted a programme of area and joint inspections.
  Amendment No. 263 will therefore allow ALI to function with as few as two members—in practice, the chairman and the chief inspector—during the transitional period. A similar approach in respect of the LSC was agreed by this House in the earlier stages of the Bill. Noble Lords will note that once all the other members have been appointed, the provision will expire automatically.
  With this group of largely technical amendments the Government complete their provisions for the new inspection regime. The preparations for a successful implementation are already under way. The draft common inspection framework produced by the three current inspectorates is a demonstration of how inspection can be conducted under shared principles. With the appointment of Nick Reilly to be the chairman designate of ALI we have an experienced, dynamic leader to help build the new organisation. These provisions will help us in our mission to drive up standards and quality across the post-16 sector and I commend them to the House.
  Moved, That the House do agree with the Commons in their Amendments Nos. 51 to 116.—(Baroness Blackstone.)
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  117 Clause 87, Page 38, line 36, at end insert—
  ("(2A) The Secretary of State may make a scheme providing for the transfer to any listed person of any of the property, rights and liabilities of a person with whom the Secretary of State has made arrangements under section 2 of the Employment and Training Act 1973 (arrangements regarding employment).")
  118 Page 39, line 10, after ("(2)") insert ("or (2A)")
  119 Page 39, line 13, at end insert—
  ("(8A) A scheme under subsection (2A) is invalid unless it is made with the consent of the person from whom the transfer is to be made.")
  120 Page 39, line 14, leave out subsection (9)
  121 After Clause 87, insert the following new clause—

  TRANSFERS: WALES
  (" .—(1) The National Assembly for Wales may make a scheme providing for the transfer of any of its property, rights and liabilities to the National Council for Education and Training for Wales.
  (2) The National Assembly may make a scheme providing for the transfer to the Council of any of the property, rights and liabilities of a person with whom the National Assembly has made arrangements under section 2 of the Employment and Training Act 1973 (arrangements regarding employment).
  (3) A scheme under this section may include such supplementary, incidental, consequential or transitional provisions as the National Assembly thinks are appropriate.
  (4) A scheme under this section comes into force on the day it specifies for it to come into force.
  (5) When a scheme under this section comes into force it has effect to transfer (in accordance with its provisions) the property, rights and liabilities to which it applies.
  (6) If a scheme under subsection (1) includes provision for the transfer of liabilities, the day specified by the scheme for it to come into force must not fall after the end of the period of 3 years starting with the day appointed under section (Commencement) for the commencement of section 86.
  (7) The day specified by a scheme under subsection (2) for the scheme to come into force must not fall after the end of the period of 3 years starting with the day appointed under section (Commencement) for the commencement of section 86.
  (8) A scheme under subsection (2) is invalid unless it is made with the consent of the person from whom the transfer is to be made.")
  122 After Clause 87, insert the following new clause—
  ("Transfers: further provision

  STAMP DUTY
  .—(1) A transfer effected by virtue of section 84 or 86 is not to give rise to liability to stamp duty.
  (2) Stamp duty is not to be chargeable on a scheme made under section 85, 87 or (Transfers: Wales).")
  123 After Clause 87, insert the following new clause—

  CONTRACTS OF EMPLOYMENT
  (" .—(1) This section applies if rights and liabilities under a contract of employment are transferred by virtue of—

  (a) section 84 or 86, or

  (b) a scheme under section 85, 87 or (Transfers: Wales).

  (2) Anything done by or in relation to the transferor in respect of the employee before the day on which the transfer takes effect is to be treated on and after that day as done by or in relation to the transferee.
  (3) For the purposes of Part XI of the Employment Rights Act 1996 (redundancy payments etc) the employee is not to be regarded as having been dismissed by virtue of the transfer.
  (4) For the purposes of that Act the employee's period of employment with the transferor is to count as a period of employment with the transferee, and the change of employment is not to break the continuity of the period of employment.
  (5) The preceding provisions do not prejudice any right of the employee to terminate the contract of employment if a substantial change is made to his detriment in his working conditions, but no such right arises by reason only of the change in employer effected by the transfer.
  (6) For the purposes of this section—

  (a) the transferor is the person from whom the rights and liabilities are transferred;

  (b) the transferee is the person to whom the rights and liabilities are transferred.")

  4 p.m.
  Baroness Blackstone: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 117 to 123. In moving those amendments, I shall speak also to Commons Amendments Nos. 166 to 168 and Amendment No. 174.
  Since we last discussed in this House the provisions in the Bill to support the smooth transition to the new arrangements, we have been working very closely with a wide range of partner organisations to work through further details. I would like to pay tribute to our partners, and in particular to TECs and chambers of commerce and training and enterprise councils, for the positive and constructive way they have worked with us to solve some very complex issues and for their
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  commitment to ensuring a successful transition. These amendments arise from those discussions and form the final piece of necessary legislative jigsaw.
  Amendments Nos. 117 to 123 are designed to ensure that the assets, rights and liabilities of existing organisations can be transferred, as appropriate, to the LSC, ALI and Ofsted in England or to the Council for Education and Training in Wales. Among other things they will allow us and the National Assembly to protect the rights of individuals and to ensure worthwhile projects can continue under the new arrangements.
  Amendments Nos. 166 to 168 will allow us to ensure that the rights of current pensioners and deferred pensioners of the TEC national pension scheme and other TEC salary and related occupational pension schemes can be safeguarded. These clauses will enable the rights and obligations under TEC schemes, with the consent of the trustees of those schemes, to be transferred to and administered under a new scheme or schemes made within the Principal Civil Service Pension Scheme. Such a scheme would be designed to ensure that the pensioners and deferred pensioners enjoy the same level of financial benefits and are no worse off in any respect than under current arrangements. These new provisions are for the benefit of the individuals concerned and the public purse. It is expected that most of the current TEC final salary pension schemes will cease to be viable because significant numbers of active members will transfer to the PCSPS on taking up employment with the LSC. These provisions will enable the trustees of the current schemes to discharge their duties to the remaining pensioners and deferred pensioners in a cost-effective way.
  Finally, Amendment No. 174 provides additional safeguards to ensure that TEC assets continue in future to be used to meet national priorities and for the benefit of local communities. Many TECs have evolved into complex organisations and they hold assets whose gross value is in excess of £600 million. These assets have been generated either directly or indirectly through the significant contracts TECs have with the Government. It has become clear that while the current contractual framework provides a number of safeguards, it does not cover all the potential scenarios which are now beginning to emerge.
  Some TECs are proposing to wind up the company and return all remaining funds to the Government. Others have plans to keep the company going in one form or another. These plans range from some form of economic development company to companies selling specialist services to business. In a small number of cases there are proposals which seem to be moving away from one of the fundamental principles which has underpinned the work of TECs. That principle is that any profits which the company makes should be recycled into activities for the benefit of local communities. Instead, individual shareholders of associated companies, who might also have been former TEC employees, could stand to gain. We believe we must ensure that no TEC resources are used in support of such proposals.

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  We have made it clear to TEC chairs that these new powers in no way change our overall approach. I want to emphasise that point very strongly. It is still our aim to reach agreement, TEC by TEC, on the use of assets in a way that is consistent with national priorities and the needs of local communities. In taking these powers it is not our intention to override TECs' existing commitments which we have agreed in their business plans, nor to exert a perpetual power over future arrangements. Neither do we wish to interfere with those assets brought to merged CCTEs by chambers or legitimately accrued since merger in the membership fund. Such assets should and will be available to chamber members to establish a new chamber.
  In recent discussions with TECs we have had the opportunity to emphasise those intentions and I know that they understand and accept our assurances that these powers of determination set out in this clause are powers of last resort for use when other avenues have been exhausted. They have also greatly welcomed our commitment to underwrite unforeseen future liabilities to allow boards to wind up companies quickly and effectively.
  We will continue to work closely with boards over the coming months. But in the final analysis the Government have a responsibility to ensure that assets continue to be used to benefit national priorities and local communities. Amendment No. 117 will allow us to do that. I commend it and the other transitional provisions to the House. I beg to move.
  Moved, That the House do agree with the Commons in their Amendments Nos. 117 to 123.—(Baroness Blackstone.)
  Baroness Blatch: My Lords, given the Secretary of State's publicly declared concern about the quality of legal advice he receives within the department, can the noble Baroness give the House an absolute reassurance that the powers taken in this Bill for transferring TEC assets are in fact legally sound?
  Baroness Blackstone: My Lords, yes; I can give the noble Baroness that assurance. We sought legal advice before we introduced these new measures. We consider that they do not contravene the ECHR and that they are legally sound.
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  124 Clause 91, page 41, line 25, after ("Assembly") insert ("for Wales")
  125 Clause 92, page 42, line 11, after ("Assembly") insert ("for Wales")
  126 Clause 94, page 42, line 28, after ("Assembly") insert ("for Wales")
  127 Clause 95, page 43, line 4, at end insert—("(2A) In subsection (3) of section 24 for "(g)" substitute "(gg)".")
  Lord Bach: My Lords, on behalf of my noble friend, I beg to move that the House do agree with the Commons in their Amendments Nos. 124 to 127. I shall also speak briefly to Amendments Nos. 170 to 173, 230 to 261 and 265 to 276.
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  This very large group of amendments serves to tidy up the Bill and ensure consistency and coherence. I can assure noble Lords that all of the amendments in this group are either purely consequential on the dissolution of the FEFCs and the creation of the LSC, CETW and the ALI, or represent minor technical changes in the light of the substantive provisions of the Bill. None of the amendments carries policy significance. I hope that noble Lords will accept that assurance and, in the interests of making progress, agree to the amendments without a detailed blow-by-blow account, which I am in a position to give if need be.
  Moved, That the House do agree with the Commons in their Amendments Nos. 124 to 127.—(Lord Bach.)
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  128 Clause 96, page 43, line 39, at end insert—
  ("(7) The power to make regulations under this section is to be exercised by the Scottish Ministers so far as those regulations are to have effect for the purposes of any provision of, or made under, an Act of the Scottish Parliament authorising grants to be paid to, or in respect of, individuals in connection with their education or training; and for this purpose references in this section to the Secretary of State are to be treated as references to the Scottish Ministers.
  (8) For the purposes of this section an enactment includes an Act of the Scottish Parliament.")
  129 After Clause 96, insert the following new clause—

  QUALIFYING ARRANGEMENTS
  (" .—(1) Subsection (2) applies if a provision contained in or made under an enactment requires arrangements to qualify under this section (or to qualify under it at a particular time).
  (2) The provision is to be taken to require the arrangements to satisfy conditions specified by the Secretary of State in regulations made under this section (or to satisfy them at the time concerned).
  (3) These conditions may be included—

  (a) conditions as to the description of individual who may enter into arrangements;

  (b) conditions as to the description of body with which arrangements may be made;

  (c) conditions as to the nature of the arrangements and the way they are to be made;

  (d) conditions requiring the arrangements to be identified by a specified name.

  (4) Conditions as to the description of body with which arrangements may be made may themselves specify the description or may allow the Secretary of State to specify it in a way he thinks fit.
  (5) The regulations may provide that a specification of a description of body with which arrangements may be made may include a requirement for bodies to have the benefit of approvals which have been given by the Secretary of State and not withdrawn.
  (6) The regulations may contain provision securing that an individual may not simultaneously—

  (a) be a party to more than one set of arrangements which qualify under this section, or

  (b) be a party to arrangements which qualify under this section and to arrangements falling within subsection (7).

  (7) Arrangements fall within this subsection if they are—

  (a) arrangements which qualify under such provision of the law of Scotland as in the opinion of the Secretary of State corresponds to this section, or

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  (b) arrangements which qualify under section (Qualifying arrangements: Northern Ireland).")

  130 After Clause 96, insert the following new clause—

  QUALIFYING ARRANGEMENTS: NORTHERN IRELAND
  (" .—(1) Subsection (2) applies if a provision contained in or made under an enactment requires arrangements to qualify under this section (or to qualify under it at a particular time).
  (2) The provision is to be taken to require the arrangements to satisfy conditions specified by the Department of Higher and Further Education, Training and Employment in Northern Ireland in regulations made under this section (or to satisfy them at the time concerned).
  (3) Subsections (3) to (7) of section (Qualifying arrangements) apply to regulations under this section as they apply to regulations under that section; and for this purpose—

  (a) references in those subsections to the Secretary of State are to be treated as references to the Department;

  (b) the reference in subsection (7)(b) to arrangements which qualify under this section is to be treated as a reference to arrangements which qualify under section (Qualifying arrangements).")

  131 After Clause 96, insert the following new clause—

  QUALIFYING ARRANGEMENTS: FURTHER PROVISION
  (" .—(1) The Secretary of State (or a person designated by him) may make arrangements with a body in connection with the making by that body of arrangements which qualify under section (Qualifying arrangements).
  (2) Arrangements under subsection (1) may include provision for the remuneration of a body and the payment of its expenses.
  (3) Arrangements under subsection (1) may include provision for a person designated by the Secretary of State to carry out on his behalf such of his functions under the arrangements as he specifies.
  (4) The Secretary of State may pay—

  (a) to a person designated by him under subsection (1) to make arrangements with a body, or

  (b) to a person designated by him under subsection (3) to carry out functions on his behalf,

  remuneration or amounts to meet the person's expenses.
  (5) The Department of Higher and Further Education. Training and Employment in Northern Ireland (or a person designated by it) may make arrangements with a body in connection with the making by that body of arrangements which qualify under section (Qualifying arrangements: Northern Ireland).
  (6) Subsections (2) to (4) apply to arrangements under subsection (5) as they apply to arrangements under subsection (1); and for this purpose references in subsections (2) to (4) to the Secretary of State are to be treated as references to the Department.")
  132 Clause 97, page 43, line 43, leave out from ("regulations") to first ("may") in line 1 on page 44 and insert ("must provide that grants may be paid only to or in respect of individuals—

  (a) who hold accounts which qualify under section 96,

  (b) who are parties to arrangements which qualify under section (Qualifying arrangements), or

  (c) who hold such accounts and are parties to such arrangements.

  (2A) The regulations")
  133 Page 44, line 6, at end insert—
  ("(aa) conditions as to the way the arrangements qualifying under section (Qualifying arrangements) are conducted;")
  134 Page 44, line 38, leave out subsection (7)
  135 After Clause 97, insert the following new clause—

  GRANTS: NORTHERN IRELAND
  (" .—(1) The Department of Higher and Further Education, Training and Employment in Northern Ireland may make regulations authorising grants to be paid to or in respect of individuals in connection with their education or training.
  (2) The regulations must provide that grants may be paid only to or in respect of individuals—

  (a) who hold accounts which qualify under section 96,

  (b) who are parties to arrangements which qualify under section (Qualifying arrangements: Northern Ireland), or

  (c) who hold such accounts and are parties to such arrangements.

  (3) Subsections (3) to (7) of section 97 apply to regulations under this section as they apply to regulations under that section; and for this purpose—

  (a) references in those subsections to the Secretary of State are to be treated as references to the Department;

  (b) the reference in subsection (4)(b) to arrangements which qualify under section (Qualifying arrangements) is to be treated as a reference to arrangements which qualify under section (Qualifying arrangements: Northern Ireland).")

  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 128 to 135. These amendments were spoken to with Amendment No. 13.
  Moved, That the House do agree with the Commons in their Amendments Nos. 128 to 135.—(Lord Bach.)
  On Question, Motion agreed to.
  4.15 p.m.

  COMMONS AMENDMENT
  136 Leave out Clause 98
  Baroness Blackstone: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 136. I shall speak also to Amendment No. 136A to be moved by the noble Baroness, Lady Blatch, which I shall urge the House to reject. In speaking to Amendment No. 136, I am happy to set out the Government's position on selective admissions to grammar schools and the reasons why I must urge noble Lords to agree with the government amendment.
  We made a commitment in our manifesto that, although we do not support further selection by academic ability, we will empower parents, by means of petitions and ballots, to decide whether selective admissions to grammar schools should continue. The reason for the commitment is that we know many parents have strong views about selection. We thought then, and still think now, that it is only fair and right that parents should be able to decide the future of selective admission arrangements at grammar schools. We delivered this manifesto promise with Sections 105 to 109 of the School Standards and Framework Act 1998.
  On 14th March, by a majority of just five, this House voted to remove those provisions from the 1998 Act. In doing so, it removed the right of those most directly

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  concerned to decide the future of local schools and placed that power back in the hands of local authorities. My right honourable friend the Secretary of State made clear in another place the day after that vote, as I did in this House, that the Government's position on selection remained the same. We therefore pledged to restore the provisions for petitions and ballots to the School Standards and Framework Act. That was achieved while the Bill was in the other place, and I believe that noble Lords should join me in underlining that position here.
  We believe that parents are best placed to decide the future of selection at grammar schools. The high turnout of 75 per cent in the Ripon ballot—far above the turn-out in local and national elections—clearly showed that parents want to express their views.
  On previous occasions the Opposition have argued, and may do so again, that petitions and ballots represent a threat to some of our best schools. Yet, in the 25 years before the 1998 Act, 18 of which were under a Conservative government, the number of grammar schools fell from 809 to 166. To continue to attack this Government's grammar schools policy would simply be to fuel an old debate and, in the case of the Opposition Front Benches, to demonstrate (if I may say so) some inconsistency in relation not only to grammar schools but parents' ballots. After all, it was the Opposition who when in power introduced the principle of parental ballots on the issue of grant-maintained status.
  Noble Lords have on previous occasions heard a great deal about statistics and how they prove the relative merits of the comprehensive or selective systems. We have recently published statistics which show that the average GCSE point score for 15 year-olds in grammar schools (who make up roughly the top 25 per cent of the ability range in selective areas) is 60.7, compared with 60.9 for the top 25 per cent of 15 year-olds in comprehensive schools. Objective consideration clearly shows one thing: broadly speaking, bright pupils perform as well in comprehensive schools as in selective schools. I hope that noble Lords will help us move on from this outdated debate which pits grammar schools against comprehensive schools and support the Government's schools agenda. This agenda is founded on a clear drive for higher standards and the promotion of greater diversity, including the specialist schools programme. This agenda is vital if we are to prepare young people better for the challenges of a rapidly changing and technologically advanced world.
  I turn now to Amendment No. 136A. In my remarks so far I have sought to set out the rationale for the balloting process—our belief that parents should have the opportunity to decide this issue—and that is why I ask noble Lords to resist this amendment. We publicised and consulted widely on the details of the balloting process. We believe that the arrangements
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  that we have put in place are fair and sensible. Indeed, we listened to reasonable arguments and sought to reconcile, on the one hand, the principle of allowing parents to raise petitions and, on the other, the need for stability in schools. We entirely recognise the need for this stability. That was why we introduced a five-year moratorium for ballots after one had taken place. It is a means of providing a balance between allowing parents the opportunity to express their views and not distracting attention from the crucial work of raising standards in schools.
  The five-year moratorium means that if there is a ballot during the first year of a child's time at an 11 to 18 grammar school and the outcome is to keep the existing admissions arrangements at that school, a further ballot can be held only after five years. Should the result of that further ballot be in favour of changing the admissions arrangements, the time-scales for implementation would be such that the child would be able to complete even his sixth-form education at the school before the change was made. A five-year moratorium, therefore, offers an entirely appropriate period of stability in relation to admissions. It ensures considerably greater stability than the Opposition were prepared to offer when in government in respect of ballots on grant-maintained status where the moratorium was for one year only.
  In contrast, Amendment No. 136A seeks to extend this moratorium from five to 10 years. At a stroke, that would remove the opportunity for many parents ever to have their say about the future of selective admission arrangements to grammar schools. For feeder school ballots, where the electorate is drawn from the parents of primary pupils, a 10-year moratorium means that children would pass completely through the age range from which the parental electorate would be drawn before a further ballot could be held. For area ballots, where all parents of children up to 16, including those who turn 16 during that year, have a vote, a 10-year moratorium is still a very long time. Why should the parent of a child of five at the time of a first ballot not have the chance to vote again on the issue until the child is approaching the end of its compulsory school years? In these circumstances, we cannot reconcile this amendment with the clear aim of the ballot policy to place power in the hands of parents. I must, therefore, urge noble Lords to support government Amendment No. 136 which reinstates the ballot procedure set out in the 1998 Act and to resist Amendment No. 136A.
  Moved, That the House do agree with the Commons in their Amendment No. 136.—(Baroness Blackstone.)

  AS AN AMENDMENT TO COMMONS AMENDMENT NO. 136
  Baroness Blatch Baroness Blatch rose to move:
  As an amendment to the Motion that the House do agree with the Commons in their amendment, at the end to insert "and do propose the following amendment in lieu of the words so left out of the Bill"—.

  MORATORIUM FOR HOLDING FURTHER BALLOT FOR RETENTION OF SELECTIVE ADMISSION ARRANGEMENTS IN GRAMMAR SCHOOLS
  (" . At the end of section 105(8) of the School Standards and Framework Act 1998 there shall be inserted "and that period shall be not less than 10 years".")
  The noble Baroness said: My Lords, I beg to move Amendment No. 136A. In the course of presenting her arguments for and against the amendments on the Marshalled List, the noble Baroness accused this side of the House of pitting grammar schools against comprehensive schools. If anybody is guilty of that it is the noble Baroness and her noble friends opposite. The Government's policy does precisely that. One has only to visit Trafford, Barnet and parts of Kent to see just how vociferous and active is the Labour Party in that work.
  The noble Baroness also made no mention of what we believe to be the Secretary of State's plans to modify the petitioning and balloting arrangements in order to make it easier to close grammar schools. We understand that that matter is under active discussion within the department. It is not for me today to go over the arguments about the merits of grammar schools; we have debated those at length in this House. I concede defeat on the amendments passed by this House which went to another place. However, one matter that is worth considering—it is the kind of consideration that this House usually deals with sensitively—is that there should be an end to the upheaval, war of attrition and discomfort caused to schools by this kind of activity on an annual basis. We believe that the five-year moratorium, which in practice is only four years, should be set aside and the period of respite for schools should be 10 years.
  For those who wish to see the demise of grammar schools, they will not go away; they will remain active even between one period and another. We are not talking about one generation of children who pass through the school during those five years. A child starting grammar school can expect twice during his time there to have his schooling disrupted, his teachers and head teachers distracted, his parents disturbed and politicking going on around him. It is only fair to give at least one generation of children a respite from such upheaval occurring a second time.
  My honourable friend Graham Brady, when considering our amendment in another place, said that one of the saddest aspects of the current Parliament is that a government claiming to be more interested in standards than in structures took early action focused directly on the structures of education. They did so in relatively limited areas of the country but where, by and large, the system has been working well. If the Government were truly more interested in improving standards than in tinkering with structures, they should have left the remaining grammar schools alone two years ago when the School Standards and Framework Act 1998 was passed. He went on to say that if it is their true agenda today, they should warmly embrace the House of Lords Clause 98, which was wisely added to the Bill by this House. He said that in the present climate the House of Lords seemed to take
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  more care of the interests of the electorate and behaved more like a democratically responsive body of Parliament than the House of Commons. I shall return to that theme during debates on later amendments.
  The Government's blind prejudice against academic ability has never been more manifest than in their philosophical objection to academic selection. What, may I ask the Minister, is so evil about selecting children on the basis of ability, particularly bright children from poor homes?
  Moved, That Amendment No. 136A, as an amendment to Commons Amendment No. 136, be agreed to.—(Baroness Blatch.)
  Lord Tope: My Lords, I listened to the noble Baroness, Lady Blatch, with incredulity. I do not doubt that she is genuine in her concern for the disruption and distress caused in schools which are undergoing ballots. I speak from personal experience of schools and can say that, coming from the representative of a government who introduced ballots on maintained status and had school after school experiencing considerable division and disruption all because of their ideological drive to force grant-maintained schools on a country which demonstrated in ballot after ballot—and more particularly by refusing to hold ballots—that it did not want such schools, the concern is hard for me to understand. I do not want to use unparliamentary language, but I find some of what has been said remarkable coming prom a party which started the ballots.
  We opposed the Government's proposal, which is now in the Act, to ballot on grammar schools. We thought that it was inappropriate and that it would be better left to local decision-making. We do not want to rehearse those arguments today, but if the Government are considering amending the ballot regulations to make them a little fairer and more workable, I suppose that we welcome it. However, I should welcome much more their reappraisal of the whole situation.
  The Minister spoke eloquently, as always, against selection in education but perhaps I may correct her on one point. She referred to grammar schools versus comprehensive schools. That is wrong; it is grammar and secondary modern schools versus comprehensive schools. If you have grammar schools, by definition you must have secondary modern schools, whatever label or name you choose to give them. That is the proper comparison with comprehensive schools and when one makes it one can see that in the overwhelming majority of cases our comprehensive schools have been most successful.
  We will not support the amendment tabled by the noble Baroness, Lady Blatch. However, I must again make clear our party's opposition to the Government's ballot proposals as enshrined in the School Standards and Framework Act.
  Lord Baker of Dorking: My Lords, when it comes to grammar schools, the Government are in a mess. It is a tailor-made, self-imposed mess. Before the election,

  809
  their only undertaking as regards education policy was to do something about the grammar schools. They were unspecific, but it was clear that many Labour Members believed that they would move to the abolition of grammar schools. Indeed, some Labour Members—notably the noble Lord, Lord Hattersley, and others—have been totally consistent in their abhorrence of selection and their belief that comprehensive education is the only formula for the UK. The Government in whom he was a Cabinet Minister in the 1970s not only believed that but implemented it.
  This Government do not quite believe that but it is difficult to know what they believe. They are in favour of selection sometimes and against it at other times. If they were totally opposed to selection, and if they believed that it was evil to select children on ability, they should have the courage of their convictions and introduce a Bill to abolish the remaining 164 grammar schools. But that is not what they have done.
  Old Labour Members would have liked that because they did not believe in selection. Many of them continue in that belief. Therefore, the Government decided to create a series of fancy franchises around the country in order to pass the decision making down to selected members of the community. And they must be disappointed that the fancy franchises they have created have given them a raspberry! The only ballot has been in Ripon. In Trafford, Birmingham and Kent, parents or local activists tried to reach the target but were unable to do so. In Ripon, the only place where an election took place, there was a decisive result in favour of grammar schools.
  No doubt the noble Baroness will have read the minute which came from the Prime Minister's hands in recent days. She will remember that he wrote that the Government are out of touch with the "gut instinct" of the British people. The gut instinct in Trafford, Birmingham and Kent is to keep the grammar schools, not to abolish them. The Government cannot even get 20 per cent of the electoral college, which is a fancy franchise, to say that they want to abolish the grammar schools. Therefore, in response to the minute the Minister should tell her leader that she recognises that that is the case and that where there has been an election, the gut instinct was clearly for the continuation of the grammar schools.
  Perhaps I may also remind the Minister that after the result in Ripon the heads of the grammar and comprehensive schools there said, "Never again do we want to be put through that; not in five years and not in 10 years". I support the amendment tabled by my honourable friend, because 10 years is long enough to ensure that it will never happen but those heads did not want to go through it again because they did not want to waste their time.
  I ask the Minister to reflect on the improvements which could have been made to existing comprehensive schools in Birmingham, Kent and Trafford if the energies of all the parents had been spent on improving the quality of those schools rather than fighting such an and battle. Therefore, I believe
  810
  that the Government should accept the fact that that ruse has not worked and should abandon it as quickly as possible. They should certainly agree to the amendment of my honourable friend.
  Noble Lords: Noble friend!
  Lord Baker of Dorking: My noble friend—noble and honourable, I hope.
  Noble Lords: No.
  Lord Baker of Dorking: I shall use as many adjectives as your Lordships require, but she is a very good egg!
  My point is that my noble friend's amendment would remove that particular dispute from controversy, and that is what we should seek. The last thing that our country's education system needs is a fight on old barren ground. The clear wish of people who expressed a view is that the remaining grammar schools should stay. On certain days the Government agree with that; on other days, they do not—and that is an imperfect lead to give to the education system of our country. Therefore, I very much hope that the House will support the amendment.
  I must not sit down before I touch on the Liberal Democrats in relation to this matter. The Liberal Democrats nationally are against selection. That is clearly set out in their manifesto. With regard to the local option—the noble Lord, Lord Tope, knows more about the local option than anyone because he presides over a local authority—it is the local level that maintains grammar schools, believes that they are marvellous, campaigns for them, funds them, pays them and encourages them to grow and develop. Therefore, I believe that we should discount entirely the integrity of the Liberal Democrat Party in this matter—not only in this matter, but particularly in this matter—because it is one on which they say, "Don't do as I do; do as I say".
  I hope that your Lordships will consider these to be the battles of yesteryear and agree that we should not continue them.
  4.30 p.m.
  Lord Carlisle of Bucklow: My Lords, when the Minister introduced the amendment, she referred to the history of discussions about grammar schools over the past 25 years. As someone who had a part in that history, perhaps I may say that I notice and accept that on the face of it the Labour Party appears substantially to have changed its position. Perhaps I may remind her that in 1979 the purpose of the first Bill introduced by the incoming Conservative government was to restore to local education authorities the power to retain grammar schools. That short Bill, introduced on approximately the seventh day of the life of that government, was necessary because of the previous Bill that had been passed by the Labour government under the noble Baroness, Lady Williams, as their

  811
  Secretary of State for Education. Their Bill required local education authorities to become comprehensive and to do away with grammar schools.
  There is no doubt that at that stage parents were not asked for their views; the government dictated that grammar schools should disappear. Happily, having passed the 1979 Bill, we have retained 164 grammar schools in this country. I believe that they continue to be a valued part of our education system. They are popular with parents and with the people of the country as a whole.
  In the past few days, we have heard a great deal about the Government's concern over the perception of their policies. The Minister told us today that one of the Government's policies is the drive for and pursuit of higher standards in education. It is hardly surprising if the public have a slightly different perception when the only two Acts to have been passed by the present Government in this regard abolished the assisted places scheme, which provided education opportunities for children in inner cities which otherwise they would not have had, and maintained their open opposition to grammar schools.
  Although the Government say that it is for parents to decide, the Minister, like the Minister in the other place, made it clear that they are opposed to, and wish to see the end of, grammar schools. The only ballot that has taken place—in Ripon—showed clear support for grammar schools. The attempt to hold a ballot in Trafford did not even get off the ground because an insufficient number of people signed the petition to start a ballot; and the provisions in the 1998 Act only cause worry and fear to grammar schools and disruption when a ballot takes place.
  I am sorry that the other place decided to reject the amendment that we passed in this House. However, I hope that the compromise moved by my noble friend today, proposing a moratorium of 10 years before any further ballot can take place, will be passed in an effort to show that the House supports those who want to see the continuation of grammar schools.
  Lord Pilkington of Oxenford: My Lords, I speak as president of the Grammar Schools Association. I did not intend to speak in this debate but, as ever, the noble Lord, Lord Tope, has provoked me to the Floor.
  The noble Baroness will remember that she answered two Written Questions which I tabled relating to A and B grades at A-level gained by independent and grammar schools. She may remember that she answered that 25 per cent of the A and B grades were gained by independent schools and 13 per cent by grammar schools. Therefore, 42 per cent of the top two grades at A-level were gained by 10 per cent of children in independent and grammar schools.
  Is that an indictment of the state education system? I do not know. However, in face of that, schools on the Continent have opted for flexibility. In Kent, which has grammar schools, other schools have specialised in technology and various other subjects. The noble Lord, Lord Tope, is wrong—he is an historical dinosaur—to say that the only alternative to grammar
  812
  schools is secondary modern schools. He has only to look across the Channel or to Kent to see that a wide variety of schools can provide alternatives that satisfy children who are not necessarily academic. Believe me, I was good at writing essays but I have never earned as much money as a London plumber.
  Therefore, I suggest to the Government that they should be more pragmatic, more tolerant and look more closely at the facts rather than attach themselves to a dogma which died with Harold Wilson.
  Lord Mayhew of Twysden: My Lords, I declare an interest as a board member of an organisation called Support Kent Schools. During the passage of the School Standards and Framework Act 1998, the Government's position, as represented by the Minister, was that they were not hostile to grammar schools but they wanted the public to have an opportunity to decide the character of schooling in their areas. That stance seemed to me to be replicated today by the noble Baroness. She said that the Government do not support selection but want merely to return the decision to the public.
  I, for one, must confess to having felt a certain scepticism during the passage of the earlier Bill because I believed it more likely that Ministers in this Government were the doctrinal heirs of Mr Anthony Crosland, whose objectives during his time in office were frequently cited in our debates, suitably edited.
  Now we have an opportunity for the Government to demonstrate the sincerity of the position to which they aspired and which they avowed. As has been pointed out on a number of occasions this afternoon, we now know that the necessary threshold has not been achieved anywhere. The threshold was achieved in Ripon but that result has already been remarked upon. Nowhere else—in Trafford or Kent—has even the threshold for a ballot been achieved.
  Therefore, the pressure to dispose of selection simply does not exist. In adopting the methods put forward by the Government—that is, their own threshold machinery—the people have spoken; or, to express it more accurately, the eloquence of the public has been decisive. It cannot be mistaken. Therefore, surely now is the time for the Government to say, "Very well, we accept that that is the case and we must now strike a balance between again taking the horse to water and avoiding the undoubted instability and damage that comes from instability to schools—not only selective schools but other, non-selective schools which would be affected by any change, to say nothing of the interests of parents and children".
  I should like the Minister to answer two questions. First, does she accept that a period of uncertainty on this issue inevitably causes damage of the kind that has been mentioned today and which I need not repeat? Secondly, will she give an undertaking that this Government will not bring forward amendments to the thresholds which were so integral a part of the previous Bill and which have failed, I suggest, to produce the result that the Government wanted? I, for one, would be extremely grateful if in her reply an answer is given to those two questions.

  813
  I believe that my noble friend's amendment of a 10-year moratorium strikes the right balance. It is the minimum that can really be afforded schools, which have gone through that immensely disruptive process in the past year or so. It strikes the minimum balance of stability needed and the Government now have the opportunity to demonstrate that they respect the wishes of the people and are not truly motivated by hostility to selection.
  Lord Elton: My Lords, my incredulity is equal to that of the noble Lord, Lord Tope. I shall try to express it in equally parliamentary terms. It is a debating point, but it is a valid one. The noble Lord spent a long time telling us that he is against ballots and then advised his friends to vote against an amendment to have fewer of them. There is probably no point in drawing that to the attention of his colleagues because they will do what they are told, but it is to be hoped that the rest of your Lordships will draw your own conclusions about the Liberal Democrats' position.
  Baroness Blackstone: My Lords, I find it quite amazing to hear two former Secretaries of State for Education who served various Conservative governments, under whom numbers of grammar schools were turned into comprehensive schools, make the speeches that they have just made. They criticise the Government for fighting the battles of yesteryear. It seems that it is they who are now fighting the battles of yesteryear, and perhaps battles that they wish they had fought a little harder when they were members of those governments.
  However, the criticism made by the noble Lord, Lord Tope, is accepted. Of course, I should have referred to secondary modern schools too. When members of the Conservative Party are debating this subject, they never refer to the fact that where we have the selective system, as in Kent, with grammar schools we confine 75 per cent of pupils to secondary modern schools. They are labelled as failures at the age of 11, and it is made very difficult for them to escape from that failure. It would be more honest if from time to time members of the Conservative Party made it absolutely clear that that is what is being discussed.
  The noble Lord, Lord Baker, referred to the noble Baroness, Lady Blatch, as a "good egg". I do not want to dispute that at all. But the claim that the Government are involved in blind prejudice against academic ability is outrageous. The Government are committed to raising the academic ability of all our children, right across our primary schools and right across our secondary schools. In fighting old battles, the Conservatives are becoming obsessed with 160-odd grammar schools. What a pity the Conservatives do not think about the needs of all our pupils in all our schools.
  I do not want to get involved in another debate about selection, because, as I said in my introductory remarks and as the noble Baroness, Lady Blatch, rightly said, we have already had that debate several times.
  814
  I shall answer the two questions put by the noble and learned Lord, Lord Mayhew. He supports the continuation of not only grammar schools but also secondary modern schools in Kent. The noble and learned Lord asked whether I accepted that there would be a period of uncertainty when ballots take place and whether that would cause damage. I repeat what I said earlier, and what was said by the noble Lord, Lord Tope. It was the noble and learned Lord's party which introduced ballots in the first instance. So I wonder whether he believes that there was any damage caused in that respect.
  The noble and learned Lord also asked about whether the Government have any intention of amending the thresholds. The threshold is in primary legislation and the Secretary of State has said that he will not reduce it.
  4.45 p.m.
  Lord Mayhew of Twysden: My Lords, I am sure that the noble Baroness, Lady Blackstone, has inadvertently neglected to answer the first question. Will she take this opportunity to do that?
  Does the noble Baroness regard "secondary modern" as some pejorative term which applies, for example, to Angley School in Kent, which operates in co-operation with Cranbrook School, at the other end of the town, and is sending its children to Oxford and Cambridge and to other universities from an increasingly successful sixth form?
  Baroness Blackstone: My Lords, I thought I had answered the first point. Of course, whenever changes to admission arrangements are made, some disruption will be caused while they are carried out, but it is not believed that long-term damage is done. I reiterate what I said earlier: the Government believe that it was right to consult parents about the issue.
  Regarding the point about secondary modern schools in Kent, I am sure there are a great many secondary modern schools in Kent doing the best that they possibly can in a situation which is not at all desirable.
  The noble Lord, Lord Baker, thinks that the Government are out of touch with public opinion. I think that he is profoundly out of touch with public opinion. When surveys of public opinion were undertaken when the 11-plus was still in place—it still is in Kent—the vast majority of people disliked it intensely and wanted to see it come to an end.
  I set out my reasons earlier for rejecting the Opposition's proposals and I shall not repeat them all again. I urge noble Lords to support the Government's Amendment No. 136 and to restore the provisions for parental petitions and ballots about the future admission arrangements at grammar schools to the School Standards and Framework Act and to support the position achieved while the Bill was in another place. In so doing, I hope that noble Lords will also be persuaded by my arguments against the Opposition's Amendment No. 136A, which would impose a moratorium of 10 years on further balloting instead of

  815
  the present five years. To support the Government's amendment and to resist the Opposition's amendment is to support the balance the Government have been keen to strike between ensuring that parents have opportunities to decide the future of admissions to grammar schools and ensuring that schools have the stability between ballots which they need.
  Baroness Blatch: My Lords, it was the Prime Minister and not the noble Baroness, Lady Blackstone, who said that the Labour Government were out of touch, and therefore my noble friend was right to refer that. The Prime Minister himself said it.
  The noble Baroness, Lady Blackstone, said rather patronisingly that some secondary moderns were doing their best in the best possible circumstances. Many secondary moderns are doing exceptionally well indeed, and so are many other schools, many comprehensives, and many high schools. I refute very strongly the accusation that somehow or other my colleagues and I are not concerned with all children in all schools. It was our government who introduced city technology colleges. It was our government who introduced specialist schools. It was our government who introduced bilateral schools and grant-maintained schools. It was our government who supported grammar schools and the best comprehensive schools, high schools, secondary modern schools, Church schools and special needs schools. That system provides choice and diversity and an education that meets the needs of all children, including children of high academic ability.
  Why is there a vendetta against 164 schools out of 4,000? We all know why: it is the Government's obsession with academic brilliance and pandering to every other form of selection. Why is it right to select on the basis on an aptitude for science and technology, or art, or music, or sport, and not for a child who is bright and very able academically?
  I am afraid that the noble Lord, Lord Tope, did ask for it. First, he referred to the ballots which we introduced for grant-maintained schools. There is a very important distinction in that regard. The parents, the teachers and staff in each school which became grant maintained made that decision. This is a very different form of attrition.
  The parents of children in many of those grammar schools are denied a vote at all about the future of the schools. In the case of grant-maintained schools, they were not voting about whether the school survived as a school; they were voting about a change of management in the school This is about whether the school should survive at all as a school. Many of the schools will cease to exist as grammar schools. I am saying to the noble Baroness that if there is a successful vote in those areas—in other words, to change the admissions arrangements—those schools cease to exist as grammar schools. They are no longer grammar schools.
  816
  That was not the position in relation to grant-maintained schools. They continued to be the schools that they were and the ballot was on a change of management and the fact that there would be more control over the running of the school.
  Once again, we have witnessed the two faces of the Liberal Democrat Party. When we were discussing the Bill originally, we all remember that a Front Bench Liberal Democrat spokesman said quite openly in this Chamber, "What we say nationally is one thing; what we do on the ground is another". I have no respect for such a policy.
  Let there be no mistake that we shall abandon those petition and balloting arrangements when we return to office. A vote for my amendment will be a vote for a widening of choice and diversity in education. A vote against my amendment will impact most strongly on bright children from low income families.
  This Government prove beyond doubt that the politics of envy and the class war are alive and well. I commend the Motion to the House.
  4.52 p.m.
  On Question, Whether the said amendment No. 136A), as an amendment to Commons Amendment No. 136, shall be agreed to?
  Their Lordships divided: Contents, 206; Not-Contents, 237.

  Division No. 1

  CONTENTS

  Ackner, L.

  Carrington, L.

  Alexander of Weedon, L.

  Carver, L.

  Allenby of Megiddo, V.

  Cavendish of Furness, L.

  Ampthill, L.

  Chadlington, L.

  Anelay of St Johns, B.

  Chalfont, L.

  Arran, E.

  Chalker of Wallasey, B.

  Astor, V.

  Chilver, L.

  Astor of Hever, L.

  Clark of Kempston, L.

  Attlee, E.

  Coe, L.

  Baker of Dorking, L.

  Colwyn, L.

  Barber, L.

  Cope of Berkeley, L.

  Beaumont of Whitley, L.

  Courtown, E.

  Bell, L.

  Cowdrey of Tonbridge, L.

  Belstead, L.

  Cox, B.

  Biffen, L.

  Craig of Radley, L.

  Blackwell, L.

  Cranborne, V.

  Blatch, B.

  Crathorne, L.

  Bledisloe, V.

  Crickhowell, L.

  Boardman, L.

  Cuckney, L.

  Brabazon of Tara, L.

  Dacre of Glanton, L.

  Bridgeman, V.

  Dean of Harptree, L.

  Bridges, L.

  Denham, L.

  Brigstocke, B.

  Dixon-Smith, L.

  Brittan of Spennithorne, L.

  Donaldson of Lymington, L.

  Brougham and Vaux, L.

  Durham, Bp.

  Burnham, L. [Teller]

  Eden of Winton, L.

  Buscombe, B.

  Elles, B.

  Butterworth, L.

  Elliott of Morpeth, L.

  Buxton of Alsa, L.

  Elton, L.

  Byford, B.

  Feldman, L.

  Caithness, E.

  Ferrers, E.

  Campbell of Alloway, L.

  Fitt, L.

  Campbell of Croy, L.

  Flather, B.

  Carlisle of Bucklow, L.

  Fookes, B.

  Carnarvon, E.

  Forsyth of Drumlean, L.

  Carnegy of Lour, B.

  Fraser of Carmyllie, L.

  817

  Freeman, L.

  Norfolk, D.

  Gardner of Parkes, B.

  Northbourne, L.

  Garel-Jones, L.

  Northbrook, L.

  Geddes, L.

  Northesk, E.

  Gilmour of Craigmillar, L.

  Norton of Louth, L.

  Glentoran, L.

  O'Cathain, B.

  Goschen, V.

  Onslow, E.

  Gray of Contin, L.

  Onslow of Woking, L.

  Greenway, L.

  Oppenheim-Barnes, B.

  Hanham, B.

  Oxfuird, V.

  Hanson, L.

  Park of Monmouth, B.

  Harris of High Cross, L.

  Parkinson, L.

  Haslam, L.

  Pearson of Rannoch, L.

  Hayhoe, L.

  Peel, E.

  Henley, L.[Teller]

  Perry of Southwark, B.

  Higgins, L.

  Peyton of Yeovil, L.

  Hodgson of Astley Abbotts, L.

  Pike, B.

  Hogg, B.

  Pilkington of Oxenford, L.

  Home, E.

  Platt of Writtle, B.

  Hooper, B.

  Plumb, L.

  Howe, E.

  Plummer of St. Marylebone, L.

  Howe of Aberavon, L.

  Powell of Bayswater, L.

  Howell of Guildford, L.

  Prior, L.

  Hunt of Wirral, L.

  Pym, L.

  Hurd of Westwell, L.

  Quinton, L.

  Hylton, L.

  Rawlinson of Ewell, L.

  Hylton-Foster, B.

  Reay, L.

  James of Holland Park, B.

  Rees, L.

  Jellicoe, E.

  Rees-Mogg, L.

  Jenkin of Roding, L.

  Renton, L.

  Jopling, L.

  Roberts of Conwy, L.

  Kelvedon, L.

  Rogan, L.

  Kimball, L.

  Rotherwick, L.

  King of Wartnaby, L.

  Sainsbury of Preston Candover, L.

  Kirkham, L.

  St. John of Bletso, L.

  Knight of Collingtree, B.

  St John of Fawsley, L.

  Knights, L.

  Saltoun of Abernethy, Ly.

  Laing of Dunphail, L.

  Sanderson of Bowden, L.

  Laird, L.

  Seccombe, B.

  Lamont of Lerwick, L.

  Selkirk of Douglas, L.

  Lane of Horsell, L.

  Selsdon, L.

  Lang of Monkton, L.

  Sharples, B.

  Liverpool, E.

  Shaw of Northstead, L.

  Lucas, L.

  Simon of Glaisdale, L.

  Luke, L.

  Slim, V.

  Lyell, L.

  Sterling of Plaistow, L.

  McColl of Dulwich, L.

  Stevens of Ludgate, L.

  McConnell, L.

  Stewartby, L.

  Macfarlane of Bearsden, L.

  Stodart of Leaston, L.

  Mackay of Ardbrecknish, L.

  Strathdyde, L.

  Mackay of Clashfern, L.

  Swinfen, L.

  Mancroft, L.

  Tebbit, L.

  Marlesford, L.

  Tenby, V.

  Marsh, L.

  Thomas of Gwydir, L.

  Masham of Ilton, B.

  Tombs, L.

  Mayhew of Twysden, L.

  Trefgarne, L.

  Miller of Hendon, B.

  Trumpington, B.

  Monson, L.

  Vivian, L.

  Montagu of Beaulieu, L.

  Waddington, L.

  Montrose, D.

  Wade of Chorlton, L.

  Moore of Lower Marsh, L.

  Wilberforce, L.

  Moran, L.

  Wilcox, B.

  Mowbray and Stourton, L.

  Willoughby de Broke, L.

  Moynihan, L.

  Windlesham, L.

  Murton of Lindisfarne, L.

  Wolfson, L.

  Naseby, L.

  Wolfson of Sunningdale, L.

  Noakes, B.

  Young, B.

  NOT-CONTENTS

  Acton, L.

  Amos, B.

  Addington, L.

  Andrews, B.

  Ahmed, L.

  Archer of Sandwell, L.

  Alderdice, L.

  Ashley of Stoke, L.

  Alli, L.

  Ashton of Upholland, B.

  818

  Attenborough, L.

  Grenfell, L.

  Avebury, L.

  Hamwee, B.

  Bach, L.

  Hardy of Wath, L.

  Barker, B.

  Harris of Greenwich, L.

  Barnett, L.

  Harris of Haringey, L.

  Bassam of Brighton, L.

  Harris of Richmond, B.

  Berkeley, L.

  Harrison, L.

  Bernstein of Craigweil, L.

  Haskel, L.

  Billingham, B.

  Haskins, L.

  Blackburn, Bp.

  Hattersley, L.

  Blackstone, B.

  Hayman, B.

  Borrie, L.

  Hilton of Eggardon, B.

  Bradshaw, L.

  Hogg of Cumbernauld, L.

  Bragg, L.

  Hollis of Heigham, B.

  Brennan, L.

  Holme of Cheltenham, L.

  Brett, L.

  Hooson, L.

  Bristol, Bp.

  Howells of St. Davids, B.

  Brooke of Alverthorpe, L.

  Hughes of Woodside, L.

  Brookman, L.

  Hunt of Chesterton, L.

  Brooks of Tremorfa, L.

  Hunt of Kings Heath, L.

  Bruce of Donington, L.

  Hutchinson of Lullington, L.

  Burlison, L.

  Irvine of Lairg, L. (Lord Chancellor)

  Carlile of Berriew, L.

  Islwyn, L.

  Carter, L. [Teller]

  Jacobs, L.

  Castle of Blackburn, B.

  Janner of Braunstone, L.

  Chandos, V.

  Jay of Paddington, B. (Lord Privy Seal)

  Chelmsford, Bp.

  Jeger, B.

  Christopher, L.

  Jenkins of Hillhead, L.

  Clarke of Hampstead, L.

  Joffe, L.

  Clement-Jones, L.

  Judd, L.

  Clinton-Davis, L.

  King of West Bromwich, L.

  Cocks of Hartcliffe, L.

  Kirkhill, L.

  Cohen of Pimlico, B.

  Layard, L.

  Crawley, B.

  Lea of Crondall, L.

  Currie of Marylebone, L.

  Lester of Herne Hill, L.

  Dahrendorf, L.

  Linklater of Butterstone, B.

  Darcy de Knayth, B.

  Lipsey, L.

  David, B.

  Lockwood, B.

  Davies of Coity, L.

  Lofthouse of Pontefract, L.

  Davies of Oldham, L.

  Longford, E.

  Dean of Thomton-le-Fylde, B.

  Lovell-Davis, L.

  Derby, Bp.

  Ludford, B.

  Desai, L.

  McCarthy, L.

  Dholakia, L.

  Macdonald of Tradeston, L.

  Diamond, L.

  McFarlane of Llandaff, B.

  Dixon, L.

  Donoughue, L.

  McIntosh of Haringey, L. [Teller]

  Dormand of Easington, L.

  Dubs, L.

  McIntosh of Hudnall, B.

  Elder, L.

  MacKenzie of Culkein, L.

  Elis-Thomas, L.

  Mackenzie of Framwellgate, L.

  Evans of Parkside, L.

  Mackie of Benshie, L.

  Evans of Temple Guiting, L.

  McNally, L.

  Ezra, L.

  Maddock, B.

  Falconer of Thoroton, L.

  Mallalieu, B.

  Falkender, B.

  Mar and Kellie, E.

  Falkland, V.

  Mason of Bamsley, L.

  Farrington of Ribbleton, B.

  Massey of Darwen, B.

  Faulkner of Worcester, L.

  Merlyn-Rees, L.

  Filkin, L.

  Methuen, L.

  Fyfe of Fairfield, L.

  Miller of Chilthorne Domer, B.

  Gale, B.

  Mishcon, L.

  Gavron, L.

  Mitchell, L.

  Geraint, L.

  Gibson of Market Rasen, B.

  Molloy, L.

  Gilbert, L.

  Morgan, L.

  Gladwin of Clee, L.

  Morris of Manchester, L.

  Goodhart, L.

  Murray of Epping Forest, L.

  Gordon of Strathblane, L.

  Newby, L.

  Goudie, B.

  Nicholson of Winterbourne, B.

  Gould of Pottemewton, B.

  Nicol, B.

  Grabiner, L.

  Northover, B.

  Graham of Edmonton, L.

  Oakeshott of Seagrove Bay, L.

  Greaves, L.

  Oxford, Bp.

  Greengross, B.

  Palmer, L.

  Gregson, L.

  Parekh, L.

  819

  Patel, L.

  Smith of Gilmorehill, B.

  Patel of Blackburn, L.

  Smith of Leigh, L.

  Peston, L.

  Stallard, L.

  Pitkeathley, B.

  Stern, B.

  Plant of Highfield, L.

  Stoddart of Swindon, L.

  Ponsonby of Shulbrede, L.

  Stone of Blackheath, L.

  Portsmouth, Bp.

  Strabolgi, L.

  Prashar, B.

  Symons of Vernham Dean, B.

  Puttnam, L.

  Taverne, L.

  Ramsay of Cartvale, B.

  Taylor of Blackburn, L.

  Randall of St. Budeaux, L.

  Thomas of Gresford, L.

  Razzall, L.

  Thomas of Macclesfield, L.

  Rea, L.

  Thomas of Walliswood, B.

  Redesdale, L.

  Thomson of Monifieth, L.

  Rendell of Babergh, B.

  Thornton, B.

  Rennard, L.

  Tomlinson, L.

  Richard, L.

  Tope, L.

  Richardson of Calow, B.

  Tordoff, L.

  Rochester, Bp.

  Turnberg, L.

  Rodgers of Quarry Bank, L.

  Turner of Camden, B.

  Rogers of Riverside, L.

  Uddin, B.

  Roper, L.

  Varley, L.

  Russell, E.

  Wakefield, Bp.

  Russell-Johnston, L.

  Walker of Doncaster, L.

  Sainsbury of Turville, L.

  Wallace of Saltaire, L.

  Salisbury, Bp.

  Walmsley, B.

  Sandwich, E.

  Walton of Detchant, L.

  Sawyer, L.

  Warner, L.

  Scotland of Asthal, B.

  Watson of Invergowrie, L.

  Scott of Needham Market, B.

  Watson of Richmond, L.

  Sewel, L.

  Wedderburn of Charlton, L.

  Sharman, L.

  Whitaker, B.

  Sharp of Guildford, B.

  Whitty, L.

  Shepherd, L.

  Wigoder, L.

  Shore of Stepney, L.

  Wilkins, B.

  Shutt of Greetland, L.

  Williams of Crosby, B.

  Simon, V.

  Williams of Elvel, L.

  Simon of Highbury, L.

  Williams of Mostyn, L.

  Smith of Clifton, L.

  Woolmer of Leeds, L.

  Resolved in the negative, and amendment disagreed to accordingly.
  On Question, Motion agreed to.
  5.4 p.m.

  COMMONS AMENDMENT
  137 Clause 102, page 46, line 26, at end insert—
  ("( ) Sections 496 and 497 of the Education Act 1996 (intervention) shall have effect in relation to powers and duties conferred or imposed by virtue of Schedule 7 as if—

  (a) those powers and duties were conferred or imposed by the Education Act 1996, and

  (b) the bodies specified in sections 496(2) and 497(2) were any local education authority, any school organisation committee and the governing body of any maintained school (within the meaning given by section 20(7) of the School Standards and Framework Act 1998).")

  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 137. In moving this amendment, I shall speak also to Commons Amendments Nos. 210 to 228. In view of the need to make progress, I should like to speak in a little detail about one amendment only, Amendment No. 137. The other amendments in this group address minor and entirely technical points. I am happy to give explanations of any of those if noble Lords require.
  The purpose of Amendment No. 137 is to apply Sections 496 and 497 of the Education Act 1996 to local education authorities, school governing bodies
  820
  and school organisation committees in the exercise of their functions under Schedule 7 to the Bill. Sections 496 and 497 give the Secretary of State powers to take action where certain public bodies act, or propose to act, unreasonably in the exercise of their functions or are in default of their duties. The various bodies involved in proposals for changes to school organisation under the provisions of the School Standards and Framework Act 1998 are subject to the Secretary of State's powers of intervention. The amendment is needed because, unlike the 1998 Act, the Learning and Skills Bill is not "construed as one" with the Education Act 1996. That means that Sections 496 and 497 do not apply automatically.
  Moved, That the House do agree with the Commons in their Amendment No. 137.—(Lord Bach.)
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  138 Clause 103, page 47, line 5, leave out subsection(6)
  139 Clause 104, page 47, line 21, leave out ("and")
  140 Page 47, line 22, at end insert—
  ("and
  ( ) a Primary Care Trust.")
  141 Clause 106, page 48, line 40, leave out ("and city colleges for the technology of the arts,") and insert (", city colleges for the technology of the arts and city academies,")
  142 Leave out Clause 107
  143 After Clause 107, insert the following new clause—

  INSPECTION
  (" .—(1) Her Majesty's Chief Inspector of Schools in England—

  (a) shall advise the Secretary of State on request about matters relating to services provided in pursuance of section 103(1),

  (b) may give the Secretary of State other advice about those matters,

  (c) shall, when requested to do so by the Secretary of State, inspect and report on the provision of those services, and

  (d) may undertake such other inspections of the provision of those services as he thinks fit.

  (2) A request under subsection (1)(c)—

  (a) may be general or in relation to specific matters,

  (b) may relate to a specific person or institution providing services, or to a specific class of person or institution, and

  (c) may relate to a specific area.

  (3) A reference in subsection (1) to the provision of services includes a reference to the management and use of resources in providing services.
  (4) Subsections (5) to (7) apply to an inspection under subsection (1)(c) or (d) of services provided by a person or institution in pursuance of section 103(1).
  (5) A person carrying out or participating in the inspection shall have the same powers as an Inspector of Schools under the following provisions of the School Inspections Act 1996—

  (a) section 3(3)(a) and (b) (right of access), and

  (b) section 42 (computer records).

  (6) Section 42A of the 1996 Act (publication of reports) shall apply.
  (7) A person who wilfully obstructs a person in carrying out or participating in the inspection—

  (a) shall be guilty of an offence, and

  821

  (b) shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale.")

  144 Clauses 108, page 49, line 35, leave out ("age") and insert ("date of birth")
  145 Clause 109, page 50, line 12, after ("the") insert ("persons or")
  146 Page 50, line 15, after ("person") insert ("or body")
  147 Page 50, line 16, after ("Those") insert ("persons and")
  148 Page 50, line 19, at end insert—
  ("( ) a chief officer of police,")
  149 Page 50, line 20, leave out ("and")
  150 Page 50, line 21, at end insert ("and
  ( ) a Primary Care Trust")
  151 Transpose Clause 110 to before Clause 113
  152 Clause 111, page 50, line 33, leave out ("110") and insert ("109")
  153 Page 51, line 5, at end insert—
  ("( ) The power under section 103 shall not be used to provide or secure the provision of services outside England.")
  154 Clause 112, page 51, leave out lines 8 to 39 and insert—

  Inspection.
  10B.—(1)Her Majesty's Chief Inspector of Schools in England—

  (a) shall advise the Secretary of State on request about matters relating to services provided in England in pursuance of section 8 or 9,

  (b) may give the Secretary of State other advice about those matters,

  (c) shall, when requested to do so by the Secretary of State, inspect and report on the provision of those services by any person or institution, and

  (d) may undertake such other inspections of the provision of those services by persons or institutions as he thinks fit.

  (2) A request under subsection (1)(c)—

  (a) may be general or in relation to specific matters,

  (b) may relate to a specific person or institution providing services, or to a specific class of person or institution, and

  (c) may relate to a specific area.

  (3) An inspection under subsection (1)(c) or (d) may not relate to services provided for persons who have attained the age of 20.
  (4) A reference in subsection (1) to the provision of services includes a reference to the management and use of resources in providing services.
  (5) Subsections (6) to (8) apply to an inspection under subsection (1)(c) or (d) of services provided in pursuance of arrangements under section 10(1) of this Act.
  (6) A person carrying out or participating in the inspection shall have the same powers as an Inspector of Schools under the following provisions of the School Inspections Act 1996—

  (a) section 3(3)(a) and (b) (right of access), and

  (b) section 42 (computer records).

  (7) Section 42A of the 1996 Act (publication of reports) shall apply.
  (8) A person who wilfully obstructs a person in carrying out or participating in the inspection—

  (a) shall be guilty of an offence, and

  (b) shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale."").

  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 138 to 154.
  With the exception of Amendment No. 138 and amendments in respect of the inspection of the Connexions Service, to which I shall turn in due course, the majority of these amendments are minor technical adjustments, which will not, I believe, take up much of our time. For example, Amendments Nos. 139, 140, 150 and 151 add primary care trusts to the lists of statutory bodies in Clause 104 which must be consulted about and collaborate in Connexions provision; and in Clause 109 which are empowered to disclose relevant information to the Connexions Service. As new bodies involved in providing local medical services—including services for young people with special educational needs, they will clearly be important statutory Connexions partners.
  So too will chief officers of police, who have responsibilities not only for young people in trouble in their areas, but for the protection of all young people, including the victims of crime. They will have relevant information which is unavailable to the other bodies listed in Clause 109. It is therefore important that they are empowered to disclose such information to the Connexions Service. Amendment No. 148 makes provision for that. It was prompted by work undertaken following, and is indeed identical to, the amendment tabled by the honourable gentleman, the Member for Daventry, in another place. We are grateful to him for his help in this matter.
  Amendment No. 144 changes the reference in Clause 108 from age to date of birth as that corresponds more accurately to the data that is kept on the child benefit register and will be supplied to the Connexions Service under that clause.
  I turn to Amendments Nos. 142, 143 and 154. Together these amendments replace the existing Clauses 107 and 112 in respect of the inspection of the Connexions Service, including careers service provision for young people, in order to make three changes. First, they give Ofsted the independent power to inspect and advise on provision, in addition to its duty to inspect and advise on the service when asked to do so by the Secretary of State.
  Secondly, the amendments put beyond doubt that the scope of inspections may extend to the management and use of resources by providers. Finally, they introduce a criminal sanction against any person wilfully obstructing inspections. This last part is entirely in line with provisions in the Bill and elsewhere in respect of other inspections by both Ofsted and ALI.

  823
  I turn finally to Amendment No. 138. This deletes two additions which were made to Clause 103 in respect of careers provision by the successful amendment moved by the noble Baroness, Lady Sharp, at Third Reading in this House. As the Government explained in another place, our intention with Amendment No. 138 is to remove wording which we believe could inhibit the Connexions Service's ability to improve the quality and delivery of careers provision and to remove a superfluous provision which simply repeats existing statutory duties on the Secretary of State.
  I do not believe any more needs to be said about the technical defects of the provisions which Amendment No. 138 seeks to reverse; rather, the debates it gave rise to both here and in another place helpfully aired the concerns which underlay the provisions. I am happy to provide further reassurances about those matters now.
  We fully recognise that all young people, including those in the average and higher ability ranges and from stable backgrounds, need information, advice and guidance to progress in appropriate learning, particularly at key decision stages in their lives. Failure to provide such support may result in inappropriate decisions which will result in more serious problems, such as dropping out of training or further or higher education. We are determined that all young people should get the help that they need to identify the right path for them and to stay on it. That is why careers advice will be a core element of the Connexions service. We consider it vitally important that all young people receive information and advice on the full range of post-16 opportunities, including opportunities in further and higher education and in work-based learning.
  We are also aware of concerns about the continuing impartiality of careers advice in schools. We have made clear that the Connexions personal adviser in schools will supplement the advice given by careers teachers and, where appropriate, will refer young people to specialist advice and support, including specialist careers advice and guidance. Connexions personal advisers will be appointed and managed by head teachers, but their remit will make clear their responsibility to provide objective careers advice for school pupils.
  We intend to explore further how the role of schools and colleges can be developed in support of improved careers education; how impartial guidance in schools can be developed and technology better used. In addition, we shall be looking to set up rigorous standards for careers information, education and guidance in schools and colleges against which Ofsted might inspect provision.
  There has also been much discussion about how the Connexions service will be resourced. We have said that resources for the service will come from the co-ordination of existing central government resources and from those already devoted by local partners to youth support and guidance. In addition, through the Government's Comprehensive Spending Review we shall be looking to identify any additional resources which may be available to the new service.
  824
  A range of individuals and bodies have attempted to calculate the potential cost of the service in terms of personnel and funding on the basis of existing delivery mechanisms. But of course it will not be possible to arrive at national figures with any precision until proper audits of existing local provision, staffing and need have been completed and until we have explored what existing—and new—delivery mechanisms work well. That is why we are piloting the service and phasing it in over a number of years.
  An adequate supply of personal advisers is, of course, crucial to the effective operation of the Connexions service and it is important that they should not be met at the expense of other essential services. The Connexions strategy document made it clear that we shall be consulting on the implications for professional working in related fields, such as the provision of information, advice and guidance for adults. We have also set up a cross-government group to look at the labour market implications of the demand for personal advisers across public services and how that demand might best be met.
  We are determined that the new service will have sufficient high quality staff to achieve its aims. That is why the rate at which it is phased in will depend partly on the availability of appropriate local personal adviser staff, without adverse effect on other important services.
  Finally, concerns have been expressed about the effect of the Connexions service on the provision of adult careers information and advice services. Adult careers provision is, of course, delivered by a very wide range of private, voluntary and public sector providers. As the Connexions specification makes clear, it will be critical to ensure that effective careers provision for adults is coherent with that for young people. Information, advice and guidance partnerships are currently leading in the development of such services for adults, and the Connexions service locally will be represented as members of those partnerships. Indeed, in some areas, partners in the Connexions service may act as the lead body for advice and guidance services for adults. Connexions partnerships will need to take those arrangements into account when developing their plans and services.
  I hope that, with the assurances I have given, noble Lords will agree that Amendment No. 138, like the other Commons amendments in this group should stand.
  Moved, That the House do agree with the Commons in their Amendments Nos. 138 to 154.—(Lord Bach.)
  5.15 p.m.
  Baroness Blatch: My Lords, I have heard it bandied around that between 20,000 and 47,000 advisers are to be employed. Can the Minister give us the figure and tell us how much it will cost?
  Baroness Sharp of Guildford: My Lords, I wish to speak to Amendment No. 138. I was sad to see that the Government dropped what I felt was our elegantly worded, redrafted subsection of the Bill. As the

  825
  Minister argued during many phases of discussion in this House, the additional words were unnecessary. She gave us repeated assurances, which were also given by the Minister in the other place, that the intention of the new Connexions service was not to diminish in any way the quality or quantity of careers information advice and guidance given to the general run of students; it was to ensure that such advice was available to those who, in the past, had failed to obtain it. Yet it was precisely because they lacked the skills and qualifications—and jobs—that they needed it more.
  As I made clear in our discussions through all stages of the Bill, I did not dispute the logic of that argument. From these Benches we support wholeheartedly the emphasis on the disadvantaged and the concern to equip those who have dropped out of the schooling process with skills and capabilities which can help them to play a full and useful role in society. But on the practical side of those ambitions, things do not add up. There is neither enough money nor enough people to fulfil both those functions adequately. That may be changed by this afternoon's announcement in the other place. I hope that we see a generous settlement for education which will allow those ambitions to be fulfilled.
  There are real problems in terms of the supply of people who are suitable to be mentors and their training. For that reason I take on board and welcome the fact that, as the Minister said, the new services are to be phased in. But the evidence on the front line at the moment is that both services are not being provided. Instances have been drawn to my attention where schools have lost the advice and guidance and it is being claimed that that is because there are pressures on the Careers Service to fulfil their Connexions responsibilities in other ways.
  I can see that, inevitably, there will be glitches in the process of transition; I accept that. But I hope that the ambitions of the Government are fulfilled and that we see enough resources and training to do that.
  Lord Bach: My Lords, in response to the noble Baroness, Lady Blatch, I am afraid I cannot give her either a figure or the cost. Everything depends on the planning from the bottom up. We have always made that absolutely clear.
  Baroness Blatch: My Lords, I am grateful to the noble Lord for giving way. Does that mean that there is an open-ended budget? Whatever the number is, will there be money to fund it? If so, what is the budget head for it?
  Lord Bach: My Lords, the noble Baroness need not worry. Of course it is not an open-ended budget; there never is one. But we have to make certain, from when the planning begins, that we get this right. It would be ridiculous and misleading to the House to suggest a number and cost at this stage.
  826
  The criticism of the amendment that was successful here was not that it was not elegantly worded; it certainly was. But we felt that it was a little imprecise and obviously the other place agreed. However, the concerns expressed by the noble Baroness, Lady Sharp, today, will be very much taken on board.
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  155 After Clause 112, insert the following new clause—
  ("Support for 11 to 25 year olds: Wales

  PROVISION OF SERVICES
  .—(1) The National Assembly for Wales may direct a local authority—

  (a) to provide youth support services;

  (b) to secure the provision of youth support services;

  (c) to participate in the provision of youth support services.

  (2) In this section "youth support services" means services which in the opinion of the National Assembly will encourage, enable or assist young persons (directly or indirectly) —

  (a) to participate effectively in education or training,

  (b) to take advantage of opportunities for employment, or

  (c) to participate effectively and responsibly in the life of their communities.

  (3) In this section "young persons" means persons who have attained the age of 11 but not the age of 26.
  (4) A direction under subsection (1) —

  (a) may include provision for grants, loans and other kinds of financial assistance to be provided by the National Assembly (whether or not on conditions),

  (b) may require local authorities to have regard to guidance issued by the National Assembly, and

  (c) may require local authorities when making arrangements with other persons to require those persons to have regard to guidance issued by the National Assembly.

  (5) A direction under subsection (1) —

  (a) may relate to a particular class of young person;

  (b) may make different provision for different classes of young person;

  (c) may be revoked or varied by a later direction.")

  156 Insert the following new clause—

  LOCAL AUTHORITY: DUTY AND POWERS
  (" .—(1) A local authority—

  (a) shall comply with a direction given to it under section (Provision of services)(1), and

  (b) may provide, secure the provision of or participate in the provision of youth support services otherwise than in accordance with paragraph (a).

  (2) Action which a local authority takes in pursuance of subsection (1)—

  (a) may relate to a particular class of young persons;

  (b) may relate to services for a person from another area.

  (3) In complying with a direction under section (Provision of services)(1) a local authority shall have regard to the expediency of co-operation with voluntary organisations.
  (4) For the purpose of subsection (1) a local authority may—

  (a) incur expenditure;

  (b) employ officers;

  (c) enter into agreements for the supply of goods or services;

  (d) do anything else (other than forming companies) which they consider necessary or expedient.

  (5) Nothing in or done under section (Provision of services) shall prejudice any power of a local authority to provide services or incur expenditure.")
  157 Insert the following new clause—

  CONSULTATION AND COORDINATION
  (" .—(1) Before complying with a direction under section (Provision of services)(l) by providing, securing the provision of or participating in the provision of services for residents of a particular place or area, a local authority shall consult each of the following with responsibility for all or part of the area—

  (a) a Health Authority,

  (b) a chief officer of police,

  (c) a police authority,

  (d) a probation committee, and

  (e) a youth offending team.

  (2) The local authority shall also—

  (a) consult any voluntary body which provides services for young persons in the place or area concerned and which the local authority think it appropriate to consult,

  (b) consult the National Council for Education and Training for Wales,

  (c) consult any authority or person with whom arrangements have been made for the place or area concerned under section 10(1) or (3)(a), (b) or (c) of the Employment and Training Act 1973 (careers services),

  (d) consult any relevant organisation established for the purpose of enabling voluntary bodies to co-operate and co-ordinate their activities,

  (e) consult such other persons as the local authority think appropriate, and

  (f) provide such opportunities as the local authority think appropriate for young persons in the place or area concerned to express their views.

  (3) Subsection (4) applies where a local authority—

  (a) provide or propose to provide youth support services for the residents of a particular place or area, or

  (b) secure or propose to secure the provision of youth support services for the residents of a particular place or area.

  (4) Where this subsection applies, persons and bodies listed in subsection (1) with responsibility for all or part of that place or area shall—

  (a) exercise their functions so as to support and assist the services provided, secured or proposed by the local authority, and

  (b) coordinate the exercise of their functions, so far as seems reasonable, with persons providing those services.

  (5) Subsection (4) shall not require persons or bodies to take action which would significantly interfere with the efficient or effective exercise of their functions.")
  158 Insert the following new clause—

  EDUCATIONAL INSTITUTIONS: INFORMATION AND ACCESS
  (" .—(1) Where a person is involved in the provision of services in pursuance of section (Provision of services)(1)(a) or (b), an educational institution to which this section applies shall, for the purpose of the provision of those services—

  (a) provide him on request with the name and address of a pupil or student;

  (b) provide him on request with the name and address of a parent of a pupil or student;

  (c) provide him on request with information in the institution's possession about a pupil or student;

  (d) permit him to have access to a pupil or student on the institution's premises at reasonable times;

  828

  (e) make available to him, so far as is reasonably convenient, facilities on the institution's premises for providing services to individual pupils or students or groups of pupils or students.

  (2) Information shall not be provided under subsection (1)(c)—

  (a) in the case of a pupil or student who has not attained the age of 16, if a parent of his has instructed the institution not to provide information of that kind under this section, or

  (b) in the case of a pupil or student who has attained the age of 16, if he has instructed the institution not to provide information of that kind under this section.

  (3) This section applies to the following institutions—

  (a) community, foundation and voluntary schools,

  (b) community or foundation special schools (other than those established in hospitals),

  (c) city technology colleges and city colleges for the technology of the arts,

  (d) pupil referral units,

  (e) institutions within the further education sector, and

  (f) institutions in receipt of funding from the National Council for Education and Training for Wales.")

  159 Insert the following new clause—

  INSPECTION
  (" .—(1) Her Majesty's Chief Inspector of Education and Training in Wales—

  (a) shall advise the National Assembly for Wales on request about matters relating to services provided in pursuance of section (Provision of services)(1),

  (b) may give the National Assembly other advice about those matters,

  (c) shall, when requested to do so by the National Assembly, inspect and report on the provision of those services, and

  (d) may undertake such other inspections of the provision of those services as he thinks fit.

  (2) The National Assembly shall consult the Chief Inspector before making a request under subsection (1)(a) or (c).
  (3) A request under subsection (1)(c)—

  (a) may be general or in relation to specific matters,

  (b) may relate to a specific person or institution providing services, or to a specific class of person or institution, and

  (c) may relate to a specific area.

  (4) A reference in subsection (1) to the provision of services includes a reference to the management and use of resources in providing services.")
  160 Insert the following new clause—

  CONDUCT AND EFFECT OF INSPECTIONS
  (" .—(1) This section applies where a service is inspected pursuant to a request under section (Inspection)(1)(c) or in accordance with section (Inspection)(1)(d).
  (2) A person carrying out or participating in the inspection shall have the same powers as an Inspector under the following provisions of the School Inspections Act 1996—

  (a) section 6(3)(a) and (b) (right of access), and

  (b) section 42 (computer records).

  (3) Section 42A of that Act (publication of reports) shall apply.
  (4) Where the Chief Inspector arranges for the publication of a report of an inspection, the person who provides the inspected service shall—

  (a) prepare a written statement of the action which he proposes to take in the light of the report and the period within which he proposes to take it,

  829

  (b) publish the statement within such period, and in such manner, as may be prescribed by regulations made by the National Assembly for Wales, and

  (c) send copies of the statement to such persons as may be prescribed by regulations made by the National Assembly.

  (5) Where a local authority provides an inspected service, or secures or participates in the provision of an inspected service, the authority—

  (a) shall ensure that the action specified in any statement prepared under subsection (4)(a) is sufficient to remedy any weakness mentioned in the report, and

  (b) shall take all reasonable steps to ensure that the action specified in the statement is taken within the period specified.

  (6) If the National Assembly consider that a local authority is failing to comply with its duties under subsection (5)—

  (a) the National Assembly may give directions to the local authority about the performance of those duties, and

  (b) the authority shall comply with the directions.")

  161 Insert the following new clause:

  SUPPLEMENTARY
  (" .—(1) In sections (Provision of services) to (Conduct and effect of inspections)—

  "local authority" means a county council or a county borough council,

  "Health Authority" has the meaning given by section 8 of the National Health Service Act 1977,

  "parent", in relation to a child, means a person who has parental responsibility for him within the meaning of section 3 of the Children Act 1989,

  "probation committee" means a committee established under section 3 of the Probation Service Act 1993,

  "police authority" has the meaning given by section 101 of the Police Act 1996,

  "young person" has the meaning given by section (Provision of services)(3),

  "youth offending team" means a team established under section 39 of the Crime and Disorder Act 1998, and

  "youth support services" has the meaning given by section (Provision of services)(2).

  (2) The power under section (Provision of services) shall not relate to services which are provided or to be provided outside Wales.")
  Baroness Farrington of Ribbleton: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 155 to 161. In moving these amendments, I shall speak also to Amendment No.169.
  Perhaps I may begin by setting out the background to these amendments. The new clauses that they insert into the Bill on youth support services for 11 to 25 year-olds in Wales flow from our consultative Green Paper, Learning is for Everyone, which was published in April 1998, and consideration of youth issues by the National Assembly.
  The new clauses prepare the ground for the Assembly to introduce a distinctive Wales approach to support services for young people in partnership with Welsh local authorities and in co-operation with the voluntary sector, and others. They will enable the National Assembly, in consultation with local authorities and others, to introduce measures aimed
  830
  at: supporting young people in the transition to adulthood and independence, so that they maximise their potential as individuals and as members of groups and communities; encouraging young people of compulsory school age to remain in education or training and encouraging people up to the age of 25 to remain in, or return to, education or training; providing young people with information and counselling services and co-ordinating other support services; identifying disaffected, disengaged and socially excluded young people, meeting their needs for support and bringing them into or back into education and training; and preventing offending and other risk-taking behaviour by young people in co-operation with organisations that have specific responsibility in those fields.
  The amendments will strengthen and improve the statutory basis for youth support services and underpin National Assembly initiatives aimed at enhancing services for children and young people in Wales. They have been warmly received by the Welsh Grand Committee. They represent good news for Wales and are a clear and potent example of devolution in action. The amendments demonstrate how effectively the National Assembly, the Wales Office and UK government Ministers work together, with common purpose, in the best interests of Wales.
  In commending these amendments to the House, perhaps I may point out that I did note the concern raised by the noble Lord, Lord Roberts. I take his point about the period of time that it took to ensure, so close to the enactment of devolution, the appropriate circumstances for meeting in full the needs determined by Welsh people for people in Wales. I thank the noble Lord for his patience and hope that we now have his support.
  Moved, That the House do agree with the Commons in their Amendments Nos. 155 to 161.—(Baroness Farrington of Ribbleton.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  162 After Clause 112, insert the following new clause—
  ("City colleges and academies

  CITY ACADEMIES
  .—(1) Section 482 of the Education Act 1996 (city technology colleges and city colleges for the technology of the arts) shall be amended as follows.
  (2) In subsection (2)(c)—

  (a) omit "either", and

  (b) after "arts" insert "or on a subject area mentioned in subsection (2A)".

  (3) After subsection (2) insert—
  "(2A) The subject areas are—

  (a) modern foreign languages;

  (b) visual arts, performing arts or media arts (or any combination of them);

  (c) sport;

  831

  (d) any subject specified by order by the Secretary of State."

  (4) In subsection (3) after paragraph (b) insert ", or
  (c) as a city academy, if the emphasis of its curriculum is on a subject area mentioned in subsection (2A)."
  (5) After subsection (3) insert—

  "(3A) A school established on or after the relevant day and which would otherwise, by virtue of subsection (3), be known as a city technology college or a city college for the technology of the arts may instead, if the person carrying it on so chooses, be known as a city academy.

  (3B) Before entering into an agreement under this section in relation to a school to be known as a city academy, the Secretary of State must consult the local education authorities referred to in subsection (3C) about the establishment of the school.

  (3C) The authorities are—

  (a) the local education authority in whose area the school is to be situated, and

  (b) if the Secretary of State thinks a significant proportion of the pupils at the school is likely to be resident within the area of another local education authority, that authority."

  (6) After subsection (5) insert—
  "(6) For the purposes of subsection (3A) the relevant day is the day on which section (City academies) of the Learning and Skills Act 2000 comes into force."
  (7) This section does not apply to schools in Wales.")
  Baroness Blackstone: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 162. In moving this amendment, I shall speak also to Amendments Nos. 163 to 165 and 229. Perhaps I should mention at the beginning of my remarks that I believe there is a small error on the groupings list. It refers to this group as relating to Amendments Nos. 162 to 164, whereas it should refer to Amendments Nos. 162 to 165.
  These are important amendments. They provide for the establishment of city academies—a new type of school intended to provide new opportunities for pupils in our most deprived urban areas. I am very sorry that this House has not been able to debate these provisions until now. The city academy policy is new, but I am glad that a number of noble Lords were able to attend a meeting held last week to consider the Government's proposals.
  City academies are a logical and necessary extension of existing policies, such as Excellence in Schools and Fresh Start. If we are to ensure that all pupils, especially those from the most disadvantaged and challenging areas, have the opportunities that they deserve, the Government recognise that we need radical action. The Government have set LEAs a challenge: by the year 2004 at least 20 per cent of pupils in every secondary school should achieve five or more GCSEs at grades A to C; and by the year 2006, at least 25 per cent of pupils should reach that bench-mark.
  However, there is a long way to go. In 530 secondary schools in England last year—one in six of the total—fewer than 25 per cent of pupils achieved five or more GCSEs at Grades A to C. Many of those schools are in our major conurbations, serving communities that
  832
  are disadvantaged and at risk of social exclusion. Many schools in these areas do succeed, often in the face of quite incredible odds. But we need to ensure that every school is a successful school. All the young people in these areas need access to high quality schools that have the vision and determination to succeed.
  The city academy route will be one way to provide such schools. In most cases city academies will replace existing poorly-performing schools. This might involve a city academy replacing one school that is closing. Alternatively, a city academy might be set up as part of a wider re-organisation to replace two or three schools. In a few cases, city academies will be new schools set up in areas of under-achievement where there is a need for new places.
  Initially, we expect to fund up to 10 pathfinder city academies. We shall want to monitor their progress carefully, so that we take account of their experiences in our wider work to raise standards. In all cases, we expect the decision to establish a city academy to be reached following local discussions and debates. We are not looking for a simplistic definition of schools that should become city academies: we will want to look at the individual circumstances of schools; the nature of the area that they serve; and the challenges that they face. Above all, we will want to look at whether closing the existing school and setting up a city academy would offer better opportunities for pupils.
  City academies will be mixed-ability secondary schools, employing qualified teachers. They will be specialist schools offering a curriculum focus drawn from the range that applies to all specialist schools. Amendment No. 162 also gives the Secretary of State the power to specify by order other subject areas. We want to encourage innovation and creativity and so we do not want to close the door to any new ideas.
  City academies will be set up and run by sponsors from the private and voluntary sectors. Sponsors will contribute to the capital costs of city academies, but will not be required to provide any part of the running costs. City academies will be funded at the same level as similar LEA schools in the same area. The only additional funding that they receive will be to take account of the services that LEAs provide for their own schools free of charge. They will also receive the same per pupil funding as other specialist schools.
  City academies will be accountable to the Secretary of State through a funding agreement that will cover the key elements of their governance and management and the characteristics of the education that they provide. City academies will have considerable freedom to manage their own affairs. They will be able and expected to use that freedom to try out new approaches to curriculum development and delivery; to school management and organisation; and to the length of the school day, term and year.
  City academies will be different from the schools that they replace and from other maintained schools. But they will not be divorced from the local family of schools or, indeed, from the LEA. On the contrary, we

  833
  expect them to be set up with the involvement and support of LEAs. The prospectus for sponsors makes this very clear. We want close links between LEAs and city academies, both while the academy is being set up and once it opens its doors to pupils. We recommend that the LEA—and other local interests—should be represented on each city academy's governing body.
  Against that background, I am delighted to tell the House that we have received a very encouraging response from several LEAs which have welcomed this initiative and can see how a city academy might benefit their pupils. We have also been approached by a number of potential sponsors from the business world and from the voluntary sector who are interested in sponsoring these academies.
  We want city academies to be at the heart of their communities and to work with other local schools. All the schools in our specialist schools programme are required to share their expertise, facilities and good practice with other schools. It will be the same for city academies. The latter will have admission arrangements that are consistent with admissions law and with the codes of practice on admissions. They will work to meet the needs of challenging pupils and will not be able to exclude pupils more readily than other schools.
  Many noble Lords have long taken a particular and close interest in the education of children with special needs. Let me emphasise that city academies will cater for children with special educational needs—both those with and without statements. We are taking this opportunity to clarify the law about provision for pupils with statements of special educational need attending city academies and city technology colleges. There has been some confusion about the Education Act 1996. Amendment No. 165 amends that Act by inserting a clause providing a regulation-making power for the Secretary of State to govern the powers and duties of LEAs in respect of pupils with statements who attend CTCs and city academies.
  In particular, this will mean that LEAs are able to pay CTCs and city academies for the provision they make for pupils with statements and will also be able to provide other in kind support and assistance to CTCs and city academies in connection with such pupils. We intend to consult widely with organisations involved with special educational needs before these regulations are made. I am pleased that the Select Committee on Delegated Powers and Deregulation recognised the importance we are placing on that full consultation before we use this power.
  Amendments Nos. 163 and 229 are concerned with the provision of land for the purposes of setting up a city academy. They allow the Secretary of State to transfer land which has been used as a community school to a sponsor for use as a city academy. I must emphasise that we envisage that these provisions will be used rarely. In the great majority of cases we expect the sponsor and the LEA to work out together the arrangements for providing land for city academies. That is the spirit of this initiative and the prospectus makes this clear. But there may be rare cases where an
  834
  LEA unreasonably sets its face against a city academy. It would be wrong to allow intransigence of that kind to deprive pupils of the opportunities a city academy could bring. In such circumstances—and as a last resort—it must be right for the Secretary of State to have the reserve powers to transfer land to a sponsor. Before exercising this power the Secretary of State would have to consult the LEA. There are important safeguards in Amendment No. 229 which mean that land transferred to a sponsor for a city academy can only be used for a city academy.
  It may be helpful to the House if I use this opportunity to respond to the amendment of the noble Baroness, Lady Sharp, although I shall, of course, listen carefully to what she has to say and respond in more detail later. I understand the intention behind Amendment No. 162A. I have made clear our hopes that LEAs and city academies will work closely together. Government Amendment No. 162 provides already for LEAs to be consulted before a city academy is established. This gives the LEA the opportunity to make its views known and these will have to be taken into account by my right honourable friend the Secretary of State.
  Co-operation between city academies and LEAs should rightly be agreed between them. They will, after all, have a shared interest in securing the best education for all the young people in the area. Our experience so far is that LEAs and sponsors want to work together. Against that background, Amendment No. 162A is unnecessary. It sends a signal that we do not expect city academies and LEAs to be able to work together freely. That would be wholly opposed to the nature of the experiment that we are introducing.
  Let me outline what we expect to happen for each of the areas covered by Amendment No. 162A. The governance of each city academy is a matter for the city academy and the Secretary of State. We expect local interests always to be represented on the governing body and we have said in the prospectus that we are encouraging sponsors to appoint LEA representatives.
  So far as admissions are concerned, we have given assurances in the other place, in this House and elsewhere that the funding agreement between the city academy and the Secretary of State will require each city academy to have admission arrangements which are consistent with admissions law and the DfEE codes of practice which apply to maintained schools. I am happy to give a further firm commitment to the House that this requirement will be non-negotiable.
  Similarly, we shall require proposals for city academies to set out clearly their plans for pupil support and these would be included in the funding agreement. We have made clear that city academies should not be able to exclude pupils more readily than other schools. We expect city academies to be involved in local initiatives with other schools to support challenging pupils.
  As with all schools, the main responsibility for monitoring pupil achievement rests with the school itself. Of course, LEAs have an important role in challenging and supporting the schools they maintain. But city academies will not be maintained by LEAs.

  835
  I hope that the noble Baroness will recognise the value of these firm commitments on these important issues and that with the assurances I have been able to give she will not feel the need to press her amendment. Our proposals for city academies offer a real change and an opportunity to raise standards by breaking the cycle of underperformance and low expectations. I commend these amendments to the House.
  Moved, That the House do agree with the Commons in their Amendment No. 162.—(Baroness Blackstone.)

  AS AN AMENDMENT TO COMMONS AMENDMENT NO. 162
  162A Line 35, at end insert—
  ("(3D) On an application by the local education authority in whose area the school is situated, the Secretary of State shall direct the person who is to conduct the school under subsection (1) to agree arrangements for governance, pupil admissions, pupil support and monitoring pupil achievements with the local education authority.").
  5.30 p.m.
  Baroness Sharp of Guildford: My Lords, I beg to move Amendment No. 162A. I thank the Minister for the reply that she has already given to my amendment. However, in discussing the amendment, I wish to speak more generally about city academies. As the Minister rightly pointed out, this is the first time we have had the opportunity to debate them in this House.
  I should like to begin by discussing the more general issue. We on these Benches are sympathetic to the measures which the Government are putting forward which seek to improve the position of inner city schools in disadvantaged areas which have a disproportionately large number of people with all the multiple problems of poverty and who live in rundown communities. We have long argued that these schools should be in the front line of the fight against poverty and need more resources, more talented teachers and innovative programmes.
  However, we see these proposals for city academies not as part of a co-ordinated strategy on the part of the Government to cope with these issues but, regretfully, as another ad hoc piece of legislation and another gimmick adding to an already complex situation for these schools. We already have community schools, foundation schools, Church schools and city technology colleges, all of which have different set-ups, different relations with local authorities and different governance systems.
  On Report in the other place the Secretary of State made it quite clear that the new academies were not, like city technology colleges, to be placed outside the local authority system. On the contrary, he said,
  "City academies are not like the old city technology colleges—15 of them parachuted in like cuckoos in the nest, for good or ill … I have made it clear that the admissions code will hold, and that schools cannot be parachuted in … It is clear—and I shall make it explicit in the funding agreement—that city academies will co-operate with the admissions forum and seek to work in partnership with other schools in the neighbourhood. This is a collaborative, not a competitive, approach".—[Official Report, Commons, 27/6/00; cols. 751–54.]
  836
  The noble Baroness echoed the words of the Secretary of State in that regard. However, the question then arises: why is this legislation necessary? The Secretary of State already has sufficient powers to set up such city academies without having to pass special measures to set them up as, in effect, city technology colleges with a wider remit to enable them to be arts colleges and not just technology colleges. The key issue is that of independent sponsors whose only function is to contribute 20 per cent of capital funding. All revenue funding is to come from the LEAs. However, in return for their 20 per cent capital contribution, the sponsors have the freedom to set up their own management structures and processes.
  The initial draft prospectus had little to say about local government except that the sponsors would liaise with local education partners, including the LEA and other schools. But the revised prospectus which has been issued more recently has shown that the Government expect that city academies will be established with the consent of local education authorities. We take that on board. It contains reference to local government—including encouraging sponsors to invite the LEA to nominate a representative to the governing body—and to the LEA role in identifying potential schools and proposing closures. A government amendment at the Commons Report stage requires the Secretary of State to consult with LEAs about the establishment of city academies. This is one of the amendments we are considering.
  However, despite this requirement to consult and the emphasis on partnership, there remain doubts. A requirement to consult does not mean that the Secretary of State will react to the concerns of local authorities. City academies will essentially remain outside the sphere of local government and, consequently, separated from the integrated range of services that local government offers. The amendment seeks to address these concerns. If city academies are meant to be at the heart of the community they need to have community representation on the governing body.
  Arrangements for governance will allow for community representation on that governing body—not only a single representative nominated by the LEA. Arrangements for pupil admissions will ensure that admissions are fair—with no interviewing—and inclusive and will reflect the local population. Arrangements for pupil support will ensure that children in city academies will have access to the same support arrangements that operate in LEAs, including welfare benefits, support for children at risk of exclusion and education welfare officers. Arrangements for monitoring pupil achievements outside the Ofsted school inspection system are essential to the Government's policy objective of raising standards. The LEA should have the ability to monitor the achievements of all local schools provided through their financing.

  837
  Moved, That Amendment No. 162A, as an amendment to Commons Amendment No. 162, be agreed to.—(Baroness Sharp of Guildford.)
  Baroness Blotch: My Lords, the noble Baroness said that she was sorry that we were unable to debate these proposals earlier. However, I am deeply saddened that I was not shown the courtesy of being given notice that these amendments were being laid in another place; nor did I receive the consultation papers. I have had to go around carrying out detective work to obtain information about what the Government were doing. It is not unusual—I have made this complaint before—but I wish to register it for the record.
  My noble friend Lord Baker, who is in his place, developed city technology colleges. They have been hugely successful—so successful, in fact, that the Government have not only retained them but are building on that experience. My noble friend Lord Harris of Peckham has been incredibly generous in respect of his CTC, and many other people have been equally generous.
  Perhaps I may ask the noble Baroness a number of questions. First, following consultation, but without the consent of an LEA and without the consent of the governing body of a school which is destined to become a new academy, can the Government set objections aside and press on with the development of a city academy anyway? In which case, will every child in the school have the right to become a pupil of the new city academy? My understanding of a reply given to a question in another place is that Estelle Morris referred to "some" children having a right to transfer to the new city academy. If that is the case, what happens to those children who do not?
  It is said that city academies will be all-ability schools which cater for pupils who are 11 to 16 or 11 to 18 years' old, according to the pattern of local provision; so, too, do all comprehensives, city technology colleges and many other schools. It is said that they will be situated in major urban areas; well, such schools are in such areas. It is said that schools will be at the heart of their communities, sharing their facilities with other schools and the wider community; all schools are at the heart of their communities and many of them share their facilities with the wider community. Schools will be registered as independent schools, subject to inspection by Ofsted, and charge no fees; that, of course, is the case with CTCs.
  Schools will have state-of-the-art facilities, with sponsors making a contribution; that, of course, is the case with CTCs—but why should it be only these schools with state-of-the-art facilities? What makes them distinctive? They will be owned and run by sponsors; so are CTCs. They will be schools with a broad curriculum but with special emphasis in an area of the curriculum such as science, languages, arts or sport; our specialist schools do that. They will be schools developing in their pupils the qualities of enterprise, self-reliance and responsibility which young people need for adult life; I would hope that that
  838
  is a mission for all of our schools. They will be schools aiming to secure the highest possible standards of achievement, never satisfied with past levels of achievement; I hope that also applies to all other schools. What is distinctive about the city academies when compared to city technology colleges and our specialist schools?
  5.45 p.m.
  Lord Baker of Dorking: My Lords, earlier I was critical of the Government's policy on grammar schools; on this occasion I fully support the proposals tabled by the noble Baroness. I think these academies are an excellent idea, for several reasons. First, they will be based in the inner city areas, which, as everyone recognises, present the most difficult educational problems. Secondly, they will be supported by local industry—in fact the Government expect £2 million per college to be contributed. I hope that they will be successful in that. When we set up the city technology colleges we raised some £44 million for the first 15 colleges. For me, it was quite easy money to raise. I hope that the noble Baroness will find it as easy to raise money from industry and commerce as we did.
  Thirdly, they will be independent of local government. I certainly congratulate the Government on this. When I introduced the technology colleges I was lambasted for this particular proposal. The original CTCs were independent of local authorities and that gave them the freedom and flexibility they needed. They could experiment with timetabling; with opening and closing schools at different hours; with varying the holidays of the year and so on. The city academies should have the same degree of freedom.
  The fourth reason I welcome the academies is that the Government have done something that I did not perhaps have the percipience to do: they have taken powers—which, if I had introduced them, would have been accused of being draconian—to transfer the property of schools at no charge to the city academies. When I came to set up the city technology colleges, the schools said "Our school is worth £4 million or £5 million for development value; please give us £4 million or £5 million". The Government have sensibly taken these draconian measures—which I fully support—to transfer the schools. That is not a loss to the local community; it is transferring an existing educational asset, which is defunct and not operating correctly, into an educational asset which is properly run.
  I am very glad to support the Government. As I say, the academies will be virtually indistinguishable from city technology colleges, whatever oratory and clever words the Government may use. I do not complain about that. I always feared that when the Government came to power in 1997 they would stand by their original proposal to abolish the CTCs. Not only have they not done that; they have expanded them into a

  839
  network of 700 colleges. Collectively, they produce some of the finest schools in the country. I hope that the academies will be a considerable addition to them.
  Lord Roberts of Conwy: My Lords, perhaps I may briefly note the fact that Wales is entirely excluded from the proposals relating to city colleges and academies. I can think only of one reason for that—namely, that the National Assembly did not foresee certain circumstances in which they would be needed. In that case, we should all remind ourselves of a saying I once heard Nye Bevan utter—namely, that one of our troubles is that we plan for society as it is rather than for society as we would wish it to be.
  I welcome very much the youth services support referred to in the last group of amendments, but I am somewhat surprised that this initiative is not being made applicable to Wales as well. What is good enough for England is usually good enough for Wales.
  Baroness Blackstone: My Lords, I am grateful to the noble Baroness, Lady Sharp, and to the noble Lords, Lord Baker and Lord Roberts, for their support for this idea. City academies are intended as a radical solution to very intractable problems. Perhaps I may say to the noble Baroness, Lady Sharp, that they are in no sense a gimmick. They are designed to try to find our way through a problem with which successive governments have found it difficult to deal. Let us be clear. They are not the only solution. And nor are we intending to impose them on unwilling communities.
  Perhaps I may say to the noble Baroness, Lady Blatch, that it would be unthinkable for us to set up city academies against local opposition. In most cases the LEA or the school itself will publish the proposals which lead to a school closing so that a city academy can be set up. In very rare cases the Secretary of State could use his powers under the School Standards and Framework Act to propose the closure of a school which is already seriously failing. But, in doing that, he would want to take account of local views.
  The noble Baroness asked whether pupils who have been at a school which is being closed, with a city academy being formed in its place, would go on as pupils in the city academy. We certainly expect that the vast majority of pupils at schools replaced by city academies will transfer to the city academy. However, it would be a mistake to try to lay down hard and fast rules now which could not possibly take account of particular cases. For example, the establishment of a city academy may be part of a reorganisation where several schools are closing or changing size. Two schools might be merged and be replaced by a single city academy. Where that happened, pupils might prefer to transfer to another local school rather than to the city academy. Parents might also choose to send their children to a school other than the city academy. What we are clear about is that we do not want to create surplus places.
  The noble Baroness asked about the difference between CTCs and city academies. The noble Lord, Lord Baker, was perfectly happy to have city academies that would be slightly different from CTCs.
  840
  The first respect in which they will be different is that, unlike CTCs, the creation of city academies will not create surplus places and in that sense threaten other schools in the area. Secondly, and perhaps even more importantly, they will have fair and open admissions systems. CTCs were set up able to interview applicants and take into account rather subjective criteria, such as parental commitment. Finally, city academies will be required to use their specialist status to benefit other schools too. Those are all important differences.
  Perhaps I may respond to what the noble Lord, Lord Roberts, said about Wales. The provision does not apply to Wales because the National Assembly decided that it did not want these powers. The noble Lord will have to go back to his colleagues in the National Assembly on that point.
  I return to the points raised by the noble Baroness, Lady Sharp. I can assure the House that governance arrangements for city academies will be transparent and will ensure that they do reflect best practice from the maintained and independent sectors on all the key issues—from child protection to financial probity, the involvement of parents, and so on. I have already given an assurance about admissions arrangements. The LEA will also have the ability to make representations to the Secretary of State should it have concerns about them. I accept that proper arrangements for pupil support are essential and we will ensure that the funding agreement for each city academy gives proper attention to that. But city academies are to have the freedom to devise new solutions. That is the whole point of them. We do not want them to be constrained in what they are doing.
  For all schools, working to ensure that pupils achieve their full potential is by far the most important task. We know that careful monitoring of pupil achievements is the key to achieving high standards. That work must be first and foremost the responsibility of the school itself. The prospectus makes it clear that city academies will set targets against agreed performance indicators.
  I hope that, taken together with my earlier comments, the noble Baroness will feel that we have given adequate reassurances about our plans for city academies. In particular, I hope that the House will agree that our plans give city academies the freedom they need to be truly innovative and that they also protect the interests of the young people who will attend them and the other schools in the area. With that in mind I trust that the noble Baroness will feel able to withdraw her amendment and join the House in agreeing with the Commons amendments.
  Baroness Sharp of Guildford: My Lords, I thank the Minister for her reassurances on these issues. It is clear that if city academies are to succeed they have to be in the heart of their local communities and work extremely closely with their local education authorities. I take on board the Minister's assurances that that will be the case. I beg leave to withdraw the amendment.
  Amendment No. 162A, as an amendment to Commons Amendment No. 162, by leave, withdrawn.

  841
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  163 After Clause 112, insert the following new clause—

  CITY ACADEMIES: LAND
  (" .—(1) Schedule (City academies: land) contains provisions about land in relation to city academies.
  (2) That Schedule does not apply to land in Wales.")
  164 After Clause 112, insert the following new clause—

  CITY ACADEMIES: FINANCIAL PROVISIONS
  (" . In section 483 of the Education Act 1996 (city colleges: financial provisions) after subsection (3) there shall be inserted—
  "(3A) If the school is a city academy, subsection (3) shall apply with such modifications (if any) as may be specified by the Secretary of State by order."").
  165 After Clause 112, insert the following new clause—

  CITY COLLEGES AND ACADEMIES: SPECIAL EDUCATIONAL NEEDS
  (" . After section 483 of the Education Act 1996 there shall be inserted—
  CITY COLLEGES AND ACADEMIES: SPECIAL EDUCATIONAL NEEDS

    City colleges and academies: special educational needs.
    483A.—(1) This section applies in relation to any child falling within subsection (2) if the condition in subsection (3) is satisfied.
    (2) A child falls within this subsection if—

    (a) he is a child for whom a statement is maintained under section 324, and

    (b) he attends (or proposes to attend) a school which is a city technology college, a city college for the technology of the arts or a city academy.

    (3) The condition in this subsection is satisfied if—

    (a) the school is approved by the Secretary of State under section 347(1), or

    (b) the Secretary of State consents to the child being educated at the school.

    (4) The Secretary of State may by regulations make provision for securing that arrangements are made—

    (a) for making the special educational provision specified in the statement;

    (b) for making any non-educational provision specified in the statement.

    (5) Regulations under subsection (4) may require or authorise a local education authority—

    (a) to make payments to the school in respect of the child, or

    (b) to provide any other assistance to the school in respect of the child.

    (6) No condition or requirement imposed by virtue of section 482(4)(a) is to prevent a local education authority making payments or providing assistance by virtue of subsection (5).
    (7) This section does not apply to schools in Wales."").
    166 After Clause 112, insert the following new clause—
    ("Pensions

  PENSIONS
  .—(1) Section 1 of the Superannuation Act 1972 (persons to or in respect of whom benefits may be provided by schemes under that section) shall apply to persons falling within subsection (2).
  (2) This subsection applies to a person if—

  (a) he has rights and obligations as a pensioner or deferred pensioner under a salary related occupational pension scheme, and

  (b) the rights and obligations arose by virtue of his or another person's employment with any of the employers specified in subsection (3).

  (3) The employers are—

  (a) a person with whom the Secretary of State or the National Assembly for Wales has made arrangements under section 2 of the Employment and Training Act 1973 and who is specified in an order made by the Secretary of State or is of a description so specified;

  (b) a company which is a subsidiary of a person falling within paragraph (a) and which is specified in an order made by the Secretary of State or is of a description so specified.

  (4) A scheme under section 1 of the Superannuation Act 1972 (a new scheme) may not be made in relation to the persons falling within subsection (2) unless—

  (a) the trustees of the occupational scheme consent in writing to the new scheme being made,

  (b) the rights of the persons under the new scheme are no less generous than their rights as they existed under the occupational scheme, and

  (c) the obligations of the persons under the new scheme are no more onerous than their obligations as they existed under the occupational scheme.")

  167 After Clause 112, insert the following new clause—

  PENSIONS: INTERPRETATION
  (" .—(1) This section has effect for the purposes of section (Pensions).
  (2) Rights in relation to a person include—

  (a) all forms of right to or eligibility for the present or future payment of a pension to or in respect of him;

  (b) a right of allocation in respect of the present or future payment of a pension.

  (3) A deferred pensioner is a person who has rights under the occupational scheme but is neither a pensioner under it nor a person to whom rights are accruing under it by virtue of his employment.
  (4) "Salary related occupational pension scheme" has the meaning given by section 93(1A) of the Pension Schemes Act 1993.")
  168 After Clause 112, insert the following new clause—

  PENSIONS: DELEGATION
  (" .—(1) A function exercisable by virtue of section 1 of the Superannuation Act 1972 in consequence of section (Pensions) or of paragraph 6(1) of Schedule 1 may be exercised by (or by employees of) such person as may be authorised in that behalf by the person whose function it is.
  (2) An authorisation given by virtue of subsection (1) may authorise the exercise of a function—

  (a) either wholly or to such extent as may be specified in the authorisation;

  (b) either generally or in such cases as may be so specified;

  (c) either unconditionally or subject to the fulfilment of such conditions as may be so specified.

  (3) An authorisation given by virtue of subsection (1) is to be treated for all purposes as if it were given by virtue of an order under section 69 of the Deregulation and Contracting Out Act 1994 (contracting out of functions of Ministers and office-holders).
  (4) An authorisation given by virtue of subsection (1) may be revoked at any time by the person who gave it.")
  169 Before Clause 113, insert the following new clause—

  WALES: PROVISION OF INFORMATION BY PUBLIC BODIES
  (" .—(1) For the purpose of the provision in Wales of services mentioned in subsection (2), any of the persons or bodies mentioned in subsection (3) may supply information about a young person—

  (a) to a local authority;

  (b) to any other person or body involved in the provision of the services.

  (2) The services are—

  (a) services provided in pursuance of section (Provision of services) of this Act,

  (b) services provided in pursuance of any of sections 2, 8, 9 and 10 of the Employment and Training Act 1973 (training and careers services), and

  (c) services wholly or partly funded in pursuance of section 12 of the Industrial Development Act 1982 (careers in industry).

  (3) The persons and bodies are—

  (a) a local authority,

  (b) a Health Authority,

  (c) the National Council for Education and Training for Wales,

  (d) a chief officer of police,

  (e) a probation committee, and

  (f) a youth offending team.")

  170 Clause 113, page 52, line 29, at end insert—
  ("(12) Sections 496 and 497 of the Education Act 1996 shall have effect as if—

  (a) the duties and powers referred to in those sections included duties imposed and powers conferred by virtue of this section, and

  (b) in relation to those duties and powers, the bodies to which those sections apply included the governing body of a relevant school, the governing body (within the meaning given by section 90(1) of the Further and Higher Education Act 1992) of a further education institution and an appropriate body for the purposes of subsection (2)."").

  171 Clause 114, page 52, line 45, leave out ("and")
  172 Page 53, line 2, at end insert (", and
  ( ) who is receiving, or in the Secretary of State's opinion is likely to receive, post-16 education or training (within the meaning of Part I of this Act) or higher education (within the meaning of the Education Reform Act 1988).")
  173 Page 53, line 10, leave out subsection (6) and insert—
  ("(6) In its application to Wales this section shall have effect with the following modifications (in addition to those specified in section (Wales)—
  ("(a) the reference to Part I of this Act shall be construed as a reference to Part II, and
  (b) the reference to section 13 shall be construed as a reference to section 41.")
  174 After Clause 114, insert the following new clause—

  TRAINING PROGRAMMES: CESSATION OF FUNDING
  (" .—(1) This section applies to a company if—

  (a) it has entered into an arrangement with the Secretary of State with a view to receiving payments under section 2(2)(d) of the Employment and Training Act 1973 (arrangements in respect of training) in connection with the provision of facilities,

  844

  (b) before the passing of this Act the company has received notice from the Secretary of State that he intends to terminate the arrangement mentioned in paragraph (a),

  (c) the company's memorandum and articles of association are in a form approved by the Secretary of State generally or specifically for purposes connected with arrangements of the kind described in paragraph (a), and

  (d) the company's memorandum of association requires all income and profits to be applied towards the promotion of the company's objects and not to be distributed to members.

  (2) Unless the Secretary of State consents in writing, a company to which this section applies may not after the passing of this Act—

  (a) take action of a prescribed kind, or

  (b) cause or permit a person to take action of a prescribed kind.

  (3) In subsection (2) "prescribed" means prescribed by order of the Secretary of State; and the action which may be prescribed under that subsection includes, in particular—

  (a) making a disposal or payment of a prescribed kind or in prescribed circumstances,

  (b) incurring expenditure of a prescribed kind or in prescribed circumstances, and

  (c) entering into a transaction of a prescribed kind or in prescribed circumstances.

  (4) A company to which this section applies shall comply with a written direction from the Secretary of State given after the passing of this Act which requires it to transfer an asset to—

  (a) a specified body, or

  (b) the Secretary of State.

  (5) Before giving a direction to a company under subsection (4) the Secretary of State shall consult the company.
  (6) Where a company to which this section applies takes, causes or permits action in contravention of subsection (2) the High Court may on the application of the Secretary of State make any order which seems to it appropriate.
  (7) An order under subsection (6) may, in particular—

  (a) provide for a contract or other agreement to be of no effect;

  (b) vary the terms of a contract or other agreement;

  (c) require money to be paid to the Secretary of State by or on behalf of the company to which this section applies;

  (d) require money to be paid to the Secretary of State by or on behalf of any other specified person;

  (e) require the Secretary of State to pay to a specified person compensation of an amount specified in the order or determined in accordance with the order.

  (8) Section (Wales) shall not apply to this section; but in the application of this section to a company which operates in Wales—

  (a) a reference to the Secretary of State in subsection (1)(a) and (b) shall be construed as a reference to the Secretary of State or the National Assembly for Wales,

  (b) the functions conferred or imposed on the Secretary of State by subsections (2) to (6) shall be exercisable by the National Assembly, and

  (c) a reference in subsections (2) to (7) to the Secretary of State shall be taken as a reference to the National Assembly.")

  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 163 to 174. All of these amendments have been spoken to, respectively, with Amendments Nos. 117, 155 and 162. I beg to move.

  845
  Moved, That the House do agree with the Commons in their Amendments Nos. 163 to 174.—(Lord Bach.)
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  175 Clause 116, page 55, line 21, after ("of(", insert ("property,")
  176 After Clause 116, insert the following new clause—

  DESIGNATED INSTITUTIONS: DISPOSAL OF LAND, &C
  (" .—(1) This section applies to land which after the coming into force of this section is transferred to trustees under section 32(3)(b) of the Further and Higher Education Act 1992 (transfer of property on designation of institution).
  (2) This section also applies to land which—

  (a) is held by trustees for the purposes of an institution which became a designated institution after the coming into force of this section, and

  (b) was acquired or enhanced in value wholly or partly by means of money paid under section 65 of the Education Act 1996 (grants) or paragraph 5 of Schedule 3 to the School Standards and Framework Act 1998 (grants).

  (3) If trustees dispose of land to which this section applies they shall notify the appropriate council.
  (4) If trustees dispose of land to which this section applies they shall pay to the appropriate council so much of the proceeds of disposal as may be determined to be just—

  (a) by agreement between the trustees and the council, or

  (b) in default of agreement, by the Secretary of State.

  (5) In making a determination under subsection (4) regard shall be had, in particular, to—

  (a) the value of the land at the date of the determination, and

  (b) any enhancement of the land's value which is attributable to expenditure by the trustees or the governing body of the designated institution.

  (6) More than one determination may be made under subsection (4) in relation to a particular disposal where it is just to do so, in particular where the disposal involves the creation of a lease.
  (7) If trustees permit land to which this section applies to be used for purposes not connected with the designated institution—

  (a) they shall be treated for the purposes of this section as having disposed of the land, and

  (b) subsection (4) shall have effect as if the reference to the proceeds of disposal were a reference to the value of the land.

  (8) Where a designated institution has ceased to exist—

  (a) this section applies to land which satisfied subsection (1) or (2) immediately before the institution ceased to exist, and

  (b) in subsection (7) the reference to purposes not connected with the designated institution shall be treated as a reference to purposes not connected with an institution within the further education sector (within the meaning given by section 91(3) of the Further and Higher Education Act 1992).

  (9) In this section "the appropriate council" means—

  (a) the Learning and Skills Council for England, in respect of land in England, and

  (b) the National Council for Education and Training for Wales, in respect of land in Wales.")

  177 After Clause 116, insert the following new clause—

  FURTHER EDUCATION COLLEGES: GOVERNORS' LIABILITY
  (" .—(1) Subsection (2) applies where a member of a body listed in subsection (3) is found liable in civil legal proceedings in respect of something which he did or omitted to do in the course of carrying out his duties as a member of the body.
  (2) If—

  (a) the member of the body applies to a court for an order under this subsection, and

  (b) the court considers that the action or omission which gives rise to the member's liability was honest and reasonable,

  the court may make an order extinguishing, reducing or varying the liability.
  (3) The bodies referred to in subsection (1) are—

  (a) a further education corporation established by virtue of section 15,16 or 47 of the Further and Higher Education Act 1992, and

  (b) a body corporate established by virtue of section 116(4) or (5) of this Act.

  (4) Where a member of a body listed in subsection (3) applies to a court for an order under this subsection, the court may make any order which—

  (a) relates to liability in civil legal proceedings which may come to be incurred by the member in respect of a specified course of action, and

  (b) is of a kind which the court could have made if the liability had already been incurred.

  (5) In subsections (2)(a) and (4) "a court" means the High Court or a county court; but this subsection is subject to any order under section 1 of the Courts and Legal Services Act 1990 (allocation of business between High Court and county courts).")
  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 175 to 177. I shall speak first to Amendment No. 177. Amendment No. 177 inserts a new clause which meets the commitment we made at the Committee stage in this House to consider what provision we could make to protect the personal liability of individual FE governors. This clause will place governors of FE corporations on a similar footing to trustees of charities or directors of companies. The new clause allows a governor to apply to the courts to be relieved fully or partially from an actual or potential personal liability if the courts find that the governor has acted honestly and reasonably. However, cases where liability has arisen from criminal acts will be excluded, which is consistent with the treatment of trustees and company directors. I should like to thank noble Lords—in particular, the noble Lord, Lord Tope—for the interest they have taken in this issue. I hope that the provision meets with their satisfaction.
  Amendment No. 176 inserts a new clause which will correct inadequate provisions in current legislation in the interests of protecting investments of public funds. Under Section 28 of the Further and Higher Education Act 1992 institutions may be designated by the Secretary of State to be part of the FE sector but, on closure, he has no powers to prevent land acquired or enhanced by public funds being lost to the trustees. Given the possibility of the creation of new designated institutions under the provisions of this Bill, we must make sure that there is provision for the recovery of the proceeds of sale of such land or its value where the use of the land is changed, including cases where the institution closes. The new clause achieves that by

  847
  requiring that the trustees of such an institution inform the LSC or CETW if they dispose of or change the use of land acquired or enhanced in value using public funds and repay the proceeds or value as may be determined. If agreement cannot be reached by the council and the trustees, the Secretary of State or the National Assembly will determine the amount that must be repaid.
  Amendment No. 175 addresses a minor drafting point. By inserting the word "property", we secure a formulation: that is, "property, rights and liability", which is consistent with the education Acts.
  Moved, That the House do agree with the Commons in their Amendments Nos. 175 to 177.—(Lord Bach.)
  On Question, Motion agreed to.
  6 p.m.

  COMMONS AMENDMENTS
  178 After Clause 116, insert the following new clause—

  FINANCIAL SUPPORT FOR STUDENTS
  (" .—(1) The Teaching and Higher Education Act 1998 shall be amended as follows.
  (2) In section 22 (new arrangements for giving financial support to students)—

  (a) in subsection (1) for "attending" substitute "undertaking", and

  (b) in subsections (2)(h) and (7) omit "attendance on".

  (3) In section 23 (transfer or delegation of functions relating to student support) in subsection (1)(b)—

  (a) for "at" substitute "with", and

  (b) for "attending" substitute "undertaking".

  (4) In section 26 (imposition of conditions as to fees at further or higher education institutions) in subsections (4), (5) and (10)(b) for "attending" (in each place) substitute "undertaking".
  (5) In section 28(1) (interpretation) in the definition of "fees" for "attendance on" (in each place) substitute "undertaking".")
  179 After Clause 116, insert the following new clause—

  FINANCIAL SUPPORT FOR STUDENTS: NORTHERN IRELAND
  (" .—(1) The Education (Student Support) (Northern Ireland) Order 1998 shall be amended as follows.
  (2) In Article 2(2) (interpretation) in the definition of "fees" for "attendance on" (in each place) substitute "undertaking".
  (3) In Article 3 (new arrangements for giving financial support to students)—

  (a) in paragraph (1) for "attending" substitute "undertaking";

  (b) in paragraphs (2)(h) and (7) omit "attendance on".

  (4) In Article 4 (transfer or delegation of functions relating to student support) in paragraph (1)(b)—

  (a) for "at" substitute "with", and

  (b) for "attending" substitute "undertaking".

  (5) In Article 7 (imposition of conditions as to fees at further or higher education institutions) in paragraphs (1), (2), (3) and (8)(b) for "attending" (in each place) substitute "undertaking".")
  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 178 and 179. In moving these amendments, with the leave of the House I shall speak also to Amendment No. 264.
  848
  Amendment No. 178 will enable the Secretary of State to provide financial support to students on open learning courses that do not have attendance requirements. The new clause it inserts into the Bill makes technical but important changes to existing legislation which is currently couched in terms of attendance and which prevents, for example, Open University students being eligible for the same support as students in other universities. In 2000–01 this support will be provided in the form of loans for part-time students on low incomes and disabled students' allowances for part-time students with disabilities. I know that the Open University had been concerned at the unforeseen limitations of the wording in the Teaching and Higher Education Act and we are now delighted to put things right.
  Amendment No. 179 makes equivalent changes to the relevant legislation for Northern Ireland. Although the Assembly would normally prepare its own legislation in this area, by making provision directly in the Bill we are ensuring that the new arrangements can be put in place for the next academic year. The relevant committee of the Northern Ireland Assembly has approved the approach.
  Lastly, Amendment No. 264 simply makes transitional provision to cover so-called "old-style loans" under the new post-16 arrangements. It is merely part of consequential amendments which replace references to the FEFCs with the LSC and the CETW. The whole of the Education (Student Loans) Act 1990 was repealed by the Teaching and Higher Education Act 1998. Order-making powers under the latter were used to ensure that the relevant provisions of the 1990 Act were preserved to cover existing student loans or students whose circumstances meant that they were still eligible for "old-style loans". This includes students on particularly long courses, the final stages of which may be funded by the LSC or the CETW. Amendment No. 264 therefore provides that the provisions preserved from the 1990 Act also apply in respect of institutions receiving funding from the LSC or the CETW under this Bill.
  Moved, That the House do agree with the Commons in their Amendments Nos. 178 and 179.—(Lord Bach.)
  On Question, Motion agreed to.
  Lord Carter: My Lords, before we move on to the next grouping, Amendments Nos. 180 to 182C, it may be for the convenience of the House if I say a brief word about the order in which the business on this grouping of amendments will proceed.
  All the Lords amendments to Commons Amendments Nos. 180 to 182 are on the subject of sex education guidance. They have therefore all been grouped together. It is intended that we should hold a single debate encompassing all these amendments. After the debate we shall then move to a series of decisions, all of which should be moved formally without any need for further debate.
  To open the debate, the Minister will move that Commons Amendment No. 180 be agreed to. At that point, the Minister will make her speech. She will then

  849
  move her own amendment to Amendment No. 180; namely, Amendment No. 180A. In practice, the rest of the debate will then take place on that amendment.
  Any noble Lord who wishes to speak to any of the amendments on the subject of sex education guidance—Amendments Nos. 180 to 182C inclusive—should do so at that point, when Amendment No. 180A is the Question before the House.
  At the end of the debate, the Question will first be put on Amendment No. 180A and decided. The other amendments dealing with sex education guidance will then be taken in the order in which they appear on the revised Marshalled List when moved formally. They will be decided or withdrawn without further debate.
  In short, it is intended that only one debate should take place on the Minister's amendment, Amendment No. 180A.
  Baroness Blatch: My Lords, before the noble Baroness moves the amendment, perhaps I may ask the Chief Whip a question. Is the entire debate to take place on only one amendment? Do I understand, however, that noble Lords who have tabled amendments will be entirely free, as will be the whole House, to debate any other amendment in the grouping?
  Lord Carter: My Lords, that is the intention. Because all the amendments address the same subject, we shall hold a single debate on the whole grouping. Any noble Lord who has tabled an amendment in that grouping will be free to speak to the amendment. At the end of the debate, the Questions will then be taken in order. The noble Baroness, Lady Young, has agreed that this will be a good way to proceed.

  COMMONS AMENDMENT
  180 Page 55, line 26, at end insert—
  ("(1A) In section 351 (general duties in respect of the curriculum) after subsection (5) insert—
  "(6) Nothing in this section shall be taken to impose duties on a local education authority with regard to sex education."").
  Baroness Blackstone: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 180. Perhaps I may speak at the same time to Amendments Nos. 181 and 182.
  I should like to start by reflecting on how we have reached this position. At Third Reading of the Bill in this House, the Government brought forward a carefully balanced amendment built on consensus and agreement. There was general agreement that our amendment was well constructed. That carefully balanced amendment was demolished and replaced by what in our view was a partial and selective amendment. I pledged that the Government would delete it in another place—and this we have done. We brought forward in another place amendments which focused on the key concerns that have been raised.
  These amendments brought from another place have one firm and central purpose: the protection of children from inappropriate teaching and materials in
  850
  the delivery of sex education in schools. They clarify that local education authorities have no duties in the policy or delivery of sex education in schools. They place a duty on the Secretary of State to issue guidance so that pupils are protected from inappropriate teaching and materials. They require governing bodies and head teachers to have regard to that guidance. They deal also with material produced by health authorities for schools.
  The Government have fulfilled the commitment that I made at Third Reading. We have taken a consistent approach throughout the debate on sex and relationship education. Our approach has centred on providing protection for our children, support for our teachers and governors, and reassurance for our parents. The Secretary of State issued new sex and relationships education guidance on 7th July. That guidance provides clarity and support to schools, governors, teachers and parents. It is backed up by the personal, social and health education framework issued last autumn as a part of the Government's national curriculum review.
  It may be helpful to the debate if I comment immediately on Amendment No. 182A tabled in the name of the right reverend Prelate the Bishop of Blackburn. This amendment is very close to the wording of part of the original amendment that the Government brought forward at Third Reading. It is clearly grounded in the personal, social and health education framework and it is consistent with the sex and relationships education guidance issued by the Secretary of State.
  Our new sex and relationships education guidance provides for pupils to learn about the importance of marriage for family life and for bringing up children, and about the significance of marriage and stable relationships as the key building blocks of community and society. That guidance achieved broad consensus in consultation.
  Our guidance is underpinned by the personal, social and health education framework. The PHSE framework provides that at ages seven to 11, pupils should be taught to be aware of different types of relationship, including marriage and those between friends and families, and to develop the skills to be effective in relationships. At ages 11–14 pupils should be taught about the role and importance of marriage in family relationships. At 14–16 pupils should be taught about the nature and importance of marriage for family life and bringing up children. Our guidance will also be supported by our National Healthy School Standard, to which every school is expected to sign up within the next few years, and which contains as success criteria the requirement for schools to teach in line with the Secretary of State's guidance.
  I want to make it clear at this stage of the debate that the Government support the amendment put forward by the right reverend Prelate the Bishop of Blackburn. We believe that it underpins and reinforces the balance that we have achieved. Taken in the context of the Secretary of State's guidance, we believe that accepting

  851
  this amendment will underpin the effective delivery of our sex education policy. That policy is grounded in consultation and consensus.
  It may also be helpful if I comment on the amendment tabled by the noble and learned Lord, Lord Ackner.
  Lord Campbell of Alloway: My Lords, I should like to ask a very important question. Does the Minister accept that the guidance is wholly unenforceable in any court of law? Even if the amendments of the right reverend Prelate the Bishop of Blackburn or my noble friend Lady Young are accepted, the provisions will remain wholly unenforceable. How does the Minister propose that conformity with the guidelines should be achieved? Thank you for allowing me to intervene.
  Baroness Blackstone: My Lords, the amendments that the Government are bringing forward today require schools and governing bodies to take notice of the guidance. Of course it will be enforceable in a court of law, thanks to its place in the Bill.
  I recognise that the noble and learned Lord, Lord Ackner, has a serious intention in wanting to ensure that the law works effectively. I shall listen very carefully to what he says, but I hope that when I reply I shall be able to reassure him that the amendments that we have inherited from another place already secure the objective that he seeks to achieve.
  It might also be helpful if I comment briefly on Amendments Nos. 180B and 180C, tabled by the noble Baroness, Lady Young. I recognise that she has identified a particular issue that some people have concerns about: the training and advice that local education authorities provide to schools. I recognise the motivation behind the amendments, but the form in which they are expressed is too narrow. It would be wrong to focus on marriage as a single issue. We want local education authorities to have regard to the broad range of issues identified in our guidance, including protecting children from inappropriate teaching and materials, which is central to the amendments brought forward by the Government in another place.
  For that reason, the Government have brought forward Amendment No. 180A, which we believe to be a more effective response to the issue identified by the noble Baroness. It ensures that when local education authorities carry out any activity that may have a bearing on the provision of sex and relationship education, they must have regard to the Secretary of State's guidance on sex and relationship education, based on the PSHE framework and on a broad consensus achieved in consultation.
  I emphasise that the Government's amendment does not change the existing provision that the key responsibility for sex and relationship education must remain with the head teacher and the governing body, and that the local education authority has no duty in the policy or delivery of sex education.
  I must contrast Amendment No. 182B, tabled by the noble Baroness, Lady Young, with Amendment No. 182A, tabled by the right reverend Prelate the Bishop
  852
  of Blackburn. Amendment No. 182A rests on the wording of the PSHE framework. It is founded on a careful statement built on consensus. Amendment No. 182B, on the other hand, is based on wording taken from the Home Office document, Supporting Families, published in 1998. We know that because her honourable friends in another place made it clear when they introduced the same amendment. That text was written for a specific purpose, and unfortunately the sentence used in the amendment does not give the full picture.
  I believe that noble Lords would find it helpful to hear the words that the noble Baroness chose to leave out of her amendment. The relevant passage reads:
  "This Government believes that marriage provides a strong foundation for stable relationships. This does not mean trying to make people marry, or criticising or penalising people who choose not to. We do not believe that Government should interfere in people's lives in that way."
  The document goes on to say:
  "But we do share the belief of the majority of people that marriage provides the most reliable framework for raising children".
  It then says:
  "There are strong and mutually supportive families and relationships outside marriage and many unmarried couples remain together throughout their children's upbringing and raise their children every bit as successfully as married parents".
  By lifting words selectively, the noble Baroness's honourable friends in another place did not give the full picture, and I fear that the noble Baroness is about to do the same.
  In summary, I want to make it clear that the Government will oppose Amendments Nos. 180B and 180C. I encourage noble Lords on all sides of the House to support instead the Government's Amendment No. 180A, which is a broader, more balanced response to the issue identified by the noble Baroness. We support Amendment No. 182A, put forward by the right reverend Prelate the Bishop of Blackburn, but we cannot support Amendment No. 182B, put forward by the noble Baroness, Lady Young.
  Moved, That this House do agree with the Commons in their Amendment No. 180.—(Baroness Blackstone.)

  AS AN AMENDMENT TO COMMONS AMENDMENT No. 180
  180A Line 4, at beginning insert ("In exercising any function which may affect the provision of sex education in maintained schools, every local education authority must have regard to the guidance issued by the Secretary of State under section 403(1A).
  (7) Except to the extent provided in subsection (6),").
  Baroness Blackstone: My Lords, I have already spoken to the amendment. I beg to move.
  Moved, That Amendment No. 180A, as an amendment to Commons Amendment No. 180, be agreed to.—(Baroness Blackstone.)
  6.15 p.m.
  Baroness Young: My Lords, I shall speak to Amendments Nos. 180B, 180C and 182B. I am very glad that the government amendments, which were inserted as Clause 117 in another place, cover national health service trusts. The Minister did not refer to that, but the issue was referred to on a number of occasions when we debated the matter last March. I am also glad that they ensure that sex education takes account of the religious and cultural background of pupils. I welcome the Minister's further amendment that she has moved this afternoon.
  However, although I welcome the new amendments, they are much weaker than those that were passed by the House of Lords last March. My amendments, which the House was then good enough to support, encouraged marriage, set clear principles for determining inappropriate material and gave governors an absolute veto over what materials could be used in schools.
  In welcoming the fact that the Bill now takes account of pupils regardless of their religious or cultural background, I make the point once again that my amendments have cross-party support and cover all religions.
  Amendments Nos. 180B and 180C are essential. I am glad that the Minister recognised that I have identified a gap in the provisions made for sex education. I make no apology for the terms in which I speak to the amendments. They are essential because I know full well that local education authorities give training and advice to teachers, governors and parent governors on sex education and I have no doubt that they will continue to do so and that such advice will increase with the new guidelines.
  Local education authorities are also the major providers of in-service training. It is therefore essential that marriage is put at the centre of their courses. I am delighted to see so many on the Bishops Bench today. I do not think that I have ever seen quite so many before. I hope that they will support my amendment if they really believe in marriage.
  The wording of my Amendment No. 180C applying to local education authorities is very nearly the same as Amendment No. 182B, which applies to governors and teachers. So I am completely consistent in what I am saying. It seems to me that one should be consistent, and that marriage should be on the face of the Bill in the two areas of provision relating to sex education.
  I was pleased that the noble Baroness made the point that I have taken the wording from the Government's own publication. I do not want to spend time now telling the noble Baroness on just how many occasions marriage is included in the Government's Green Paper, Supporting Families. Incidentally, I was always under the assumption that a Green Paper emanated from the Government, not from one particular department, and that every department signed up to it.
  854
  The noble Baroness explained in some detail why the amendment of the right reverend Prelate the Bishop of Blackburn was acceptable and mine was not. That is an outstanding example of government spin. There are those of us who take these matters very seriously; I count myself as one. Marriage is at the centre of Supporting Families, and all I am doing, with the intention of being helpful, is to quote from the Green Paper. I had intended to quote precisely the same paragraph as the noble Baroness quoted, but I shall not take up the time of the House.
  It is important that the House should be aware that, even today, local education authorities are producing material which is entirely inappropriate. My attention was drawn to this by a friend of mine who is a school governor and who was invited to attend a conference a couple of months ago on sex and relationship education. Perhaps I may read part of the paper that was issued to participants. It stated:
  "Sex and relationship education should empower pupils after a positive view of sex and sexuality and support sexual self-acceptance, be well linked to contraceptive services, be sustained by working within a theoretical framework, meet local needs, undertake specific work to meet the needs of vulnerable children, be provided early, reinforce value messages, focus on risk education, use active learning and participatory techniques, ensure that children have a critical awareness of the messages that are portrayed in the media".
  That is the message. The section on marriage refers to:
  "marriage linked with relationships and homosexuality".
  My friend made a note that the man running the course said of marriage that it was,
  "not important per se, but important for some".
  The message is clear. This amendment is essential.
  It is essential because of the material that is currently being used by LEAs. One example is a book that is being used in Birmingham. Marriage is not mentioned at all, yet it contains plenty of advice on abortion, "coming out", gay rights and bisexuality. Material recently issued by Leicestershire mentions marriage only when pupils are about to leave school.
  I do not believe that the guidelines that are linked to the government amendment make clearer the whole issue of what is appropriate or inappropriate. What emerges from paragraphs 1.8 and 4.5 is that what is not appropriate is inappropriate. It is a kind of circular argument. Yet those who saw the exhibition that we held with regard to what local education authorities and some teachers thought appropriate in 1988 and what health promotion units think is appropriate today will have found much of the material simply appalling. All this material is paid for by the taxpayer. Many people, myself included, would regard much of it as pornographic, and all of it is put before children. I am certain that if Section 28 is repealed and the minimum provisions are not in place, the floodgates for this appalling material will be open for ever more. Perhaps I may reinforce the comment of my noble friend Lord Campbell. Guidelines, weak as they are, are not enforceable. So I believe strongly that my first amendment is essential. I hope that everyone in the House who believes in marriage will support it.

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  My second amendment—again, I am grateful to the noble Baroness, Lady Blackstone—is similar to the one introduced by my honourable friend Mr Gerald Howarth in another place. As I said, it is based on words from the Government's Green Paper. If the Government do not believe the words in their Green Paper, what can I do about it? It now seems that they do not. If they do—one must assume that that is the case—why not write them on to the face of the Bill? I am not asking for anything other than that.
  It is incredible that we should be debating the need to include marriage in sex education. Marriage is still the basis of society. Many of the greatest problems being faced today—rising crime and an enormous welfare bill, to name but two—arise from the breakdown of marriage. If we examine the guidelines, we get little comfort. Marriage is mentioned only three times in 33 pages. In modern jargon, the guidelines are non-judgmental and value free. That means in effect that adults have abdicated their responsibilities to pass on traditional beliefs and knowledge, leaving children free to choose any kind of lifestyle, and that all lifestyles are to have equal value. As a kind of sop to adult consciences, children are given more rights in exchange.
  I was interested to read a report by Archbishop Vincent Nichols of Birmingham in the Catholic Herald on 14th July about the guidelines, in which he said:
  "Yet in the document there is no guidance concerning the moral principles that shape and guide a true understanding of the nature and purpose of human sexuality".
  He went on to say:
  "the document indicates clearly that England and Wales are seen by government to be thoroughly secularised societies".
  I have long argued that there is a major debate in this country between those of us who stand by the belief that our country has been shaped and formed by the great Judaeo-Christian tradition, and those who wish to see a secular society and are quite prepared to sign up to it. I am not.
  Good teachers, on reading the guidelines, will be placed in an impossible position as they struggle to follow all of this. There is no mention of right or wrong. That is extraordinary in a document such as this. The rest of us who have read it should hardly be surprised that there are so many teenage pregnancies and an increase in sexually transmitted diseases.
  Yet the extraordinary thing is that we know from all the polls taken that the overwhelming majority of young people want to get married, and that the overwhelming majority of parents would welcome education on sex in marriage. I cannot understand why, if the Government really listen to what people want, they will not accept the amendments.
  I hope that the right reverend Prelate the Bishop of Blackburn will not think me discourteous if I comment on his amendment before he has spoken to it. But in the way that this debate in being taken, this may be my only opportunity to do so. Some noble Lords may well think that there is very little to choose between the amendment of the right reverend Prelate which refers to governors and teachers and my second amendment,
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  Amendment No. 182B. I want to press my amendment because—I say this with much regret —I consider the amendment tabled by the right reverend Prelate to be a much weaker amendment than mine; and as I have said, I regard mine as much weaker than that which the House agreed last March. I do not want to take up the time of the House splitting hairs over what each means, but there is a difference between the two verbs "to learn" and "to be taught". "Taught" is much stronger and likely to be more effective. Children may or may not learn: they are actually taught. The right reverend Prelate stresses the importance of marriage for family life. My amendment says that marriage provides "the most reliable framework", which is a statement of fact and based on the Government's own words. This is not a matter of semantics.
  Furthermore, as the noble Baroness, Lady Blackstone, has said, the House must understand that this is a package. Amendment No. 182A is linked to Amendment No. 180A. Clearly, the intention is that, if carried, the Government will be able to repeal Section 28 with impunity. In fact, it is not a substitute for Section 28. I have already made quite clear what is happening in local education authorities. The amendment on marriage is in effect a toning down of what the Government themselves said previously. Therefore, I very much hope that the House will accept my amendment.
  To sum up: I believe that the two amendments that I am moving are an absolute minimum requirement. They are in the interests of children and parents. They must include marriage because I believe—as I believe do most people in the country—that marriage is the basis of our society. Weakened as it has been, it is still the basis and we should put in front of children the ideal by which they should live.
  Of the alternative amendments directed at governors, I believe that mine is the stronger. It is not as strong as I would like, but stronger than the others. Therefore, I ask the House to support my two amendments this evening. I have spoken on this issue before. It is something about which I believe strongly. I am as certain as I am standing here that I speak for thousands of people in the country as a whole, an overwhelming majority, who wish to see these amendments carried.
  6.30 p.m.
  The Lord Bishop of Blackburn: My Lords, I speak to Amendment No. 182A tabled in my name. I want to make it clear that, although the Churches were not consulted about the amendments made in the Commons, insofar as it goes, I welcome what Amendment No. 182 sets out, not least because it further clarifies what for some has been a continuing area of uncertainty; namely, that some LEAs now have no responsibility for sex and personal relationship education in schools. That is a matter on which there is a misleading article even in today's Daily Telegraph.
  This matter clearly rests with the governors and headteachers of schools, having regard to the guidance issued by the Secretary of State. But it is helpful in our

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  consideration of Commons Amendment No. 182, that the guidance has been published by the Secretary of State before our debate. With the noble Baroness, Lady Young, I also welcome the protection offered to pupils from inappropriate materials, and the inclusion in that protection of material published by NHS bodies, which has been the cause of concern to so many parents and others. It is also good that the teaching must have regard to the age and the religious and cultural background of the pupils concerned. That is vitally important.
  But we must not underestimate the demands which this very sensitive area of the curriculum places on our teachers. We need to get into the real schools in the real world, acting, as the teachers are, very much in loco parentis, seeking to impart sensitive knowledge which many believe properly belongs to the home and to the parents. Headteachers and governors must clearly not only keep in touch with parents about this, but carry their confidence and that of the local community. That in itself is no easy task in modern Britain.
  That said, I must now return to a concern first expressed in this House by my friend the right reverend Prelate the Bishop of Oxford in the Second Reading of the Local Government Bill on 9th December last year (Hansard, col. 1044); namely, the importance of marriage. Despite the quasi-jocular remarks made, this Bench remains full square about the importance of marriage. It has consistently done so and nothing that I have said in this House on any occasion during the passage of this legislation or the Local Government Bill can call that into question. Indeed, the bishops of the Church of England issued a statement on marriage, as they understood it, as recently as last year.
  In my view, and that of the Church of England Board of Education, a balanced group of people representing different opinions within the Anglican tradition, and which has recently debated the new Clause 117 from the Commons, and the Catholic Education Service with which I have been working very closely are of the view that Commons Amendment No. 182 does not provide, in the statutory enforcement of the guidance, all that is required or indeed all that I believe I was promised. It is for that reason that on 18th May the chairman of the Catholic Education Service, Archbishop Nicholls, who has already been referred to, and I, in a statement broadly welcoming the provisions of Clause 117, said,
  "We regret the omission from the government amendment of any affirmation of marriage and we look to the forthcoming guidance to state clearly the importance for all pupils of positive teaching about marriage".
  In the situation in which we find ourselves, my amendment seeks to rectify that omission. I have had no discussion with the Government about it. The amendment was simply tabled after discussion with the Board of Education, with the Catholic Education Service and with a very rare meeting of the Lords Spiritual. Like the noble Baroness, Lady Young, I am also glad to see so many of them here this evening.
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  As long ago as February, when we were dealing with the Committee stage of the Local Government Bill, the Minister, the noble Lord, Lord Whitty, told the Committee,
  "We agree wholeheartedly that children should be taught about the importance of marriage, of family life and of bringing up children".—[Official Report, 7/2/00; co1.434.]
  We are therefore very concerned that that is not included on the face of the Bill in order to protect our children from those unscrupulous teachers—there will not be many of them—whose own lifestyle may cause them to overlook this part of the guidance, not least because in the guidance marriage and stable relationships are linked together as though they held for everyone a moral equivalence with no recognition of the fact that the state as well as the Christian and other faith communities give marriage a unique standing among relationships.
  As two of the correspondents to the noble Baroness, Lady Young, who copied their letters to me, put it,
  "Whilst we appreciate that we cannot impose our Christian view of morality on the population as a whole, every society in recorded history has promoted marriage as a basis for the organisation of that society".
  That should be expressed in some form on the face of the Bill even if that may be, for those cleverer than myself, something of an exaggeration.
  As my friend the right reverend Prelate the Bishop of Rochester put it in that debate,
  "The Government's claim that they wish to promote marriage and a stable family as the basic building block of society must find an echo not only in their policies but in their legislative programmes".—[Official Report, 7/2/00; col. 451.]
  Many people, including the Government, are anxious about what is happening in British society, from concern about teenage pregnancies to mindless football hooliganism; from road rage to rural crime. We seem to expect the schools, the Churches and the Government to do something about them. But surely at its root lies the modern cult of individualism: that what I want matters most. As I see it, the difference between marriage and other relationships, no matter how stable they may be, is that marriage involves not just the people concerned but an accountability to society which formally recognises that family unit and has clear expectations of it. Marriage is a public statement of intention and commitment made by the couple but witnessed on behalf of society. It does not rest simply on the say-so of the individuals concerned. Others are asked to respect that relationship, that new family unit. So I hope I have made it clear why I seek to amend the Bill in the way I do.
  Finally, I return to the classroom and the frequently stated proper concerns that if marriage is affirmed in the way I wish it to be, then the children whose parents are not married will in some way be disadvantaged.
  I do not underestimate the difficulty of the task that we ask of our teachers in providing sex and relationships education. However, the importance of marriage is taught regularly in Church schools. In the eyes of many parents and impartial observers, those

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  schools are given a very high rating for the pastoral care of their pupils. I do not want pupils in community schools to be denied what is offered in Church schools.
  We must be careful that in our pastoral concern for pupils we do not remove ideals and reduce everything to a kind of basic common denominator which may better fit health than sex and relationships education. The best schools in our country are communities in which ideals and challenges are presented and pupils are prepared to make a contribution to society. Demanding though that task is, I believe that our teachers, supported by their governors, want to achieve it. I ask the House to support the inclusion of the amendment standing in my name that pupils learn the nature of marriage and its importance to family life and the bringing up of children.
  6.45 p.m.
  Lord Davies of Coity: My Lords, not very long ago I argued against the repeal of Section 28, and that view was upheld by your Lordships' House. Subsequently, the Secretary of State acknowledged the decision of this House and introduced an amendment to the Learning and Skills Bill. I appreciated that in introducing that amendment the Secretary of State had genuinely addressed the concerns that I had expressed. Therefore, I spoke in favour of that amendment, believing that if it was carried resistance to the repeal of Section 28 would no longer be necessary. However, the government amendment failed to find favour in your Lordships' House and was defeated by a mere 15 votes. Hence, we return to the issue following further consideration by the other place.
  I have given this question much attention. I hope that what I am about to say will not be a repeat of the arguments that I advanced previously. I address the terms of Clause 117, with particular reference to Amendments Nos. 182A and 182B. It is worth while first to explore the common ground on which all sides of the House can unite and compare it with that which divides us. We all recognise that sensible, sensitive sex education must be provided in schools. We know that this issue is not about homosexuality between consenting adults in private. That issue is dealt with in other legislation which has been in force for some time. None of us wants to see homophobic bullying in schools or anywhere else. All of us want children to be protected from sexual abuse, or any other form of abuse. We do not want to see the promotion—I emphasise that word—of homosexuality in schools. We want the teaching of sexual relationships to be carried out in a sensitive and delicate way. Although we want the importance of marriage and family life to be expressed, none of us wants any child to feel inferior because his or her parents have chosen not to marry but, none the less, provide a very stable home life. We do not want the children of single parent families to feel second class. For me, those are the fundamental, sensible and compassionate factors on which we should all be able to agree. They reflect the objectives on which we should be united, and I believe that they are embraced in this Bill and the guidance notes.
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  Let us consider whether the issues that divide us have any importance or relevance. To be able to do that it is necessary to trace legislative developments since 1986. First, Section 2 of the Local Government Act 1986 dealt with the prohibition of political publicity. Secondly, in 1988 Section 28 was introduced. Under Section 2A of the Local Government Act 1986, the promotion of homosexuality in schools by local authorities was prohibited. A decade later, in 1996, the same Conservative administration introduced the Education Act. Sex education in schools is dealt with in Sections 403, 404 and 405 of that Act. I do not need to deal with Sections 404 and 405. However, Section 403(1) provides:
  "The local education authority, governing body and head teacher shall take such steps as are reasonably practicable to secure that where sex education is given to any registered pupils at a maintained school, it is given in such a manner as to encourage those pupils to have due regard to moral considerations and the value of family life".
  From that we see immediately that the authority for teaching sex education in schools has changed and the language used differs from earlier legislation. The essence of Section 28 as contained in the 1988 legislation has been overtaken by the enactment of the Education Act 1996. In reality, Section 28 is virtually ineffective, if not totally moribund.
  In the circumstances, I believe that the Government would have been wiser to let sleeping dogs lie than propose the repeal of Section 28 and stir up a hornets' nest unnecessarily. I believe that it has created a polarisation of views—a rallying call around a symbolic flag—between the opponents of homosexuality in general and its supporters, many of whom believe that homosexuality is an equal and alternative lifestyle. That is not, and should not be, what the debate is about. The debate is about the teaching of sex education in schools and, in the process, the protection of school children. Unfortunately, the issue has attracted such publicity that often it overshadows many of the worthwhile successes of the Government, which I support.
  None the less, this is where we are. When I opposed the repeal of Section 28, I did so to draw to the attention of the Secretary of State my concerns and those of many others about the protection of children and young people in schools from possible abuse which, in the absence of legislation to prevent it, a minority might try to perpetrate in the teaching of sex education. The proposed repeal of Section 28 can now be seen as something of a blessing in disguise because its defeat has led to Clause 117 of the Bill.
  I believe that the Secretary of State has responded. I was disappointed that this House rejected this provision on the previous occasion. However, we now have another opportunity to deal with this matter in Clause 117, the provision having been further refined in the other place. A number of amendments have been tabled, to which I have no fundamental objection. However, as I believe that this House should be united as much as possible on this very sensitive and delicate issue, I favour the amendment tabled by the right

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  reverend Prelate the Bishop of Blackburn. I believe that the terms of that amendment are less likely to be misinterpreted and to cause confusion and resentment, and that the sentiments which it reflects are less dogmatic. This Bill, including Clause 117 and the accompanying guidance notes, is a good one. It is my hope that the House will overwhelmingly embrace the Commons amendments and Amendments Nos. 180A and 182A.
  In conclusion, I hope that, having secured in this Bill all that we seek, the House will unite and no longer find it necessary to divide again next week on Section 28. I am sure that we all recognise that that provision no longer has any real relevance.
  Baroness Richardson of Calow: My Lords, I believe profoundly and passionately in the holy and honourable estate of marriage. It is wholly because of that commitment to marriage that I must speak against Amendments Nos. 180B and 180C.
  As a Methodist minister, I have conducted many hundreds of marriages. I belong to a Church which for the past 25 years has permitted its ministers to conduct people's second marriages provided they are satisfied with the reasons for the failure of the first and that better hopes for the future are in place. Many couples have spoken to me about their previous experiences of marriage, giving reasons for its failure. I have listened to stories of abuse and neglect and of couples who had grown apart because they married when they were too young. Some couples have told me how little preparation they had for entering into marriage in the first place, many of them with a romantic ideal of what marriage would give them. Some married under parental pressure, mostly because of pregnancy. Some married in order to get out of their family home because they could stand it no longer. Some married because the teachings of the Church were that there should be no sexual relationships before marriage. Marriage was therefore the legalisation of sex.
  I agree entirely that marriage may provide a strong foundation for stable relationships, but I believe even more that strong stable relationships provide the basis for marriage. I do not believe that entering into marriage, and going through a form of marriage, guarantees that the relationships will be strong enough to support the couple through life's difficulties.
  Neither do I believe that there is a simple, reliable framework for the raising of children. We would long for marriage to be that framework for raising children, but the incidence of child abuse and neglect and the number of children taken into care because of danger and for protection from their parents reveals that the ability to bear children does not confer parenting skills. The skills involved in both marriage and the upbringing of children need to be learnt in the commitment to seeing it through together.
  Amendment No. 180C provides that we,
  "shall have regard to the fact that marriage provides a strong foundation for stable relationships".
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  It is not a good teaching method to proclaim that as a fact when the experience of many people shows that it is demonstrably untrue in many cases. It is wonderfully better to proclaim it as an ideal and as an aspiration to be worked towards in lifelong learning together. We must also recognise that it is an ideal which many people will never be able to fulfil either because of their orientation or for other reasons which are not for us to enter into. To label them as failing in an ideal from the beginning is something we would not want to do for our children.
  My main objection is that the amendment proclaims something which is not a fact but an aspiration. I therefore wholeheartedly support Amendment No. 182A and the Government's Amendment No. 180A and hope that the other amendments, which in my opinion are too strong a declaration of our hopes, will be defeated.
  The Earl of Longford: My Lords, the noble Baroness, Lady Richardson, speaks from wide experience and exceptional qualifications. I do not agree with her conclusions but believe that she made an impressive speech. I have my qualifications which the House may feel disable me. I have been happily married for 69 years and I cannot see anyone here who has been married for longer. Your Lordships may believe that that gives me a bias in favour of marriage. Be it so, but I plead not only that marriage is important but that it should be treated as pre-eminent. That is a word which I like.
  I know many people both inside and outside my family who are happier in their second marriage than in their first. A young friend, a much admired man, has lived with a lady for many years and they have several children. They are happy and good people, so of course it can be done. But I retain my conviction that marriage is pre-eminent; it is a better way.
  Many people have spoken of an ideal and we should aim at the ideal. I am not one of those people who believes that the whole country is going to the dogs. I believe that there has been a sexual decline but that in many ways we are a more compassionate society. The wonderful debate on the disabled which we had in this House only last week shows that we are a more compassionate society, but our sexual life has deteriorated. We must make an effort and this is a chance to try to pull the country together again in that area.
  I realise that one should never mention one's conscience because that can be dangerous. I remember Ernest Bevin deriding George Landsbury, the then Leader of the Labour Party. He said, "I'm not going to have George Landsbury hawking his conscience all round Europe". Landsbury did not last as Leader for much longer. I know that everyone has a conscience; we are all equal in that respect. Mine tells me that tonight we should find the strongest Motion in favour of marriage and vote for it.
  Earl Ferrers: My Lords, I want to make two points. First, Amendment No. 182, tabled by the noble Baroness, Lady Blackstone, states that:

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  "The Secretary of State must issue guidance designed to secure that when sex education is given to registered pupils at maintained schools they are protected from teaching materials which are inappropriate".
  Who decides what is inappropriate? Presumably, some of the material referred to by my noble friend Lady Young, and which some of us saw, was considered by some people to be appropriate, otherwise it would not have been produced. Therefore, the provision would not prevent such material from being used.
  Furthermore, the Minister puts great store on the words "must issue guidance". However, guidance is guidance; one is not obliged to be held by it. The guidance requirement has effect only when a person is taken to court. The fact that he or she did not follow the guidance which was issued can be taken into account. That is the strength of guidance.
  My second point relates to the important difference between the amendments tabled by my noble friend Lady Young and the right reverend Prelate the Bishop of Blackburn. The right reverend Prelate's amendment states:
  "they learn the nature of marriage".
  One cannot ensure by statute that anyone learns. All one can ensure by statute is that people are taught. Whether they absorb what they are taught is another matter. That is why I believe my noble friend's amendment is far better. The power it contains ensures that people are taught, but whether they learn is another matter.
  Lord Warner: My Lords, perhaps I may say a few words about the amendments tabled by the noble Baroness, Lady Young. I speak as someone who has spent much of his working life dealing with issues relating to children. I believe that those amendments are deeply stigmatising to the children brought up in households where the parents are not married. Children experience the effects of the legislation.
  I fully accept that marriage is a desirable state in which to bring up children. However, in my experience children recognise cant and hypocrisy from the adult world. A proportion of the children taught under the regime of the noble Baroness, Lady Young, would have experienced divorce—some very painfully; others would have been brought up perfectly satisfactorily by parents who are not married but cohabiting. I believe that that was recognised fully in the Government's consultation paper, Supporting Families, which I was glad to have a hand in preparing, and from which I believe the noble Baroness quoted somewhat selectively in speaking to her amendment.
  I also remind the House that good research shows that the conduct of fathers in married and cohabiting relationships is virtually indistinguishable in terms of their participation in their children's life. As I said, many of those children would be the recipients of the type of tuition which would come forth as a result of the noble Baroness's amendment. I believe that, if we are not careful, we are in danger of dividing children into two groups. In their eyes we shall undermine their and their parents' position when they compare what
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  they are being taught under this regime with their personal experiences at home. I hope that the House will not support the noble Baroness's amendment.
  7 p.m.
  Lord Blackwell: My Lords, I have not taken up the time of the House on this subject until now, partly because it seemed to me that the issues were so clear that they hardly needed lengthy debate. However, I should like to say a few words tonight in support of the amendment of my noble friend Lady Young.
  Her amendment seems to me to be the clearest possible statement of the primacy of marriage and of its fundamental role in bringing up families. The only possible reason for diluting the language is to introduce ambiguity. The only consequence that I can see of introducing ambiguity is that an element of fudge would be allowed to enter at local level that would enable activists who wish to ignore the primacy of marriage and to promote alternative lifestyles as equivalent to find doors through this legislation which would enable them to carry on pursuing education in the way they see fit.
  Some noble Lords may believe that that is appropriate, and I respect their views. I do not; I support the stance behind the amendment tabled by my noble friend Lady Young. I believe that there is no reason for the House not to accept the amendment unless it is seeking to introduce a form of ambiguity or fudge. I can see no purpose whatever in that. Therefore, I urge the House to support the very firm statement put forward by my noble friend Lady Young.
  Lord McCarthy: My Lords, I simply want to ask the noble Baroness, Lady Young, a question or two. No doubt she will be aware of the Sex and Relationship Education Guidance paper. On page 14 it states that:
  "Parents and pupils may need to be reassured that the personal beliefs and attitudes of teachers will not influence the teaching of sex and relationship education within the PSHE framework. Teachers and all those contributing to sex and relationship education are expected to work within an agreed values framework".
  I ask the noble Baroness whether she agrees that it is reasonable to ask that of teachers. I do not believe that it is; if we were to pass her amendment. Many teachers would then have to say things that they did not believe. It is not that they might not believe marriage to be a good thing; very probably they would consider it to be a good thing. Some might even have tried it—several times! In one sense or another they might well believe marriage to be the most reliable framework for raising children. For many people it is. However, when the noble Baroness said that she can prove it, my response is that I should love to see the evidence. What she makes is a value statement. One cannot prove value statements, but never mind. We should all like it to be true.
  But what are teachers to do in the average maintained school if this amendment is passed? They may not be married themselves. But the kids will know whether or not they are married. Even if they are

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  married, it may not be a good marriage, and the kids will know that too. In many areas, most of the kids will come from homes where the father has disappeared, or it is not even known who he is. However, all the same, they may have stable backgrounds. They may say, "I see, Sir, you're married, are you?"; or, if they have a little more nerve, they may say, "And I suppose that you think my mum should get married".
  One is placing teachers in an impossible position. If one says that they are not allowed to give their own opinions and are not even allowed to have opinions, one can only ask them to do things which are generally accepted throughout society, and, frankly, this proposition is not generally accepted. It is a step too far. I want to know what the noble Baroness, Lady Young, believes that the teacher should say in a situation such as I outline.
  The Earl of Listowel: I wish to speak in defence of the amendment of the noble Baroness, Lady Young. One should not idealise marriage. Often it fails—and fails miserably. However, marriage is important for children. The US national longitudinal survey of youth found that boys raised by unwed mothers were approximately two-and-a-half times more likely to be imprisoned. In England and Wales between 1993 and 1995 the infant mortality rate was approximately 50 per cent higher among children of unmarried parents.
  I have met children. I met a child whose mother said to him, "I wish that you had never been born and I wish that I had had an abortion". Obviously she said that in the heat of the moment. She would not have said that if she had thought more carefully. I believe that one reason why marriage works is that it provides a process by which adults can decide that they wish to commit to one another and are likely to want to have children together. That does not necessarily come about through cohabitation.
  I very much favour the Home Secretary's idea of having a six-month delay between saying that one wishes to be married and the act of marriage taking place. We should reinforce marriage. We should make it more of a credible institution so that people say, "We are marrying and are thinking of having children. This is a very serious business". That is desperately important. I support the noble Baroness's amendment.
  Baroness Blatch: My Lords, I rise to support the first amendment of the noble Baroness, Lady Blackstone. I support strongly my noble friend's amendment and, indeed, that of the noble and learned Lord, Lord Ackner. We all hope that in relation to guidance for sex education the Bill will be strengthened through the amendments tabled this evening. However, whether or not we are successful in that objective, it will be no substitute whatever for the repeal of Section 28. Sadly, that is what the Government's late amendments to the Bill are about.
  My noble friend Lord Campbell of Alloway is absolutely right and I hope that the Minister will accept the point because it is a legal point. The
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  guidance is not enforceable in law. The only thing that is enforceable is having regard to it. It is possible for a governing body to meet, to discuss the guidance and then to do its own thing. At a tribunal it has only to prove that it has had regard to, and has good reasons for disregarding, the guidance. That is my first point.
  My second point relates to a matter raised by the right reverend Prelate; that is, even if it were possible by law to enforce the guidance, it is not possible to enforce learning. It is possible to enforce teaching but not learning. The new Sex and Relationship Education Guidance has been published—even before this Bill reaches the statute book. Therefore, so far as concerns most of us here, the guidance is a fait accompli.
  Thirdly, on the basis of Amendment No. 182, the only part of the guidance that appears to be compulsory is item 1.8 which relates to the use of materials. That is why amending the Bill is so crucial. We need something stronger on the face of the Bill: the guidance must be strengthened. We should be concerned about children not only in the classroom but at the school gates, in their play areas, in their youth clubs, or wherever they are prey to the influence of other people.
  Freedom under the law for parents to withdraw their children is now made nigh on impossible by the encouragement of schools to teach sex education through many curricular subjects; for example, drama, personal and social health education and many others. Would the Minister say how parents will be advised and helped to exercise their right to withdraw their children from sex education?
  The Prime Minister himself has said that it is absolute nonsense—I think he used the word "rubbish"—to those who said that role playing was permitted in schools. However, paragraph 4(4) of the guidance actually encourages role playing for sex education in our schools.
  The right reverend Prelate the Bishop of Blackburn, in his amendment, is asking that children learn about the nature of marriage. The right reverend Prelate's interpretation of the nature of marriage is wholly acceptable to me in the terms in which he has spelt it out, but I have to say that the nature of marriage as understood by many other noble Lords—whom I shall not name—would not be acceptable. I think the noble Lord, Lord Warner, gave it away: it is a dumbing down. It is equivocation. It is taking the lowest possible common denominator.
  I do not believe it is stigmatising children. I think children from broken homes would benefit greatly from the sort of education that the noble Baroness, Lady Young, is proposing through her amendments. All the evidence shows that marriage is the most stable form of relationship and that children brought up within marriage do better in every sense. The amendment of the noble Baroness, Lady Young, asks that children are taught that marriage provides a strong foundation for stable relationships and that that is the most reliable framework for raising children. It is unequivocal as opposed to what I believe is equivocal.

  867
  My noble friend's Amendments Nos. 180B and 180C refer to local education authorities which provide training and advice. I hope I did not mishear the right reverend Prelate when he said LEAs will from now on have no role in sex education. That is simply not true. LEAs have responsibility for giving advice, for giving guidance to their schools and also for providing training for sex education, and, in so far as they do, it is absolutely essential that my noble friend's amendment ensures that when LEAs are undertaking that obligation and duty for their schools that they do so having regard to the guidance.
  The Government at this time in another department are considering relaxing the laws on cruising for sex, group sex, gay people kissing in public and soliciting, under which a man can be jailed for up to two years for asking another man for sex while in a public place. That is not joined-up government.
  All surveys undertaken have shown that there is real concern on this issue. My noble friend has overwhelming support for the stand she is taking. I believe she has taken a courageous stand. The level of care and concern among the thousands who have written contrasts starkly with the level of intolerance by a high proportion of the few who have written opposing my noble friend's stand on this issue. Their mission is clear, and so too is the Government's; that is, do what you can today because it will leave us free to repeal Section 28 next week.
  Childhood is precious, and the combination of weak and equivocal guidance and the repeal of Section 28 will violate their innocence and healthy education. I hope that noble Lords will think very carefully and support my noble friend in her amendments.
  7.15 p.m.
  Lord Tope: My Lords, I have the sense of the House that it would like to reach a decision very soon, but on this issue it is appropriate that at least one speaker from our Benches should take part. I shall do so briefly to set out our position, which has been well rehearsed in the many, many hours of debate we have had on this subject during the course of the Bill.
  I have a little sadness that it is this subject, important though it is, that has consumed so much time from so many of your Lordships on a Bill which is actually about post-16 education and of which this issue, important though it is, is not a central part.
  I start by welcoming the changes which the Government have made to the Bill in this area. It is in the nature of compromise that it never satisfies everyone. Indeed, it rarely satisfies anyone. In this, all of us who are going to support the Government's view are to a greater or lesser extent compromising. I recognise that that is true on the Benches opposite me, and I refer to the right reverend Prelates here in such number. We are doing that because we want to reach consensus and agreement on what is a very important and sensitive issue. I would appeal to all your Lordships to try to think of it in those terms. We do no good to the people we wish to help and to protect by going forward in such a divided manner.
  868
  The hours that have been spent on debating this matter, more particularly outside this Chamber than in it, have produced amendments to the Bill which cover most of the points of concern raised by your Lordships through the many hours of debate.
  Similarly, little reference has been made tonight to the guidance. I welcome most of what is in the recently published guidance document. On the whole that document is thoughtful and well balanced. I have concerns over one or two elements but I sense that this is not the time to deal with those.
  I deal briefly with the amendments. I agree with much that has been said about the amendments in the name of the noble Baroness, Lady Young, so I shall not repeat it.
  I believe she is insisting on including in this Bill a comparative statement about the value of relationships. That is her view, and a very sincerely held view. It is probably the view held by most of us here today. But I feel no need to make value judgments about other people's relationships, and I feel even less need to have that enshrined in legislation. One point is well made, and I shall repeat it briefly; namely, our desire to protect pupils in the classroom. This provision is actually about young people, young children, the pupils. It is not about their parents. We should be remember that. How would children feel if they are in a classroom where the teacher is having to teach that marriage is the only stable relationship and their parents happen not to be married?
  We may regret this, and personally I do, but it is a fact that last year more children were born outside marriage than inside marriage. How will those children feel when they are in school and they are made to feel that in some way their parents' relationship and their home-life is of less value and a worse bet for a successful life than others?
  I now turn to the amendment in the name of the right reverend Prelate the Bishop of Blackburn. In doing so, I pay tribute to the enormous amount of hard work that I know he has had to do in this Chamber, but I suspect much more outside, in reaching this position. We will support his amendment. It is in terms that are not judgmental. His words are positive without any negative implications and they make a valued and important point without a value judgment. On these Benches we will support that amendment, and I am pleased to hear tonight that that is what the Government intend to do. We shall support the amendment in the name of the right reverend Prelate, but we cannot support the amendments in the name of the noble Baroness, Lady Young, for the reasons which have been stated so eloquently by other Members of your Lordships' House this evening.
  Baroness Blackstone: My Lords, this has been a long debate and I do not want to take up too much time of the House now. I intend to respond to some of the points which have been raised and to try to clarify the Government's position.
  I was a little disappointed by the speech of the noble Baroness, Lady Young. It seemed to me that she was simply repeating many of the things that she said on an

  869
  earlier occasion without taking any cognisance of the fact that the Government are responding to many of the concerns which she and others have expressed on a number of occasions.
  She repeated remarks which she has made about unsuitable materials without, again, any reference to the fact that the Government's amendment is determined to make sure that pupils in our schools will not be put under pressure to receive material that is totally unacceptable.
  I was also rather surprised by a number of references by noble Lords opposite to the guidance and to a suggestion from, I believe, the noble Earl, Lord Ferrers, and others that our guidance would not be adequate as a basis for reinforcing what the Government and many other people who have been consulted about this, including both the Anglican and Catholic Church, want to see.
  Our guidance is very clear. The head teacher and governors are responsible for making judgments in the last instance about what is appropriate. But that must be in line with that guidance, and within the PSHE framework and the law. Exactly the same considerations apply to many other aspects of the national curriculum.
  We cannot write a national curriculum for sex education or, indeed, for anything else and put that on the face of legislation. We must rely on the good judgment of head teachers and governors in implementing what is desirable and acceptable and what is the intention of the Government and many others who have considered those complex issues.
  However, I can tell the House that there are both sanctions and safeguards available if governing bodies do not have regard to that guidance. First, parents must be consulted about the governors' policy on sex education. Secondly, Ofsted has a statutory responsibility to inspect PSHE. Parents can complain. They can complain to the local education authority and, in the last resort, to the Secretary of State. Ultimately, they can take the school to judicial review. There has been a misunderstanding on behalf of noble Lords opposite.
  Lord Elton: My Lords—
  Baroness Blackstone: My Lords, it would be helpful if I were allowed to complete my speech in order that we can have the Division.
  I listened very carefully to what the noble Baroness, Lady Young, said, and to her explanation of Amendments Nos. 180B and 180C. I was also very grateful for what the noble Baroness, Lady Richardson, said in opposing the amendments. She spoke wisely from her own very deep experience of these matters.
  I should say to the noble Baroness, Lady Young, that providing advice and training to teachers and governors is an important role which local education authorities play in supporting schools. The Government have undertaken a number of measures
  870
  to underpin the rigour and quality of that role. As well as the Ofsted inspections of LEAs, we have issued a draft code of practice setting out the standards to be expected of those providing training and have asked Ofsted to carry out inspections of training provision.
  We expect that the general teaching council will also play a key role in supporting the quality of teacher training when it is established in September this year. The Teacher Training Agency has written to all providers of initial teacher training to draw their attention to the Secretary of State's sex and relationship education guidance. So teachers in training will also have to be fully aware of what is in the guidance.
  I was very grateful to the noble Lord, Lord Tope, for his support in relation to the guidance and its coverage. He mentioned that there are one or two areas in which he might like to have seen changes. But I am grateful for his general support for it on the Liberal Democrat Benches.
  I should mention at this point, since the noble Lord, Lord Tope, mentioned it, that we are including health service materials. I should say to the noble Baroness, Lady Young, that I mentioned that in my opening remarks but she apparently did not hear me make that point.
  We believe that it is right that local education authorities should have regard to the principles which we have set out when providing training and advice to schools. We have already sent copies of our guidance to all LEAs to encourage them to do so.
  We recognise that the noble Baroness has identified an important issue but we believe that the government Amendment No. 180A is a much more effective response to the issue which the noble Baroness identified.
  I turn now to Amendment No. 182. She does not think that marriage is mentioned often enough in our guidance. Perhaps I may quote from the Catholic Education Service's recent release which states that,
  "The guidance … is unambiguous in its insistence on children being taught the importance of marriage".
  Clearly, the Catholic Education Service and, indeed, from the remarks of the right reverend Prelate, the Anglican Church take a rather different view from that taken by the noble Baroness.
  In response to the claims made by the party opposite, I make absolutely plain the fact that not once did the previous government ever mention marriage in sex education guidance. This Government introduced marriage into sex and relationship education guidance for the first time. Circular 5/94, which our guidance replaces, contains no mention of marriage whatever. So it is a bit rich for the noble Baroness to complain that marriage is not mentioned often enough in our guidance.
  The noble Baroness spoke at length about her amendment. We must recognise that that amendment carries the same risk as the noble Baroness's previous amendment; namely, stigmatisation and possible bullying for many children at school.

  871
  Sex education has a serious purpose, not least to help to reverse the alarmingly high trend of teenage pregnancies. We cannot achieve that unless we take young people seriously and avoid denigrating the circumstances in which many of them live.
  Our guidance makes it clear, as does the Supporting Families document which is quoted in the guidance and the noble Baroness's amendment, that we recognise that there are other stable relationships in society. We should not allow homophobic bullying to take place. A number of noble Lords, including the noble Lord, Lord Tope, expressed particular concern about that during the Third Reading of the Bill. He and others referred to it again in this debate. We have strengthened our guidance to make it crystal clear that schools need to be able to deal with homophobic bullying.
  My noble friends Lord Davies of Coity and Lord Warner have rightly said that no child should be stigmatised because of his or her home circumstances. Again, that was a point made by the noble Lord, Lord Tope.
  I was grateful to the right reverend Prelate the Bishop of Blackburn for explaining his amendment. By drawing on the PSHE framework and the Government's sex and relationship education guidance, the wording of the amendment which he has tabled allows a true balance to be struck while giving clear support for the importance of marriage.
  We have worked hard over the past few months to agree principles and build consensus across society. By contrast, I am afraid that the amendment tabled by the noble Baroness threatens to undo what we have achieved.
  Perhaps I may say to the noble Baroness, Lady Blatch, that I was disappointed by her remarks. I thought she was being unduly cynical in her suggestion that the Government are bringing forward these amendments simply in order that Section 28 of the Local Government Act should be repealed. The Government are bringing forward these amendments because, unlike the previous government, they believe that it is right that pupils in our schools should get the best possible sex education, for all the reasons I have set out. Perhaps I may also say to the noble Baroness that we shall make it clear that if parents wish to withdraw their children from sex education, they may do so.
  There is a simple choice before this House this evening. If we are to have effective sex and relationship education, noble Lords must oppose the amendments tabled by the noble Baroness, Lady Young, Amendments Nos. 180B and 180C, and support the government amendment, Amendment No. 180A. If we are to have guidance built on the consensus that we have sought to achieve, this House must support Amendment No. 182A tabled by the right reverend Prelate the Bishop of Blackburn and must reject Amendment No. 182B tabled by the noble Baroness, Lady Young. I commend the amendment to the House.
  On Question, Motion agreed to.
  7.30 p.m.

  AS AN AMENDMENT TO COMMONS AMENDMENT NO. 180
  180B Line 4, at beginning insert ("Subject to subsection (7) below").
  Baroness Young: My Lords, I beg to move Amendment No. 180B, as an amendment to Commons Amendment No. 180.
  Moved, That Amendment No. 180B, as an amendment to Commons Amendment No. 180, be agreed to.—(Baroness Young.)
  On Question, Whether the said amendment (No. 180B), as an amendment to Commons Amendment No. 180, shall be agreed to?
  Their Lordships divided:—
  Their Lordships divided: Contents, 220; Not-Contents, 234.

  Division No. 2

  CONTENTS

  Ackner, L.

  Cranborne, V.

  Ahmed, L.

  Crathorne, L.

  Alexander of Weedon, L.

  Cuckney, L.

  Allenby of Megiddo, V.

  Cumberlege, B.

  Ampthill, L.

  Dean of Harptree, L.

  Anelay of St Johns, B.

  Denham, L.

  Arran, E.

  Dixon, L.

  Astor, V.

  Dixon-Smith, L.

  Astor of Hever, L.

  Donaldson of Lymington, L.

  Attlee, E.

  Eden of Winton, L.

  Baker of Dorking, L.

  Elles, B.

  Barber, L.

  Elliott of Morpeth, L.

  Bell, L.

  Elton, L.

  Belstead, L.

  Erroll, E.

  Blackwell, L.

  Evans of Parkside, L.

  Blatch, B.

  Feldman, L.

  Boardman, L.

  Ferrers, E.

  Brabazon of Tara, L.

  Fitt, L.

  Bridgeman, V.

  Flather, B.

  Bridges, L.

  Fookes, B.

  Brigstocke, B.

  Forsyth of Drumlean, L.

  Brittan of Spennithorne, L.

  Fraser of Carmyllie, L.

  Brookeborough, V.

  Freeman, L.

  Brougham and Vaux, L.

  Gardner of Parkes, B.

  Burnham, L. [Teller]

  Geddes, L.

  Buscombe, B.

  Glentoran, L.

  Butterworth, L.

  Goschen, V.

  Buxton of Alsa, L.

  Gray of Contin, L.

  Byford, B.

  Greenway, L.

  Caithness, E.

  Hanham, B.

  Campbell of Alloway, L.

  Hanningfield, L.

  Campbell of Croy, L.

  Hanson, L.

  Carlisle of Bucklow, L.

  Harris of High Cross, L.

  Carnarvon, E.

  Haslam, L.

  Carnegy of Lour, B.

  Hayhoe, L.

  Carr of Hadley, L.

  Henley, L. [Teller]

  Carrington, L.

  Higgins, L.

  Cavendish of Furness, L.

  Hodgson of Astley Abbotts, L

  Chadlington, L.

  Hogg, B.

  Chalfont, L.

  Holderness, L.

  Chalker of Wallasey, B.

  Home, E.

  Chilver, L.

  Hooper, B.

  Clark of Kempston, L.

  Howe, E.

  Cocks of Hartcliffe, L.

  Howe of Aberavon, L.

  Coe, L.

  Howell of Guildford, L.

  Colwyn, L.

  Hunt of Wirral, L.

  Cope of Berkeley, L.

  Hussey of North Bradley, L.

  Courtown, E.

  Hylton, L.

  Cowdrey of Tonbridge, L.

  Hylton-Foster, B.

  Cox, B.

  Islwyn, L.

  Craig of Radley, L.

  James of Holland Park, B.

  873

  Jellicoe, E.

  Pearson of Rannoch, L.

  Jenkin of Roding, L.

  Peel, E.

  Jopling, L.

  Peyton of Yeovil, L.

  Kelvedon, L.

  Pilkington of Oxenford, L.

  Kimball, L.

  Platt of Writtle, B.

  King of Wartnaby, L.

  Plumb, L.

  Kingsland, L.

  Plummer of St. Marylebone, L.

  Kirkham, L.

  Powell of Bayswater, L.

  Knight of Collingtree, B.

  Prior, L.

  Laing of Dunphail, L.

  Pym, L.

  Laird, L.

  Rawlinson of Ewell, L.

  Lamont of Lerwick, L.

  Reay, L.

  Lane of Horsell, L.

  Rees, L.

  Lang of Monkton, L.

  Renton, L.

  Lindsay, E.

  Renton of Mount Harry, L.

  Listowel, E.

  Roberts of Conwy, L.

  Liverpool, E.

  Rogan, L.

  Lofthouse of Pontefract, L.

  Rotherwick, L.

  Longford, E.

  Saatchi, L.

  Lucas, L.

  Saltoun of Abemethy, Ly.

  Luke, L.

  Sanderson of Bowden, L.

  Lyell, L.

  Seccombe, B.

  McColl of Dulwich, L.

  Selkirk of Douglas, L.

  McConnell, L.

  Selsdon, L.

  Macfarlane of Bearsden, L.

  Sharples, B.

  McFarlane of Llandaff, B.

  Shaw of Northstead, L.

  Mackay of Ardbrecknish, L.

  Sheppard of Didgemere, L.

  Mancroft, L.

  Simon of Glaisdale, L.

  Marlesford, L.

  Slim, V.

  Masham of Ilton, B.

  Stallard, L.

  Mason of Barnsley, L.

  Stevens of Ludgate, L.

  Mayhew of Twysden, L.

  Stewartby, L.

  Miller of Hendon, B.

  Stodart of Leaston, L.

  Molyneaux of Killead, L.

  Stoddart of Swindon, L.

  Monson, L.

  Strange, B.

  Montagu of Beaulieu, L.

  Strathclyde, L.

  Montrose, D.

  Swinfen, L.

  Moore of Lower Marsh, L.

  Taylor of Warwick, L.

  Moran, L.

  Tebbit, L.

  Mowbray and Stourton, L.

  Tenby, V.

  Moynihan, L.

  Thomas of Gwydir, L.

  Murton of Lindisfarne, L.

  Tombs, L.

  Naseby, L.

  Trefgarne, L.

  Neill of Bladen, L.

  Trumpington, B.

  Noakes, B.

  Tugendhat, L.

  Norfolk, D.

  Vivian, L.

  Northbrook, L.

  Waddington, L.

  Northesk, E.

  Wade of Chorlton, L.

  O'Cathain, B.

  Wakeham, L.

  Onslow, E.

  Waldegrave of North Hill, L.

  Onslow of Woking, L.

  Weatherill, L.

  Oppenheim-Barnes, B.

  Wilberforce, L.

  Orme, L.

  Wilcox, B.

  Oxfuird, V.

  Williamson of Horton, L.

  Palmer, L.

  Windlesham, L.

  Palumbo, L.

  Wolfson, L.

  Park of Monmouth, B.

  Wolfson of Sunningdale, L.

  Parkinson, L.

  Young, B.

  Patten, L.

  Young of Graffham, L.

  NOT-CONTENTS

  Acton, L.

  Bassam of Brighton, L.

  Addington, L.

  Bath and Wells, Bp.

  Alderdice, L.

  Beaumont of Whitley, L.

  Alli, L.

  Berkeley, L.

  Amos, B.

  Bernstein of Craigweil, L.

  Andrews, B.

  Billingham, B.

  Archer of Sandwell, L.

  Birt, L.

  Ashley of Stoke, L.

  Blackburn, Bp.

  Ashton of Upholland, B.

  Blackstone, B.

  Attenborough, L.

  Bledisloe, V.

  Avebury, L.

  Borrie, L.

  Bach, L.

  Bradford, Bp.

  Barker, B.

  Bradshaw, L.

  Barnett, L.

  Bragg, L.

  874

  Brennan, L.

  Hunt of Chesterton, L.

  Brett, L.

  Hunt of Kings Heath, L.

  Bristol, Bp.

  Hutchinson of Lullington, L.

  Brooke of Alverthorpe, L.

  Irvine of Lairg, L. (Lord Chancellor)

  Brookman, L.

  Jacobs, L.

  Burlison, L.

  Janner of Braunstone, L.

  Carlile of Berriew, L.

  Jay of Paddington, B. (Lord Privy Seal)

  Carter, L. [Teller]

  Castle of Blackburn, B.

  Jenkins of Hillhead, L.

  Chandos, V.

  Joffe, L.

  Christopher, L.

  Judd, L.

  Clement-Jones, L.

  King of West Bromwich, L.

  Clinton-Davis, L.

  Kirkhill, L.

  Cohen of Pimlico, B.

  Laming, L.

  Craigavon, V.

  Layard, L.

  Crawley, B.

  Lea of Crondall, L.

  Dahrendorf, L.

  Lester of Herne Hill, L.

  Darcy de Knayth, B.

  Linklater of Butterstone, B.

  David, B.

  Lipsey, L.

  Davies of Coity, L.

  Lockwood, B.

  Davies of Oldham, L.

  Lovell-Davis, L.

  Dean of Thornton-le-Fylde, B

  Ludford, B.

  Dearing, L.

  McCarthy, L.

  Derby, Bp.

  McCluskey, L.

  Desai, L.

  Macdonald of Tradeston, L.

  Dholakia, L.

  McIntosh of Haringey, L. [Teller]

  Diamond, L.

  McIntosh of Hudnall, B.

  Donoughue, L.

  MacKenzie of Culkein, L.

  Dormand of Easington, L.

  Mackenzie of Framwellgate, L

  Dubs, L.

  Mackie of Benshie, L.

  Durham, Bp.

  McNally, L.

  Eatwell, L.

  Maddock, B.

  Elder, L.

  Mallalieu, B.

  Evans of Temple Guiting, L.

  Mar and Kellie, E.

  Ezra, L.

  Marsh, L.

  Falconer of Thoroton, L.

  Massey of Darwen, B.

  Falkland, V.

  Merlyn-Rees, L.

  Farrington of Ribbleton, B.

  Methuen, L.

  Faulkner of Worcester, L.

  Miller of Chilthorne Domer, B

  Filkin, L.

  Mitchell, L.

  Fyfe of Fairfield, L.

  Molloy, L.

  Gale, B.

  Morgan, L.

  Gavron, L.

  Morris of Castle Morris, L.

  Geraint, L.

  Morris of Manchester, L.

  Gibson of Market Rasen, B.

  Murray of Epping Forest, L.

  Gilbert, L.

  Newby, L.

  Gladwin of Clee, L.

  Nicholson of Winterbourne, B.

  Goodhart, L.

  Nicol, B.

  Gordon of Strathblane, L.

  Northover, B.

  Goudie, B.

  Norton of Louth, L.

  Gould of Potternewton, B.

  Oakeshott of Seagrove Bay, L.

  Grabiner, L.

  Oxford, Bp.

  Graham of Edmonton, L.

  Greaves, L.

  Parekh, L.

  Greengross, B.

  Patel of Blackburn, L.

  Gregson, L.

  Paul, L.

  Grenfell, L.

  Peston, L.

  Hamwee, B.

  Phillips of Sudbury, L.

  Hardy of Wath, L.

  Pitkeathley, B.

  Harris of Greenwich, L.

  Plant of Highfield, L.

  Harris of Haringey, L.

  Ponsonby of Shulbrede, L.

  Harris of Richmond, B.

  Portsmouth, Bp.

  Harrison, L.

  Prashar, B.

  Haskel, L.

  Puttnam, L.

  Haskins, L.

  Ramsay of Cartvale, B.

  Hattersley, L.

  Randall of St. Budeaux, L.

  Hayman, B.

  Razzall, L.

  Healey, L.

  Rea, L.

  Hilton of Eggardon, B.

  Hollick, L.

  Redesdale, L.

  Hollis of Heigham, B.

  Rendell of Babergh, B.

  Holme of Cheltenham, L.

  Rennard, L.

  Hooson, L.

  Renwick of Clifton, L.

  Howells of St. Davids, B.

  Richard, L.

  Hoyle, L.

  Richardson of Calow, B.

  Hughes of Woodside, L.

  Rodgers of Quarry Bank, L.

  875

  Rogers of Riverside, L.

  Thomas of Walliswood, B.

  Roper, L.

  Thomson of Monifieth, L.

  Russell, E.

  Thornton, B.

  Russell-Johnston, L.

  Tomlinson, L.

  Sainsbury of Turville, L.

  Tope, L.

  Salisbury, Bp.

  Tordoff, L.

  Sawyer, L.

  Turnberg, L.

  Scotland of Asthal, B.

  Turner of Camden, B.

  Scott of Needham Market, B.

  Varley, L.

  Sewel, L.

  Walker of Doncaster, L.

  Sharman, L.

  Wallace of Saltaire, L.

  Sharp of Guildford, B.

  Walmsley, B.

  Shepherd, L.

  Walpole, L.

  Shore of Stepney, L.

  Warner, L.

  Shutt of Greetland, L.

  Warnock, B.

  Simon of Highbury, L.

  Warwick of Undercliffe, B.

  Simpson of Dunkeld, L.

  Watson of Invergowrie, L.

  Smith of Clifton, L.

  Watson of Richmond, L.

  Smith of Gilmorehill, B.

  Wedderburn of Charlton, L

  Smith of Leigh, L.

  Whitaker, B.

  Stern, B.

  Whitty, L.

  Stone of Blackheath, L.

  Wigoder, L.

  Strabolgi, L.

  Wilkins, B.

  Williams of Crosby, B.

  Symons of Vernham Dean, B.

  Williams of Elvel, L.

  Taverne, L.

  Williams of Mostyn, L.

  Taylor of Blackburn, L.

  Winston, L.

  Thomas of Gresford, L.

  Woolmer of Leeds, L.

  Thomas of Macdesfield, L.

  Young of Old Scone, B.

  Resolved in the negative, and amendment disagreed to accordingly.
  7.43 p.m.
  [Amendment No. 180C, as an amendment to Commons Amendment No. 180, not moved.]
  On Question, Commons Amendment No. 180, as amended, agreed to.

  COMMONS AMENDMENT
  181 Clause 117, page 55, leave out lines 28 and 29 and insert ("omit "local education authority,".")
  Baroness Blackstone: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 181.
  Moved, That the House do agree with the Commons in their Amendment No. 181.—(Baroness Blackstone.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  182 Clause 117, page 55, line 30, leave out from beginning to end of line 44 on page 56 and insert—
  ("(3) After subsection (1) of that section insert—

  "(1A) The Secretary of State must issue guidance designed to secure that when sex education is given to registered pupils at maintained schools they are protected from teaching and materials which are inappropriate having regard to the age and the religious and cultural background of the pupils concerned.

  (1B) In discharging their functions under subsection (1) governing bodies and head teachers must have regard to the Secretary of State's guidance.

  (1C) Guidance under subsection (1A) must include guidance about any material which may be produced by NHS bodies for use for the purposes of sex education in schools.

  876

  (1D) The Secretary of State may at any time revise his guidance under subsection (1A)."

  (4) In subsection (2) of that section—

  (a) for "subsection (1)" substitute "this section", and

  (b) at the end insert "and "NHS body" has the same meaning as in section 22 of the National Health Service Act 1977."

  (5) In section 404 (sex education: statements of policy) after subsection (1) insert—
  "(1A) A statement under subsection (1) must include a statement of the effect of section 405."").
  Baroness Blackstone: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 182.
  Moved, That the House do agree with the Commons in their Amendment No. 182.—(Baroness Blackstone.)

  AS AN AMENDMENT TO COMMONS AMENDMENT NO. 182
  182A Line 6, after ("schools") insert—
  ("(a) they learn the nature of marriage and its importance for family life and the bringing up of children, and
  (b)")
  The Lord Bishop of Blackburn: My Lords, I beg to move Amendment No. 182A.
  Moved, That Amendment No. 182A, as an amendment to Commons Amendment No. 182, be agreed to.—(The Lord Bishop of Blackburn.)
  On Question, Amendment No. 182A agreed to.
  [Amendment No. 182B, as an amendment to Commons Amendment No. 182, not moved.]

  AS AN AMENDMENT TO COMMONS AMENDMENT NO. 182
  182C Line 15, at beginning insert ("While adhering to the principles set out in subsection (1A),")
  Lord Ackner: My Lords, I beg to move Amendment No. 182C as an amendment to Commons Amendment No. 182.
  This amendment comes as an anti-climax. It has nothing to do with the emotional subjects which have been recently canvassed. It concerns a simple drafting amendment which is designed to ensure that, although the Secretary of State under subsection (1D) may at any time revise his guidance under subsection (1A), he must do so while adhering to the principles set out in subsection (1A).
  When I drafted this amendment, I thought the answer might well be that the Secretary of State was limited by subsection (1D) in whatever new amendments he wished to make. But I was not sure. I felt the matter would be easily cleared up by adding the simple 10 words in front of subsection (1D),
  "While adhering to the principles set out in subsection (1A)",
  and that would deal with the matter. The noble Baroness, with characteristic courtesy only matched by her charm, kindly sent me a photostat letter on 18th July in fact telling me the answer was precisely that; that is, that subsection (1A) conditioned and limited what the Minister could do.

  877
  I accept that that is arguable. But I wish to move my amendment purely on the basis that the whole of this ambiguity can be dealt with by using the less than 12 words which my amendment proposes; that is, the addition of the words,
  "While adhering to the principles set out in subsection (1A)",
  and then there is no further problem.
  Moved, That Amendment No. 182B, as an amendment to Commons Amendment No. 182, be agreed to.—(Lord Ackner.)
  Baroness Blackstone: My Lords, I am a little surprised that the noble and learned Lord, Lord Ackner, did not speak to his amendment when we discussed all the amendments in this group. However, I shall be very happy to respond to it now.
  Lord Ackner: My Lords, one of the arts of advocacy is to know when to remain silent. If I had got up when everyone was clamouring for the Minister to respond and said that I had a dull drafting amendment to put forward, I do not think that I would have been the flavour of the month.
  Baroness Blackstone: My Lords, perhaps the noble and learned Lord is right in that respect. I have to say that I am a little daunted in the face of his expertise and experience in such matters when embarking on the explanation of what I believe to be the legal effect of the amendment. However, I hope that it will be helpful to the House if I try to clarify the position.
  The new subsection (1A) sets out the requirement as to what the guidance issued by the Secretary of State must secure. Whenever the Secretary of State issues further guidance or amends it in any way, subsection (1A) is still the basis for the guidance. Therefore, it must still meet the requirements of subsection (1A). I hope that the noble and learned Lord will agree that the objective of his amendment has already been secured and that he will feel able to withdraw it.
  Lord Ackner: My Lords, I do not look upon my amendment as being an earth-shattering one. I have the well-known case, in which I was one of the Law Lords involved, of Pepper v Hart on my side. As the Minister has said in terms that that which I was worried about is amply covered by the Bill, that seems to me to be all that I desired to achieve. I beg leave to withdraw my amendment.
  Amendment No. 182C, as an amendment to Commons Amendment No. 182, by leave, withdrawn.
  On Question, Motion, as amended, agreed to.

  COMMONS AMENDMENT
  183 Before Clause 119, insert the following new clause—

  WALES
  (" .—(1) Where this Part of this Act confers a function on the Secretary of State (whether by amendment of another Act or otherwise)—
  878

  (a) the function shall be exercisable in relation to Wales by the National Assembly for Wales, and

  (b) for that purpose any reference to the Secretary of State shall be taken as a reference to the National Assembly.

  (2) Where—

  (a) this Part confers a function on the Secretary of State by amendment of an Act, and

  (b) any functions of that Act have before the passing of this Act been transferred to the National Assembly by Order in Council under section 22 of the Government of Wales Act 1998 (transfer of functions),

  the Order shall be treated for the purposes of any varying or revoking Order as having transferred to the National Assembly the function mentioned in paragraph (a).
  (3) Subsection (1)(a) has effect subject to any Order in Council made by virtue of subsection (2).
  (4) This section shall not apply in relation to—

  (a) section 85. 87, 96, (Pensions) or (Commencement) of this Act,

  (b) the amendment of section 1(3) of the Education (Fees and Awards) Act 1983 (fees at institutions) made by Schedule 8 to this Act,

  (c) the amendment of section 26 of the Employment Act 1988 (status of trainees etc) made by Schedule 8 to this Act, or

  (d) the amendment of section 19 of the Disability Discrimination Act 1995 (discrimination in relation to goods, facilities and services) made by Schedule 8 to this Act.")

  Baroness Farrington of Ribbleton: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 183. In moving this Motion, I shall speak also to Amendments Nos. 187 to 194.
  The only new points of substance in this group are Amendments Nos. 183 and 191. The other amendments are consequential on those new clauses or on other territorially related amendments debated when we discussed earlier groups. I am happy to provide further detail on any of those amendments should any noble Lord require me to do so.
  The two new clauses that Amendments Nos. 183 and 191 insert relate to devolution and commencement of provisions of the Bill. As they need to reflect the totality of the Bill, noble Lords will, I hope, understand that work on these two new clauses could only be finalised once all the other amendments to the Bill had been prepared.
  Amendment No. 183 inserts a new clause that deals with devolution of provisions in Part V. Noble Lords will recall that the earlier parts of the Bill relate clearly and simply to England or Wales only. But Part V is rather more complex. The new clause therefore makes clear that, where non-reserved provisions in Part V confer functions upon the Secretary of State, those functions are exercisable in relation to Wales by the National Assembly for Wales. It covers both the new functions set to out in the Bill and the amendments by the Bill to existing legislation underpinning functions that were devolved to the National Assembly under the Government of Wales Act 1998.
  Amendment No. 191 inserts a new clause covering commencement of the provisions of the Bill and, in particular, makes provision for the National Assembly to commence provisions that relate to Wales.

  879
  Noble Lords will know that Bills, or parts of Bill, normally come into force in accordance with one or more commencement orders made by the relevant Secretary of State. The commencement clause of the Bill as it left this House—Clause 122—provided for the National Assembly to commence the Welsh Parts II and IV and for the Secretary of State, on top of the English Parts I and III, to commence the English-and-Welsh Part V. However, it is an agreed principle of the devolution arrangements that the National Assembly should commence legislation as far as it relates to Wales. In the context of this Bill, that has required an extremely complex analysis of Part V in relation to commencement. The new clause fully achieves that separation. Therefore, I commend it the House.
  Moved, That the House do agree with the Commons in their Amendment No. 183. —(Baroness Farrington of Ribbleton.)
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  184 Clause 119, page 57, line 2, leave out ("Schedule 9 contains") and insert ("Parts I and II of Schedule 9 contain")
  185 Page 57, line 5, at end insert—
  ("( ) Part III of Schedule 9 contains transitional provision relating to the establishment of the Adult Learning Inspectorate.")
  186 Page 57, line 5, at end insert—
  ("( ) Part IV of Schedule 9 contains transitional provision relating to the Education (Student Loans) Act 1990.")
  187 Clause 120, page 57, line 12, leave out ("122(1)") and insert
  "(Commencement)(1) or (3)")
  188 Page 57, line 14, at end insert—
  ("(2A) A statutory instrument is subject to annulment in pursuance of a resolution of the Scottish Parliament if the instrument contains regulations made by the Scottish Ministers under section 96.
  (2B) The power of the Department of Higher and Further Education, Training and Employment in Northern Ireland to make regulations under section (Qualifying arrangements: Northern Ireland) or (Grants: Northern Ireland) shall be exercisable by statutory rule for the purposes of the Statutory Rules (Northern Ireland) Order 1979; and any such regulations shall be subject to negative resolution within the meaning of section 41(6) of the Interpretation Act (Northern Ireland) 1954 as if they were statutory instruments within the meaning of that Act.")
  189 Page 57, line 18, leave out from ("the") to ("thinks") in line 19 and insert ("person making the order or regulations")
  190 Clause 122, Leave out Clause 22.
  191 After Clause 122, insert the following new clause—

  COMMENCEMENT
  (" . —(1) The following provisions of this Act shall come into force in accordance with provision made by the Secretary of State by order—

  (a) Parts I and III,

  (b) sections 84, 85, 87, (Stamp duty), 90, 92(1), 93, 96, (Qualifying arrangements), (Qualifying arrangements: Northern Ireland), (Qualifying arrangements: further provision), 97, (Grants: Northern Ireland), 103 to 109. 111, 112, (City academies: financial provisions), (City colleges and academies: special educational needs), (Pensions), (Pensions: interpretation), (Pensions: delegation), (Financial support for students) and (Financial support for students: Northern Ireland),

  880

  (c) in Schedule 8, paragraphs 2, 2C, 12, 14 to 16, 17 to 19, 21B to 22, 23(3), 37A, 39A and 39B,

  (d) Part IV of Schedule 9, and

  (e) in Schedule 10, the repeals in section 91 of the Further and Higher Education Act 1992 and section 142 of the School Standards and Framework Act 1998 and the repeals consequential upon any provision mentioned in paragraph (c).

  (2) The following provisions of this Act shall come into force in accordance with provision made by the National Assembly for Wales by order—

  (a) Parts II and IV, and

  (b) sections 86, (Transfers: Wales), 91, 92(2), 94. (Provision of services) to (Supplementary) and (Wales: provision of information by public bodies).

  (3) If and in so far as a provision of this Part relates to England, the Secretary of State may (subject to subsection (5)) make provision by order about its commencement.
  (4) If and in so far as a provision of this Part relates to Wales, the National Assembly for Wales may (subject to subsection (5)) make provision by order about its commencement.
  (5) Subsections (3) and (4) do not apply to—

  (a) a provision mentioned in subsection (1) or (2),

  (b) any of sections (City academies), (City academies: land), (Wales), 119, 120, 123 and 124,

  (c) Schedule (City academies: land),

  (d) any provision of Schedule 8 or 10 which is consequential upon section (City academies) or (City academies: land) or Schedule (City academies: land),

  (e) Parts I to III of Schedule 9, or

  (f) this section.

  (6) The Secretary of State may by order make provision—

  (a) in consequence of a provision of this Act being brought into force at different times in relation to England and in relation to Wales, or

  (b) in consequence of one provision of this Act being brought into force before another.

  (7) The National Assembly for Wales may by order make provision in relation to Wales in consequence of either of the matters mentioned in subsection (6)(a) and (b).
  (8) An order under subsection (6) or (7) may, in particular, disapply or modify the application of provision made by or under this or any other Act.")
  192 Clause 123, page 57, line 26, leave out ("122") and insert ("(Commencement)")
  193 Page 57, line 27, at end insert—
  ("( ) Section (Qualifying arrangements: further provision) extends to England and Wales and Northern Ireland.
  ( ) Sections (Qualifying arrangements: Northern Ireland), (Grants: Northern Ireland) and (Financial support for students: Northern Ireland) extend to Northern Ireland only.")
  194 Clause 124, page 57, leave out lines 32 to 35
  195 Schedule 1, page 58, line 23, after ("member") insert ("or chairman or chief executive")page 57, leave out lines 32 to 35
  196 Page 58, line 25, after ("chairman") insert ("or chief executive")
  197 Schedule 2, page 61, line 20, at end insert—

  Director
  A1.—(1) The Council must appoint one of its employees as the director of a local council.
  (2) The Council must seek the advice of the chairman of a local council before appointing a director.
  (3) Sub-paragraph (2) does not apply to the appointment of the first director of a local council.
  (4) If a person to be appointed as a director of a local council is not already a member of that local council, the Council must appoint him as a member of the local council for the same term as the term of his appointment as director.
  (5) If a person to be appointed as a director of a local council is already a member of that local council but his term of appointment as such ends before the term of his appointment as director ends, the Council must extend his term of appointment as a member so that it ends when the term of his appointment as director ends.")
  198 Page 61, line 24, after ("member") insert ("or chairman")
  199 Page 61, leave out lines 42 and 43
  200 Page 62, line 1, leave out ("other")
  201 Schedule 3, page 62, line 29, at end insert—
  ("(2A) The committee must also consider, and advise the Council on, what education and training would be appropriate for young persons of different abilities and aptitudes in order to prepare them for those opportunities, responsibilities and experiences of adult life which are not connected to employment.")
  202 Schedule 4, page 64, line 37, after ("member") insert ("or chairman or chief executive")
  203 Page 64, line 39, after ("chairman") insert ("or chief executive")
  204 Schedule 5, page 68, line 22, after ("member") insert ("or chairman")
  205 Schedule 6, page 69, line 7, at end insert—
  ("( ) If a person to be appointed under section 50(3) is not already a member of the Inspectorate, the Secretary of State must appoint him as a member for the same term as his appointment as chairman or chief officer.
  ( ) If a person to be appointed under section 50(3) is already a member of the Inspectorate but his term of appointment as such would end before his term of appointment as chairman or chief officer ends, the Secretary of State must extend his term of appointment as a member so that it ends when his appointment as chairman or chief officer ends.")
  206 Page 69, line 8, after ("member") insert (", chairman or chief officer")
  207 Page 69, line 10, after ("chairman") insert ("or chief officer")
  208 Page 70, line 31, after ("company") insert (", or otherwise become a member of a company,")
  209 Page 72, line 18. at end insert—

  Financial year of the Inspectorate.
  A financial year of the Inspectorate is—

  (a) the period starting with the date on which it is established and ending with the second 31 March following that date;

  (b) each successive period of twelve months.")

  210 Schedule 7, page 73, line 4, leave out from ("80") to ("forms") in line 5 and insert (the Chief Inspector")
  211 Page 73, line 7, leave out from beginning to ("shall") and insert ("The Chief Inspector")
  212 Page 74, line 35, leave out from ("80") to ("forms") in line 36 and insert ("the Chief Inspector")
  213 Page 74, line 40, leave out from beginning to ("shall") and insert ("The Chief Inspector")
  214 Page 78, line 34, leave out ("35(5)") and insert ("35(6)")
  215 Page 79, leave out line 10
  216 Page 79, line 12, at end insert ("; and if the event does not occur by the specified time, the proposals shall be treated as being rejected at that time.")
  217 Page 79, line 36, after ("may") insert ("(before the arrival of the specified time)")
  218 Page 79, line 40, at end insert—
  ("( ) A school organisation committee may act under subparagraph (2)(a) or (b) only in response to a request by the Council.")
  219 Page 79, line 41, leave out from ("only") to ("is") in line 43 and insert ("in response to a proposal of the Council which")
  220 Page 79, line 45, at end insert—
  ("; and where a determination is made under sub-paragraph (2)(c) in relation to proposals they shall be treated as rejected.")
  221 Page 79, line 48, leave out from ("36(2),") to end of line 2 on page 80.
  222 Page 80, line 4, leave out ("a question of a kind referred to in sub-paragraph (1)(a) or (b)") and insert ("the question mentioned in sub-paragraph (1)")
  223 Page 81, leave out line 5
  224 Page 81, line 7, at end insert ("; and if the event does not occur by the specified time, the proposals shall be treated as being rejected at that time.")
  225 Page 81, line 16, after ("may") insert ("(before the arrival of the specified time)")
  226 Page 81, line 20, at end insert—
  ("( ) The National Assembly may act under sub-paragraph (2)(a) or (b) only in response to a request by the Council.")
  227 Page 81, line 21, leave out from ("only") to ("is") in line 23 and insert ("in response to a proposal of the Council which")
  228 Page 81, line 25, at end insert—
  ("; and where a determination is made under sub-paragraph (2)(c) in relation to proposals they shall be treated as rejected.")
  229 After Schedule 7, insert the following new schedule—

  SCHEDULE CITY ACADEMIES: LAND

    Transfer schemes
    1.—(1) The Secretary of State may make a scheme in relation to land if these requirements are met—

    (a) a local education authority holds a freehold or leasehold interest in the land when the scheme is made;

    (b) at some time in the period of 5 years ending with the day on which this Act is passed the land was used wholly or mainly for the purposes of a county school or community school;

    (c) at the time the scheme is made the land is no longer used as mentioned in paragraph (b) or the Secretary of State thinks it is about to be no longer so used;

    (d) before making the scheme the Secretary of State consulted the authority.

    (2) These requirements must be met as regards a scheme—

    (a) the scheme must provide for a transfer of the authority's interest in the land or in such part of it as is specified in the scheme;

    (b) the transfer must be to a person (the transferee) who is specified in the scheme and is concerned with the running of a city academy;

    (c) the transfer must be made to the transferee for the purposes of the city academy;

    (d) the scheme must provide for the transfer to the transferee of any right or liability held by the authority as holder of the interest in the land or specified part concerned.

    (3) In sub-paragraph (2) the reference to a right or liability—

    (a) includes a reference to a right or liability as a trustee, but

    (b) excludes a reference to a liability in respect of the principal of or interest on a loan.

    (4) A scheme may include such supplementary, incidental, consequential or transitional provisions as the Secretary of State thinks are appropriate.
    (5) A scheme must be so expressed that it does not come into force while the land concerned is used as mentioned in sub-paragraph (1)(b).
    (6) A scheme comes into force—

    (a) on the day it specifies for it to come into force, or

    883

    (b) on the day it otherwise identifies as the day for it to come into force.

    (7) When a scheme comes into force it has effect to transfer (in accordance with its provisions) the interests, rights and liabilities to which it applies.
    (8) A transfer made by virtue of a scheme is binding on all persons (as well as on the authority and the transferee) even if, apart from this sub-paragraph, it would have required the consent or concurrence of any person.

    Restriction on disposal
    2.—(1) Sub-paragraph (2) applies if—

    (a) a freehold or leasehold interest in land is held by a local education authority,

    (b) at any time in the period of 5 years ending with the day on which this Act is passed the land was used wholly or mainly for the purposes of a county school or community school, and

    (c) the authority proposes to make a disposal in respect of the interest, or to enter into a contract to make a disposal in respect of it, or to grant an option to make an acquisition in respect of it.

    (2) Unless the Secretary of State consents, the authority must not make the disposal or enter into the contract or grant the option.
    (3) Sub-paragraph (2) does not apply to a disposal made in pursuance of a contract made, or option granted, before the coming into force of this paragraph.
    (4) Sub-paragraph (2) does not apply to—

    (a) a disposal in favour of a person for the purposes of a city academy and for no consideration;

    (b) a contract to make such a disposal;

    (c) a grant of an option for a person to make an acquisition for the purposes of a city academy and for no consideration.

    (5) A disposal or contract or grant is not invalid by reason only that it is made in contravention of sub-paragraph (2).
    (6) A person acquiring an interest in land or entering into a contract to acquire it is not to be concerned to enquire whether consent required by sub-paragraph (2) has been given.
    3.—(1) This paragraph applies if an authority makes a disposal or enters into a contract or grants an option in contravention of paragraph 2(2).
    (2) In the case of a grant of an option, the Secretary of State may by notice served on the option holder repudiate the option at any time before it is exercised.
    (3) In the case of a contract to make a disposal in respect of an interest, the Secretary of State may by notice served on the other party to the contract repudiate it at any time before a conveyance of the interest concerned is executed.
    (4) A repudiation under sub-paragraph (2) or (3) has effect—

    (a) when the notice is served, and

    (b) as if the repudiation were made by the authority.

    (5) In the case of a disposal in respect of an interest (whether or not in pursuance of an option or contract falling within subparagraph (2) or (3)) the Secretary of State may purchase the interest concerned compulsorily.
    (6) The Acquisition of Land Act 1981 is to apply in relation to the compulsory purchase of an interest under sub-paragraph (5).
    (7) On completion of a compulsory purchase of an interest under sub-paragraph (5) the Secretary of State must transfer it to a person concerned with the running of a city academy.
    (8) If the Secretary of State acquires an interest by compulsory purchase under sub-paragraph (5) he is entitled to recover from the authority an amount equal to the aggregate of—

    (a) the compensation agreed or awarded in respect of the purchase,

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    (b) any interest payable by him in respect of the compensation, and

    (c) the costs and expenses incurred by him in connection with the making of the compulsory purchase order.

    (9) The authority must provide the Secretary of State with such information as he may require it to provide in connection with a compulsory purchase under sub-paragraph (5).
    4.—(1) For the purposes of paragraphs 2 and 3—

    (a) references to a disposal in respect of an interest are to a disposal of the whole interest or of a lesser interest;

    (b) references to an acquisition in respect of an interest are to an acquisition of the whole interest or of a lesser interest.

    (2) If the disposal referred to in paragraph 3(3) or (5) is a disposal of a lesser interest, the reference there to the interest concerned is to the lesser interest.

    Restriction on appropriation
    5.—(1) Sub-paragraph (2) applies if—

    (a) a freehold or leasehold interest in land is held by a local education authority,

    (b) at any time in the period of 5 years ending with the day on which this Act is passed the land was used wholly or mainly for the purposes of a county school or community school, and

    (c) the authority proposes to make an appropriation of the land under section 122 of the Local Government Act 1972.

    (2) Unless the Secretary of State consents, the authority must not make the appropriation.
    6.—(1) This paragraph applies if an authority makes an appropriation in contravention of paragraph 5(2).
    (2) The Secretary of State may purchase the interest concerned compulsorily.
    (3) Paragraph 3(6) to (9) apply to a compulsory purchase of an interest under sub-paragraph (2) above as they apply to a compulsory purchase of an interest under paragraph 3(5).

    Duty to inform
    7.—(l) Sub-paragraph (2) applies if—

    (a) a freehold or leasehold interest in land is held by a local education authority,

    (b) at any time in the period of 5 years ending with the day on which this Act is passed the land was used wholly or mainly for the purposes of a county school or community school, and

    (c) the authority proposes to change the use of the land in such a way that (were the change made) the land would cease to be capable of use wholly or mainly for the purposes of a school.

    (2) The authority must inform the Secretary of State of the proposal.

    Former city academies
    8.—(1) This paragraph applies if—

    (a) a freehold or leasehold interest in land is transferred from a local education authority on or after the day on which this Act is passed,

    (b) the transfer is made to a person for the purposes of a city academy, and

    (c) the first or the second condition set out below is satisfied.

    (2) The first condition is that—

    (a) the school concerned ceases to be a city academy, and

    (b) immediately before the school ceases to be a city academy the interest is held by a person for the purposes of the city academy.

    (3) The second condition is that, although the school concerned continues to be a city academy, the interest ceases to be held for the purposes of the city academy.
    (4) This paragraph applies whether or not the transfer is made by virtue of a scheme under paragraph 1.
    (5) Sub-paragraph (2) applies whether or not, on the school ceasing to be a city academy, it simultaneously ceases to function as a school.
    (6) The Secretary of State may make a scheme providing for the transfer of the interest—

    (a) from the person holding it;

    (b) to the authority from which the transfer mentioned in sub-paragraph (1)(a) was made.

    (7) A scheme may include such supplementary, incidental, consequential or transitional provisions as the Secretary of State thinks are appropriate.
    (8) A scheme comes into force on the day it specifies for it to come into force.
    (9) When a scheme comes into force it has effect to transfer (in accordance with its provisions) the interest to which it applies.
    (10) A transfer made by virtue of a scheme is binding on all persons (as well as on the authority and the transferee) even if, apart from this sub-paragraph, it would have required the consent or concurrence of any person.

    Other Acts
    9.—(1) Section 123(2) of the Local Government Act 1972 (disposal for consideration less than the best reasonably obtainable) does not apply to a disposal to a person for the purposes of a city academy.
    (2) Section 123(2A) of that Act (disposal of open space requires certain procedures) does not apply to a disposal which is made—

    (a) to a person for the purposes of a city academy, and

    (b) for no consideration.

    (3) Section 77(1) of the School Standards and Framework Act 1998 (restriction on disposal of playing fields) does not apply to a disposal which is made—

    (a) by a local authority to a person for the purposes of a city academy, and

    (b) for no consideration.

    Regulations
    10. The Secretary of State may make regulations containing such incidental, consequential, transitional or supplementary provisions as he thinks are appropriate in consequence of this Schedule or for giving it full effect; and in particular the regulations may include provision described below.
    11.—(1) The regulations may include—

    (a) provision requiring a person to be appointed by the Secretary of State in connection with the proposed making of a scheme under paragraph 1;

    (b) provision requiring the appointed person to identify the interests, rights and liabilities to be the subject of a scheme under paragraph 1;

    (c) provision requiring the authority concerned to provide the appointed person with such documents as he may require in order to identify the interests, rights and liabilities to be the subject of a scheme under paragraph 1.

    (2) The regulations may include—

    (a) provision requiring an authority whose interest is (or is to be) transferred by virtue of a scheme under paragraph 1 to execute instruments and deliver certificates for the purposes of the enactments relating to registered land;

    (b) provision treating such an authority as having given acknowledgement in writing of the right to production of documents.

    12. The regulations may include—

    (a) provision that consent under paragraph 2 is to be sought in a specified way;

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    (b) provision that information is to be given under paragraph 7 in a specified way.

    General
    13. A dwelling-house used by an authority for occupation by a person employed to work at a school is to be treated for the purposes of this Schedule as used for the purposes of the school.
    14. For the purposes of this Schedule—

    (a) a city academy is a city academy within the meaning of section 482 of the Education Act 1996;

    (b) a community school is a community school within the meaning of the School Standards and Framework Act 1998;

    (c) a county school is a county school within the meaning of the Education Act 1996 (as that Act had effect before 1 September 1999).")

    230 Schedule 8, page 82, line 4, at end insert—
    ("Public Records Act 1958 (c.51)
    1A. In Schedule 1 to the Public Records Act 1958 (definition of public records) in Part II of the Table at the end of paragraph 3, insert at the appropriate places—
    "Adult Learning Inspectorate.",
    "Learning and Skills Council for England."

    Superannuation Act 1972 (c.11)
    1B. In Schedule 1 to the Superannuation Act 1972 (kinds of employment to which schemes may apply) in the list of "Other Bodies", insert at the appropriate places—
    "Adult Learning Inspectorate.",
    "Learning and Skills Council for England.",
    "National Council for Education and Training for Wales."

    House of Commons Disqualification Act 1975 (c.24)
    1C. In Part III of Schedule 1 to the House of Commons Disqualification Act 1975 (offices disqualifying for membership) insert at the appropriate places—
    "Any member of the Learning and Skills Council for England in receipt of remuneration.",
    "Any member of the National Council for Education and Training for Wales in receipt of remuneration."

    Sex Discrimination Act 1975 (c.65)
    1D. In section 23A of the Sex Discrimination Act 1975 (discrimination by further education and higher education funding councils)—

    (a) for "the Further Education Funding Council for England, the Further Education Funding Council for Wales," substitute "the Learning and Skills Council for England, the National Council for Education and Training for Wales,", and

    (b) after "the Education Acts" insert "and the Learning and Skills Act 2000".

    1E. After section 25 of that Act insert—

    General duty: post-16 education and training etc.
    25A.—(1) The Learning and Skills Council for England and the National Council for Education and Training for Wales shall be under a general duty to secure that the facilities falling within subsection (2) and any ancillary benefits or services are provided without sex discrimination.
    (2) Facilities falling within this subsection are facilities for—

    887

    (a) education,

    (b) training, and

    (c) organised leisure-time occupation connected with such education or training,

    the provision of which is secured by the Learning and Skills Council for England or the National Council for Education and Training for Wales.
    (3) The provisions of sections 25 and 45 of the Learning and Skills Act 2000 shall be the only sanction for breach of the general duty in subsection (1), but without prejudice to the enforcement of section 23A under section 66 or otherwise (where the breach is also a contravention of that section)."
    1F.—(1) Section 26 of that Act (exception for single-sex establishments) is amended as follows.
    (2) In subsections (1) and (2) for "and 25" in each place where the words occur substitute ", 25 and 25A".
    (3) In subsection (3) after "section 25" insert "or 25A".
    1G. In section 28 of that Act (exception for physical training) for "and 25" substitute ", 25 and 25A".

    Race Relations Act 1976 (c.74)
    1H. In section 18A of the Race Relations Act 1976 (discrimination by further education and higher education funding councils)—

    (a) for "the Further Education Funding Council for England, the Further Education Funding Council for Wales," substitute "the Learning and Skills Council for England, the National Council for Education and Training for Wales,", and

    (b) after "the Education Acts" insert "and the Learning and Skills Act 2000".

    11. After section 19 of that Act insert—

    General duty: post-16 education and training etc.
    19ZA.—(1) The Learning and Skills Council for England and the National Council for Education and Training for Wales shall be under a general duty to secure that the facilities falling within subsection (2) and any ancillary benefits or services are provided without racial discrimination.
    (2) Facilities falling within this subsection are facilities for—

    (a) education,

    (b) training, and

    (c) organised leisure-time occupation connected with such education or training,

    the provision of which is secured by the Learning and Skills Council for England or the National Council for Education and Training for Wales.
    (3) The provisions of sections 25 and 45 of the Learning and Skills Act 2000 shall be the only sanction for breach of the general duty in subsection (1), but without prejudice to the enforcement of section 18A under section 57 or otherwise (where the breach is also a contravention of that section)."").
    231 Page 82, line 11, at end insert—
    (""(g) any institution which receives funding from the National Council for Education and Training for Wales (whatever proportion that funding represents of the institution's total funding) and which is specified in, or is of a class or description specified in, the regulations."

    Disabled Persons (Services, Consultation and Representation) Act 1986 (c.33)
    2A. In section 5(9) of the Disabled Persons (Services, Consultation and Representation) Act 1986 (disabled persons leaving special education) in the definition of "the responsible authority", in paragraph (c) for "a further education funding council" substitute "the Learning and Skills Council for England or the National Council for Education and Training for Wales".
    Local Government Act 1988 (c.9)
    2B. In paragraph 8(3)(a)(i) of Schedule 1 to the Local Government Act 1988 (competition: excluded activities) for "section 15" substitute "section 15A or 15B".

    Employment Act 1988 (c.19)
    2C. In section 26 of the Employment Act 1988 (status of trainees etc) after subsection (1) insert—
    "(1A) Where it appears to the Secretary of State that provision has been made under section 5(1)(c) or 34(1)(c) of the Learning and Skills Act 2000 for trainees to receive payments from the Learning and Skills Council for England or the National Council for Education and Training for Wales, the Secretary of Stale may by order provide—

    (a) that those trainees are, for the purposes and in the cases specified or described in or determined under the order, to be treated in respect of the training as being or as not being employed;

    (b) that where those trainees are treated as being employed they are to be treated as being the employees of the persons so specified, described or determined and of no others;

    (c) that where those trainees are treated as not being employed they are to be treated in such other manner as may be so specified, described or determined; and

    (d) that those payments are to be treated for the purposes of such enactments and subordinate legislation as may be so specified, described or determined in such manner as may be so specified, described or determined;

    and for the purposes of this subsection trainees are persons receiving or proposing to receive training."

    Education Reform Act 1988 (c.40)
    2D. In section 124 of the Education Reform Act 1988 (powers of a higher education corporation)—

    (a) in subsection (2)(b) omit the words ", as defined by section 15(6) and (7) of the Education Act 1996".

    (b) in subsection (2) for paragraph (f) substitute—

    "(f) to subscribe for or otherwise acquire shares in or securities of a company for the purpose of carrying on any such activities;", and.
    (c) at the end insert—
    "(5) For the purposes of subsection (2)(b) a person has a learning difficulty if—

    (a) he has a significantly greater difficulty in learning than the majority of persons of his age, or

    (b) he has a disability which either prevents or hinders him from making use of facilities of a kind generally provided by institutions within the higher education sector for persons of his age.

    (6) But a person is not to be taken to have a learning difficulty solely because the language (or form of language) in which he is or will be taught is different from a language (or form of language) which has at any time been spoken in his home."
    2E. In section 128(1)(b) of that Act (dissolution of higher education corporations) for sub-paragraph (v) substitute—
    "(v) the Learning and Skills Council for England or the National Council for Education and Training for Wales."
    2F. For section 161(1)(b) of that Act (interpretation: further or higher education functions) substitute—
    "(b) references to the further or higher education functions of a local education authority are references to the functions of the authority (except in so far as they relate to secondary education) under sections 15A and 15B of the Education Act 1996 (post-16 education) and section 120 of this Act (higher education);".
    2G. In section 218(2B) of that Act (school and further and higher education regulations)—

    (a) for "or city colleges for the technology of the arts" substitute ", city colleges for the technology of the arts or city academies", and

    (b) after "such colleges" insert "or academies".

    Environmental Protection Act 1990 (c.43)
    2H. In section 98 of the Environmental Protection Act 1990 (definitions) in subsection (2)(e) for "or city college for the technology of the arts" substitute ", city college for the technology of the arts or city academy,".")
    232 Page 82, line 20, at end insert—
    ("( ) In subsection (3) omit "within the meaning of section 4(6) of this Act".")
    233 Page 82, line 22, leave out ("form or take part in forming") and insert ("subscribe for or otherwise acquire shares in or securities of")
    234 Page 82, line 25, leave out ("of providing education or")
    235 Page 82, line 26, at end insert—
    ("(4B) The power conferred by subsection (4)(bb) above may not be exercised for the purpose of the provision of education if the provision is secured (wholly or partly) by financial resources provided by the Learning and Skills Council for England or the National Council for Education and Training for Wales.
    (4C) But subsection (4B) above shall not apply to the extent that the Council concerned consents to the exercise of the power conferred by subsection (4)(bb) above in a way which does not comply with the restriction in subsection (4B)."
    ( ) After subsection (5) insert—
    "(6) A person has a learning difficulty if—

    (a) he has a significantly greater difficulty in learning than the majority of persons of his age, or

    (b) he has a disability which either prevents or hinders him from making use of facilities of a kind generally provided by institutions within the further education sector for persons of his age.

    (7) But a person is not to be taken to have a learning difficulty solely because the language (or form of language) in which he is or will be taught is different from a language (or form of language) which has at any time been spoken in his home."").
    236 Page 83, line 11, at end insert—
    ("8A. In section 41(10) of that Act (control of contracts) after "This section does not apply" insert—

    (a) in relation to a relevant institution which does not provide full-time education suitable to the requirements of pupils of compulsory school age, or

    (b)".

    8B.—(1) Section 44 of that Act (collective worship) is amended as follows.
    (2) For subsections (1) and (2) substitute—
    "(1) This section applies to any institution within the further education sector which is principally concerned with the provision of full-time education suitable to the requirements of persons over compulsory school age who have not attained the age of nineteen years.
    (2) An institution is of voluntary origin for the purposes of this section if—

    (a) immediately before it joined the further education sector it was a voluntary school (within the meaning of the Education Act 1996),

    (b) immediately before it joined the further education sector it was a foundation or voluntary school (within the meaning of the School Standards and Framework Act 1998) having a foundation established otherwise than under that Act,

    (c) it is designated for the purposes of this paragraph by order of the Secretary of State, or

    (d) it is formed by or for the purpose of merging two institutions both of which were within paragraphs (a) to (c).

    (2A) The governing body of an institution to which this section applies shall ensure that at an appropriate time on at least one day in each week during which the institution is open an act of collective worship is held at the institution which persons receiving education at the institution may attend."
    (3) In subsection (3)(b) for "became a further education institution" substitute "joined the further education sector".
    (4) In subsection (4) for "other further education institutions" substitute "other institutions to which this section applies".
    (5) In subsection (5) for "a further education institution" substitute "an institution to which this section applies".
    (6) Omit subsection (6).
    (7) At the end of the section insert—
    "(7) In the application of this section to an institution which is of voluntary origin by virtue of subsection (2)(d), subsection (3)(b) shall be taken as referring to the religious traditions and practices of the two institutions mentioned in subsection (2)(d)."
    8C.—(1) Section 45 of that Act (religious education) shall be amended as follows.
    (2) For subsections (1) and (2) substitute—
    "(1) This section applies to any institution to which section 44 of this Act applies.
    (2) An institution is of voluntary origin for the purposes of this section if it is of voluntary origin for the purposes of section 44 of this Act.
    (2A) The governing body of an institution to which this section applies shall ensure that religious education is provided at the institution for all persons attending the institution who wish to receive it."
    (3) In subsection (3) for "a further education institution" substitute "an institution to which this section applies".
    (4) In subsection (5)—

    (a) for "each further education institution" substitute "institution to which this section applies",

    (b) in paragraph (a)(ii) for "became a further education institution" substitute "joined the further education sector", and

    (c) in paragraph (b) for "further education institutions" substitute "other institutions to which this section applies".

    (5) Omit subsection (6),
    (6) At the end of the section insert—
    "(7) In the application of this section to an institution which is an institution of voluntary origin by virtue of section 44(2)(d), subsection (5)(a)(ii) shall be taken as referring to the religious traditions and practices of the two institutions mentioned in section 44(2)(d)."
    8D. In section 52 of that Act (duty to provide for named individuals) in subsection (1) omit "full-time".")
    237 Page 83, leave out lines 15 to 17 and insert—
    ("9A. In section 54 of that Act (duty to give information) in subsection (1)(b) for "or city college for the technology of the arts" substitute ", city college for the technology of the arts or city academy".
    9B. In section 55 of that Act (inspections etc of local authority institutions other than schools), subsections (1) to (3) and paragraphs (a) and (b) of subsection (7) shall cease to have effect.
    9C. Section 56 of that Act (directions) shall cease to have effect.")
    238 Page 83, line 29, leave out ("the Education Acts") and insert ("any Act")
    239 Page 83, line 33, leave out ("the Education Acts") and insert ("any Act")
    240 Page 84, line 40, at end insert—
    ("16A. In section 89(2) of that Act (orders and regulations)—

    (a) after "29(6) and (8)," insert "30(2)(b),", and

    (b) after "38," insert "44(2)(c),".")

    241 Page 85, line 19, at end insert—
    ("Welsh Language Act 1993 (c.38)
    21A. In section 6(1) of the Welsh Language Act 1993 (meaning of "public body") for paragraph (j) substitute—
    "(j) the National Council for Education and Training for Wales;".

    Value Added Tax Act 1994 (c.23)
    21B.—(1) In Schedule 9 to the Value Added Tax Act 1994 (exemptions) Group 6 (education) is amended as follows.
    (2) In item 3 (provision of examination services) in paragraph (b)(i) for "or 5" substitute ", 5 or 5A".
    (3) After item 5 insert—
    "5A. The provision of education or vocational training and the supply, by the person providing that education or training, of any goods or services essential to that provision, to the extent that the consideration payable is ultimately a charge to funds provided by the Learning and Skills Council for England or the National Council for Education and Training for Wales under Part I or Part II of the Learning and Skills Act 2000."
    (4) After Note (5) insert—
    "(5A) For the purposes of item 5A a supply of any goods or services shall not be taken to be essential to the provision of education or vocational training unless—

    (a) in the case of the provision of education, the goods or services are provided directly to the person receiving the education;

    (b) in the case of the provision of vocational training, the goods or services are provided directly to the person receiving the training."

    Education Act 1994 (c.30)
    21C. In section 9(2) of the Education Act 1994 (joint exercise of functions) for "a further education funding council" substitute "the Learning and Skills Council for England, the National Council for Education and Training for Wales".

    Disability Discrimination Act 1995 (c.50)
    21D. In section 19 of the Disability Discrimination Act 1995 (discrimination in relation to goods, facilities and services) in subsection (5), after paragraph (a) insert—

    "(aa) education which is provided by an institution within the further education sector (within the meaning given by section 91(3) of the Further and Higher Education Act 1992);

    (ab) education which is provided by such establishments as may be specified by the Secretary of State by order;".").

    242 Page 85, line 24, at end insert—
    ("22A. In section 1 of the Education Act 1996 (the stages of education) in subsection (3) for the words from "confers functions" to the end substitute "makes provision with respect to further education."")
    243 Page 85, line 25, leave out ("the Education Act 1996") and insert ("that Act")
    244 Page 85, leave out line 39 and insert—
    ("( ) After subsection (1) insert—
    "(1A) The power under subsection (1) to secure the provision of education includes power to secure the provision—

    (a) of training, including vocational, social, physical and recreational training, and

    (b) of organised leisure time occupation (within the meaning of section 2(6)) which is provided in connection with the provision of education or of training within paragraph (a)."

    ( ) In subsection (2) after "functions under this section" insert, "in respect of secondary education".
    ( ) After subsection (2) insert—
    "( ) In exercising their functions under this section in respect of further education a local education authority shall in particular have regard to the needs of persons with learning difficulties (within the meaning of section 13(3) and (4) of the Learning and Skills Act 2000).").
    245 Page 85, line 47, at end insert—
    ("(1A) The power under subsection (1) to secure the provision of education includes power to secure the provision—

    (a) of training, including vocational, social, physical and recreational training, and

    (b) of organised leisure time occupation (within the meaning of section 2(6)) which is provided in connection with the provision of education or of training within paragraph (a).

    (1B) In exercising their functions under this section a local education authority shall in particular have regard to the needs of persons with learning difficulties (within the meaning of section 13(3) and (4) of the Learning and Skills Act 2000).").
    246 Page 86, line 4, at end insert—
    ("(3) This section does not apply to higher education."
    26A. In section 312(2) of that Act (meaning of learning difficulty") for "section 15(5)" substitute "section 15A or 15B".")
    247 Page 86, line 12, at end insert—
    ("27A.—(1) Section 490 of that Act (grants in respect of special provision for ethnic minorities) is amended as follows.
    (2) In subsection (1)(b) for "or a city college for the technology of the arts" substitute ", a city college for the technology of the arts or a city academy".
    (3) In subsection (2) for "or college" substitute ", college or academy".
    27B.—(1) Section 509 of that Act (provision of transport etc) is amended as follows.
    (2) In subsection (1)—

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

    (b) omit paragraph (d) and the word "or" immediately preceding it.

    (3) After subsection (1) insert—

    "(1A) A local education authority shall make such arrangements for the provision of transport and otherwise as they consider necessary, or as the Secretary of State may direct, for the purpose of facilitating the attendance of persons receiving education or training at an institution outside both the further education and higher education sectors.

    (1B) Arrangements under subsection (1A) may be made in relation to a person only if the Learning and Skills Council for England or the National Council for Education and Training for Wales has secured for him—

    (a) the provision of education or training at the institution, and

    (b) the provision of boarding accommodation under section 13 or 41 of the Learning and Skills Act 2000."

    (4) In subsection (2) after "subsection (1)" insert "or (1A)".
    (5) In subsection (3)—

    (a) after "education" insert "or training";

    (b) in paragraph (b) after "subsection (1)" insert "or (1A)";

    (c) in the words following paragraph (b), for "that subsection" substitute "either of those subsections".

    (6) In subsection (4)—

    (a) after "subsection (1)" insert "or (1A)";

    (b) in paragraph (b) after "education" insert "or training".

    (7) In subsection (5)—

    (a) after "subsection (1)" insert "or (1A)";

    (b) in paragraph (c) for "education at institutions mentioned in subsection (1)(d)" substitute "education or training at institutions mentioned in subsection (1A)";

    (c) in paragraph (c)(i) for "section 15(5)" substitute "section 13 of the Learning and Skills Act 2000".

    (8) In subsection (6)(a) for "or (d)" substitute "or (1A)".

    27C. In section 537 of that Act (power of the Secretary of State to require information from governing bodies etc) in subsection (7)(b) for "or city college for the technology of the arts" substitute ", city college for the technology of the arts or city academy".

    27D. In section 541 of that Act (distribution of information about further education institutions) in subsection (1)(b) for "or city college for the technology of the arts" substitute ", city college for the technology of the arts or city academy".

    27E. In section 550B of that Act (detention outside school hours) in subsection (2)(c) for "or city college for the technology of the arts" substitute ", city college for the technology of the arts or city academy".

    27F. In section 580 of that Act (index) in the table at the appropriate place insert—

    "city academy

    section 482(3)".

    27G. In Schedule 1 to that Act (pupil referral units) in paragraph 8 for "county schools" substitute "community schools".")
    248 Page 86, line 25, leave out ("In")
    249 Page 86, line 26, after ("inspectors)") insert ("is amended as follows.
    (2) In subsection (3) after paragraph (g) insert—
    "(gg) city academies; and".
    (3) At the end of subsection (4B)(a) insert "or approved under Schedule 7 to the Learning and Skills Act 2000".
    (4) In subsection (4B)(d) for "or city college for the technology of the arts" substitute ", city college for the technology of the arts or city academy".
    ( )")
    250 Page 86, line 43, at end insert—
    ("31A. In section 25 of the Education Act 1997 (other functions of the Qualifications and Curriculum Authority) after subsection (4) insert—
    "(5) The Authority may supply any person designated by the Secretary of State with such information as the Authority thinks fit about any matter in relation to which it has a function."
    31B. In section 31 of that Act (other functions of the Qualifications, Curriculum and Assessment Authority for Wales) after subsection (4) insert—
    "(5) The Authority may supply any person designated by the National Assembly for Wales with such information as the Authority thinks fit about any matter in relation to which it has a function."
    31C. In section 43 of that Act (provision of careers education in schools) in subsection (2)(d) for "and city colleges for the technology of the arts" substitute ", city colleges for the technology of the arts and city academies"")
    251 Page 86, line 44, leave out ("the Education Act 1997") and insert ("that Act")
    252 Page 86, line 45, at end insert—
    ("Audit Commission Act 1998 (c.18)
    32A.—(1) Section 36 of the Audit Commission Act 1998 (studies at request of educational bodies) is amended as follows.
    (2) In subsection (1), in the Table, after the entry relating to the governing body of an institution receiving funding under Part I of the Education Act 1994 insert—

    "The Learning and Skills Council for England.

    The council.

    The National Council for Education and Training for Wales.

    The council."

    (3) In that Table, in the entry relating to the governing body of an institution within the further education sector, in the second column for "or the appropriate further education funding council" substitute ", the Learning and Skills Council for England or the National Council for Education and Training for Wales".
    (4) In subsection (2) omit "or a further education funding council".

    Teaching and Higher Education Act 1998 (c.30)
    32B.—(1) Section 26 of the Teaching and Higher Education Act 1998 (imposition of conditions as to fees at further or higher education institutions) is amended as follows.
    (2) Omit subsections (1) and (2).
    (3) In each of subsections (6), (7), (10)(a) and (11)(b) for "subsection (2) or (4)" substitute "subsection (4)".
    (4) In subsection (9)—

    (a) in the definition of "the relevant academic year" for "subsection (2) or (4)" substitute "subsection (4)", and

    (b) in the definition of "specified" for "subsection (1) or (3), as the case may be" substitute "subsection (3)".

    (5) In subsection (11) for "subsection (1) or (3)", in both places where the words occur, substitute "subsection (3)".
    32C. In section 28(1) of that Act (interpretation) in the definition of "publicly-funded institution", in paragraph (a)—

    (a) omit "5 or",

    895

    (b) omit the words from "from a further" to "its costs", and

    (c) after "1996" insert "or any institution receiving financial resources under section 5 or 34 of the Learning and Skills Act 2000".

    32D. Section 34 of that Act (inspection of vocational training in Wales) shall cease to have effect.
    32E. In section 35 of that Act (inspection of careers services in Wales), for subsection (6) substitute—
    "(6) Any inspection under this section shall be conducted by one or more of the following—

    (a) any of Her Majesty's Inspectors of Education and Training in Wales or Arolgwyr Ei Mawrhydi dros Addysg a Hyfforddiant yng Nghymru, or

    (b) any additional inspector authorised under paragraph 2 of Schedule 1 to the School Inspections Act 1996;

    but such an inspector or inspectors may be assisted by such other persons (whether or not members of the Chief Inspector's staff) as the Chief Inspector thinks fit.
    (6A) In conducting an inspection under this section, the inspector or inspectors shall act in accordance with any instruction or guidelines given from time to time by the National Assembly for Wales.
    (6B) Where an inspection under this section has been completed, the inspector or inspectors shall make a written report on the inspection and shall send the report to the National Assembly for Wales.
    (6C) The National Assembly for Wales may arrange for any report of an inspection under this section to be published in such manner as the National Assembly for Wales considers appropriate; and section 42A(2) to (4) of the School Inspections Act 1996 shall apply in relation to the publication of any such report by the National Assembly for Wales as they apply to the publication of a report by the Chief Inspector under any of the provisions mentioned in section 42A(2)." ").
    253 Page 87, line 15, leave out paragraph (a) and insert—
    ("(a) in paragraph (a) for "primary and secondary education" substitute "primary education, and secondary education suitable to the requirements of pupils of compulsory school age,";")
    254 Page 87, line 39, at end insert—

    Plans of National Council.
    26B.—(1) In preparing a school organisation plan a local education authority in Wales shall have regard to the plans of the National Council for Education and Training for Wales published under section (Plans) of the Learning and Skills Act 2000.
    (2) Subsection (3) applies if a school organisation plan prepared by a local education authority in Wales is being considered by the school organisation committee or by the adjudicator.
    (3) The committee or the adjudicator shall have regard to the plans of the National Council for Education and Training for Wales published under section (Plans) of the Learning and Skills Act 2000.
    (4) In this section references to the school organization committee are to the committee established by the authority under regulations made under section 27.
    (5) In this section references to the adjudicator are to—

    (a) such person appointed as adjudicator under those regulations as may be determined in accordance with them, or

    896

    (b) such persons appointed as a panel of adjudicators under those regulations as may be so determined."").

    255 Page 87, line 46, at end insert—
    ("37A. In section 30(3) of that Act (notice by governing body to discontinue foundation or voluntary school) for "the appropriate further education funding council" substitute "the Learning and Skills Council for England (if the school is in England) or the National Council for Education and Training for Wales (if the school is in Wales)".")
    256 Page 87, line 49, at end insert—
    ("38A. In section 110 of that Act (home-school arrangements) in subsection (1)(b) for "or a city college for the technology of the arts" substitute ", a city college for the technology of the arts or a city academy"")
    257 Page 88, line 2, at end insert—
    ("39A.—(1) Section 137 of that Act (Education Transfer Council: alteration and dissolution) shall be amended as follows.
    (2) In subsection (3)(c) for "or under the Education Reform Act 1988" substitute ", under the Education Reform Act 1988 or under the Further and Higher Education Act 1992".
    (3) At the end of subsection (4)(a) insert "or section 34 or 36 of, or Schedule 5 or 7 to, the Further and Higher Education Act 1992".
    39B. In section 142(1) of that Act (general interpretation) omit the definition of "the appropriate further education funding council".")
    258 Page 88, line 21, leave out ("or implement")
    259 Page 88, line 29, leave out ("or implement")
    260 Page 88, line 37, leave out ("or implement")
    261 Page 88, line 45, leave out (", and are to be implemented,")
    262 Page 88, line 47, at end insert—
    ("Government of Wales Act 1998 (c.38)
    42A.—(1) Section 104 of the Government of Wales Act 1998 (funding of the Chief Inspector of Education and Training in Wales) is amended as follows.
    (2) In subsection (4), omit the words from "; and in determining" to the end.
    (3) After subsection (4), insert—
    "(4A) The Assembly shall—

    (a) approve the plan submitted to it under section (Annual plan of the Chief Inspector for Wales) of the Learning and Skills Act 2000; and

    (b) determine the amount of the funding it is to provide under this section in accordance with the plan as approved by it.

    (4B) But before it gives its approval under subsection (4A)(a), the Assembly may require the Chief Inspector to modify the plan."
    42B. In section 118(2) of that Act (meaning of "Welsh public records") after paragraph (h) insert—
    "(ha) the National Council for Education and Training for Wales,".
    42C. In Part I of Schedule 4 to that Act (public bodies subject to reform by Assembly) for the entry relating to the Further Education Funding Council for Wales substitute—
    "5. The National Council for Education and Training for Wales."").
    263 Schedule 9, page 91, line 38, at end insert—

  PART III ADULT LEARNING INSPECTORATE
  .—(1) During the interim period, section 50(2) has effect as if for "9" there were substituted "not less than 2 and not more than 9".
  (2) The interim period begins on the day on which section 50 comes into force.
  (3) The interim period ends on the first day on which there are 9 members of the Inspectorate.")
  264 Page 91, line 38, at end insert—

  PART IV STUDENT LOANS
  .—(1) Sub-paragraph (2) has effect in relation to the Education (Student Loans) Act 1990 to the extent that it continues in force by virtue of any savings made, in connection with its repeal by the Teaching and Higher Education Act 1998, by an order under section 46(4) of the Teaching and Higher Education Act 1998.
  (2) Section 1(3) of the Education (Student Loans) Act 1990 shall have effect as if the definition of "institutions receiving support from public funds" included a reference to institutions which receive financial resources under section 5 or 34 of the Learning and Skills Act 2000.")
  265 Schedule 10, page 91, line 41, at end insert—

  ("1972 c. 11.

  Superannuation Act 1972.

  In Schedule 1, in the list of "Other Bodies", the words "Further Education Funding Council for England in receipt of remuneration." and "Further Education Funding Council for Wales in receipt of remuneration.".

  1975 c. 24.

  House of Commons Disqualification Act 1975.

  In Schedule 1, in Part III the words "Any member of the Further Education Funding Council for England in receipt of remuneration." and "Any member of the Further Education Funding Council for Wales in receipt of remuneration.".

  1975 c. 65.

  Sex Discrimination Act 1975.

  Section 25(6)(d).

  1976 c. 74.

  Race Relations Act 1976.

  Section 19(6)(d).

  1988 c. 40.

  Education Reform Act 1988.

  In section 124(2)(b), the words ", as defined by section 15(6) and (7) of the Education Act 1996".")

  266 Page 91, line 45, at end insert—

  ("Section 44(6).

  Section 45(6).

  In section 52(1), the word "full-time".

  In section 55, subsections (1) to (3) and paragraphs (a) and (b) of subsection (7).

  Section 56.")

  267 Page 92, line 7, column 3, at beginning insert—

  ("Section 19(6)(e) and (f).")

  268 Page 92, line 9, column 3, at end insert—

  ("In section 403(1) the words "local education authority,".

  In section 482, in subsection (2)(c) the word "either" and in subsection (3) the word "or" immediately preceding paragraph (b).

  In section 509(1), paragraph (d) and the word "or" immediately preceding that paragraph.")

  269 Page 92, line 10, column 3, leave out ("paragraph") and insert ("paragraphs 70, 112 and")
  270 Page 92, line 11, at end insert—

  ("1996 c. 57.

  School Inspections Act 1996.

  In section 10(3) the word "and" at the end of paragraph (g).")

  271 Page 92, line 19, at end insert—

  ("1998 c. 18.

  Audit Commission Act 1998.

  In section 36(1), in the Table, the entry relating to a further education funding council.

  In section 36(2), the words "or a further education funding council".")

  272 Page 92, line 28, column 3, at end insert—

  ("In section 22(2)(h) and (7) the words "attendance on".

  Section 26(1) and (2).

  In section 28(1), in the definition of "publicly-funded institution", in paragraph (a) the words "5 or" and the words from "from a further" to "its costs".

  Section 34.")

  273 Page 92, line 29, column 3, leave out from beginning to end of line 32
  274 Page 92, line 33, column 3, at end insert—

  ("In section 142(1), the definition of "the appropriate further education funding council".")

  275 Page 93, line 4, column 3, at end insert—

  ("In Schedule 30, paragraphs 41 and 42.")

  276 Page 93, line 4, at end insert—

  ("1998 c. 38.

  Government of Wales Act 1998.

  In section 104(4), the words from "; and in determining" to the end.")

  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos.184 to 276.

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  Moved, That the House do agree with the Commons in their Amendments Nos.184 to 276.—(Lord Bach.)
  On Question, Motion agreed to.
  An amendment (privilege) made.
  Bill returned to the Commons with amendments.

Football (Disorder) Bill
Brought from the Commons; read a first time, and to be printed.

Comprehensive Spending Review
7.55 p.m.
Lord McIntosh of Haringey: My Lords, with the leave of the House, I shall now repeat a Statement that has been made in another place by the Chancellor of the Exchequer. The Statement is as follows:
"The public spending allocations for 2001 to 2004 that I am announcing today are possible because, having eliminated the £28 billion deficit that we inherited and having reduced the national debt, the state of our public finances is strong.
"In the economic cycles of the past 30 years, the current budget deficits averaged £109 billion, the national debt doubled and rose to 44 per cent of national income in 1997 and stop-go in the economy meant stop-go in the public finances.
"So our first task was to create stability and sustainable public finances. Having set clear fiscal rules over the economic cycle—a current budget in balance, borrowing only to invest within prudent and cautious limits—today we not only have low inflation and stable growth but year-on-year current budget surpluses and debt falling below 40 per cent of national income; indeed, debt being repaid this year and next.
"And it is this sustained and sustainable improvement in our public finances that makes possible a sustained and sustainable improvement in our public services.
"Our second task was to encourage the work ethic and secure rising employment. Today, with the assistance of the New Deal, unemployment is at its lowest for 20 years and almost 28 million people, more people than ever before, are in work in our country today.
"Now, building on the foundation of stability and strengthened economic fundamentals, we can move to the next stage in creating a better future: to make good the damage done by the legacy of decades of under-investment across our public services; and to realise long-term national goals that we have set for a decade, to close the productivity gap with our competitors, to deliver and sustain full employment, to secure higher education for a majority of our young people, to halve and then abolish child poverty and to build strong public services as we create a Britain where there is security and opportunity not just for a few but for everyone.
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"The first conclusion of this year's spending review is that prudent targeted long-term investment is not only a social good, but also, in a changing and often insecure world, an economic necessity.
"It is only by investment in education, in science and in the future of our children that we can equip ourselves for future economic success and ensure that there is opportunity for all. It is only by investing in health, transport, the environment and in law and order that we can ensure a more productive economy and security for all.
"And just as stability and economic strength make possible investment, so, too, new investment reinforces stability and creates longer-term economic strength. So, while we will raise current expenditure only in line with our neutral view of trend growth—by 2.5 per cent a year we propose to tackle the long-term neglect of investment in our country with a step change in capital investment for education, science, health, policing and in our transport and infrastructure.
"As I announced in the Budget, net capital investment will more than double, rising from £7 billion this year to £19 billion by 2004, within a ceiling for public investment of 1.8 per cent of national income, as we renew our public services.
"The second conclusion of our spending review is that it is by tying new resources to reform and results, and by locking in incentives, penalties, inspection and information that we ensure new investment goes to front line services: in secondary as well as in primary schools, new targets for literacy and numeracy and IT; in hospitals, new systems of inspection; in law and order, reforms to criminal justice; in defence, implementing the next stage of the Strategic Defence Review; with local government, new public service agreements; and in transport, a new partnership between private and public sectors. At every stage money will be tied to output and performance.
"Let me give full details of the financial background. In the Budget I confirmed the current surpluses from 2000 onwards would be £14 billion, 16, 13, 8 and £8 billion. My Budget also confirmed net borrowing will be minus 6.5, minus 5, plus 3, plus 11, plus £13 billion, lower borrowing in every year than in any year of the previous Parliament.
"I said that, as a share of national income, debt will be 35 per cent, 34, 33, 33, 33 and thus even with our programme of public investment we meet both our fiscal rules and do so even on the most cautious case and a cautious view of trend growth at 2.25 per cent.
"In accordance with the code of fiscal stability, I will publish the second fiscal forecasts of the year in the autumn. But I can already report that since the Budget the fiscal position has further strengthened. For the year ending March 2000, the current surplus is healthier than originally forecast at the time of the Budget—not £17.1 billion, but £20.4 billion.

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"Debt as a share of GDP has been reduced even more, from 37.1 to 36.8 per cent. Indeed, I will use a further underspend of £2.5 billion in annually managed expenditure to repay debt. Two billion pounds in departmental expenditure can be carried forward. However, on grounds of prudence, I have decided to allow a carry forward of only £1.5 billion and to allow spending of only half of that this year and half next year—and to allocate the remaining sum to repay more debt.
"It is only because we have put the public finances on a sustainable footing that I can raise spending today. It is this same discipline that allows me to inform the House that this year we have repaid £6.2 billion more debt than the £11.9 billion originally planned—in total, a debt repayment of £18.1 billion, the largest repayment of debt in any year since the war.
"We have not and will not relax our discipline. So I have three policy announcements to underpin the strength of the public finances. Further limited sales of spectrum will take place by the end of 2001. We shall not repeat the mistakes of the North Sea oil windfall and of the privatisation sales where receipts were immediately used up in current spending. I can confirm that all the capital proceeds will—as with the £22 billion from the first sale—go to further reduce the burden of debt.
"As debt is reduced, so, too, are debt interest payments. The first spectrum sale alone will reduce the bill for debt interest by a further £1 billion a year by 2003–4, money that—as I shall confirm later this afternoon—will, year after year, go directly to improving public services.
"Secondly, departments and authorities will make asset and property sales of £4 billion a year over the next three years—4 billion a year released by realising unproductive assets we do not need to fund service improvements we do need. Because money is tied to modernisation, the new public service agreements signed with departments—and for the first time with local government—will not only specify agreed outcomes but precise timetables for making necessary reforms.
"I can tell the House, as a result of the fall in the share of administration costs in total government spending, new money makes possible a substantial shift in spending to the front line services—to recruit more nurses, doctors, teachers, classroom assistants, and police, more staff in our front line services.
"With the success of the New Deal, the bills for social and economic failure are now £3.5 billion lower, enabling us to transfer £3.5 billion each year from paying unemployment benefits to funding public services.
"With this improvement comes a radical shift in the composition of public spending. Our promise was to reduce the costs of failure—the bills for unemployment and debt interest—in order to reallocate money to the key public services.
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"In the two decades from 1979 until 1997, rising debt interest and unemployment and social security accounted for 42 per cent of all extra public spending and that meant that 42 pence in every additional pound spent was not available to the key public services.
"In the coming three years, unemployment, social security and debt interest payments will account for not 42 per cent but now only 17 per cent of extra public spending, even as we direct more money to child benefit and the minimum income guarantee. That leaves around 80 per cent of new money for health, education, transport, policing and other public services—extra resources now available to us, not at the expense of our prudence, but because of our prudence.
"So within our fiscal rules and within the envelope I set in the Budget and have strictly adhered to, I can announce that spending on public services—what is called the departmental expenditure limit—is able to rise from £195 billion this year and our previously planned £203 billion next year to £212.1 billion and then to £229 billion in 2002–3 to £246 billion in 2003–4. By 2004 an extra £43 billion a year will be allocated to front line services. Sustained improvements in public services are now made possible because with stability and strengthened economic fundamentals, and lower debt interest and lower unemployment, we have sustained improvements in our public finances.
I now turn to the departmental allocations. In recent years, in addition to their conventional responsibilities, Britain's defence forces have taken on a new and valued role in international peacekeeping and in conflict prevention, promoting human rights and peace throughout the world, including in Sierra Leone and Kosovo.
"To complete the restructuring agreed in the Strategic Defence Review—to fund new equipment and to increase the mobility and efficiency of our front line forces—defence spending, which has been failing in real terms every year since the end of the Cold War, will now increase in real terms. The allocations are £23.6 billion next year rising to £25 billion in 2003–4.
"The rise in the Foreign Office budget from £1.2 billion next year to £1.32 billion in 2003–4 will not only finance the proper representation and promotion of Britain abroad but also the Foreign Secretary is announcing today that the British Council will receive extra funds and the budget for the BBC World Service will rise substantially from £174 million this year to £180 million next year, to £210 million by the end of the period to achieve our new target of 153 million World Service listeners by 2002.
"Because we take seriously our international responsibilities to the environment, the Government are announcing today a special £85 million fund to assist nuclear clean up at Chernobyl. The international community's clearest duty and

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greatest challenge is to halve world poverty by 2015 and make primary education universal for every child.
"Our international aid budget will rise from £2.8 billion this year to £3.1 billion next year, then £3.3 billion and £3.6 billion by 2004, a real terms rise of 6.2 per cent a year, in contrast to the falling share of national income devoted to overseas aid from 1979 to 1997. There is a rising share of national income today and in the future, as we honour in full our commitment to debt relief and our obligation to the poorest countries of the world.
"I turn to our second set of decisions, new investment to build stronger communities. The Home Office budget will rise from £8.2 billion this year to £9.6 billion next year, to £10.3 billion the year after, to £10.6 billion in 2003–4, an annual rise in real terms averaging 6.4 per cent a year. Tomorrow the Home Secretary will set out both his targets and how this allocation will be spent.
"To implement fully the Good Friday agreement, an extra £316 million over three years will help fund the modernisation of policing and criminal justice in Northern Ireland, and in this way help underpin peace and future prosperity.
"Every community in the land is weakened by the evil of drugs. In return for challenging new targets to cut drug related reoffending by 50 per cent over the decade and to treat twice as many addicts through the new National Treatment Agency, the new anti-drugs budget will be set at £870 million in 2001–2 and then rise to £931 million and £996 million by 2004, an average annual real growth rate of 10 per cent.
"Strengthening our local communities involves a new partnership with local government based on increased investment and new targets. The three year settlement for local government—an annual real terms rise of 3 per cent over and above inflation—will he set out in full by the Minister for Local Government. Ministers in Scotland, Wales and Northern Ireland will make related announcements.
"Local and national government need to work even more closely in a new partnership for reform and improvement in our poorest areas. For decades our whole country has been scarred by deep and persistent deprivation and under-achievement in high unemployment communities.
"While much previous spending has been directed to dealing with the consequences of economic and social failure, it is time now to invest in tackling the causes of failure—poor school results, poorer standards of public health and low levels of economic activity. Today our poorest council estates suffer unemployment four times and burglary rates three times the national average, with mortality rates 30 per cent higher. These unjustifiable and divisive inequalities cannot be tolerated. Both government and communities must
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raise their sights, with a new target to raise the poorest areas up and thereby narrow the gap between these areas and the rest of the country.
"So we will not only extend the New Deal for communities but strengthen the institutions—from our schools to our health centres—on which communities depend. In return for local public service agreements that require new minimum standards in school attainment, public health, law and order and job creation, a new neighbourhood renewal fund will provide, by 2004, new resources worth £400 million a year.
"In this spending round, housing—and our objective of decent affordable housing for all—will receive the priority it deserves and resources it needs—an additional £1.6 billion of new investment by 2004, a real terms rise averaging 12 per cent a year.
"Across the social sector, we will ensure that half a million more houses will be modernised or repaired, part of a 10-year plan to eliminate all substandard housing. And as we implement key recommendations of the Rogers report, reclaimed brownfield sites will account for 60 per cent of all new housing, creating thousands of new construction jobs.
"Investment in the future must mean investment in a cleaner environment. To meet our climate change commitments the Environment Minister will announce how new resources will promote emissions trading and energy efficiency in Britain's homes, and there will be further announcements on the use of renewable energy and recycling by local authorities.
"In rural communities the new rural transport fund has extended the rural network with 2000 new or improved bus services. And the rural transport fund will be increased from an annual allocation of £60 million to £95 million. And there will be an announcement of new finance available for maintaining the Post Office network in both rural and urban areas.
"And as farming restructures and deals with BSE and meets challenging targets to move from the old farm production subsidies to the new environmental improvement payments, the agriculture budget, including the Intervention Board, will increase from £1 billion this year to £1.35 billion by 2004, an average annual real terms rise of 6 per cent. And the Food Standards Agency will see its budget rise from £87 million this year to £111 million by 2004.
"Extending access, particularly for our young people, to the arts and to sport will strength every community. With a 4.3 per cent annual real terms rise in the budget of the Department of Culture, there will be significant improved funding for the arts, and the Secretary of State will give details of new funding to encourage children to use our libraries, museums and arts and to encourage sports in schools and in our communities.

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"Strengthening communities must involve strengthening our social services and our health service. Our NHS plans will be announced next week. There will also be a major package of investment in services for elderly people—including the Government's response to the Royal Commission on Long Term Care. The Health Secretary will announce the detail of this and other allocations from the health and social services budget next week.
"I can also confirm that in the autumn the Government will publish their proposed plans for a new pensioner credit with a view to further announcements on a Budget timetable.
"The strong civic society we seek is built not by rights alone but by rights and responsibilities. So we will match our Budget tax reliefs to encourage the giving of money with new measures today to encourage the giving of time, extra resources of £60 million by 2003–2004, with a clear aim—to encourage 1 million more of our citizens as volunteers in community service in our country.
"I turn now to the investment we must make in our economic future. Britain has great strengths—the best place in Europe to do business, with world class companies in science and technology—but to build for the future we must put in place the long-term investment which is the precondition of a strong economy and of bridging the productivity gap with our competitors and avoid the short-termism of the past.
"Working with business, the role of modern government is not to subsidise loss-makers or to attempt to pick winners. The new role of government is to invest in science and innovation, to promote competition, small business development and enterprise for all, to encourage balanced regional development and meet the pressing needs of transport and infrastructure and most of all to invest in the greatest driver of prosperity—education and skills.
"First, investment in science. With our investment in a £1 billion public private partnership with Wellcome to re-equip university science and extra resources to support pioneering medical research, we will raise the science budget by 5.4 per cent a year in real terms.
"And to ensure invention in Britain leads to manufacturing in Britain and jobs in Britain, the Secretary of Industry will announce new resources for the University Challenge fund that commercialises inventions and for university-based regional enterprise centres.
"Britain's small businesses are the backbone of our local economies. And to offer new services businesses have themselves requested, the budget of the new Small Business Service will rise substantially from £197 million this year to £277 million by 2004. This will include a national Internet service offering comprehensive business advice and a consultancy
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service for start-ups, worth up to £2,000 for start-ups in high unemployment areas. So the numbers of small businesses who employ people, and which have already risen from 1.2 million in 1997 to 1.3 million, can expand in every area of the country.
"The newest and most decisive challenge in the new century demanding higher levels of investment is to master and lead in the new information technologies. To make Britain best for electronic training and to bridge the growing digital divide, the review has agreed a three-year programme of rapidly rising investment in our schools and our communities and a new fund that the Prime Minister will announce to ensure that by 2005 Britain will have all government services offered on line.
"Investment in innovation, infrastructure and skills is essential in every region if there are to be high levels of productivity in Britain and full employment throughout our country.
"To secure balanced regional development, regional development agencies will receive new resources, their budgets increased by £500 million a year by 2003–2004. These will not only be new funds but new flexibilities they have themselves identified: in the North West promoting innovation and research; in the North East, increasing entrepreneurship; in Yorkshire and Humberside, small business development; in the East Midlands, information and communications technology; in the West Midlands, modern manufacturing; in the South East and South West, as in Scotland, Wales and Northern Ireland, with their devolved decision-making, the promotion of clusters of growth; in every region, new support for skills, employment and for schools and colleges to promote enterprise open to all.
"The overall settlement for Scotland provides for an increase of £3.4 billion a year by 2003–2004, an annual real terms rise of 4.4 per cent. A separate announcement will be made by the Scottish Executive.
"For the Objective 1 areas in the United Kingdom—in Wales, Cornwall, Merseyside, south Yorkshire—and for Objective 2 and 3 areas, I am announcing a new approach that will raise their levels of investment. Within our departmental allocations we are making today the Government will ensure funding for the European share of Objective 1, 2 and 3 projects. For EU structural funds this is estimated to total £4.2 billion over three years, including an estimated total of £600 million for new Objective 1 programmes in English regions.
"The settlement increases funding for Wales by a total of 5.4 per cent a year in real terms and allows for match funding—and includes a special allocation to ensure funding of the European share of Wales' Objective 1 needs, an allocation to Wales of £80 million, £90 million, £102 million over the next three years. I am also transferring management of the European Social Fund allocations for Wales of £149 million over the next three years to the Welsh Assembly.

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"It is because of the importance to all regions of modern transport and infrastructure that we will now make a step change in investment in public transport. In the Budget we removed the automatic fuel escalator and extra money was allocated to roads and public transport this year. Now we are able to raise spending on roads and public transport by significant extra sums to meet the needs of business and the public, from £4.9 billion this year to £6 billion next year, then to £7.4 billion and £9.1 billion in 2003–2004, a real terms rise of 20 per cent a year to 2004.
"Details of the targets to improve rail and bus services and to cut road congestion and of the allocation of funds will be set out in the ten-year plan to be published by the Deputy Prime Minister on Thursday.
"The modern economy can succeed only when it uses all the talent of all its people. Any potential squandered is a resource denied to the country's future. In this review we allocate new funds to advance our goal of full employment. For 70,000 employers, nearly 500,000 young people and for Britain, which has seen long-term youth unemployment fall by 70 per cent, the New Deal has been succeeding, a central building block for our policy of full employment. So long-term youth unemployment, which rose to 500,000 in the 1980s, is 50,000 today.
"The windfall levy raised over £5 billion, with £1.6 billion allocated to schools and £3.5 billion to employment creation. Because the New Deal has been even more successful than forecast, with more getting back to work more quickly, there is an underspend, enabling us to fund the New Deal well into the next Parliament and to transform what started as the New Deal for the young unemployed into a permanent deal for all long-term unemployed.
"Having helped 500,000 on the New Deal, we now set plans to help the next 500,000. Next year and until 2003, I expect £1.7 billion to be available from the windfall levy to do more to coach the hard-to-employ young unemployed and systematically to create new opportunities for our long-term unemployed, nearly 1 million single parents and thousands of disabled men and women who want to work.
"To bring both childcare and employment within the reach of more parents, childcare investment will rise from £66 million this year to £200 million by 2003–04, as we deliver our national childcare strategy.
"Because of our success in cutting unemployment, social security spending, which grew by 4 per cent a year in the previous Parliament, is growing by 1.5 per cent a year over the next three years and the budget for unemployment-related benefits is falling. To make further social security savings by tackling fraud and error, we are announcing new investment in staff and technology. Having cut errors in income support claims by half,
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we now plan to cut fraud and error in the job seeker's allowance and income support payments, first, by 25 per cent by 2004 and then 50 per cent.
"I turn now to investment to ensure that all children have the best start in life. Today's children will be tomorrow's doctors, scientists, engineers and nurses—our future workforce. By investing in children, we are investing in our country's future. Having invested £7 billion a year more in families—raising child benefit by 35 per cent, guaranteeing a minimum family income under the working families' tax credit and from next April the new children's tax credit, giving the typical family £442 a year—it is time to take further steps.
"The war against child poverty requires not only additional cash but the support and encouragement of all forces of care and compassion in every community. It can be won only by the combined efforts of parents and private, voluntary, charitable and public sectors working together. So in a unique initiative, and after consultations with charities and voluntary organisations, we will create a national children's fund with a budget over three years totalling £450 million to help children and young people at risk. The children's fund will work with national children's charities and local community organisations—secular and faith based—and support those dedicated staff and committed volunteers who offer one-to-one help to young people, and parents, at risk. Seventy million pounds will be allocated to a network of 50 local and regional children's funds.
"I turn to investment in education. With the funds the Secretary of State for Education allocated from the first spending review he has made reforms in education, ensuring nursery education for every four year-old, cut class sizes for five to seven year-olds, raised literary and numeracy standards for 11 year-olds by six and 10 percentage points and reformed and expanded higher and further education. Education qualifications are, in the modern world, the surest route to opportunity and security for all.
"All children should be ready to learn when they reach school. From the first spending review came Sure Start, now lifting 50,000 children and their parents out of poverty. In this second review, and tied to targets for improving child development and parental responsibility, we will, by 2004, and with a budget of £500 million, expand the number of children helped to 345,000. And with nursery places already increasing from 200,000 in 1997 to 400,000 in 2002, the Secretary of State for Education and Employment will announce funds for the next stage in the expansion of nursery education.
"Having improved standards in our primary schools, the next task is now to raise standards as decisively in the secondary schools. The expansion of resources which the Secretary of State for Education and Employment will announce for all schools is designed to back up reform and to bring about radical improvement within the

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comprehensive system to ensure opportunity for all means the highest standards for all. We will now consult on and fund a new target for our secondary schools. By 2007, not today's 60 per cent but 85 per cent of 14 year-olds must meet literacy, numeracy and computer standards.
"To raise Britain's appallingly low school staying-on rate, we are setting aside £150 million a year for education maintenance allowances worth up to £40 a week. Our new and challenging target is by 2004, 80,000 more young 16 to 18 year-olds in education and by age 21 nearly 60 per cent of young people having left school or college with A-levels or their equivalent.
"Under the New Deal for Schools, 17,000 of our schools will have had some improvement, modernisation or renovation by 2002, and every one of our 32,000 schools will be linked to the Internet, with the objective of, by 2004, 500,000 more computers in our schools. By 2010 we want the majority of young people to go on to higher education. The Secretary of State is today allocating £100 million extra to higher education in 2001–02, making a 4.6 per cent real terms increase in total. The review provides further finance that will raise the numbers in part-time and full-time higher and further education towards our goal of 50 per cent.
"State school pupils secure two-thirds of the top A-level qualifications but only half the places in some of our leading universities. To bridge this gap the Secretary of State for Education is today setting a new objective to improve access. The Higher Education Funding Council will provide financial help for universities submitting plans for year-on-year improvements in widening access. Two million adults have a reading age of seven or less. Adult illiteracy is not just a failure of our society but, as business leaders round the country have told me, an economic inefficiency that cannot any longer be tolerated. In the coming weeks, the Secretary of State for Education will announce the new resources provided to tackle these barriers to opportunity and earnings.
"The best education for all, from early learning to lifetime learning, is not only a time-honoured social ideal but in today's world an absolute economic necessity. That is why we have decided to make increased investment in education the priority of this year's review and to back sustained long-term reform with a sustained increase in resources. In the Budget I was able to allocate new resources to the NHS, amounting to a rise of 6.1 per cent a year in real terms over four years to 2004. I was also able to allocate an additional £1 billion to UK education this year. Today, in return for new targets for improved standards, we can allocate further resources for UK education for the next three years.
"Under the previous government, UK education spending rose by an average of only 1.5 per cent a year in real terms. Over the next three years, UK education spending will rise by 5.4 per cent a year in real terms. Spending will rise from last year's £40.6
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billion and this year's £45.8 billion to £49.5 billion next year, £53.4 billion the year after and then £57.7 billion. The money I announced in the Budget and now today will deliver, over the four years up to 2004, an average annual increase of 6.6 per cent in real terms, an annual rate of growth far in excess of the 1.5 per cent achieved from 1979 to 1997.
"I have one further announcement. In March the Secretary of State for Education made special payments direct to headteachers for books and equipment ranging from £3,000 to £9,000 for primary schools and from £30,000 to £50,000 for secondary schools—£290 million in total that went direct to the headteacher, to be spent by the school for use in the classroom. The Government have decided to continue this innovation. But next April the Education Secretary will allocate to our headteachers not £290 million but £540 million. As a result, head teachers in every one of our smaller primary schools will next year receive not £3,000, but a payment of £6,000; the larger primary schools, not £9,000, but a payment of £20,000. For the smaller secondary schools, there will now be payments of £50,000, rising, for the larger secondary schools, to payments of £70,000. These payments will now be made not only for one year, but for every year until 2004.
"So we have made our choice. It is now for those who oppose our spending plans to state clearly where their cuts would fall. The Government have been prudent for a purpose. Our choice is stability, employment and sustained long-term investment now and into the next Parliament to create a Britain of security and opportunity for all. I commend the Statement to the House".
My Lords, that concludes the Statement.
8.30 p.m.
Lord Saatchi: My Lords, wow! That was £43 billion of extra spending. So many billions, so many noughts; is it not marvellous? However, perhaps a question then arises: if it is so marvellous, why is not a grateful nation falling at the Government's feet in gratitude? Why do people appear not to be happy? Why does Gallup's "feelgood factor" stand at minus 15? Why has the Government's lead in the polls halved? Why is the Prime Minister's satisfaction rating now negative? Where is the gratitude?
There appear to be three possible reasons for the mysterious lack of gratitude. I should like to consider them. First, it may be that people just do not believe the figures. Could it be that, as was stated in The Times:
"When people discover they have been deceived, they are apt to become angry"?
Or is it that they believe what was said in the Daily Mail, that the Government were "bending the truth"? How shocking; how can people be so cynical?
Is it because the Government, in their last Budget report, claimed that,
"The tax burden on the average family will fall to its lowest level since 1972"?

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Only later did people find out that the Government's calculation included only direct taxes—which the Chancellor had cut by £30 billion a year—and excluded indirect taxes—which the Chancellor had quietly raised by £70 billion a year? Or is it because the Government claimed last year that they were increasing spending on health and education by £40 billion? It then turned out that the increases had been triple counted and that the actual increase was only half that figure?
Could it be because the Government said that they would raise petrol tax and pensions by the rate of inflation? Only later did people find out that the Government had used the historic rate of inflation for pensions—up 1.1 per cent—but the forecast rate for petrol tax—up 3.3 per cent.
We should not be so cynical. Let us take the figures at face value. That could bring us to a second possible solution to the case of the missing gratitude. Could it be that, even if people do believe the figures, they may be sophisticated enough to ask themselves: where is all this money coming from? Is it the strong economy? It is not that, because our economy is now growing more slowly than that of either France or Germany. On the plans announced today, government spending will grow by 3.3 per cent per annum, but the UK economy will grow by only around 2 per cent per annum. Thus, on today's spending plans, the Government are opening up a dangerous gap between government expenditure and national income.
Noble Lords will recall the dictum: annual income £20, annual expenditure £19–19s–6d, result—happiness; annual income £20, annual expenditure £20–6d, result—misery. Could people have worked out that, to fill the "misery gap", taxes are rising by the equivalent of 5.3p on the basic rate of income tax? Of course the Government do not put it that way. They rely instead on so-called "fiscal drag", a delightfully invisible aspect—from the Treasury's point of view—of our complex tax system, whereby tax allowances rise more slowly than earnings. Tax receipts to the Government rise faster than the growth of GDP. This year, as was the case last year, the Government's tax receipts are rising by 9 per cent, three times faster than the growth in GDP and three times faster than earnings. That is how the miracle to which the Minister referred—that of the allegedly "strong public finances"—is in fact being delivered. This Comprehensive Spending Review is ill named. It should be called the "Comprehensive Taxing Review".
However, let us once again be generous. Let us say that one does believe the figures and understand that the additional money has to come from tax. Because one is a public-spirited soul in a post-materialist age, one accepts that. Then a third question arises: what are they actually doing with all this money? Surely people can see that the money is not creating shorter hospital waiting lists, better cancer survival rates, more policemen and fewer violent crimes. What are the Government doing with the money?
One clue might be found in the Guardian newspaper which, each Wednesday, produces a supplement called "Society". It details job vacancies in the public sector.
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We have been monitoring this publication over the past month. Taking this week's issue—a typical issue—we find that the Government are advertising 394 jobs at salaries which will cost the Government £9.7 million a year. I can assure noble Lords that a similar number of positions at similar salaries are advertised every week. This year alone, taxes will have to rise by £500 million just to pay for the Government's jobs being advertised in that newspaper alone.
For the first time since 1979, employment in the public sector is on the increase. According to new figures I have today received from the Office for National Statistics, the number of state jobs rose by 44,000 in 1999. As I have said, that represents the first increase since 1979.
How marvellous that would be if those jobs all represented more policemen, doctors or nurses? However, we see that they are instead, "dignity at work consultants" at salaries of £28,000 a year, or "training zone trainer administrators" at £22,000 a year, or "multi-agency facilitator team leaders" at £24,000 a year. The reason why people are not falling on the floor with gratitude is because they do not believe the spending figures, they are not inclined to pay more in taxes for them and even if they were, they cannot accept more tax with results that are imperceptible to the naked eye. That is a triple whammy from which I cannot see how the Government will recover.
Is there any way in which Members of your Lordships' House could help the Minister in his plight? Well, there is one body in the land that could help to restore some credibility to the presentation of the Government's finances, but sadly, that body is excluded from the process. I refer, of course, to your Lordships' House.
I am told that this short debate will last for around 40 minutes, or perhaps a little longer. On that basis, that means that your Lordships' House will be passing judgment at a rate of £1 billion a minute. Because of the expertise and experience represented on all sides of your Lordships' House, this House is one of the bodies in our constitution best equipped to deal with the details of financial matters. However, it is not called upon to do so. Our debate today will probably last for less than an hour. The 572 pages contained in two volumes of the Finance Bill 2000 will be dealt with in this House in two hours or so at 11 a.m. on the last Friday of this Session.
Why is that? Is it not because the Parliament Act 1911 deprived your Lordships' House of the right to scrutinise money Bills? The then government's express argument for that Act was that the House of Lords was undemocratic and illegitimate, because it was packed with hereditary Peers. Did not the House of Lords Act 1999 remove that impediment? Does not the Leader of your Lordships' House say that our new House is more democratic, more legitimate and more authoritative? In the light of that, is it not perhaps time to revisit the relevance of the Parliament Act 1911 to today's House of Lords?
There are many ways in which your Lordships' House could exercise its scrutinising skills—which are undoubted and visible on all sides of the House—to

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improve the details of all financial legislation. I hope that the Minister will allow us to debate these matters along with the details of the Bill when we come to our all too brief discussion of the Finance Bill on 28 July.
8.40 p.m.
Lord Taverne: My Lords, one thing that is clear from the Minister's marathon Statement is that we should revise the procedures of the House. It should be possible for a Minister to say, "We have all read the Statement. Let's read it into the record. Any questions?" That would save an awful lot of time and would save the Minister an awful lot of breath.
It is fair to acknowledge that there are many good things about the Statement. Let us start with them. The increases in public expenditure are welcome. That should—not necessarily, but it should—make this country a more civilised society. Among the many particular items that we welcome, I wish to mention the increase in expenditure on the World Service, the increase in the science budget, the increase in overseas aid and the support given to the Good Friday Agreement.
However, we have one fundamental criticism of the Statement and government policy. The Chancellor may have avoided stop-go in overall economic management but he has not avoided stop-go in the management of public expenditure. We have had stop-go in public expenditure in spades.
Last year, public expenditure was 38.3 per cent of gross domestic product, which is a 35-year low. The record of the growth of public expenditure over the whole Parliament will not be particularly impressive. That low figure might please the Conservatives but it is reflected in the appalling state of many of our public services. Stop-go is the reason why the Government have failed to achieve smaller classes, with an average size of 25. It is the reason for the shortage of nurses and hospital beds and for longer waiting lists. It is also the reason for the Government's failure so far to realise their promise to increase the size of the police force. What has increased, of course, is the prison population, because the Home Secretary seems determined to follow the policy of his predecessor and lock up just about anyone in sight whom he can lay his hands on. That is not the right way to deal with crime and the causes of crime.
Stop-go in the management of public services leads to havoc in public services. We hope that we are now going to see an increase in the number of policemen, but a number of experienced policemen will leave and we will have new recruits instead. The police force as a whole will suffer. The same applies to nurses.
Perhaps the worst failure, which is not mentioned in the review, is on pensioners. For our relative wealth, our state pensioners are the worst-off in the European Union. My colleagues will return to that subject time after time.
I do not wish to say anything else about the Statement at this stage. We have gone on long enough. Finally, I turn to one part of the Statement with which no one can quarrel. The Minister said:
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"It is now for those who oppose our spending plans to state clearly where their cuts would fall".
The Conservatives should state where they will find the £20 billion of cuts in these spending plans. If they do not, we can only infer that their programme will mean fewer nurses, fewer beds, fewer police and bigger classes. It is time to come clean.
Baroness Hogg: My Lords—
8.44 p.m.
Lord McIntosh of Haringey: My Lords, surely the noble Baroness, Lady Hogg, is not going to deprive me of the pleasure of responding to those contributions. I was described as being in a plight. Having read that Statement, I am a happy man. I am happy because all the things that I have worked for throughout my life in politics are starting to work out. I shall show that not only is the Statement in pursuit of our ideals and objectives; it is the right way to protect our economy and our society.
The noble Lord, Lord Saatchi, asked why the population was not falling about. Apart from the obvious answer that we cannot afford the services of M&C Saatchi, I wonder whether he has looked at the opinion polls recently. I wonder whether he has noticed that, for the first time since polling began, three years into a Parliament, the government party is significantly ahead. Of course there is criticism of the Government's style. If the papers cannot get at the substance, they have to criticise the style. That is what they have been doing and good luck to them; it is their job. We do not have to take that very seriously in this House. The Government should not be deterred from pursuing their economic and social policies by the tittle-tattle that has been going around in the press for the past few weeks and months. If the question is why there is a lack of gratitude, I answer that the people of this country are more sensible than the people who provide them with their news and gossip.
The noble Lord, Lord Saatchi, has three solutions for his non-problem. First, he says that people do not believe the figures. He did not provide very much evidence for that. He looked at the difference between petrol tax and pensions and pointed out that, in September 1999, a forecast produced a lower increase for pensions than an actual figure produced for an increase in petrol tax. He did not look at 1998 or 1997 or observe that there has been an almost even balance during this Parliament, with the balance being in favour of higher rises for pensions. Unless the noble Lord has more evidence than that, we should not take too seriously his claim that people do not believe the figures. He rightly went on to say that we should not be cynical.
The noble Lord's next point was about the gap between available income—that is, growth in the economy—and public spending. There is no gap between the projected growth in the economy and in public spending. The figure for public spending is 2.5 per cent, which is the same as a neutral view of growth. In any case, there is a margin of error so that the fiscal rules will still work even if growth is only 2.25 per cent.

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I ask him to look back at the Red Books of Conservative governments over the 1990s, when the forecasts for growth and income from taxes were grossly exaggerated year after year.
The noble Lord described this as a comprehensive taxing review. We shall come on to taxing in due course. He did not notice that we have stopped using the word "comprehensive".
The third question was what we were doing with the money. The noble Lord made a curious argument about the number of public sector jobs rising, citing in evidence the Wednesday Society supplement of the Guardian. He did not look in the Nursing Times, The Times Educational Supplement or any of the journals that advertise jobs for people in the front line of public services. If he looks at the real figures he will find, for example, that there are 5,000 more doctors than there were when we came to office and 10,000 more nurses. There are many more examples. If the party opposite seeks to make progress by revising the Parliament Act 1911, I do not think they can be taken seriously as economic critics.
The remarks of the noble Lord, Lord Taverne, were even more interesting. He argued that, because we accepted the Conservative spending plans not only in the first year, about which had no choice, but also in the second, that somehow represents what he called "stop-go" in public expenditure.
The noble Lord ought to look back at his own party's manifesto for the 1997 election. He ought to look at Liberal Democrat targets for public expenditure on education, health, policing and a whole series of public expenditure issues. What he will find, time after time, is that the Liberal Democratic Party is the party of low public spending. It ill becomes the Liberal Democratic Party now to complain when the prudent management of the economy shows that we can, within strict fiscal rules and without abandoning prudence in any way, surpass the objectives which the Liberal Democratic Party thought it proper to put before the people in May 1997.
8.50 p.m.
Lord Lipsey: My Lords, did my noble friend by any chance notice the opinion poll in the Economist, the Angus Reed poll, which indicated that voters in Britain, uniquely in the world, put higher public spending ahead of lower taxes in their list of priorities? Does he therefore agree that the Chancellor has today set out excellent terrain on which the Government can fight the next general election against an Opposition whose attitude to public services and public servants was so graphically displayed by the noble Lord, Lord Saatchi?
Lord McIntosh of Haringey: My Lords, it is not for me to go further than I have done in analysing the achievements and motives of noble Lords opposite. I respond to them only because they say these things and it is open to me to respond. I do not think that it is open to me to respond when my noble friend makes equally valid points. Certainly, the value of public service was
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allowed to decay very seriously over the past 20 years. We are seeking to restore it, and I believe that in these spending plans we have the means to do so.
Baroness Hogg: My Lords, I must offer an apology to the Minister, first, for interrupting him, and secondly, for missing the beginning of the Statement. I can assure him that I had read the Statement and indeed listened to it in another place.
Perhaps I may ask the Minister to elucidate a couple of points in this well-padded but in some ways uninformative document produced by the Treasury. Perhaps I may raise one point on which I gave the Minister notice. There is talk in the Statement, rightly, of increases in public expenditure. However, before turning to the statistical annex to the document and looking at what is actually happening as a result of this announcement in the year that is just beginning, I find that, so far as the Chancellor of the Exchequer is concerned, charity seems to begin at home. The only department whose expenditure is increasingly significantly in this year as a result of the plans set out in the Statement is the Chancellor's department. Will the noble Lord explain why that is the case?
A more general point on which I should be grateful for the noble Lord's explanation is the relative weight of the figures given today for real terms increases and for cash figures. We heard a great deal in the Statement about increases in real terms over a period of up to three years. In the document, however, figures are given in cash terms. Therefore, without wishing to labour the point, will the Minister say to which of those the Government are committed? This is particularly relevant, if I may give an example, when we look at the figures for defence. There is a great deal of talk in the Statement about the first real terms increase in defence spending. When we look in the document, we discover that the real terms increase averages 0.3 per cent over the next three years. If it is the cash numbers to which the Government are committed, it takes only a small variation in the rate of inflation over this period for this real terms increase to disappear. If on the other hand it is the real terms increase to which the Government are committed and they have moved away from a long period of cash budgeting, we should be told explicitly that these real terms increases are precisely what the Government are committed to.
When we come to the measurement of inflation in relation to all the increases, perhaps I may ask the Minister one more question. It relates to an Answer that he gave me recently at Question Time on how inflation is measured. I asked him why it was the case the new statistics commission had had excluded from its remit a consideration of the measures of inflation collected in relation to the retail prices index. His response was that when the commission was set up, he was sure that it would be able to look at whatever it wanted. I wonder whether he can confirm that to me, because the Treasury tells me otherwise.

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Finally, I rarely disagree with the noble Lord, Lord Lipsey, but he cast some aspersions on the attitude—
Lord Bach: My Lords, will the noble Baroness give way? I am sorry to interrupt her, but the convention is fairly clear. Comments and questions for no more than two or three minutes from each Back-Bencher is considered the norm—
Lord McIntosh of Haringey: If that.
Lord Bach: "If that", my Lords, as my noble friend with much more experience than I tells me. I wonder whether the noble Baroness would mind winding up her questions now.
Baroness Hogg: My Lords, I shall certainly do so, and I shall take up my point with the noble Lord, Lord Lipsey, later. I ask the Minister to have reference to the comment of the Secretary of State for Education on civil servants before casting aspersions elsewhere.
Lord McIntosh of Haringey: My Lords, the noble Baroness did indeed, in the corridor a few minutes before I entered the Chamber and before I had a chance to check any figures, draw my attention to the figures for the Treasury. As she well knows, the Treasury is a very small organisation with well under 1,000 staff and very few capital assets. The expenditure under that heading is largely for the Inland Revenue and Customs and Excise. The test for that is surely how much it costs to collect each £1 or each £1 million of taxation or excise duty. I shall gladly write to the noble Baroness on the subject, but I think she will find that the cost of collection in those terms is not rising.
The noble Baroness asked whether the figures that I quoted are indeed real terms figures. Yes, they are. Every time that I said they were real terms figures, I referred to "real terms" in the light of forecast inflation. As the noble Baroness well knows, although her party does seem to be willing to admit it, inflation has been exceptionally stable over the past three years. While not giving any absolute assurance that it will continue to be stable, the policies of price stability appear to be working. So far as concerns the changeover from cash to resource accounting, we are still in the middle of it. These figures are presented in resource account terms. The noble Baroness will observe that resource expenditure and capital expenditure are separated out in the White Paper for each department. But there are still elements which it has not been possible to allocate as between capital and revenue, and those will fall into annually managed expenditure rather than departmental expenditure limits. It is the custom of this House that I should reply to only two questions, and I have done so.
Lord Ezra: My Lords, accordingly, perhaps I may put two questions to the noble Lord. First, I was amazed at his remark on the Liberal Democrat approach to public expenditure. I have spent a number of years in this House and throughout that period I
918
have pressed very hard for increased expenditure on infrastructure. A basic theme of our thinking has been affordable increases in public expenditure. Perhaps the Minister will comment.
Secondly, I should like to draw the Minister's attention to the difficulties that manufacturing industry presently faces, on which we shall have a short debate later. Will the noble Lord indicate what proportion of the extra expenditure announced today will be of direct benefit to manufacturing industry?
9 p.m.
Lord McIntosh of Haringey: My Lords, I do not claim to be an expert on the expenditure plans of the Liberal Democrats. If any noble Lords on those Benches look at their manifesto for May 1997, they will find that their expenditure targets fall below the plans which the Government have announced today. The noble Lord, Lord Ezra, is a doughty defender of tax and spend, and I admire him for that. He should look at his own publications first.
As regards manufacturing industry, a very useful and sensible question has been raised which will be answered by my noble friend Lord Sainsbury in a following debate. I say to the noble Lord that there is direct support for manufacturing industry in the White Paper. I gave the example of the promotion of the Small Business Service as evidence of that. Most of the things that we are doing for manufacturing industry do not occur here, but in the Budget which is concerned with taxes. The fact that we have among the lowest rates of corporation tax and 100 per cent capital allowance for investment in information technology, and so on, is evidence of that although those provisions do not appear in this Statement.
A whole range of government expenditure on education, health, transport and other things is for the benefit of manufacturing industry. If people are to be available to work in manufacturing industry and if the industries are to be successful, they have to have investment, particularly in education and training, provided for in the spending plans.
Baroness Gale: My Lords, I congratulate my noble friend the Minister on bringing such good news to the House tonight. Part of that good news was investment in education and in our children's future and the continuing crusade by the Government to lift children out of poverty. Those factors are very good news. I especially thank the Minister for bringing to the people of Wales the good news of the biggest increase in public spending in Wales. I was particularly pleased to hear about Objective 1 funding for Wales. Does the Minister agree that that funding will go to parts of North Wales, west Wales and in the Valley areas, in which I am particularly interested as I live in the Valleys? Does he agree that that is one of the most deprived areas in the country? Objective 1 money will be of great assistance. I am sure that this settlement will be warmly welcomed by the people of Wales.

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When they hear of it tonight and of Objective 1, there will be "Songs of Praise" to the Government from the people of the Valleys of Wales.
Lord McIntosh of Haringey: My Lords, I should have liked to hear that. It could not have come from anywhere better. My noble friend is right to draw attention to Objective 1 funding. We do not ourselves determine that funding any more than we have determined Objectives 2 and 3 other than by putting forward a good case. The really significant point about the Statement—this is the first time that it has ever happened—is that we have guaranteed that we shall provide the matching funding from public funds to ensure that we do not lose any European funding. We shall cover the full forecast increase in structural fund receipts. That has been a bone of contention in the more deprived regions of our country for many years. Quite a change is being made here and I am glad that my noble friend recognises how important that is.
Lord Sheppard of Didgemere: My Lords, I find it difficult to comment on the quality of spend because, understandably, there are so many things still to come. I hope that the transport strategy to be announced on Thursday has some numbers attached to it. Even more important than numbers, I hope that there is some action in the strategy. We have had a great number of words in the past three years. I do not know what it is like in Wales, but the economy of London is really suffering. The business economy is suffering. The business community has stated quite clearly what we need. A great deal of the money can come from the private sector. Shall we hear fewer words on Thursday and have some action on solving some of our transport problems?
Lord McIntosh of Haringey: My Lords, the distinguished service of the noble Lord, Lord Sheppard, in promoting business in London is well known. It is outstanding. The whole country is grateful to him and his colleagues for it. I have not seen the transport plans. I do not know what the balance will be between words and figures. Taking this White Paper as an indicator of what is going to happen at inter-departmental level, I believe the prospects for a sensible, action-based, realistic series of transport plans to be announced on Thursday are rather good. The noble Lord, Lord Sheppard, and I will both have to wait and see.
Lord Desai: My Lords, at £1 billion a minute, perhaps I may ask my questions quickly. I join many others in welcoming the increase in DfID's expenditure. I welcome the fact that the Government have now met the target of 0.3 per cent of GDP for foreign aid. Can my noble friend assure me that that figure will be sustained for the future? In addition, I welcome the cross-departmental initiative in helping conflict resolution. Can my noble friend assure me that the Government will keep to that innovation?
Lord McIntosh of Haringey: My Lords, I thought that my noble friend was going to ask more than two
920
questions. I should have had to deny him as I denied the noble Baroness, Lady Hogg. He was very restrained and I am grateful to him. We have announced today public expenditure figures for the years 2001 to 2004. There can never be any indication of what will happen after that. Even announcing the figures three years in advance is a very considerable improvement on what has been the habit of governments of all parties—this is not a party point—over many years.
My noble friend points out that we have achieved the first target that we set ourselves for international development and aid as a percentage of gross domestic product. I am sure that he and others will press for that to continue beyond the year 2004. I am sure that Clare Short will be very sympathetic towards that. I can confirm that in both cases the amounts of money which are to be allocated to international aid and conflict resolution will continue throughout the period of the spending review. That is as far as any government can ever go about future expenditure.
Lord Davies of Oldham: My Lords, does my noble friend agree that the characteristic feature of the proposals is the emphasis on investment? Is my noble friend aware of the contrast between that and the circumstances 20 years ago when the government were also well funded through increased oil revenues but used them to reduce taxation and not invest in the necessary services of the country?
Lord McIntosh of Haringey: My Lords, in a sense what is proposed for investment expenditure is an understatement rather than the reverse. What we now propose, and flagged up in the 1998 comprehensive spending review, is a doubling of public expenditure on investment as opposed to revenue. The changeover from cash to resource accounting makes it possible for the first time to identify investment and for investment expenditure to be amortised over the life of the assets created by investment. Beyond that, our success in encouraging the private finance initiative, and the only two large private/public partnerships for the London Underground and National Air Traffic Services, indicates that the total amount of investment in public projects, including public and private investment, will increase beyond the figures given in the White Paper.
Lord Northbrook: My Lords, I should like to put two questions to the Minister. First, I understand that the Government have projected economic growth at 3 per cent this year and 2.5 per cent next year. Is that not high by historic standards, particularly in view of the slow-down in the US economy? Secondly, unemployment, social security and debt interest account for only 17 per cent of additional spending. The assumption is that spending in these fields will increase by only 1.5 per cent each year compared with 2.5 per cent in previous plans. The Government's assumption is that they can keep social security spending from rising faster than the rate of inflation. Is that not risky in the longer term?
Lord McIntosh of Haringey: My Lords, I do not believe that any of these assumptions is risky, except in

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the sense that none of us can be certain about anything in the future. The noble Lord's comments are rather surprising in the light of the fact that a few minutes ago his own Front Bench appeared to doubt our growth projections from the opposite direction. These are very prudent figures which take into account the possibilities of lower growth than our realistic median trend projection and lower receipts from taxation. If the noble Lord's greatest concern is social security expenditure, the fact that we have created 1 million jobs since we came into office will not be reversed in the timescale with which this review is concerned.

Care Standards Bill [H.L.]
9.11 p.m.
The Parliamentary Under-Secretary of State, Department of Health (Lord Hunt of Kings Heath): My Lords, I beg to move that the Commons amendments be now considered.
Moved, That the Commons amendments be now considered.—(Lord Hunt of Kings Heath.)
On Question, Motion agreed to.

Care Standards Bill [H.L.]
  COMMONS AMENDMENTS
  [The page and line refer to Bill 105 as first printed for the Commons.]

  COMMONS AMENDMENTS
  1 Clause 1, page 1, line 8, leave out ("This section has") and insert ("Subsections (2) to (6) have")
  2 Page 1, line 13, at end insert ("or by a foster parent")
  3 Page 2, line 4, leave out from beginning to ("or") in line 6
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 1 to 3. I shall speak also to the other amendments grouped with these three amendments. The first group of amendments are minor amendments that clarify the definition of children's homes and tidy up definitions used in the part of the Bill which covers the welfare inspections of boarding schools.
  I should like to deal first with Amendments Nos. 1, 2, 7, 192, 194, 240, 241, 244, 245, 258, 259 and 284. At present, the Children Act 1989 exempts from regulation children's homes which accommodate three or less children. This is a loophole that we are closing through this Bill. However, as a result it became necessary to ensure that foster carers were not inappropriately caught by the widened definition and required to be registered by the national care standards commission as children's homes. That is certainly not our intention.
  Amendment No. 2 clarifies this position in relation to foster carers generally and Amendment No. 7 defines a foster carer. Amendment No. 245 slightly amends the definition of "private foster" care in the Children Act. This is needed to prevent loopholes which could allow unscrupulous people to avoid registering as a children's home by pretending to be private foster carers.
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  Amendments Nos. 192 and 194 insert the definitions of "private fostering" and "local authority foster parents" which are in the Children Act into the Bill. Amendments Nos. 241 and 258 ensure that the provisions in the Children Act which set out the circumstances in which a person may foster more than three children without being treated as a children's home also apply to this Bill. Amendments Nos. 1, 240, 259 and 284 are consequential to the changes we are making here.
  I turn to Amendment No. 6. We believe it is important that any child who is accommodated in a boarding school for more than 295 days in a year should have the extra protection provided by that school also having to register as a children's home. However, during the Committee stage in this place, the noble Lord, Lord Northbourne, raised the concern that any boarding school which provided holiday camps during the school holidays would be required to be registered as a children's homes as it would be accommodating children for more than the 295 days specified. The noble Lord was quite right to point that out and I can assure noble Lords that that was certainly not our intention. Amendment No. 6 clarifies this position and puts beyond doubt that an individual child has to be accommodated for more than 295 days before the boarding school is required to be registered as a children's home.
  In the other place there was concern about why only children in an independent boarding school should benefit from the extra protection provided by having the boarding school registered as a children's home if children were accommodated for more than 295 days. This is anomalous and there is no good reason why children in voluntary or state sector homes should not benefit from this protection. Amendment No. 5 therefore extends this requirement to all boarding schools.
  I turn to Section 82(5). In the other place a number of honourable Members were concerned that homes established under this section of the Children Act would be exempt from regulation as children's homes. Section 82(5) allows the Secretary of State to establish homes to meet the needs of children for particular services or facilities which are not provided in community homes. These homes are currently inspected by the social services inspectorate. We originally decided to exempt them from regulation because it had been decided that the department should no longer continue to run such childcare facilities, as we believe that these services are best provided by local authorities, the health service and specialist facilities in the private sector. It is worth reminding your Lordships that the only remaining home of this kind, Glenthorne, closed last week.
  However, while there is no current intention to use Section 82(5) to establish any more of these homes, its use cannot be ruled out for some point in the future. In those circumstances, we decided that these homes should be regulated as children's homes by the national care standards commission and Amendment No. 3 amends Clause 1 accordingly. Amendments

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  Nos. 212, 231, 232 and 235 to 238, and amendments 262 and 263 are consequential to bringing these homes within the regulatory framework.
  I turn to community homes. The Bill extends regulation to services not previously regulated, and none is more important than ensuring that looked-after children are properly protected. Therefore, community homes will be regulated for the first time. Amendment No. 199 brings the rather complicated management arrangements which apply to community homes provided by voluntary organisations within the new registration provisions.
  When these homes are required to register, the question arises as to who should be treated as "carrying on" the home, and "managing" the home, to use the terminology of Part II of the Bill. Amendment No. 199 enables arrangements to be made, if necessary on a home-by-home basis, for designating who should be treated as requiring to register. This provision enables the registration system to work effectively without unduly disturbing the management and governance systems that apply to community homes.
  Amendment No. 15 removes from Clause 4 the definition of what is meant by the term "carrying on" a fostering or voluntary adoption agency. It also removes the provision that carrying on an establishment or agency includes carrying it on otherwise than for profit. Subsection (3)(a) and (3)(b) in Amendment No. 199 would see these provisions reappear word for word in the general interpretation clause, while Amendment No. 190 simply introduces into the Bill the definition of community home used in the Children Act.
  Finally, I want to speak to Amendments Nos. 174 to 178, 180, 181, 243 and 254. These are all tidying-up measures. At present, if a boarding school is a children's home or care home, then there is no need for the provisions in Section 87 of the Children Act in relation to welfare in boarding schools to apply. This is because the welfare requirements in relation to registration as a children's home or care home are more stringent than those for boarding schools, so meeting them would mean that it would be unnecessary also to satisfy the Section 87 requirements.
  With this Bill, we are extending the Section 87 welfare requirements to further education colleges as well as to all boarding schools. We need, therefore, to exempt colleges as well as boarding schools from Section 87 requirements if they are registered as children's homes or care homes, and this is the intention behind Amendment No. 174. Section 62 of the Children Act imposes functions on local authorities with regard to children accommodated by voluntary organisations. Clause 85(5) amends Section 62 by disapplying it to schools which are voluntary organisations. Amendment No. 178 does the same for colleges.
  I turn to Amendments Nos. 175, 243 and 254. We are introducing a new definition of "appropriate authority" for Section 87 of the Children Act as a result of the national care standards commission
  924
  carrying out welfare inspections of boarding schools and colleges. Amendment No. 175 defines the "appropriate authority" as meaning the commission in England and the National Assembly for Wales in Wales.
  Initially, we intended the definition of "appropriate authority" to be used throughout the Children Act, but we now realise that we need to keep the current definition in Section 68 of the Act in relation to persons who are disqualified from acting as private foster carers. Therefore, Amendments Nos. 243 and 254 make clear that the new definition applies, in addition to Section 87, to Sections 65 and 65A, but not elsewhere in the Act.
  Finally, Amendments Nos. 176, 177, 180 and 181 are purely technical amendments which amend and correct the definition of "further education corporations".
  I well understand that this is a large group of amendments. However, in the main they are responses to concerns raised in this House and in the other place and are tidying up measures. I hope that noble Lords will agree to support them.
  Earl Howe: My Lords, I begin by thanking the Minister for speaking so fully to these amendments. There is nothing in them that I would regard as contentious; indeed, a number, such as those which relate to boarding schools, are decidedly welcome.
  The Minister was kind enough to write to me last Friday with a comprehensive explanation of all the government amendments that we are considering today. I take this opportunity to thank him for the trouble that he took in doing so. It assisted me enormously in preparing for today's debates but, perhaps more to the point, it will have saved us a good deal of detailed and perhaps unnecessary discussion across the House—something which I am sure we are all keen to minimise.
  Having said that, I am unlikely to be alone in the dismay that I felt when confronted with today's list of amendments. No fewer than 289 government amendments to this Bill have been passed in another place, including 20 new clauses and one new schedule. The Bill is now approximately 20 per cent longer than when it left us in the spring. I am the first to recognise that a good number of the amendments represent the Government's response to concerns raised in both Houses during the passage of the Bill. We shall all be grateful for that and, to that extent, I do not wish to sound in the least churlish. However, by any standards, 289 amendments in a Bill of this length is a large mouthful to swallow at one go. Of course, that figure excludes the 185 government amendments inserted during the Lords stages, if I have counted them correctly.
  There was a respectable case to be made for having the Bill re-committed. I have no doubt that the Minister will repeat often as we progress through the groupings that a substantial proportion of the amendments are technical in nature. Of course, there will always be amendments of that kind. However, I

  925
  am sure that some of us long for the day when the majority of technical anomalies are ironed out before Bills are laid before Parliament in the first place. We seem to be moving into a rut in which wholesale amendments to Bills during their passage through Parliament is becoming more and more the norm. On an exceptional basis, it may be unavoidable and possibly even desirable. However, on a routine basis I suggest that it is neither of those things.
  I am sure that we shall all pay close attention to the Minister's words today and, at the end, come to our own view as to how strongly the Government are to be congratulated on their overall handling of the Bill.
  Baroness Barker: My Lords, even at this late hour it is good to be back at another meeting of the "balance club" which has been through this Bill several times before. After much of the high-flown oratory, it is good to be back doing work which really will make a difference to people who need protection in institutional settings.
  I greatly welcome what the Minister said with regard to the work that has been done on the Bill since it left this House. I welcome in particular the work done on the definition of community homes and the work done in the light of many comments made in this House about the position of independent boarding schools. I too regret the list of bingo numbers in front of us this evening. However, I understand that they reflect what has happened throughout the Bill's passage in this House; namely, that the Government are prepared to listen to what many of us had to say based on our own practical experience in these fields. I welcome that very much.
  I have one particular point on this group of amendments and that relates to Amendment No. 6. Your Lordships will recall the point which was well made by the noble Lord, Lord Northbourne, during our discussions about the fact that some boarding schools, particularly those which raise income by letting their premises during school holidays for the purposes of holding activity holidays for children, may be caught under that definition. I understand that Amendment No. 6 is an attempt to clarify that. My point is: people who are teachers in independent boarding schools may well themselves either adopt or foster children, and they may well live on the premises. In that case, it is entirely possible that a fostered or adopted child may live in such premises for more than 295 days a year. I seek clarification from the Minister that a school in that position would not be caught. I know that that is not the intention of this amendment. The last thing that any of us want is for an independent school to be caught for that one single reason. That is the only point of substance I raise on this group of amendments.
  Lord Laming: My Lords, I too do not want to raise any objections to any of these amendments, although like the noble Earl, Lord Howe, I suspect that with better parliamentary drafting many of these amendments could have been avoided.
  926
  On Amendments Nos. 2 to 7, I noticed that when the noble Lord the Minister spoke to these items he referred to "foster carers" and not to "foster parents". I believe that he was correct to do so. Why do these amendments refer to "foster parents" rather than to "foster carers" which is the correct term nowadays?
  Lord Hunt of Kings Heath: My Lords, I certainly recognise that 289 amendments comprise a somewhat daunting agenda for your Lordships at this rather late hour. I recognise that we are having to focus our minds on many different matters of detail.
  In relation to the nature of the debates we have had, it is worth recalling that it was in mid-December, which seems a long time ago, that this Bill had its Second Reading. It has had rather slow progress through your Lordships' House and then into another place. I believe there has been one benefit from that: we have been able to take account of many of the comments and concerns that have been raised. The noble Earl, Lord Howe, in a sense anticipated my response to his strictures about the question of whether the drafting could have been better to start with. No doubt some things could have been done better. But the record indicates that the Government have listened very carefully to the many comments made in your Lordships' House and, indeed, during the passage of the Bill in another place.
  Although later we shall come to debate a matter on which there has been disagreement in your Lordships' House right from the start, overall there has been a consensus approach to the main provisions of the Bill because we are all concerned about improving regulation in the care arrangements and in relation to the establishment of a general social council. Therefore, while the challenge for us this evening is to reflect on a considerable number of amendments, the final outcome is a better Bill which has emerged as a result of extremely informed debate in your Lordships' House.
  The noble Baroness, Lady Barker, asked whether the 295 day rule applies to a child who is a student at the school but who lives at the school during the holidays. I am happy to give her the assurance that the provision would not apply in those circumstances.
  As regards the point raised by the noble Lord, Lord Laming, I am advised that while it is right to refer to foster carers, the term "foster parent" is used in this legislation because that is the term used in the Children Act.
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  2 Clause 1, page 1, line 13, at end insert ("or by a foster parent")
  3 Page 2, line 4, leave out from beginning to ("or") in line 6
  9.30 p.m.
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 2 and 3.

  927
  Moved, That the House do agree with the Commons in their Amendments Nos. 2 and 3.—(Lord Hunt of Kings Heath.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  4 Clause 1, page 2, line 8, after ("is") insert ("of a description")
  Lord Hunt of Kings Heath: My Lords, I beg to move that the house do agree with the Commons in their Amendment No. 4. This is another large group of amendments. They are on the whole changes that were made in order to clarify what was already intended and make no changes of substance. They all deal with the provisions under Part II that set out the detailed processes, systems and requirements operated by the national care standards commission.
  Amendments Nos. 4, 12 and 14 respond to concerns raised by Philip Hammond in Committee in another place and seek to clarify the intention that powers to exempt from regulation will not be used to exempt individual establishments or agencies from registration requirements. The amendments use the term "of a description", which is already present in Clause 2(8).
  Amendment No. 25 relates to reports following inquiries established by the Secretary of State under Clause 9. We debated this point at some length in the House. In response to the noble Lord, Lord Laming, and in moving an amendment I said that the onus will be on the Government to publish inquiry reports and the clear expectation is that they would normally publish those reports except in exceptional circumstances. However, in response to concerns expressed during Commons Committee stage we made a further amendment to make the position even clearer on the face of the Bill that in all but exceptional circumstances the report would be published.
  Amendment No. 26 makes clear that a registered manager of an establishment or agency must be a person. The person carrying on an establishment or agency—essentially the owner—can be an organisation or company, but we wanted to make clear that the role of manager, which is so important to the day-to-day running of the care service, is one that must be undertaken by a named person, although this amendment does not preclude job-sharing arrangements.
  Linked to that is Amendment No. 35 which clarifies that regulations can be made requiring managers of specified establishments or agencies to be registered with the general social care council. That will enable the national care standards commission and the general social care council, with their separate but related responsibilities, to be brought together for the greater enhancement of quality to service users.
  Amendments Nos. 27 and 29 to 34 all make a minor clarifying change to ensure that conditions on an establishment or agency can be removed as well as varied. That change was made in response to concern expressed by in Committee in another place by Philip Hammond.
  928
  Amendments Nos. 28 and 46 respond to a problem with the Registered Homes Act 1984 and the Children Act 1989 that has recently come to light as a result of a number of cases before the courts or Registered Homes Tribunal. Essentially, the wording of the legislation allows home owners to avoid the consequences of cancellation if they closed the home before a formal cancellation decision was taken, because in such a case there was no home in respect of which to cancel, and cancellation was invalid.
  The effect of that would be that such a person could open another home elsewhere without having the cancellation on their record. Amendment No. 28 ensures that the wording of the Bill avoids that loophole. Amendment No. 46 makes the appropriate change to the Children Act so that in the period before the establishment of the national care standards commission, the loophole is fixed in respect of children's homes.
  Amendments Nos. 36, 43, 44, 50 and 51 are also technical clarifying changes that simply make sure that "documents" as well as records can be inspected by inspectors.
  Amendment No. 37 is specifically in response to a point raised by the noble Lord, Lord Clement-Jones, in our discussions at Report stage. Clause 21(6)(k) of the Bill allows regulations to be made to ensure that arrangements are in place in independent hospitals and clinics to ensure that any medical or psychiatric treatment they provide is of appropriate quality and meets appropriate standards. The noble Lord's concern was that this power really ought to extend to the nursing provided by care homes. We considered that issue carefully and tabled this amendment in Commons Committee to take account of that point.
  Amendments Nos. 38, 52 and 179 are all about consultation. Amendment No. 38 places a requirement on the Secretary of State to consult before making or significantly amending regulations under Clause 21 of the Bill. That was in response to concerns raised during Committee stage in another place.
  Amendment No. 52 is an amendment tabled in Committee which the Government were happy to accept in another place. The effect of the amendment is to require consultation on the national minimum standards to apply under Part III to local authority services to match the consultation requirement set out in Clause 22 applying to Part II services. Amendment No. 179 has the same effect in respect of standards for welfare inspections of boarding schools.
  Amendments Nos. 39 to 42 relate to offences under Part II of the Bill. Amendment No. 39 ensures that the "holding out" offence properly covers all eventualities. The drafting of the original clause was not sophisticated enough to catch people who, for example, advertise their home as being a nursing home if it is not registered to provide nursing care.
  Amendment No. 40 introduces a new offence of knowingly making a false or misleading statement in any application to the national care standards commission. That plugs an important gap in the provisions to ensure that there is no incentive for

  929
  applicants to falsify details. Amendment No. 41 allows for proceedings for an offence to be brought more than six months after they are committed. For summary offences such as those under Part II, the six-month time limit applies automatically unless otherwise specified. But in many cases, offences only come to light when problems are uncovered following inspection or whistle blowing. The amendment provides for a six-month time limit from when the offence comes to light with an overall time limit of three years from the commission of the offence.
  Amendment No. 42 simply places local authorities in the same position as other bodies registered under Part II such as companies or voluntary organisations. It allows for local authority members, as well as officers, to be prosecuted if the offence is proved to have been committed with their consent or connivance, or if it is attributable to neglect on their part.
  Finally, Amendments Nos. 47 and 48 extend the provisions of Clause 39, which is the clause under which regulations may be made to extend the provisions of Part II to other services. That would mean the introduction of regulation under the national care standards commission for services not covered on the face of the Bill. The original drafting of the clause did not allow for extension to agencies, only to local authority social services or NHS services. Amendment No. 47 therefore extends it to cover agencies supplying people who provide such services. Amendment No. 48 ensures that local authority services themselves are properly within the scope of the power. We felt that the original wording left that in some doubt.
  Moved, That the House do agree with the Commons in their Amendment No. 4.—(Lord Hunt of Kings Heath.)
  Lord Clement-Jones: My Lords, as this is the first amendment to which I wish to speak, I too take this opportunity to thank the Minister for his courtesy in writing to me in advance of the debate setting out the Government's rationale to the amendments that were moved in the other place. However, I should like to place on record the fact that I join the noble Earl, Lord Howe, in regretting the lateness of the hour at which we are debating these amendments—all 289 of them—tonight.
  This Bill has had an extraordinary passage. We started in December. We had Third Reading in April and now, in July, we are faced with the Commons amendments at quarter past nine in the evening. That puts us all in a difficult position in terms of our wanting to consider the amendments in the same way as they were made; that is, over a long period of months. After all, the Minister will recall that there were 18 or 19 Committee sessions and Report stage was also pretty lengthy.
  On the other hand, it is always difficult to find a balance between wishing to be helpful as the Bill moves through the House; to respond to criticisms made by opposition parties, but not to overload Members of
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  either House with too many government amendments. So I recognise that there is an issue here. But I acknowledge that the Bill is much improved as a result of the government amendments being brought forward.
  In Part II, which deals with establishments and agencies, can the Minister say whether or not my analysis is correct? That is to say, between the Bill leaving this House and coming back, we have introduced a separate system of registration as to ownership—that is, carrying on the business of a care home or other establishment—and that of a manager in a personal capacity. So, effectively, we have in fact got a dual registration system. I do not complain about that. It puts an added burden on those establishments. But there is a big difference in the way the registration will now be administered. That is of considerable significance and has been largely underplayed by Ministers both in the other place and by the Minister tonight in his exposition, clear though that was.
  I welcome Amendment No. 37—I would say that, wouldn't I? It was originally suggested to me by the BMA and I felt it was the right avenue to take. But I am curious as to why the suggestion we made that it should relate to clinical care and not just to nursing care was not followed and the more narrow route was taken by the Government.
  I also generally welcome from these Benches Amendments Nos. 38 and 52, one of which emanated from the official Opposition and one of which emanated from one of my honourable friends in the other place. Consultation is clearly vital, both with the private sector and with local authorities. That relates to Clause 21.
  I am curious—perhaps this should have struck us earlier, certainly on listening to the commentaries now being made on the Bill by law firms and others—about Clause 22. In a sense it is the counterpart to Clause 21, which sets out the national minimum standards. It is not quite equivalent. Although it relates to national minimum standards, it seems that regulations will not be made. They are simply standards and it is not obvious what is the legal status of those national minimum standards under Clause 22. Perhaps I can be rather unfair to the Minister and ask whether he is able to comment on that.
  Finally, I welcome Amendment No. 25. I leave it to the noble Lord, Lord Laming, to comment on whether or not his original intentions have been fulfilled. However, the way the Government have put it in terms of publishing in all but exceptional circumstances seems to be the right way forward. I am pleased that they chose that course.
  9.45 p.m.
  Lord Laming: My Lords, I take a lead from the noble Lord, Lord Clement-Jones, and say how grateful I am for Amendment No. 25 which relates to

  931
  the publication of inquiry reports. However, I add the hope that exceptional circumstances will apply only very exceptionally.
  Baroness Barker: My Lords, I refer to just two of the amendments in the group. I understand from the Minister's helpful briefing that Amendment No. 26 sets out the role of a manager. It requires a manager of an establishment to be named. I understand that; it is rather like the licensee of a licensed premises being named. However, I want to make sure that the Bill is consistent with the tenets of charity law. If an agency was run by a voluntary organisation or a charity, ultimately the trustees would be responsible for it in law. Does the Bill make it clear that although the actions of individuals—which are proven to be the actions of individual managers—may be subject to criminal prosecution, the responsibility for policies which affect the operation of an agency, which may be or have been approved by a board of trustees, are the responsibility of that board in law? I seek an assurance from the Minister that the amendment clarifies rather than confuses that issue.
  I turn to Amendment No. 41. I understand from the Minister's helpful briefing that it is entirely reasonable that actions should be commenced within six months of notification of the commission of the offence. However, I am concerned at the limitation of three years since an offence was committed. In the presence of the noble Lord, Lord Laming, I hesitate to make my next point. However, many inquiries which are now taking place are examining events that took place decades ago but have only just come to light. I do not believe that it was ever the intention behind the Bill that wrongs from the past could not be put right. I hope that the Minister can prove me wrong.
  Lord Hunt of Kings Heath: My Lords, I thank noble Lords for the interesting points that they have raised.
  I say to the noble Lord, Lord Clement-Jones, that I accept that it is not ideal to debate so many amendments at this hour of the night. I do not think that he would want me to repeat what I said to the noble Earl, Lord Howe. However, I believe that we have had a most constructive series of discussions and debates. I am convinced that the Bill is improved as a result and, what is more to the point, that the new regulatory regime that will be introduced and the new arrangements for the regulation of social workers and other social care workers will be much enhanced. I am sure that is how we would want our work to be judged.
  The noble Lord, Lord Clement-Jones, asked me about the distinction between the person who carries on an establishment and the person who manages it. I do not accept that there has been movement on that during the passage of the Bill. The distinction has always existed as between the owner and the manager. I understand that that approach was adopted in the Registered Homes Act, which the Bill succeeds.
  The noble Baroness, Lady Barker, asked me whether the trustees of a voluntary organisation who provide and equip a community home could be prosecuted for offences under the Bill. The answer is
  932
  "possibly". I am happy to write to the noble Baroness in more detail. In general terms, the Bill provides for penalties against persons carrying on a children's home. This would of course include a community home.
  Amendment No. 199 seeks to establish that, for the purposes of the Bill, a community home provided by a voluntary organisation is taken to be carried on by the person who equips and maintains it and, if the Minister so designates, the body of managers provided for in the home's instrument of management.
  I should add that some community homes are equipped by local authorities; others by voluntary organisations. A voluntary organisation may be an incorporated body and, as I have said, the Bill makes provision in Clause 28 for offences by bodies corporate. I am not sure whether that is entirely clear to the noble Baroness and I shall be happy to write to her with fuller details.
  The noble Lord, Lord Clement-Jones, raised the issue of national minimum standards and how they relate to the regulations. We have, of course, debated this question at length. The important point is this: the national minimum standards stand or fall by the regulations. In terms of what the commission will do with those national minimum standards, it will have to take into account the degree of compliance or otherwise with the standards when making decisions about how a particular establishment is complying with the regulations. They are not free-standing; they stand within the context of the regulations in the preceding clause.
  The noble Baroness, Lady Barker, referred to the three-year period. We consider that to be a reasonable period. There are various precedents in other legislation in that regard. When we were debating the order for the GMC, a three-year term was also considered appropriate. I am sorry. I think it was perhaps in the Health Service Commissioners Bill where a three-year period came into play. But there are plenty of precedents and we think that it is a reasonable length of time to embrace.
  Lord Clement-Jones: My Lords, the Minister probably will not have noticed but under the Vaccine Damage Payments Act the time period has been extended to 21 years. It very much depends on the legislation involved.
  Lord Hunt of Kings Heath: My Lords, I do not think there is a scientific law which states exactly how long the period should be. The Government have taken the view that three years is a reasonable period. Perhaps after that time it may be very difficult to establish the facts. It is simply a reasonable length of time.

  933
  So far as concerns the point raised by the noble Lord, Lord Laming, in relation to the publication of reports following inquiries, we believe that it would be only in very exceptional circumstances that the reports would not be published.
  Lord Clement-Jones: My Lords, before the Minister sits down, does he have an answer to the point about nursing care versus clinical care?
  Lord Hunt of Kings Heath: My Lords, the point is that clinical care was very much seen as a core issue in relation to private hospitals. The amendment that was brought forward in another place relates to nursing homes. Clearly in that context nursing care is crucial to the overall quality of the service being provided.
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  5 Clause 1, page 2, line 11, leave out ("An independent") and insert ("A")
  6 Page 2, line 20, at end insert—
  ("But accommodation shall not for the purposes of paragraph (a) be regarded as provided to children for a number of days unless there is at least one child to whom it is provided for that number of days; and paragraph (b) shall be construed accordingly.")
  7 Page 2, line 20, at end insert—
  ("( ) For the purposes of this section a person is a foster parent in relation to a child if—

  (a) he is a local authority foster parent in relation to the child;

  (b) he is a foster parent with whom a child has been placed by a voluntary organisation under section 59(1)(a) of the 1989 Act; or

  (c) he fosters the child privately.").

  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 5 to 7.
  Moved, That the House do agree with the Commons in their Amendments Nos. 5 to 7.—(Lord Hunt of Kings Heath.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  8 Clause 2, page 2, line 27, after ("illness") insert ("or mental disorder").
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 8. In moving this amendment, I shall speak also to Amendments Nos. 11, 193 and 197.
  This is a minor change to the Bill but an important one. It was identified during the Committee stage in another place that the Bill's definitions had a slightly odd way of covering people with learning disability. In Clause 100, the definitions worked together in such a way that a learning disabled person was included within the overall definition of "illness". As was pointed out during the Committee stage in another place, learning disabled people are not ill and to describe them as such was not only inaccurate but might be taken to be offensive.
  934
  It is quite right that "illness" is defined in Clause 100 in such a way as to include mental disorder and that "mental disorder" is defined as including,
  "arrested or incomplete development of mind",
  which would be taken to cover learning disabilities. On reflection, we felt that it was an important point to tackle and that even though the effect of the legislation was not in question, the terms in which it had that effect were not satisfactory.
  Amendment No. 193 therefore removes mental disorder from the definition of illness in Clause 100. Amendments Nos. 8 and 11 are simply consequential on that change. The amendments have the effect of separating out mental disorder from illness and listing it separately in its own right.
  Amendment No. 197 has the effect of including mental disorder in the definition of disability in Clause 100. Since we were looking again at the definitions, my right honourable friend Mr John Hutton gave a commitment on the last day of the Committee stage in another place to look more widely at the definition of disability to see whether the wording could be improved while retaining the same meaning. The definition in Clause 100(2)(a) is the one used for all social care legislation since the National Assistance Act 1948. But the language shows its age, and Amendment No. 197 represents an updated form of the same definition. It is drawn from the Housing Grants, Construction and Regeneration Act 1996 and is, I believe, an improved version of the wording without affecting the meaning of the definition.
  Moved, That the House do agree with the Commons in their Amendment No. 8.—(Lord Hunt of Kings Heath.)
  Baroness Barker: My Lords, as the noble Lord, Lord Rix, is not present, I wish to thank the Minister on the noble Lord's behalf. The noble Lord drew the point to our attention and I am glad that it has been taken on board. I want to ask a question about Amendment No. 197. The Minister referred to mental disorder. Does that include conditions such as dementia and Alzheimer's? There is a crucial distinction. People living in care homes suffer from many forms of mental disorder. It is important that we make a distinction between different people who may be at different stages of their lives and suffering from different conditions.
  Lord Hunt of Kings Heath: My Lords, my understanding is that the term "mental disorder" comes from Section 1 of the Mental Health Act and includes mental impairment, which is the term usually used for learning disability. My assumption is that it embraces the area raised by the noble Baroness. If I am wrong about that, I shall write to her.
  Lord Clement-Jones: My Lords, perhaps I may offer the Minister an alternative. Clause 100(2), taken with Amendment No. 197, deletes paragraph (a) but keeps paragraph (b). It may be that that is where the relationship with dementia and Alzheimer's is found.

  935
  It is extremely important that Alzheimer's and dementia are covered as so many of those who occupy care homes are—and the number will increase—sufferers from Alzheimer's and dementia.
  Lord Hunt of Kings Heath: My Lords, my assumption is that the terms will fall within the definition of "mental illness" and thus will be appropriately covered. However, as I have said, if further clarification is needed here, I shall be happy to give it.
  On Question, Motion agreed to.
  10 p.m.

  COMMONS AMENDMENTS
  9 Clause 2, page 2, line 27, after ("illness") insert ("or palliative care").
  10 Page 3, leave out line 11.
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 9 and 10. I should like to speak also to Amendments Nos. 13, 16, 45 and 287.
  This is a small group of amendments which tidy up the definitions of independent hospital and nurses agencies and the definition of dental services under general anaesthesia which we are inserting into the Registered Homes Act 1984 for the purpose of regulation.
  Amendments Nos. 9 and 10 were brought forward as a result of concerns from those involved about the definition of "independent hospital". As originally drafted, Clause 2 of the Bill brings within the definition of "independent hospital" any establishment which provides any of the listed services in Clause 2(7). Those listed services include palliative care. However, there was concern that because a care home might provide some palliative care to patients who are terminally ill, as drafted the Bill would require such a care home to be registered as an independent hospital. We recognise that that would be totally inappropriate.
  The two amendments clarify the distinction. Amendment No. 10 removes palliative care from the "listed services" in Clause 2, while Amendment No. 9 inserts it into the main definition of independent hospital to ensure that, as far as concerns palliative care, only those establishments, the main purpose of which is to provide palliative care, will be required to register as independent hospitals.
  As I have said, the amendments have been tabled in response to concerns raised with us by those involved. They seek simply to ensure that establishments that specialise in providing palliative care, such as hospitals, will be regarded and registered as such and will be seen as distinct from care homes that provide care for terminally ill residents as a normal and appropriate part of their overall services.
  At Third Reading I accepted an amendment tabled by the noble Earl, Lord Howe, the noble Lord, Lord Clement-Jones, and the noble Baroness, Lady Masham of Ilton, which required nurses agencies to be
  936
  regulated by the national care standards commission. At the time I said that the amendment as drafted was defective and that it would need to be amended in the other place. This is what is achieved by Amendment No. 13. The amendment ensures that the regulation of agencies for the supply of nurses, midwives or health visitors will cover employment agencies, as defined in the Employment Agencies Act 1973. This may, for example, include staff recruitment agencies or agencies providing an introduction service. The amendment also ensures that employment businesses are covered, again, as defined in the 1973 Act, and which typically employ nurses to be supplied to the NHS, to private hospitals and to nursing homes, as well as directly to patients in their own homes.
  This change has been widely welcomed and we shall, of course, be developing the necessary regulatory requirements and standards under which the commission will regulate nurses' agencies.
  At Third Reading, the noble Baroness, Lady Masham, asked whether we needed to amend the Long Title of the Bill to reflect the regulation of nurses agencies. She was absolutely right. Amendment No. 287 adds nurses agencies to the Long Title.
  Amendment No. 16 is an amendment that was accepted in the other place to correct a misplaced apostrophe.
  Perhaps I may now turn to Amendment No. 45. Noble Lords will know that a number of tragedies have occurred recently of young people who have died under general anaesthesia during the course of dental treatment outside hospitals. When the commission is established, it will regulate private dentists who provide dental treatment under general anaesthesia. However, the commission will not be established until 2002 and we do not believe that we can allow the practice to go unregulated until then. The Bill therefore provides for the regulation of dental treatment under general anaesthesia under the existing Registered Homes Act 1984. This requires any dentist who performs such treatment to be regulated by the local health authority inspection units.
  However, it is intended that only private dentists who provide treatment under general anaesthesia should be regulated under the 1984 Act. Amendment No. 45 makes this clear. That is not to say that dentists who treat NHS patients using general anaesthesia will not be regulated. We have no intention of creating such a loophole. We intend to amend NHS regulations to require dentists who provide treatment under general anaesthesia to NHS patients to be regulated under NHS arrangements.
  All the amendments tidy up definitions used in the Bill. I hope that noble Lords will find them acceptable.
  Moved, That the House do agree with the Commons in their Amendments Nos. 9 and 10.—(Lord Hunt of Kings Heath.)
  Earl Howe: My Lords, I was particularly grateful when the Minister accepted my amendment at Third Reading to include nurses agencies within the remit of the commission. However, the issue of healthcare

  937
  workers supplied by such an agency to NHS trusts or other areas of the health service was left in the air. I wonder whether the Minister could clarify how agencies supplying healthcare workers who are not domiciliary care workers are regulated under the Bill.
  I should also be grateful if the Minister could say something more about medical agencies. The question arose in another place that, although an independent medical agency is defined in Clause 2(5) as an undertaking that consists of or includes the provision of services by medical practitioners, there appears to be nothing in the Bill covering the direct supply of a nurse-led clinical service in the home. Will the Minister comment on that? Health services provided in the home by nurses unsupervised by a doctor can be far from straightforward, as I am sure that he knows. The examples of blood transfusions and chemotherapy were given in another place. The same lacuna, if I can call it that, appears to apply to services provided in the home by physiotherapists and occupational therapists. Am I correct in believing that those services are not covered by the Bill?
  Lord Clement-Jones: My Lords, I generally welcome the amendments. However, I should like to ask about what appears to be a change of status for hospices. Have the hospices made any response to their change of status resulting from Amendments Nos. 9 and 10? What consultation was carried out with them about it? They are now to be treated as independent hospitals, which I had understood was not previously the case.
  I welcome Amendment No. 13, which requires nursing, midwifery and health visitor agencies to register. I do not want to reopen a debate on whether all dentists, not just those who administer anaesthetics, should be covered, but I welcome the interim provisions in Amendment No. 45 on private dentists, bringing them under the 1984 Act, and the fact that NHS dentists in the same position will also be subject to regulation.
  Baroness Masham of Ilton: My Lords, I add my thanks to the Minister. I repeat the question of the noble Earl, Lord Howe, about nurse assistants. Thousands of them, many coming from abroad, are used in people's homes. Many of them come from the same agencies as nurses. It seems wrong for them to be left out.
  Lord Hunt of Kings Heath: My Lords, the noble Lord, Lord Clement-Jones, asked about hospitals. I am happy to provide further details about the nature of the consultation, although I do not have the information here. There was extensive discussion and consultation with all the establishments that were likely to be covered by the Bill. I believe that the outcome of those discussions was that it is right to draw a distinction between hospices—which in many senses can be regarded as hospitals—and the normal process of providing care for residents of nursing homes who may be dying. I hope that helps to clarify the position.
  938
  The noble Earl, Lord Howe, again raised the issue of nurse-led services and mentioned domiciliary physiotherapy services. There are two points to be made. Many such services will be covered one way or another, either through domiciliary care agencies or nursing agencies. An outreach service from a private hospital would certainly be covered.
  The main comfort that I give to the noble Earl is the provision in Clause 39 which allows the power to extend the application of Part II. This is an important part of the Bill. The criticism that was always made of the Registered Homes Act was that it was inflexible and did not allow us to change the nature of regulation as the nature of healthcare changed. A good example is that of private hospitals; clearly, the Registered Homes Act 1984 was not up to the task of regulating those hospitals. The answer is that many of the services will be covered in one way or another. If in the future we identify gaps in the regulatory mechanisms, clearly the Government will need to consider whether it is necessary to bring Clause 39 into play.
  So far as concerns the regulation of healthcare assistants, a number of messages of comfort can be given. First, many healthcare assistants would be employed through nursing agencies. As those agencies are covered by the scope of the legislation, that in itself provides a safeguard. Secondly, agencies outwith that situation will still be covered by the Employment Agencies Act. Although noble Lords have expressed scepticism as to whether that is sufficient, and that was reason noble Lords wanted nursing agencies to be covered in this way, it does represent some safeguards.
  The third point is that the Department of Health has commissioned De Montfort University to examine the whole issue of the regulation of healthcare assistants. I am not in a position to say when its report will be published, but we need to keep the matter under review.
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  11 Clause 3, page 3, line 23, at end insert—
  ("( ) persons who have or have had a mental disorder;")
  12 Page 3, line 30, after ("is") insert ("of a description")
  13 Clause 4, page 4. line 10, leave out from ("agency") to end of line 11 and insert ("or employment business, being (in either case) a business which consists of or includes supplying, or providing services for the purpose of supplying, registered nurses, registered midwives or registered health visitors")
  14 Page 4, line 12, at end insert ("description of")
  15 Page 4, line 18, leave out subsections (8) and (9)
  16 Page 4, line 34, leave out ("nurses"') and insert ("nurses")
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 11 to 16.
  Moved, That the House do agree with the Commons in their Amendments Nos. 11 to 16.—(Lord Hunt of Kings Heath.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  17 Clause 6, page 5, line 9, at end insert—
  ("( ) The powers of the Secretary of State under this Part to give directions include power to give directions as to matters connected with the structure and organisation of the Commission, for example—

  (a) directions about the establishment of offices for specified areas or regions;

  (b) directions as to the organisation of staff into divisions.")

  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 17. I shall speak also to Amendments Nos. 18, 19, 21, 23, 24, 49, 204, 205 and 206.
  Amendment No. 17 enables the Secretary of State to issue directions to the national care standards commission about organisational and structural matters. Clause 6(2) provides powers of direction relating to the commission's functions. These might be used, for instance, to require the commission to deal with applications for registration and representations against its proposals within strict time limits or to set up a complaints procedure for people to use if they are unhappy with how the commission has carried out its responsibilities.
  We may also need to give directions to the commission about its structure and organisation. We hope that in practice those directions will not be necessary, but we consider it important to make it clear that powers of direction over the commission extend to giving directions about its structure and organisation.
  Amendments Nos. 18, 49 and 204 are minor changes Amendment No. 18 corrects a typographical error. Amendment No. 49 reproduces in Part III the commission's power to advise the Secretary of State about the standards that exist for Part II services in Clause 7. Amendment No. 204 clarifies the wording of the Schedule 1 provision that allows for the National Care Standards Commission, the General Social Care Council and the Care Council for Wales to contract with individuals not on their own staff to undertake work. That might include engaging expert advisers to assist with inspection work rather than having to employ them full time.
  Finally, Amendments Nos. 19, 21, 23, 24, 205 and 206 are minor changes to ensure that the Bill properly and accurately reflects the position in Wales. Amendments Nos. 19, 21, 23 and 24 give the Welsh Assembly the same powers as the Bill already provides for the National Care Standards Commission in respect of general functions and inquiries. Amendments Nos. 205 and 206 tidy up a duplicating reference. Under Section 144 of the Government of Wales Act, provision is made for the Secretary of State for Wales to have powers to make provision for accounts, auditing and so on for Welsh public bodies, which would include the Care Council for Wales. As specific provision is already made for these matters in Schedule 1, these amendments disapply Section 144 in respect of the Care Council for Wales.
  Moved, That the House do agree with the Commons in their Amendments Nos. 17 to 19.—(Lord Hunt of Kings Heath.)
  940
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  20 Clause 7, page 5, line 37, leave out subsections (B) to (11)
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 20. I shall speak also to Amendment No. 22.
  We come back to a favourite topic of your Lordships, which we seem to have debated not only in relation to this Bill but also in the passage of the 1999 NHS legislation. As regards the consensus approach which I have detected throughout the debate on this Bill, there is a common purpose here to ensure, first, the proper regulation of private and voluntary healthcare and to ensure that these services are provided to proper standards. There can be no doubt that the present regulatory system which regulates independent hospitals as care homes, is totally inappropriate and outdated.
  Through this Bill, private and voluntary healthcare will for the first time be properly regulated, with independent hospitals being regulated as independent hospitals and having to meet national minimum standards developed to reflect the nature of the service provided.
  We are putting in place a system where the private and voluntary healthcare sector will be regulated by the independent national care standards commission. Within the commission there will be a separate division dealing with private healthcare. That division will be headed by a director of private and voluntary healthcare, who will be a senior member of staff.
  By putting in place a system that recognises the specific nature of private healthcare, we will ensure that proper quality of care is provided. We will do this through the regulations and national minimum standards which we are developing. But, importantly, and for the first time, we have a regulation-making power to ensure that private healthcare establishments provide quality care. I assure the House again that this will cover clinical care.
  The amendment inserted by your Lordships during Report stage required the commission to contract all its inspections of independent hospitals to the Commission for Health Improvement. This amendment was removed in the other place but—and I stress this—our discussions in your Lordships' House served a very important role. They highlighted the need for the commission and the Commission for Health Improvement to work closely together. That is why we have brought forward Amendment No. 22 to ensure that that is the case.
  Perhaps I may take this opportunity to explain the difficulties that the Government found with the amendment inserted by your Lordships. The commission and Commission for Health Improvement (CHI) were designed for different purposes. That is a point widely recognised within the National Health Service. CHI has been specifically designed and developed to help the NHS improve the

  941
  quality of clinical care. Its primary interests are with NHS patients and the arrangements that NHS bodies have in place to ensure high quality healthcare for those patients. CHI is a very important part of our 10-year modernisation programme for the NHS. It is there to help drive up standards in the NHS by providing an independent, external check of NHS processes for monitoring and assuring the quality of clinical care.
  Any system for monitoring and assessing the performance of a service sends very powerful messages about what that service is expected to deliver. CHI will play an important role which will complement NHS accountability arrangements and ensure that both quality and efficiency are central to the way the NHS is held to account. It will also provide organisations with access to the skills and expertise necessary to help tackle problems where local efforts have been unable to make a difference. I am absolutely convinced that, with the wider quality agenda, CHI's work will mean that fewer problems occur in future, and, where they do arise, they will be spotted and addressed earlier.
  It is the responsibility of the regional offices of the NHS or the health authority concerned to ensure that CHI's recommendations are acted on, with agreed plans for addressing identified shortfalls. In some cases the commission may have a role in following up specific recommendations or may be invited to review progress where the need for significant further work has been identified. That is a very different role from that of the national care standards commission. That body is to be established to regulate, provide safeguards and apply national minimum standards for patients in independent healthcare. It is not responsible for private hospitals and clinics beyond that point, nor for advising the Government about the sector or nurturing the private sector generally.
  The key principle of how the national care standards commission and CHI will achieve their respective responsibilities is the second main area of difference between the two bodies. The national care standards commission will be a regulatory body. It will, therefore, register independent healthcare providers and inspect them against regulations and set standards. If an independent sector provider does not comply with the regulations and standards the commission will be able to apply sanctions. CHI, on the other hand, is not a registration-holding, sanction-imposing, regulatory body. It will review the clinical governance arrangements in NHS bodies and provide advice as to how those arrangements may be improved. It will be vigorous but will also provide support to help NHS organisations with problems to tackle them effectively themselves.
  The third key area of distinction between the commission and CHI is as to how they will operate in practice when undertaking their rolling programmes. For example, CHI will be concerned with the arrangements and systems that an NHS body has in place to ensure and improve quality. Where an NHS body has a contract with the independent sector to provide healthcare services to NHS patients, CHI will
  942
  review the quality of services that those patients receive as part of the bigger picture of the clinical governance arrangements of that NHS body. That will be undertaken under a three to four-year rolling programme of clinical governance reviews in the NHS.
  In contrast, the national care standards commission will be responsible for inspecting at least once a year every independent healthcare provider that it regulates. It will concentrate and specialise on the specific safeguards and quality assurances that each of those individual providers has in place for all patients. It will have a remit that goes beyond looking at arrangements to provide quality in clinical care.
  There are also concerns in the field about how the amendment inserted by your Lordships may affect the successful establishment of the national care standards commission. The April edition of Registered Homes and Services reflected those views in commenting on the subsections introduced into Clause 7:
  "At a practical level there are clear benefits in a broad-based national care standards commission. With private and voluntary healthcare outside its remit, the skills and experience which will be developed within its healthcare division will suffer".
  The Royal College of Nursing was also concerned about the polarisation of the regulation of healthcare services. However, our thinking on the relationship between the commission and CHI has moved on considerably since the Bill was introduced. The Bill now allows the commission and CHI to second staff to each other, and that will help skills development in both bodies. They will also be able to share information with each other. Another example of this co-operation is the development of the national minimum standards to be used by the commission. In that context, CHI has a representative on the consultation group that is developing those standards.
  I believe that we have two separate bodies with two separate functions. I believe it logical that we should merge such situations in relation to the regulation of the care establishments and private health hospitals within the terms of the Bill and the way in which the NHS effectively manages its performance. We have seriously taken on board the suggestion that we must ensure that CHI and the commission work closely together. I believe that the amendments which the Commons considered enable that to happen and I ask for your Lordships' support.
  Moved, That the House do agree with the Commons in their Amendment No. 20.—(Lord Hunt of Kings Heath.)

  MOTION MOVED ON CONSIDERATION OF COMMONS AMENDMENT NO. 20
  Earl Howe 20A Earl Howe rose to move, as an amendment to the Motion that the House do agree with the Commons in their amendment, leave out "agree" and insert "disagree".
  The noble Earl said: My Lords, I beg to move Amendment No. 20A. I make no apology for moving the amendment. It goes to the heart of our debate during earlier stages about the regulation of acute private hospitals.
  When the House last debated what is now Amendment No. 20 the argument advanced for it was as follows. There is a welcome and necessary agenda on both the NHS and the private sector to drive up standards and the quality of clinical treatment. The part of the Bill that we are now considering addresses the structures to be put in place to ensure that the private acute sector will be subject to a much more systematic and rigorous set of standards in terms of both regulation and enforcement than has been the case hitherto. No one, least of all the private sector, has any wish to stand in the way of those changes.
  However, for the patient the issue is somewhat broader. The patient wants to be assured that wherever he or she happens to be treated—whether in an NHS ward or in a private clinic—the standards of care and clinical treatment delivered will be of a consistently high quality. The operative word is "consistently".
  In many areas of medicine and surgery the NHS and the private sector are becoming increasingly interdependent. Nowhere is that more true than in the area of mental health where the NHS subcontracts a high percentage of treatment to private establishments. But in recent weeks we have heard an explicit and welcome statement from the Government which made it clear that NHS trusts should, where appropriate, subcontract treatment to the private sector. The Government themselves are breaking down the barriers between the two healthcare sectors.
  However, alongside the cross-migration of patients between the NHS and the private sector there is also the cross-migration of clinicians and doctors. Few senior hospital doctors work exclusively for the NHS or exclusively for the private sector; they work for both. In policy terms, that means that when it comes to the setting and enforcement of standards there is less sense in having two separate governing regimes: one for the public sector and one for the private sector. However, that is exactly what the Government say they want. The private sector will be regulated on a national basis by the national care standards commission. On the other hand, the NHS will continue to be a managed service in which clinical governance, backed up by inspections from the Commission for Health Improvement will, it is hoped, deliver the quality agenda.
  However, a dual structure of that kind is a recipe for inconsistency. Under those arrangements, how can anyone be certain that the standards of care being delivered in either sector are in any way equivalent? How will it be possible to promulgate best practice from one sector to the other and vice versa? The ideal answer, which the Government have explicitly ruled out on their pronouncements on the issue, is to have a single independent regulator of healthcare responsible for both the NHS and the private sector. There would then be a unified structure of regulation across all types of hospital, both public and private.
  That, ironically, is exactly the regulatory structure that the Government are now putting in place in respect of care homes. Under this Bill the Government
  944
  are perfectly happy for there to be a single overarching regulatory framework for both publicly and privately-owned care homes. The same applies to boarding schools, both publicly and privately-owned. But when it comes to acute hospitals, the arguments apparently do not apply.
  However, if this is a bridge too far for the Government—and clearly it is—then the question is: how else can the desired consistency of standards be achieved? The amendment which your Lordships inserted on Report was designed with that end in view. The Commission for Health Improvement is the body whose remit it is to spread good practice and identify substandard practice throughout the NHS. If CHI were additionally to perform the same function for the private sector, inspecting private hospitals on behalf of the commission for care standards as regulator, in theory at least we would be one step nearer to a more consistent inspection regime. There is no suggestion that CHI should usurp the position of the commission as regulator.
  Since the Bill left this House, as the Minister mentioned, the Government have excised your Lordships' amendment and replaced it with an amendment of their own—Amendment No. 22. That amendment would enable CHI and the commission for care standards to delegate to each other the performance of their respective functions. I have no objection to that idea so far as it goes, although when the Minister replies I should be interested to hear how and in what circumstances he sees that cross-delegation working.
  Of course, its most obvious benefit is to get round the completely absurd situation where, in a ward of a particular private hospital, CHI has responsibility for overseeing NHS patients in beds numbers 1, 3, 5 and 7 and the commission for care standards is responsible for beds 2, 4, 6 and 8. That was a consequence of the Bill as it stood previously. Therefore, the amendment at least represents progress. If I were to be mean about it, it is certainly an admission by the Government that they had not thought through the implications of what they proposed initially.
  As for addressing the central concern raised by your Lordships, the Government's amendment does not even begin to qualify. A permissive power for CHI and the commission to cross-delegate on an ad hoc basis is nowhere near the same as saying that there is a comprehensive uniform inspection regime across the public and private healthcare sectors.
  I am prepared to concede, as no doubt is the noble Lord, Lord Clement-Jones, that the amendment inserted into the Bill by your Lordships is capable of improvement and refinement. What I had hoped to obtain from the Government was an acknowledgement of the central issue. We have not achieved that and I am sad about it. However, I shall listen to the Minister with the greatest care before deciding whether to press the amendment to a vote.
  Moved, as an amendment to the Motion that the House do agree with the Commons in their amendment, leave out "agree" and insert "disagree".—(Earl Howe.)
  10.30 p.m.
  Lord Clement-Jones: My Lords, as the Minister rightly pointed out, the question of standards of regulation and inspection in the independent healthcare sector has been a long-running issue in this House. As he recalled, we debated this matter during the passage of the Health Act last year and in Committee and on Report on this Bill. As we know, the other place has debated the issue extensively. However, that does not mean that the debate is over—far from it.
  In the course of our debates in this House, there was a shift in the Government's position, as evidenced by what the noble Lord, Lord Hunt of Kings Heath, said on Report. Of course, the new clause which effectively is contained in Amendment No. 22 is the product of that assurance made on Report. With regard to the state of play, the amendment and what it means, the Secretary of State, Mr Milburn, said recently:
  "The Commission for Health Improvement and the National Care Standards Commission have very different functions. The Commission for Health Improvement is intended to act as an independent inspectorate for the National Health Service as a managed care system, which is what it is. The National Care Standards Commission has a quite different function. However, the honourable gentleman is aware, as my honourable friends are aware, that we introduced an amendment during the passage of the Care Standards Bill through the House to ensure that there is much closer co-operation and flexibility between the two commissions".
  Indeed, the Minister said very similar things when he introduced his Amendments Nos. 20 and 22.
  That is an entirely circular argument. The two bodies have been given different inspection functions because that is what Ministers have decided, not because there is any logic in doing so. While we welcome the shift of position by Ministers introducing a degree of flexibility as between CHI and the commission in the discharge of their functions, the new clause after Clause 8 neither guarantees the same level of quality between the NHS and the independent healthcare sector, nor a seamless system of inspection between them.
  As we have all acknowledged, the cross-referral of patients between the two sectors is very frequent. The provision of private or independent healthcare has been debated on many previous occasions. Healthcare is provided in NHS private beds and paid for privately. Healthcare is provided in independent acute hospitals and paid for by the NHS. Healthcare is provided in independent acute hospitals and paid for privately.
  What is so very different between clinical governance and patient management and treatment in the NHS and the independent healthcare centre? Why cannot one single body be responsible for their quality? After all, the commission, as the noble Earl pointed out, will be acting as a single inspection system for social care. What makes healthcare so different? Why cannot that be dealt with in a single body? Indeed, one of the results of the amendments being made today, which have already been agreed to, is that private and NHS dentists providing treatment under general anaesthetics will have a common system of inspection.
  946
  For 0that reason, on these Benches we strongly support the Motion to insist on the original clause before us today, where, indeed, that original amendment was proposed from these Benches.
  The case against the Government's new clause is that a wholly different set of standards and methods of inspection could apply between the two sectors as a result of it. It is as if the GMC's regime applied only to the NHS, and independent healthcare had a wholly different body. Where is the logic in that?
  The Government have now shifted their position back to that taken by the original consultation paper, Regulating Private and Voluntary Health Care, which was published in June 1999, that a regulator might wish to contract with another body, such as the Commission for Health Improvement, in order to carry out local inspections. Yet progress back to that position in the form of the new clause has been painfully slow.
  As I emphasised in all our debates last year and this year, on these Benches we have no particular axe to grind for private healthcare. However, we believe that every patient should have the right to common minimum standards of quality, care and safety, irrespective of the sector in which they are treated. My noble friend, Lady Nicholson, as is well known, has campaigned strongly on the issue.
  All Ministers, including the Secretary of State, quoted earlier, have consistently recited the reason for not supporting the common system of inspection as being due to the difference between the regulation of the independent sector and the management of the NHS. Yet they have accepted that contracting can take place between the two bodies.
  If the new clause is a genuine concession by Government, perhaps the Minister can say when it would not be possible or appropriate to have CHI carry out inspections of independent acute hospitals.
  The original formulation of Clause 7 as it left this House had the merit of clarity and simplicity. The new clause has neither and could lead, as the noble Earl pointed out, to complete confusion about which body is charged with what. Patients might well fall foul of this confusion with a lack of accountability and responsibility. Clause 7 as it currently stands would enable CHI to monitor and ensure the quality of the services provided in both healthcare sectors and to identify and promote best practice wherever it may be found.
  Common standards between the NHS and the independent health sector could then be ensured. CHI would be in a position to use the expertise gained from inspecting NHS services and facilities, and the same limited pool of expertise could be used in the independent healthcare sector.
  The NHS and the independent healthcare sectors should be inspected by the national institution best suited to do the job, and to do it well. That institution

  947
  is the Commission for Health Improvement. In its unamended form, that is what the Bill achieves. Co-operation is not enough; integration is what we seek.
  Baroness Masham of Ilton: My Lords, I believe that there should be minimum standards in all hospitals, be they NHS or private, and that they should be inspected by the same body. There should be standards of infection control in all hospitals. I am sure the Minister knows that many bank and agency nurses and doctors work between NHS and private hospitals. Therefore, infection control standards should be the same. Good standards must be laid down.
  I am sorry to say that I have first-hand experience of a private hospital in Leeds in which my husband had to be treated as the local NHS hospital did not have an endocrinologist at that time. After six days in the private hospital, I discovered that my husband had not had a wash. When I inquired why, a representative of BUPA told me that it would hold an inquiry. The answer came back that he had not asked for one. When patients are ill and disorientated, they do not ask. I had taken for granted that ensuring that patients were washed was part of good nursing procedure and care.
  At the same private hospital, my husband was discharged on a Friday with a painful thrombosis in his leg. The nurses had taken no notice when he told them about it. The consultant whose care he was under was attending a conference. My husband was then admitted to the local NHS hospital as an emergency on the following Monday.
  In your Lordships' House, we have a Minister who understands the need for good care standards, and there are noble Lords on all sides of the House who use private hospitals. NHS patients are sent to private hospitals for various reasons. Patients are patients, wherever they go. All patients should be protected by standards of care enshrined in legislation. Therefore, I support the amendment moved by the noble Earl, Lord Howe.
  Baroness Nicholson of Winterbourne: My Lords, the Minister has worked extremely hard on this Bill. I am very grateful that in the Queen's Speech in November of last year, the regulation of private hospitals was included in the package of legislation which this Government were willing to tackle. I thank him most sincerely for that.
  But the gravest weakness of this Bill, as other noble Lords and I perceive it both this evening and before, is that despite the Minister's clear and accurate statement that he seeks proper regulation and standards for private healthcare, there is nothing at all on the face of the Bill about clinical or administrative standards of healthcare. Not even the most minor point is deemed worth while to place on the face of this important piece of legislation dealing with healthcare. For example, there is no demand that internal complaints procedures in private hospitals should be triggered by patients as of right. Many of us have had experience that this does not happen in private healthcare. There is no statement that there should be enough staff to perform particular procedures or to
  948
  staff particular wards. There is no demand that the staff should be qualified appropriately for the tasks which they are being asked to carry out. Nor even is there a statement saying that advertising for private hospitals should be screened and monitored; or that inaccurate advertising, which is often the case now, should not be allowed. In addition, there is the irony that we are talking about taxpayers' money. Many of these private hospitals are registered charities. A handful are even under royal charter.
  No standards of care are on the face of the Bill. The Minister told us this evening that the consultation body will take care of that. I wonder why, therefore, he has assembled a consultation group to advise on the drafting of the rules and regulations of a Bill which is dominated by private hospital groups and medical bodies, many of which are responsible for the series of tragedies which led to the Bill coming about in the first place.
  I remind the Minister that there is no representation from genuine patients and victims' groups; those who like many of us here tonight, have personal experience of the effects of iatrogenic injury. Action for Victims of Medical Accidents, for example, could and should be invited to form part of the consultation group. There are a few representative groups on this consultation body. Patients are represented by, for example, the National Health Service Confederation; the Association of Community Health Councils for England and Wales; the Patients Forum; the Council and Care Group and the Consumers' Association. However, these are not patient groups in the way that APROP and AVMA are. AVMA has a patient helpline and deals directly with patients who have been victims of iatrogenic injury in all the areas which the Care Standards Bill addresses.
  Tonight, the Minister said—I think I heard him correctly—that because the National Institute for Clinical Excellence is included as part of the consultative group, he has covered the ground to which I refer. But what we need are the real patients. Indeed, the consultation group will consult for 12 months. In other words, without anything on the face of the Bill, we are being asked to buy the Bill blind. I do not think that this is good enough. Many of us on this side of the House and, I believe, on the other side of the House, do not think that is good enough. That is why, in March of this year, we tabled the amendment which took the last resort of requesting the Minister to have at least a single body to monitor standards and to drive up standards of care in all our healthcare providers, public or private. That was a last resort. The Government will not do that either.
  I cannot understand this ministerial anathema to improving the standards of healthcare in the private sector. It is not like private education. In private education, which the Government do not much like either, children go to different schools, fee-paying or state. It is not the same in the medical world. The patients are the same people. We have learnt bitterly that they are the same people. They go to the ITU unit

  949
  in the National Health Service just the same. For part of their treatment they use public health and, for part, to private hospitals.
  The consultants are the same people; they just happen to work in the private sector after hours. The nurses are the same people. They move from one health sector to the other. The training is the same. The National Health Service has been providing the training for everybody. The machinery and equipment are the same; except that in the public health sector there is probably more of it, just as in the public health sector there are teams of medical people, not just one, two or three. It is extraordinarily difficult to see why the Government maintain this ideological division, as healthcare knows no boundaries, save those drawn by money.
  Why is it, therefore, that the Government are so deeply unwilling to grasp the obvious, to move forward and to provide a proper standard of excellence for all patients throughout the United Kingdom and all sectors of health, irrespective of whether the patient pays at point of need for their treatment or it is paid for through the taxpayer?
  It is sad to see that a recent survey showed that three-quarters of the people of the United Kingdom had no confidence that the Government could adequately run the National Health Service. I have the greatest confidence that the National Health Service will continue to provide the healthcare for all our people for most of the time that they have medical need. But inevitably private healthcare will come into play, if only because many people in the private healthcare sector wish to make a lot of money out of healthcare provision.
  I urge the Government to take the decision not to move ahead with this amendment tonight; but to support the amendment of the noble Earl, Lord Howe, and go with the flow that this House offered the Government last time we debated this issue and to allow patients at least a common standard of excellence through a common body.
  Lord Laming: My Lords, I find myself in complete agreement with all the previous speakers on this subject. It was well captured by the noble Baroness, Lady Masham, when she said that patients are patients wherever they are treated. Because all the points have been made so well, I shall be brief, save to say that, because the Government adopted the stance that they have over CHI, they have now brought forward what seems to be a pragmatic solution. However, I regret that I do not believe it will serve the best interests of patients or their carers.
  We have spent a long time in this House talking about the difference between the skills and expertise which are necessary to monitor the quality of healthcare services wherever they are delivered and those experiences and qualities that are necessary to inspect social care. Mention has already been made of the fact that the Government said that they have no objection to a greater use of the private sector, though
  950
  for myself I prefer the NHS not to need that. However, it makes the point that nowadays patients move so easily between the different sectors that there needs to be a single organisation which is responsible for setting the standards and monitoring them across the whole of the healthcare services, wherever they are delivered.
  Amendment No. 22 blurs the distinction between the Commission for Health Improvement and the National Care Standards Commission. Of course it is right that those two organisations should collaborate and co-operate in the carrying out of their different activities. It may be that their interests coincide at some points; but they do not overlap. Encouraging co-operation should not be seen as meaning that those two activities can be regarded as being interchangeable.
  I believe that we are in danger of confusing the lines of responsibility; of blurring accountability and, at the end of the day, it will be the patients who will suffer. I hope that, even at this late stage and at this late hour, the Government will pause for further consideration and think again before pressing these amendments.
  Lord Hunt of Kings Heath: My Lords, this has been a good debate. I listened with great care to what noble Lords had to say. But I am not persuaded. I believe that the Government's case throughout our debates has been absolutely clear and logical.
  I listened to the noble Lord, Lord Clement-Jones, as he repeated the words of the Secretary of State, Alan Milburn, and found myself wholly in agreement with what he said. The specific and clear point that we are making is this. First, we want effective regulation of the private and voluntary healthcare sectors. I accept the points made by the noble Baronesses, Lady Nicholson and Lady Masham, about issues in relation to the private sector. But the provisions in this Bill will undoubtedly allow for a much more effective regulation of the private healthcare sector than we have ever had before. It will be consistent. Instead of 100 different health authorities doing the same job, in many cases in a rather inadequate way, we shall have consistency throughout the country.
  Secondly, the Bill is so drafted as to allow much more focused regulation in relation to private hospitals than the existing legislation has ever allowed. Existing legislation has been very much built around nursing homes rather than the specific needs of private hospitals. I believe that the regulation will be improved by the much greater emphasis in these new arrangements that will be given to the quality of what is provided in those establishments.
  I should point out to the noble Baroness, Lady Nicholson, that, although she is disappointed as regards what appears on the face of the Bill, I believe that Clause 21 (which sets out the regulations that, in themselves, will set the context for national minimum standards) allows for the issues she has raised relating to quality and staffing to be very effectively addressed. I should refer her, in particular, to Clause 21(6)(j), which relates to the establishment of the complaints

  951
  process within establishments, and to paragraph (k), which clearly sets out issues in relation to ensuring that the appropriate quality and standards are met.
  In addition, I believe that the great benefit that we see in this Bill is flexibility. The whole problem with previous legislation in relation to registered homes is that it has been inflexible and has not kept pace with developments. This Bill will allow us to keep pace with those developments. Above all, I believe that we shall have a much higher quality of inspections, with inspection officers given the right degree of support and training.
  I well understand the point made by the noble Baroness, Lady Nicholson. She is right to refer to the external consultation group, which, as she said, includes five people representing patients' interests and five people representing providers. I believe that the mix is carefully balanced. I have taken very careful note of what the noble Baroness said about the two organisations that she mentioned. I can assure her that they will be invited to become involved in the consultation around regulation of acute hospitals, which, of course, is their special interest.
  I have talked about the regulation of private hospitals. The situation with the NHS is different. We want to ensure high quality and consistent services for the service. That is why we introduced national service frameworks and clinical governance. Indeed, that is why we formed the Commission for Health Improvement. However, CHI is designed to work within the context of a managed system, which is what the NHS is: it is a system that is accountable to Parliament through Ministers. That is very different from the situation relating to independent operators within the private sectors. The whole function of CHI is related to performance management within the NHS in the context of a public, managed healthcare system. I do not believe that it is the right body to deal with the regulation—which is very different from the regulation of the private and voluntary sectors.
  However, CHI and the commission will not operate in isolation from each another. In establishing minimum standards, CHI is bound to be informed by good practice within the NHS. We have listened most carefully to the debates in your Lordships' House. The noble Earl, Lord Howe, was a little churlish in his remarks on that matter, because we have listened most carefully.
  I turn now to the remarks made by the noble Lord, Lord Laming. In a sense, he accused us of pragmatism. I do not believe that that is the response we are giving. We are saying that there are very different roles for CHI and the commission. However, there is equally a role for ensuring that they are enabled to work together.
  The noble Earl, Lord Howe, asked me how that might happen. The national care standards commission could delegate some inspection of private hospitals to the Commission for Health Improvement when CHI is due to review a particular institution as part of its three- or four-yearly rolling programmes of NHS reviews and there is a contractual relationship
  952
  between the NHS institution it is reviewing and a particular private hospital. The national commission could be asked by CHI to do the same on its behalf. That seems to me to be the right way forward: sensible collaboration and sensible co-operation between two bodies which undertake different roles; the one regulating the independent, private healthcare sector, the other ensuring that issues in relation to quality in the NHS—a managed system accountable to Parliament—are dealt with effectively. The sensible outcome is to ensure that they are enabled to work and to collaborate together. I believe that that is the right outcome. I ask noble Lords to support it.
  11 p.m.
  Baroness Nicholson of Winterbourne: My Lords, before the Minister sits down, I welcome the fact that he will invite APROP and AVMA to join the consultative body. I commend the Minister on offering substance, not spin. I commend the Bill for offering a system that is better than in the past and which is consistent countrywide. However, does he not agree that by choosing the words "contracts for national standards" he highlights the fact that this is a non-definitive, non-prescriptive set of statements? The regulations may make provision and may impose requirements. That lies at the heart of the amendment of the noble Earl, Lord Howe, and at the heart of the amendment that the noble Earl, Lord Howe, my colleagues and I proposed in March. We do not seek an open-ended commitment but actual standards and regulations which are prescriptive and definitive.
  Lord Hunt of Kings Heath: My Lords, experience with previous legislation in this area shows that, if one attempts to include all the measures the noble Baroness mentioned on the face of the Bill, it will simply not keep pace with fast moving developments in the healthcare sector. The Bill sets the clear parameters within which we expect regulations to be conducted and allows us to be flexible, to consult and to learn from experience. At the end of the day, I believe that it will be an extremely effective regulatory regime.
  Baroness Nicholson of Winterbourne: My Lords, will the Minister substitute "will" for "may"?
  Earl Howe: My Lords, this has been an important debate. I thank all noble Lords who have taken part in it. The Minister's reply was not entirely unexpected. There is no disagreement between us that better regulation of the private sector is both necessary and desirable. There is no disagreement between us about the inadequacies of the Registered Homes Act. However, as he knows, that was not the point I sought to make.
  It is disappointing that the Minister did not extend at least a nod in the direction of the arguments that I advanced earlier. It is also disappointing that he should have offered what I fear is a spurious argument in defence of his own position. There is no suggestion in the amendment carried by the House that CHI

  953
  should usurp the role of the commission as the regulator. The Minister is right to say that CHI's functions are not regulatory, in the accepted sense at least. As far as I am aware, it has not been suggested by anyone—certainly not by me—that under Amendment No. 20 CHI should do more than carry out inspections and in so doing be accountable to the commission as regulator.
  The noble Lord admits implicitly in his own amendment that CHI is capable of performing the role I have suggested for it. He concedes that it is possible for the commission to delegate to CHI on a ad hoc basis. So why is there this hang up over a more permanent role along those lines?
  I see opposite me the massing ranks of government supporters; by contrast, few such ranks are on this side of the Chamber. But I believe that this is an issue on which the opinion of the House should be tested. I beg to move.
  11.5 p.m.
  On Question, Whether the said amendment (No. 20A) shall be agreed to?
  Their Lordships divided: Contents, 16; Not-Contents, 91.

  Division No. 3

  CONTENTS

  Astor of Hever, L.

  Lyell, L.

  Barker, B.

  Mackay of Ardbrecknish, L.

  Blatch, B.

  Mar and Kellie, E.

  Clement-Jones, L. [Teller]

  Masham of Ilton, B.

  Ezra, L.

  Montrose, D.

  Henley, L. [Teller]

  Nicholson of Winterbourne, B.

  Howe, E.

  Roberts of Conwy, L.

  Laming, L.

  Thomas of Gwydir, L.

  NOT-CONTENTS

  Acton, L.

  Elder, L.

  Alli, L.

  Evans of Parkside, L.

  Amos, B.

  Falconer of Thoroton, L.

  Andrews, B.

  Farrington of Ribbleton, B.

  Archer of Sandwell, L.

  Faulkner of Worcester, L.

  Ashton of Upholland, B.

  Fyfe of Fairfield, L.

  Bach, L.

  Gale, B.

  Bassam of Brighton, L.

  Gavron, L.

  Bernstein of Craigweil, L.

  Gibson of Market Rasen, B.

  Billingham, B.

  Gilbert, L.

  Blackstone, B.

  Goldsmith, L.

  Borrie, L.

  Gordon of Strathblane, L.

  Bragg, L.

  Goudie, B.

  Brooke of Alverthorpe, L.

  Gould of Potternewton, B.

  Brookman, L.

  Grenfell, L.

  Burlison, L.

  Hardy of Wath, L.

  Carter, L. [Teller]

  Harris of Haringey, L.

  Chandos, V.

  Harrison, L.

  Christopher, L.

  Haskel, L.

  Cohen of Pimlico, B.

  Hayman, B.

  Crawley, B.

  Hollis of Heigham, B.

  Davies of Coity, L.

  Howells of St. Davids, B.

  Davies of Oldham, L.

  Hoyle, L.

  Desai, L.

  Hughes of Woodside, L.

  Donoughue, L.

  Hunt of Kings Heath, L.

  Dormand of Easington, L.

  Islwyn, L.

  Dubs, L.

  954

  Jay of Paddington, B. (Lord Privy Seal)

  Ramsay of Cartvale, B.

  Judd, L.

  Rendell of Babergh, B.

  Layard, L.

  Sainsbury of Turville, L.

  Lea of Crondall, L.

  Sawyer, L.

  Lipsey, L.

  Scotland of Asthal, B.

  McCarthy, L.

  Sewel, L.

  Macdonald of Tradeston, L.

  Simon, V.

  Smith of Leigh, L.

  McIntosh of Haringey, L. [Teller]

  Symons of Vernham Dean, B.

  Thornton, B.

  McIntosh of Hudnall, B.

  Tomlinson, L.

  MacKenzie of Culkein, L.

  Turnberg, L.

  Mackenzie of Framwellgate, L.

  Warner, L.

  Massey of Darwen, B.

  Watson of Invergowrie, L.

  Mitchell, L.

  Whitaker, B.

  Morris of Castle Morris, L.

  Whitty, L.

  Nicol, B.

  Wilkins, B.

  Pitkeathley, B.

  Williams of Mostyn, L.

  Ponsonby of Shulbrede, L.

  Woolmer of Leeds, L.

  Puttnam, L.

  Young of Old Scone, B.

  Resolved in the negative, and amendment disagreed to accordingly.
  On Question, Motion agreed to.
  11.14 p.m.

  COMMONS AMENDMENTS
  21 Clause 8, page 6, line 6, at beginning insert—

  ("(A1) The Assembly shall have the general duty of encouraging improvement in the quality of Part II services provided in Wales.

  (A2) The Assembly shall make information about Part II services provided in Wales available to the public.

  (A3) In relation to Part II services provided in Wales, the Assembly shall have any additional function specified in regulations made by the Assembly; but the regulations may only specify a function corresponding to a function which, by virtue of section 7, is exercisable by the Commission in relation to Part II services provided in England.")

  22 After Clause 8, insert the following new clause—

  CO-OPERATIVE WORKING
  (" .—(1) The Commission for Health Improvement ("CHI") and the National Care Standards Commission ("NCSC") may, if authorised to do so by regulations, arrange—

  (a) for prescribed functions of the NCSC to be exercised by CHI on behalf of the NCSC;

  (b) for prescribed functions of CHI, so far as exercisable in relation to England, to be exercised by the NCSC on behalf of CHI,

  and accordingly CHI and the NCSC each have power to exercise functions of the other in accordance with arrangements under this subsection.
  (2) The Assembly and CHI may arrange for any functions of the Assembly mentioned in section 9(6) to be exercised by CHI on behalf of the Assembly; and accordingly CHI has power to exercise functions of the Assembly in accordance with arrangements under this subsection.
  (3) The Assembly and CHI may, if authorised to do so by regulations, arrange for prescribed functions of CHI, so far as exercisable in relation to Wales, to be exercised by the Assembly on behalf of CHI; and accordingly the Assembly has power to exercise functions of CHI in accordance with arrangements under this subsection.
  (4) References in this section to exercising functions include a reference to assisting with their exercise.
  (5) Regulations under this section shall be made by the Secretary of State; but the Secretary of State may not make regulations under subsection (3) without the agreement of the Assembly.")
  23 Clause 9, page 6, line 28, leave out ("the Assembly's registration functions") and insert—

  ("(a) any functions exercisable by the Assembly by virtue of section 5(b) or 8(A3); or

  (b) any other functions exercisable by the Assembly corresponding to functions exercisable by the Commission in relation to England,")

  24 Page 6, line 30, leave out subsection (7)
  25 Page 6, line 34, leave out ("it would be") and insert ("there are exceptional circumstances which make it")
  26 Clause 11, page 7, line 29, at end insert—
  ("( ) A person who applies for registration as the manager of an establishment or agency must be an individual.")
  27 Clause 12, page 8, line 4, after ("vary") insert ("or remove")
  28 Clause 13, page 8, line 13, after ("being") insert (", or has at any time been,")
  29 Clause 14, page 8, line 30, after ("variation") insert ("or removal")
  30 Page 9, line 3, after ("(stating") insert (", where applicable,")
  31 Clause 16, page 9, line 35, after ("vary") insert ("or remove")
  32 Clause 18, page 10, line 23, after ("varied") insert (", the condition which is removed")
  33 Clause 19, page 10, line 39, after ("varying") insert ("or removing")
  34 Page 10, line 44, after ("variation") insert (", removal")
  35 Clause 21, page 12, line 22, at end insert—
  ("( ) Regulations under subsection (2)(a) may, in particular, make provision for prohibiting persons from managing an establishment or agency unless they are registered in, or in a particular part of, one of the registers maintained under section 52(1).")
  36 Page 12, line 46, after ("of") insert ("documents and")
  37 Page 13, line 33, at end insert—
  ("( ) make provision requiring arrangements to be made by the person who carries on, or manages, a care home for securing that any nursing provided by the home is of appropriate quality and meets appropriate standards.")
  38 Page 13, line 45, at end insert—
  ("( ) Before making regulations under this section, except regulations which amend other regulations made under this section and do not, in the opinion of the appropriate Minister, effect any substantial change in the provision made by those regulations, the appropriate Minister shall consult any persons he considers appropriate.")
  39 Clause 25, page 14, line 36, at end insert—
  ("(3) No person shall, with intent to deceive any person, in any way describe or hold out an establishment or agency as able to provide any service or do any thing the provision or doing of which would contravene a condition for the time being in force by virtue of this Part in respect of the establishment or agency.
  (4) A person who contravenes subsection (3) shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.")
  40 After Clause 25, insert the following new clause—

  FALSE STATEMENTS IN APPLICATIONS
  (" .—(1) Any person who, in an application for registration under this Part or for the variation of any condition in force in relation to his registration, knowingly makes a statement which is false or misleading in a material respect shall be guilty of an offence.
  (2) A person guilty of an offence under this section shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale.")
  41 Clause 27, page 15, line 7, at end insert—
  ("( ) Proceedings for an offence under this Part or regulations made under it may be brought within a period of six months from the date on which evidence sufficient in the opinion of the prosecutor to warrant the proceedings came to his knowledge; but no such proceedings shall be brought by virtue of this subsection more than three years after the commission of the offence.")
  42 Clause 28, page 15, line 19, after ("officer") insert ("or member")
  43 Clause 29, page 15, line 34, after ("any") insert ("documents or")
  44 Page 15, line 46, after ("any") insert ("documents or")
  45 Clause 37, page 19, line 13, leave out from ("home)") to end of line 17 and insert—

  ("(a) in subsection (1), after "(3)" there is inserted "and (3A)",

  (b) in subsection (2), for "subsection (1) above" there is substituted "this section",

  (c) in subsection (3)(e)(ii), "dental practitioner or" is omitted; and

  (d) after subsection (3) there is inserted—

  "(3A) The definition in subsection (1) above does not include any premises used, or intended to be used, wholly or mainly by a dental practitioner for the purpose of treating his patients unless subsection (3B) or (3C) below applies.

  (3B) This subsection applies if—

  (a) the premises are also used, or intended to be used, by that or another dental practitioner for the purpose of treating his patients under general anaesthesia; and

  (b) the premises are not used, or intended to be used, by any dental practitioner for the purpose of treating his patients under general anaesthesia—

  (i) in pursuance of the National Health Service Act 1977; or

  (ii) under an agreement made in accordance with Part I of the National Health Service (Primary Care) Act 1997.

  (3C) This subsection applies if the premises are used, or intended to be used, for the provision of treatment by specially controlled techniques and are not excepted by regulations under subsection (3)(g) above."").

  46 After Clause 38, insert the following new clause—

  CHILDREN'S HOMES: TEMPORARY PROVISION ABOUT CANCELLATION OF REGISTRATION
  (" .—(1) In paragraph 1(4) of Schedule 5 to the 1989 Act (voluntary homes and voluntary organisations)—

  (a) in paragraph (a), after "is not" there shall be inserted ", or has not been,";

  (b) after "is" there shall be inserted ", or has been,".

  (2) In paragraph 2 of that Schedule, after sub-paragraph (5) there shall be inserted—
  "(6) In relation to a home which has ceased to exist, the reference in sub-paragraph (4) to any person carrying on the home shall be taken to be a reference to each of the persons who carried it on."
  (3) In paragraph 3(3) of Schedule 6 to the 1989 Act (registered children's homes), after "is being" there shall be inserted "and has been".
  (4) In paragraph 4 of that Schedule—

  (a) in sub-paragraph (3) after "is being" there shall be inserted ", or has been,";

  957

  (b) after sub-paragraph (4) there shall be inserted—

  "(5) In relation to a home which has ceased to exist, references in this paragraph and paragraph 5(4) to the person, or any person, carrying on the home include references to each of the persons who carried it on."").
  47 Clause 39, page 19, line 23, leave out from ("persons") to ("by") in line 26 and insert ("to whom subsection (2) or (3) applies.
  (2) This subsection applies to—

  (a) local authorities providing services in the exercise of their social services functions; and

  (b) persons who provide services which are similar to services which—

  (i) may or must be so provided by local authorities; or

  (ii) may or must be provided")

  48 Page 19, line 27, at end insert—
  ("(3) This subsection applies to persons who carry on or manage an undertaking (other than an establishment or agency) which consists of or includes supplying, or providing services for the purpose of supplying, individuals mentioned in subsection (4).
  (4) The individuals referred to in subsection (3) are those who provide services for the purpose of any of the services mentioned in subsection (2)")
  49 After Clause 40, insert the following new clause—

  GENERAL POWERS OF THE COMMISSION
  (" . The Commission may at any time give advice to the Secretary of State on—

  (a) any changes which the Commission thinks should be made, for the purpose of securing improvement in the quality of services provided by local authorities in England in the exercise of relevant functions, in the standards set out in statements under section 45; and

  (b) any other matter connected with the exercise by local authorities in England of relevant functions.")

  50 Clause 41, page 20, line 13, after ("any") insert ("documents or")
  51 Page 20, line 17, after ("any") insert ("documents or")
  52 Clause 45, page 22, line 32, leave out ("and (2)") and insert (", (2) and (3)")
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 21 to 52.
  Moved, That the House do agree with the Commons in their Amendments Nos. 21 to 52.—(Lord Hunt of Kings Heath.)
  On Question, Motion agreed to.
  11.15 p.m.

  COMMONS AMENDMENT
  53 Clause 51, page 24, line 6, leave out ("or care home") and insert (", care home or residential family centre")
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 53. This amendment comprises one of a group of 35 amendments that make minor changes to the provisions in Part IV, concerning the regulation of social care workers.
  Amendments Nos. 53 to 61 all relate to the definitions set out in Clause 51. Amendments Nos. 53 and 54 ensure that workers in residential family centres
  958
  and relevant agency workers come within the definition of "social care worker". The remaining amendments, Amendments Nos. 55 to 61, all concern the groups of workers who may be brought within the definition of "social care worker" at a later date by regulations.
  Amendment No. 55 reflects my earlier comments about the registration of managers of establishments and agencies. Amendments Nos. 56 and 57 make general provision for extending the definition of "social care worker" which reflects the commitment I made following points raised by the noble Lord, Lord Laming, during our earlier discussions in the House. Amendment No. 58 provides that the inspectors employed by the commission or Assembly may also be brought within the definition. Amendment No. 59 makes similar provision for social work students.
  Amendments Nos. 60 and 61 amend the definition of "day centre". I should like to reassure noble Lords that this is a purely technical matter. It came to our attention that the existing definition used the word "establishment". As this is already defined in Part I of the Bill, it had the effect of rendering the current definition of "day centre" deficient. This new definition simply uses the word "place" instead. I can assure noble Lords that it is intended to cover exactly the same range of organisations.
  Amendments Nos. 62 and 63 enable a person to be registered on two or more parts of the register. That is important because the field of social care is extremely wide. I know that we all wish to ensure that workers in any particular sector have all the right skills and competencies for that specialised area of work. This may mean that registration on two separate parts of the register may be necessary.
  Amendments Nos. 64 to 67 and 73 to 79 all relate to "post-qualifying" training for professional social workers. The councils already have powers to regulate the basic training of social workers through Clause 59. These amendments make additional provision in that clause so that the councils can also regulate training for social workers at the post-qualifying level.
  Amendments Nos. 68 to 72, 86 and 87 make minor changes to the fee-charging and rule-making provisions of this part. They consolidate the existing express fee-charging powers and bring them together in a more general provision. Amendment No. 68 makes a similar general provision about the rules, which will all be subject to approval by the appropriate Minister. Amendment No. 71 is a straightforward correction, altering a reference to the Secretary of State to "appropriate Minister".
  The last batch of amendments within this group amend Clause 63. Amendment No. 76 gives the appropriate Minister a number of functions relating to the training of the social care workforce which underpin the work of the councils. These functions underpin the duty of the councils to promote high standards in training. I should point out that in England it is intended that these functions should be delegated to an agency called TOPSS-England, the England arm of the UK national training organisation for personal social services.

  959
  Amendments Nos. 80 to 85 simply make provision for the Assembly to delegate functions under this clause in a similar manner to the existing provisions for the Secretary of State for England.
  Moved, That the House do agree with the Commons in their Amendment No. 53.—(Lord Hunt of Kings Heath.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  88 After Clause 67, insert the following new clause—

  CHILDREN'S COMMISSIONER FOR WALES
  (" .—(1) There shall be an office of the Children's Commissioner for Wales or Comisiynydd Plant Cymru.
  (2) Schedule (The Children's Commissioner for Wales) shall have effect with respect to the Children's Commissioner for Wales (referred to in this Act as "the Commissioner").")
  Baroness Farrington of Ribbleton: My Lords, I beg to move that this House do agree with the Commons in their Amendment No. 88. I shall speak also to Amendments Nos. 89 to 94, 184, 186, 202, 207, 277 and 288.
  The Secretary of State for Wales announced on 2nd March the Government's intention to bring forward an amendment to the Bill to establish in Wales an independent children's commissioner on a statutory basis. The case for a children's commissioner was made in part by the Welsh social services White Paper, Building for the Future. There had also been calls for it by bodies such as Children in Wales, the Welsh Local Government Association and the Welsh Affairs Committee of another place, as well as in evidence given in 1997 and 1998 to the North Wales child abuse tribunal.
  The establishment of the children's commissioner became an Assembly manifesto commitment of all the political parties in Wales except the Conservatives, who have subsequently supported the principle. Finally, Sir Ronald Waterhouse recommended in his report Lost in Care that an independent children's commissioner for Wales should be appointed.
  That was the context of the Secretary of State's announcement. Sir Ronald recommended that the commissioner's duties should include ensuring that children's rights are respected through the monitoring and oversight of the operation of complaints and whistleblowing procedures and the arrangements for children's advocacy; examining the handling of individual cases brought to the commissioner's attention, including making recommendations on their merit when he or she considers it necessary or appropriate; and publishing reports, including an annual report to the Assembly.
  The amendments put those recommendations into effect for the full range of children's services within the scope of the Bill—not just children looked after by local authorities but domiciliary care, private hospitals and clinics, day care and childminding services and children living away from home in boarding schools.
  960
  The National Assembly for Wales is committed to a children's commissioner to promote and safeguard the rights and interests of all children in Wales. Such a commissioner would be beyond the scope of the Bill. The Assembly is in discussion with the Secretary of State for Wales about an early legislative opportunity.
  In the meantime, Amendments Nos. 88 to 94 and 207 implement the first two recommendations of the Waterhouse report. Provision is made in Amendment No. 88 for the establishment of the office of the children's commissioner for Wales. Amendment No. 89 deals with the commissioner's functions in reviewing and monitoring arrangements made by providers of services in Wales or by the Assembly in respect of services for children regulated under the Bill to ascertain their effectiveness in safeguarding and promoting children's rights. There are three aspects, in line with the Waterhouse recommendations, covering complaints procedures, whistleblowing and advocacy arrangements.
  Under Amendment No. 90, the Assembly will also be able to confer power on the commissioner to examine particular cases and to make regulations governing their examination. It is not the Assembly's intention that the commissioner should routinely take the place of existing complaints procedures but that he or she should investigate situations in which a matter of principle is involved or in which there is evidence of a systematic breach of children's rights. Under subsection (3), regulations may confer power on the commissioner to require prescribed persons to supply information for the purposes of his examination functions. In that respect, the commissioner would have the same powers as the High Court. The sanctions that may apply if the commissioner is obstructed from receiving such information mirror the sanctions that apply if the High Court is so obstructed. They are dealt with in Amendment No. 91.
  Amendment No. 92 deals with the further functions that may be conferred on the commissioner by the Assembly. They include the power to assist a child in making a complaint or representation about any regulated children's services in Wales or in any prescribed proceedings. It is envisaged that the commissioner would use the power sparingly, usually in circumstances where there is a matter of principle at stake involving a "test" case. The commissioner may also give advice and information relating to his functions to any person under this clause.
  The Assembly may confer further functions on the commissioners in connection with the functions already set out. It particularly may want to make provision for the arrangements to apply where the commissioner has made recommendations in a report—for example, how the commissioner deals with responses and follow-up action, or the lack of it. Such procedures could include publication of non-compliance with recommendations.
  Finally, the clause sets out the restrictions in respect of naming people in a report but, for the purposes of defamation, the publication of any matter in a report will be absolutely privileged.

  961
  Under Amendment No. 93, the commissioner will not be able to exercise functions in circumstances which are subject to, or have been determined by, legal proceedings in a court or tribunal; or where they duplicate functions exercised on a statutory basis by other, prescribed people.
  The commissioner's functions and powers will extend to children being provided with regulated services in Wales. Amendment No. 94 defines such services as services for children regulated under the Bill. By virtue of subsection (6), regulations may provide that the commissioner can exercise his functions in respect of a matter that occurred prior to the commencement of his functions; and that he can exercise his functions in respect of an adult who was a child receiving regulated services during a prescribed time. This is to ensure that the commissioner is able to "hit the ground running" and does not have to wait for new incidents to happen before he can investigate them.
  Amendment No. 277 introduces a general transitory provision to enable the Assembly to empower the commissioner to exercise jurisdiction in the period following enactment but before the rest of the Bill has been implemented. So the commissioner would, for example, be able to review complaints procedures in children's homes with fewer than four residents before the relevant commencement order is in force in Wales.
  Amendment No. 207 deals with a range of practical details. Amendments Nos. 184, 186, 202 and 288 are technical amendments relating to consequential and supplementary provision and the addition of the commissioner to the Long Title of the Bill.
  The establishment of the children's commissioner for Wales is a significant development in ensuring that the rights of children in Wales are safeguarded and promoted in line with the recommendations of Sir Ronald Waterhouse. I therefore strongly commend these provisions to your Lordships.
  Moved, That the House do agree with the Commons in their Amendment No. 88.—(Baroness Farrington of Ribbleton.)
  11.30 p.m.
  Earl Howe: My Lords, I thank the Minister for introducing these important and lengthy amendments. They are of considerable significance for the supervision of children's services in Wales and will make that supervision safer and better.
  In particular, the creation of a children's commissioner for Wales will contribute considerably towards the more effective protection of children in the care system. The appalling deficiencies and abuses in the treatment of significant numbers of children in Welsh residential homes were graphically described by Sir Ronald Waterhouse in his report, Lost in Care. No one reading the report could seriously argue for the status quo in the regulation and supervision of
  962
  children's homes. These amendments are a useful and necessary first step in implementing Sir Ronald's recommendations and I welcome them.
  They do, however, give rise to a number of questions. We understand from the Government that the role, powers and remit of the children's commissioner will in due course be widened so as to encompass not simply the services for children regulated by the Bill but also the full range of activities to which Sir Ronald Waterhouse drew attention. Moreover, the commissioner will be an independent office holder. He will be independent of government and of the Welsh Assembly.
  Contrast that with the situation in England. The services for children regulated by this Bill will be overseen by the National Care Standards Commission and, specifically, by the children's rights director. In fact, I should have referred to some of the services because childminding will be the exclusive province of Ofsted. The children's rights director is not an independent office holder but an employee of the commission.
  Some of us argued in Committee—and I was one—that there should be an individual commissioner at board level and that he should not simply be an employee of the commission. He should be responsible for a wide range of children's issues including many of the functions now being assumed by the Welsh commissioner. Those arguments were batted away by the Minister. We were told that a children's rights director was all that was necessary to achieve what the Government had in mind.
  Therefore, the Bill introduces, in my judgment, an immediate mismatch between Wales and England. Not only do we have the contrast between an independent commissioner and an employee of the National Care Standards Commission, but we also have a contrast between their respective powers and duties. Furthermore, we have a mismatch between the future wider remit of the Welsh commissioner and the role of the children's rights director, which is necessarily limited and confined by the remit of the Commission.
  Opposition amendments to create an independent children's commissioner for England were rejected in another place. On these Benches, particularly in the light of Waterhouse, we see a role for such an individual on a much wider stage, if I may so put it, than that created by this Bill. He or she should have a remit to examine government policy and legislative proposals across the entire range of government departments and to represent the interests of children who will be affected by such proposals. Ideally, such an individual would have a UK-wide remit.
  That is only our idea. The Government may well have different ones. I do not understand why the Government, in the light of Waterhouse, have not taken the opportunity to break out of the confines of the Bill as originally drafted to set up a fully fledged independent children's commissioner for England or indeed for England and Wales combined. It is not as though the kinds of abuse highlighted in Lost in Care

  963
  are confined simply to Wales. Only a few days ago we read of a very serious set of allegations being made in connection with children's homes in, I believe, Lancashire. Sir Ronald himself made it clear that the problems that he highlighted in Wales need not be thought of as being exclusively Welsh. That may sound like a statement of the obvious, but it needs saying.
  I should like to hear from the Minister, first, as to the differences in the respective functions of the children's commissioner on the one hand and the children's rights director on the other, as defined by this Bill; and, secondly, by what mechanisms in the longer term she sees the recommendations of Waterhouse being implemented on either side of the English/Welsh border.
  Lord Clement-Jones: My Lords, the noble Earl has raised some very important points on this series of amendments. I do not need to go into much greater detail than he has already since they are precisely the questions that I wish the Minister to answer when she replies.
  I believe that it was the noble Baroness, Lady David, who tabled the original amendment about a children's commissioner. While one understands that the implementation of the Waterhouse recommendations should first take place in Wales, I cannot understand the logic for not extending the same provision to England. It may be that essentially the Government are saying that the powers of the commissioner are effectively the same as those of the children's rights director. Is this a rose by any other name? If that is the case we need an assurance from the Minister that the explicit powers provided to the commissioner will also be available to the children's rights director when the regulations are made. Can the Minister give an assurance that the regulations to be made will exactly reflect the provisions in the primary legislation as they apply to Wales? When will those draft regulations be made? Like the noble Earl, Lord Howe, I seek a considerable amount of further information about the whys and wherefores of treating the two jurisdictions so differently.
  My final point is probably one that should not be made at this time of night. In connection with Amendment No. 277, I noted that the Minister described the amendment as transitory rather than transitional. I wonder whether that is a new government description of the effect of certain clauses.
  Lord Roberts of Conwy: My Lords, this part of the Bill which establishes a children's commissioner for Wales has been much heralded. It is primarily the outcome of the report by Sir Ronald Waterhouse on child abuse in North Wales. He reported in February after this Bill had had its Second Reading. His very first recommendation was that,
  "An independent Children's Commissioner for Wales should be appointed".
  He went on to outline the duties of the commissioner.
  964
  The recommendation was accepted by the Government in their response to the report, which was a very important milestone. The recommendation was also considered in some depth by the National Assembly and at least two of its committees. It appeared that the Assembly wished the commissioner's remit to extend to all children in Wales. I agree with the Minister that that goes over the top. As the Bill stands, the commissioner's remit is confined to children in all care services regulated by the legislation, and I believe that to be a good place to start.
  I understand that discussions between the Assembly's Health and Social Services Secretary, Jane Hutt, and the Secretary of State for Wales, Paul Murphy, continue. However, I believe that they would be well advised to wait and see how they get on with the implementation of this part of the Bill before they seek to extend the role of the commissioner still further. I agree with the Minister that this Bill is not suitable for such an extension.
  In view of the past history of abuse in North Wales and what is coming to light elsewhere as a result of police inquiries—the example of Lancashire was referred to by my noble friend Lord Howe—I welcome the appointment of a commissioner as proposed in the Bill. I wish the office all success in the performance of the functions ascribed to it.
  However, two points concern me. The first is the curious provision in Clause 75(6) which prohibits the commissioner from identifying in a report anyone other than the person being investigated. It is the publication of the name of the person being investigated that concerns me. The investigation may arise as a result of a child's complaint. The case may or may not involve a criminal offence; the complaint may or may not be soundly based. In either case, the person who is being investigated may attract a great deal of adverse public attention and will have no remedy in the law of defamation, as is made clear in subsection (7).
  In my view, the commissioner will have to exercise the utmost care, as did Sir Ronald Waterhouse in the conduct of his inquiry, if the reputations of innocent people are not to be maliciously damaged. At this point, I shall say only that there is a lot of chequebook journalism about and that people who are involved and work with children in care must be protected. We must be careful that the work remains possible and that people are not scared off, leaving a shortage of those available to take care of children.
  My second concern arises from the retrospective aspect of Clause 77(6) and the power to make regulations which apply to childcare before this part of the Bill came into effect. We do not like retrospective legislation at best, but it is proposed in this context. Does it mean, for example, that the cases thoroughly examined by Sir Ronald could be reopened if the Assembly so provided? That would be reopening a can

  965
  of worms which I thought Sir Ronald scoured most judiciously. I should be grateful for an explanation of what is meant by that subsection.
  Baroness Farrington of Ribbleton: My Lords, feeling slightly like an Alice in Wonderland character, the answer to the noble Lord, Lord Clement-Jones, is, when I say "transitory" I mean "transitional".
  A range of issues has been raised. As all noble Lords recognise, this is an extremely important development and follows a harrowing account of years of suffering by children. The questions covered the children's rights director and the children's commissioner for Wales, and the similarities and differences between their posts. The key similarities between the two are that both will be able to investigate whistle blowers and the procedures set up for them, the effectiveness of complaints systems and the effectiveness of advocacy services. Potentially, both can examine individual cases and both can report to government—to the National Assembly and the Secretary of State for Health. Both are independent of government. Both posts will ensure that children's voices are listened to at the highest level, and both are senior appointments representing significant new safeguards for children.
  There are differences. The children's commissioner for Wales will be empowered to set up his own office and employ staff. The children's rights director, as a senior employee of the national care standards commission, will not need such powers. The children's commissioner for Wales will possess specific powers, including the right to demand the protection of information, the right to call witnesses and the right to certify an offence to the High Court if he is obstructed in the exercise of his powers.
  In England, the CRD will not have those specific powers but will rely instead on the powers prescribed to NCSC, which will be at least as strong. The functions of the children's rights director are limited to those of the NCSC. The commissioner in Wales is limited by the functions set out in this Bill, which are broadly the same. However, further primary legislation could extend the responsibilities for the Welsh commissioner in a way that would not be achievable for a post within the NCSC.
  A range of issues are concerned with the differences in the regulation of provision for children under the age of 8, with a different role in England where the services will be regulated separately by Ofsted and will not be in the remit of the NCRD. That is the one big difference between the two.
  The functions and powers under the Care Standards Bill will be very similar. The difference in structure derives primarily from the different constitutions of the regulatory bodies that will be set up in both places. I note the point raised by the noble Lord, Lord Roberts, that perhaps the Assembly should wait a while before it assesses how things progress. One of the elements of devolution is that ultimately that is a matter for judgment by the Assembly.
  966
  The noble Lord, Lord Roberts, did me the courtesy of telling me the detailed points that he intended to raise. With regard to Amendment No. 92, the commissioner will have discretion to name individuals under subsection (6) if, after taking into account the public interest and that of the complainant and other people, he or she considers it necessary.
  We believe it is extremely important that it is recognised that the main role of the commissioner is to monitor the operations of systems rather than to attribute blame to individuals. Ultimately, the attribution of blame is a matter for the role of employers and, ultimately again, the criminal justice system.
  The retrospective provision which the noble Lord raised—that is, the issue of post-Waterhouse—will not mean that the commissioner will be able to re-open matters already dealt with by Sir Ronald Waterhouse's tribunal because, by virtue of Amendment No. 93 in Clause 76, he will not be authorised to look into matters which have been determined already by a court or tribunal.
  I believe that I have answered points raised by noble Lords. Should any matters be outstanding, I shall of course write to them. I commend Amendment No. 88 to the House.
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  89 After Clause 67, insert the following new clause—

  REVIEW AND MONITORING OF ARRANGEMENTS
  (" .—(1) The Commissioner may review, and monitor the operation of, arrangements falling within subsection (2), (3) or (4) for the purpose of ascertaining whether, and to what extent, the arrangements are effective in safeguarding and promoting the rights and welfare of children to whom this Part applies.
  (2) The arrangements falling within this subsection are the arrangements made by the providers of regulated children's services in Wales, or by the Assembly, for dealing with complaints or representations in respect of such services made by or on behalf of children to whom this Part applies.
  (3) The arrangements falling within this subsection are arrangements made by the providers of regulated children's services in Wales, or by the Assembly, for ensuring that proper action is taken in response to any disclosure of information which may tend to show—

  (a) that a criminal offence has been committed;

  (b) that a person has failed to comply with any legal obligation to which he is subject;

  (c) that the health and safety of any person has been endangered; or

  (d) that information tending to show that any matter falling within one of the preceding paragraphs has been deliberately concealed,

  in the course of or in connection with the provision of such services.
  (4) The arrangements falling within this subsection are arrangements made (whether by providers of regulated children's services in Wales, by the Assembly or by any other person) for making persons available—

  (a) to represent the views and wishes of children to whom this Part applies; or

  (b) to provide such children with advice and support of any prescribed kind.

  (5) Regulations may confer power on the Commissioner to require prescribed persons to provide any information which the Commissioner considers it necessary or expedient to have for the purposes of his functions under this section.")
  90 Insert the following new clause—

  EXAMINATION OF CASES
  (" .—(1) Regulations may make provision for the examination by the Commissioner of the cases of particular children to whom this Part applies.
  (2) The regulations may include provision about—

  (a) the types of case which may be examined;

  (b) the circumstances in which an examination may be made;

  (c) the procedure for conducting an examination, including provision about the representation of parties;

  (d) the publication of reports following an examination.

  (3) The regulations may make provision for—

  (a) requiring persons to provide the Commissioner with information; or

  (b) requiring persons who hold or are accountable for information to provide the Commissioner with explanations or other assistance,

  for the purposes of an examination or for the purposes of determining whether any recommendation made in a report following an examination has been complied with.
  (4) For the purposes mentioned in subsection (3), the Commissioner shall have the same powers as the High Court in respect of—

  (a) the attendance and examination of witnesses (including the administration of oaths and affirmations and the examination of witnesses abroad); and

  (b) the provision of information.

  (5) No person shall be compelled for the purposes mentioned in subsection (3) to give any evidence or provide any information which he could not be compelled to give or provide in civil proceedings before the High Court.
  (6) The regulations may make provision for the payment by the Commissioner of sums in respect of expenses or allowances to persons who attend or provide information for the purposes mentioned in subsection (3).")
  91 Insert the following new clause—

  OBSTRUCTION ETC
  (" .—(1) The Commissioner may certify an offence to the High Court where—

  (a) a person, without lawful excuse, obstructs him or any member of his staff in the exercise of any of his functions under regulations made by virtue of section (Review and monitoring of arrangements)(5) or (Examination of cases); or

  (b) a person is guilty of any act or omission in relation to an examination under regulations made by virtue of section (Examination of cases) which, if that examination were proceedings in the High Court, would constitute contempt of court.

  (2) Where an offence is so certified the High Court may inquire into the matter; and after hearing—

  (a) any witnesses who may be produced against or on behalf of the person charged with the offence; and

  (b) any statement that may be offered in defence,

  the High Court may deal with the person charged with the offence in any manner in which it could deal with him if he had committed the same offence in relation to the High Court.")
  92 Insert the following new clause—

  FURTHER FUNCTIONS
  (" .—(1) Regulations may confer power on the Commissioner to assist a child to whom this Part applies—
  968

  (a) in making a complaint or representation to or in respect of a provider of regulated children's services in Wales; or

  (b) in any prescribed proceedings,

  and in this subsection "proceedings" includes a procedure of any kind and any prospective proceedings.
  (2) For the purposes of subsection (1), assistance includes—

  (a) financial assistance; and

  (b) arranging for representation, or the giving of advice or assistance, by any person,

  and the regulations may provide for assistance to be given on conditions, including (in the case of financial assistance) conditions requiring repayment in circumstances specified in the regulations.
  (3) The Commissioner may, in connection with his functions under this Part, give advice and information to any person.
  (4) Regulations may, in connection with the Commissioner's functions under this Part, confer further functions on him.
  (5) The regulations may, in particular, include provision about the making of reports on any matter connected with any of his functions.
  (6) Apart from identifying any person investigated, a report by the Commissioner shall not—

  (a) mention the name of any person, or

  (b) include any particulars which, in the opinion of the Commissioner, are likely to identify any person and can be omitted without impairing the effectiveness of the report,

  unless, after taking account of the public interest (as well as the interests of any person who made a complaint and other persons), the Commissioner considers it necessary for the report to mention his name or include such particulars.
  (7) For the purposes of the law of defamation, the publication of any matter by the Commissioner in a report is absolutely privileged.")
  93 Insert the following new clause—

  RESTRICTIONS
  (" .—(1) This Part does not authorise the Commissioner to enquire into or report on any matter so far as it is the subject of legal proceedings before, or has been determined by, a court or tribunal.
  (2) This Part does not authorise the Commissioner to exercise any function which by virtue of an enactment is also exercisable by a prescribed person.")
  94 Insert the following new clause—

  INTERPRETATION
  (" .—(1) This Part applies to a child to or in respect of whom regulated children's services in Wales are provided.
  (2) In this Part, "regulated children's services in Wales" means any of the following services for the time being provided in respect of children—

  (a) services of a description provided by or in Part II undertakings, so far as provided in Wales;

  (b) services provided by local authorities in Wales in the exercise of relevant adoption functions or relevant fostering functions;

  (c) services of a description provided by persons registered under Part XA of the 1989 Act, so far as provided in Wales;

  (d) accommodation provided by schools or by an institution within the further education sector (as defined in section 91 of the Further and Higher Education Act 1992), so far as provided in Wales.

  (3) For the purposes of this Part—

  (a) in the case of the services mentioned in subsection (2)(a), the person who carries on the Part II undertaking is to be treated as the provider of the services;

  969

  (b) in the case of the services mentioned in subsection (2)(d), the relevant person (as defined in section 87 of the Children Act 1989) is to be treated as the provider of the services.

  (4) For the purposes of this section, an establishment or agency, and an undertaking of any other description, is a Part II undertaking if the provider of the services in question is for the time being required to be registered under that Part.
  (5) Where the activities of an undertaking are carried on from two or more branches, each of those branches shall be treated as a separate undertaking for the purposes of this Part.
  (6) Regulations may provide—

  (a) for this Part to be treated as having applied to a child at any time before the commencement of this Part if regulated children's services in Wales were at that time provided to or in respect of him;

  (b) for references in this Part to children to whom this Part applies to include references to persons who, at any prescribed time, were such children.

  (7) In this Part—
  "information" includes information recorded in any form;
  "regulations" means regulations made by the Assembly.
  (8) In this section, "relevant adoption functions" and "relevant fostering functions" have the same meanings as in Part III.")
  Baroness Farrington of Ribbleton: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 89 to 94.
  Moved, That the House do agree with the Commons in their Amendments Nos. 89 to 94.—(Baroness Farrington of Ribbleton.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  95 Clause 68, page 33, line 16, leave out ("the proximity or) and insert ("regular contact with")
  11.45 p.m.
  Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 95. I shall speak also to Amendments Nos. 96 to 137, 208 to 211 and 213–49 amendments in all.
  These amendments were made to Part V in Schedule 2 to the Bill as it left this House. They are concerned with the regulation of day care and child minding. Your Lordships will be pleased to hear that I do not intend to detain the House for too long—indeed, for any time at all—in dealing with this group of amendments. They are all technical or minor. None alters to any great degree the provisions considered by this House. They were made simply with the intention of refining various provisions within Part V.
  Several of the amendments simply extend to Wales provisions which were to apply in England. They are Amendments Nos. 109, 123, 124, 126 to 128 and 132 to 135. The remaining amendments are minor or technical in nature. Their general purpose was: first, to provide increased protection for children, for example, by strengthening the provisions which test the suitability of people on the premises; secondly, to enable the chief inspector and the Assembly to fulfil their role as regulator more effectively, for example, by
  970
  giving them the ability to take away evidence that they may come across while on a provider's premises; and, thirdly, to offer improvements for providers, for example, by extending the circumstances in which registration cannot be cancelled before the provider has had time to take appropriate action.
  Amendments Nos. 96, 125, 137 and 212 are purely technical.
  I am sure that your Lordships will agree that these amendments, although minor, are beneficial. They improve Part V of the Bill. I commend them to the House. If noble Lords want details of any particular amendment, I shall be happy to oblige.
  Moved, That the House do agree with the Commons in their Amendment No. 95.—(Lord Bach.)
  Lord Clement-Jones: My Lords, the Minister's brief introduction of these amendments is commendable, but I do not wish to detain the House for very long on these technical amendments. I regret to some extent that we did not examine in more detail the provisions transferring responsibility for registration of childminders to Ofsted when they came before this House, but the separate provisions for Wales are different, as Ministers have pointed out throughout, and that raises the issue of why in England there cannot be the option of considering a different system in future. No doubt Ministers will understand that there are considerable doubts about the wisdom of transferring this responsibility to Ofsted. In the other place, there were lengthy debates on the subject. But it is odd that there should potentially be two very different systems at play in the two jurisdictions.
  Lord Bach: My Lords, the Government gave considerable thought to who would best operate these procedures. We have come to the view that we have. We believe that we shall be proved right.
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  96 Clause 68, page 33, line 30, leave out ("and every prescribed person")
  97 Page 33, line 33, leave out ("the proximity of") and insert ("regular contact with")
  98 Page 34, leave out lines 1 and 2
  99 Page 34, line 5, after ("includes") insert ("any area and")
  100 Page 34, line 28, leave out ("the proximity of") and insert ("regular contact with")
  101 Page 34, line 34, leave out ("and safety") and insert (", safety and suitability")
  102 Page 35, line 45, at end insert—
  ("(b) give any other information which the registration authority reasonably requires the applicant to give.")
  103 Page 36, line 3, at end insert—
  ("( ) Where the registration authority has sent the applicant notice under section 79L(1) of its intention to refuse an application under this section, the application may not be withdrawn without the consent of the authority.
  ( ) A person who, in an application under this section, knowingly makes a statement which is false or misleading in a material particular shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding level 5 on the standard scale.")
  104 Page 37, line 8, leave out ("carry out repairs or make alterations or additions") and insert ("make any changes or additions to any services, equipment or premises")
  105 Page 37, line 11, leave out from ("ground") to ("if") in line 12 and insert ("of any defect or insufficiency in the services, equipment or premises")
  106 Page 37, line 15, leave out from first ("the") to ("additions") in line 17 and insert ("defect or insufficiency is due to the changes or")
  107 Page 37, line 23, leave out ("The regulations may make") and insert ("Any regulations made under this section shall include")
  108 Page 37, line 23, leave out ("for")
  109 Page 37, line 28, leave out ("Chief Inspector") and insert ("registration authority")
  110 Page 38, line 22, at end insert—
  ("( ) Where an order has been so made, the registration authority shall, as soon as is reasonably practicable after the making of the order, notify the local authority in whose area the person concerned acts or acted as a child minder, or provides or provided day care, of the making of the order.")
  111 Page 38, line 44, leave out ("in person or by") and insert ("orally or in writing, by the recipient of the notice or")
  112 Page 39, line 6, at end insert—
  ("( ) Subsection (6) does not prevent a step from taking effect before the expiry of the time within which an appeal may be brought under section 79M if the person concerned notifies the registration authority in writing that he does not intend to appeal.")
  113 Page 39, line 35, at end insert (", or intend to do so")
  114 Page 39, line 37, leave out ("by registered persons")
  115 Page 39, line 40, leave out ("section 2(7)(a)") and insert ("subsection (7)(a) of section 2")
  116 Page 39, line 42, at end insert (", and the power conferred by subsection 7)(b) of that section to make other reports to the Secretary of State includes a power to make reports with respect to matters which fall within the scope of his functions by virtue of this Part.")
  117 Page 40, line 32, at beginning insert—
  ("( ) The Chief Inspector may at any time require any registered person to provide him with any information connected with the person's activities as a child minder, or provision of day care, which the Chief Inspector considers it necessary to have for the purposes of his functions under this Part.")
  118 Page 40, line 48, at end insert—
  ("( ) The Chief Inspector may arrange for an inspection conducted by a registered inspector under this section to be monitored by another registered inspector.")
  119 Page 41, line 3, at end insert—
  ("( ) The period mentioned in subsection (1) may, if the Chief Inspector considers it necessary, be extended by up to three months.")
  120 Page 41, line 5, leave out from ("he") to ("send") in line 8 and insert—
  ( ) may send a copy of it to the Secretary of State, and shall do so without delay if the Secretary of State requests a copy;
  ( ) shall")
  121 Page 41, line 11, leave out from ("and") to end of line 13 and insert—
  ("( ) may arrange for the report (or parts of it) to be further published in any manner he considers appropriate.")
  122 Page 41, line 22, at end insert (", or intend to do so")
  123 Page 41, line 22, at end insert—
  ("( ) In relation to child minding and day care provided in Wales, the Assembly shall have any additional function specified
  972
  in regulations made by the Assembly; but the regulations may only specify a function corresponding to a function which, by virtue of section 79N(5), is exercisable by the Chief Inspector in relation to child minding and day care provided in England.")
  124 Page 41, line 23, at beginning insert—
  ("( ) The Assembly may at any time require any registered person to provide it with any information connected with the person's activities as a child minder or provision of day care which the Assembly considers it necessary to have for the purposes of its functions under this Part.")
  125 Page 41, line 35, leave out ("the Chief Inspector of Schools") and insert ("Her Majesty's Chief Inspector of Education and Training")
  126 Page 41, line 43, leave out ("A registered") and insert ("An authorised")
  127 Page 41, line 44, after ("England") insert ("or Wales")
  128 Page 42, line 1, leave out ("a registered") and insert ("an authorised")
  129 Page 42, line 12, at end insert—
  ("( ) seize and remove any document or other material or thing found there which he has reasonable grounds to believe may be evidence of a failure to comply with any condition or requirement imposed by or under this Part;
  ( ) require any person to afford him such facilities and assistance with respect to matters within the person's control as are necessary to enable him to exercise his powers under this section;
  ( ) take measurements and photographs or make recordings;")
  130 Page 42, line 13, at end insert ("and the arrangements made for their welfare")
  131 Page 42, line 17, after ("living") insert ("or working")
  132 Page 42, line 23, leave out ("Chief Inspector") and insert ("registration authority")
  133 Page 42, line 24, leave out ("him") and insert ("the authority")
  134 Page 42, line 24, leave out ("a registered") and insert ("an authorised")
  135 Page 42, line 35, after ("section") insert—
  (""authorised inspector" means a registered inspector or a person authorised by the Assembly or by any person with whom the Assembly has made arrangements under section 79T(2);")
  136 Page 43, line 36, at end insert—

  COMMONS AMENDMENTS

    Time limit for proceedings.
    79UA. Proceedings for an offence under this Part or regulations made under it may be brought within a period of six months from the date on which evidence sufficient in the opinion of the prosecutor to warrant the proceedings came to his knowledge; but no such proceedings shall be brought by virtue of this section more than three years after the commission of the offence.").
    137 Page 43, line 46, leave out ("the Chief Inspector of Schools") and insert ("Her Majesty's Chief Inspector of Education and Training")
    Lord Bach: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 96 to 137.
    Moved, That the House do agree with the Commons in their Amendments Nos. 96 to 137.—(Lord Bach.)
    On Question, Motion agreed to.

  COMMONS AMENDMENT
  138 Clause 69, page 44, line 16, after ("clinic") insert (", an independent medical agency")
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 138. My noble friend Lord Bach has pointed us in the direction of brevity at this late hour, but we do come to a very important issue which deals with a large group of amendments concerning the protection of vulnerable adults list, and, indeed, the protection of children list.
  The noble Lord, Lord Phillips, brought to our attention a concern that workers who had been made redundant would evade referral to the appropriate list. Amendments Nos. 147 to 150, 201, 267, 271 and 273 plug this gap in both the POVA and POCA schemes. I pay tribute to the noble Lord for the intense interest he took in, and the help that he gave to the House in relation to, these particular clauses.
  We also discussed in the House the need for employers who have committed misconduct to be referred to the appropriate list. Amendments Nos. 152 and 162 provide new clauses relating to the POVA and POCA schemes respectively, which enable the registration authority to make referrals to the lists.
  There was also some debate about the need for the POCA scheme in particular to be extended to other services, with particular reference to day centres. Amendments Nos. 142, 144 and 161 introduce a new clause which makes comprehensive provision for the extension of the POVA scheme. Essentially, this scheme can be extended to a full range of services corresponding to those which may or must be provided by local authorities in the exercise of their social services functions and to help services that correspond to those provided by the NHS.
  The Bill already requires employers not to take on a worker who is found to be on the POVA list. Amendment No. 155 places a further duty on employers requiring them to stop employing a worker in a care position should it come to light that that person is on the list.
  Amendment No. 269 makes parallel provision for the POCA list, and Amendment No. 268 is a related technical amendment.
  Amendment No. 156 provides for a criminal offence if a person applies for, offers to do, accepts or does any work in a care position, if they know they are on the POVA list.
  There are two further areas where provision is being made for access to the POCA list once the Criminal Records Bureau comes into operation. Amendment No. 173 enables adoption agencies to screen prospective adoptive parents against the POCA list. I would argue that that is very important. In addition, this amendment also makes express provision for the registration authorities in Part II and Part V, and the councils, to screen applicants against the appropriate lists.It had always been intended that persons seeking provision under Part II of the Bill, for example, care home providers, or under Part V of the Bill, for example, day care providers, should be subject to such checks. Similarly, persons seeking to be admitted to
  974
  the registers held by councils under Part IV may also be checked. Amendment No. 173 makes explicit provision for those checks.
  Amendment No. 170 is a new clause which provides that a parent in receipt of a direct payment can require his local authority to undertake a check against the POCA list in respect of the carer he wishes to employ. If a parent reports, for example, that the carer has harmed his child or has placed him at risk of harm, the local authority can refer the carer for inclusion on the POCA list. But such a referral—and I stress this—can take place only after the local authority has conducted an inquiry under Section 47 of the Children Act.
  Three new clauses—Amendments Nos. 153, 163 and 171—have come about principally as a result of the Waterhouse inquiry. After that inquiry, we decided that it would be prudent to enable a person to be referred to the POCA or POVA list as a result of an appropriate inquiry report. We are all sadly aware that sometimes it is only as a result of an inquiry some years after the original events occurred that the abuse is discovered and the perpetrators are identified. Amendment No. 153 enables referrals to be made in those circumstances. Amendment No. 163 enables equivalent provision for POCA.
  A small group of people was referred to the consultancy index in that way as a result of the Waterhouse report. However, for technical reasons, we need to make special provision to ensure that those workers can be transferred to the new protection of children list. Amendment No. 171 has been tabled expressly for that purpose.
  The final batch of amendments within this large group simply tidies up the provisions and makes consequential amendments as a result of the new provisions that I have just described.
  Moved, That the House do agree with the Commons in their Amendment No. 138.—(Lord Hunt of Kings Heath.)
  Lord Clement-Jones: My Lords, I start by welcoming Amendments Nos. 147 to 150 put down by the Government in response to the amendments of my noble friend Lord Phillips in Committee. They certainly fulfil the role which he intended his amendments to fulfil. However, on these Benches—and it is worth stating it in this instance—we regret that the Government did not listen to all of his amendments in Committee, particularly those relating to natural justice aspects which he raised so eloquently. That is especially since the Bill will now cover a wider range of people—those put onto the list as a result of an inquiry.
  On these Benches, we continue to believe that some aspects of the POVA list provisions will act as a deterrent to the recruitment of care workers, but time will tell.
  Lord Hunt of Kings Heath: My Lords, we listened in particular to the comments of the noble Lord, Lord Phillips. There are different views. We have always felt that we have struck the right balance between the

  975
  necessary protection of young people and vulnerable adults and the ability of people so affected to have their case considered very carefully. We have provided rights of appeal. I suspect that we must agree to differ in that regard.
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  139 Clause 69, page 44, line 39, after ("clinic") insert (", independent medical agency")
  140 Page 44, line 42, leave out from ("agency") to end of line 43
  141 Page 45, line 1, leave out ("or an independent clinic") and insert ("an independent clinic or an independent medical agency")
  142 Page 45, line 4, after ("78") insert ("or (Power to extend Part VI)")
  143 Page 45, line 4, after ("78") insert ("or (Temporary provision for access to lists)")
  144 Page 45, line 6, after ("section") insert ("or section (Power to extend Part VI)")
  145 Page 45, line 6, after ("section") insert ("or section (Temporary provision for access to lists)")
  146 Clause 70, page 45, line 9. leave out from ("list") to end of line 12 and insert ("except in accordance with this Part")
  147 Clause 71, page 45, line 24, leave out ("or retired") and insert (", retired or been made redundant")
  148 Page 45, line 26, leave out ("or retired") and insert (", retired or been made redundant")
  149 Page 46, line 31, leave out ("or retiring") and insert (", retiring or being made redundant")
  150 Page 46, line 33, leave out ("or retired") and insert (", retired or been made redundant")
  151 Page 46, line 36, at end insert—
  ("( ) This section does not apply where—

  (a) the provider carries on a domiciliary care agency, or an independent medical agency, which is or includes an employment agency or an employment business; and

  (b) the worker in question is a supply worker in relation to him.")

  152 After Clause 72, insert the following new clause—

  POWER OF REGISTRATION AUTHORITY TO REFER
  (" .— (1) The registration authority may refer a care worker to the Secretary of State if—

  (a) on the basis of evidence obtained by it in the exercise of its functions under Part II of this Act, the authority considers that the worker has been guilty of misconduct (whether or not in the course of his employment) which harmed or placed at risk of harm a vulnerable adult; and

  (b) the worker has not been referred to the Secretary of State under section 71 or 72 in respect of the misconduct.

  (2) Section 71(4) to (7) shall apply in relation to a reference made by the registration authority under subsection (1) as it applies in relation to a reference made by a person under section 71(1).
  (3) The reference in subsection (1) to misconduct is to misconduct which occurred after the commencement of this section.")
  153 After Clause 72, insert the following new clause—

  INDIVIDUALS NAMED IN THE FINDINGS OF CERTAIN INQUIRIES
  (" .—(1) Subsection (2) applies where—

  (a) a relevant inquiry has been held;

  (b) the report of the person who held the inquiry names an individual who is or has been employed in a care position; and

  976

  (c) it appears to the Secretary of State from the report—

  (i) that the person who held the inquiry found that the individual was guilty of relevant misconduct; and

  (ii) that the individual is unsuitable to work with vulnerable adults.

  (2) The Secretary of State—

  (a) may provisionally include the individual in the list kept under section 70; and

  (b) if he does so, shall determine in accordance with subsections (3) to (5) whether the individual's inclusion in the list should be confirmed.

  (3) The Secretary of State shall—

  (a) invite observations from the individual on the report, so far as relating to him, and, if the Secretary of State thinks fit, on any observations submitted under paragraph (b); and

  (b) invite observations from the relevant employer on any observations on the report and, if the Secretary of State thinks fit, on any other observations under paragraph (a).

  (4) Where the Secretary of State has considered the report, any observations submitted to him and any other information which he considers relevant, he shall confirm that individual's inclusion in the list if subsection (5) applies; otherwise he shall remove him from the list.
  (5) This subsection applies if the Secretary of State is of the opinion—

  (a) that the person who held the inquiry reasonably considered the individual to be guilty of relevant misconduct; and

  (b) that the individual is unsuitable to work with vulnerable adults.

  (6) In this section—
  "relevant employer" means the person who, at the time mentioned in the definition of "relevant misconduct" below, employed the individual in a care position;
  "relevant misconduct" means misconduct which harmed or placed at risk of harm a vulnerable adult and was committed (whether or not in the course of his employment) at a time when the individual was employed in a care position.
  (7) In this section "relevant inquiry" means any of the following—

  (a) an inquiry held under—

  (i) section 9;

  (ii) section 35 of the Government of Wales Act 1998;

  (iii) section 81 of the Children Act 1989;

  (iv) section 84 of the National Health Service Act 1977;

  (v) section 7C of the Local Authority Social Services Act 1970;

  (b) an inquiry to which the Tribunals of Inquiry (Evidence) Act 1921 applies;

  (c) any other inquiry or hearing designated for the purposes of this section by an order made by the Secretary of State.

  (8) Before making an order under subsection (7) the Secretary of State shall consult the Assembly.")
  154 Clause 74, page 48, line 40, leave out first ("section")
  155 Clause 76, page 49, line 31, at end insert—
  ("( ) Where a person who provides care to vulnerable adults discovers that an individual employed by him in a care position is included in that list, he shall cease to employ him in a care position.

  977
  For the purposes of this subsection an individual is not employed in a care position if he has been suspended or provisionally transferred to a position which is not a care position.")
  156 Page 49, line 45, at end inser—
  ("(4) An individual who is included (otherwise than provisionally) in the list kept by the Secretary of State under section 70 shall be guilty of an offence if he knowingly applies for, offers to do, accepts or does any work in a care position.
  (5) It shall be a defence for an individual charged with an offence under subsection (4) to prove that he did not know, and could not reasonably be expected to know, that he was so included in that list.
  (6) An individual who is guilty of an offence under this section shall be liable—

  (a) on summary conviction, to imprisonment for a term not exceeding six months, or to a fine not exceeding the statutory maximum, or to both;

  (b) on conviction on indictment, to imprisonment for a term not exceeding five years, or to a fine, or to both.")

  157 Page 50, line 40, leave out from beginning to ("apply") in line 43 and insert ("Section 2(4) to (7) of the 1999 Act (referrals for inclusion in list of individuals who are considered unsuitable to work with children) shall, in the case of any reference under section 2, 2A or 2D of that Act,")
  158 Page 50, line 46, at end insert—
  ("(2A) Section 2B of the 1999 Act shall apply in relation to the list kept under section 70 as it applies in relation to the list kept under section 1 of that Act, but as if the references in subsections (1)(c)(ii) and (5)(b) to children were references to vulnerable adults.")
  159 Page 51, line 1, leave out from ("(2)") to end of line 4 and insert ("or (2A) provisionally include an individual in the list kept under section 70, or confirm his inclusion in the that list, unless he provisionally includes him in the list kept under section 1 of the 1999 Act or, as the case requires, confirms his inclusion in that list.")
  160 Page 51, line 5, after ("(2)") insert ("or (2A)")
  161 After Clause 79, insert the following new clause—

  POWER TO EXTEND PART VI
  (" .—(1) The Secretary of State may by regulations—

  (a) add to the list in section 69(7) any prescribed persons to whom subsection (2) applies;

  (b) amend the definitions of "care worker", "care position" and "vulnerable adult" accordingly.

  (2) This subsection applies to—

  (a) local authorities providing services to adults in the exercise of their social services functions;

  (b) persons who provide to adults services which are similar to services which—

  (i) may or must be so provided by local authorities; or

  (ii) may or must be provided by National Health Service bodies.

  (3) In its application by virtue of subsection (1), this Part shall have effect—

  (a) if the regulations so provide, as if "may" were substituted for "shall" in sections 71(1) and 72(1), and section 76 were omitted;

  (b) with such other modifications as may be specified in the regulations.")

  162 After Clause 80, insert the following new clause—

  INCLUSION IN 1999 ACT LIST ON REFERENCE BY CERTAIN AUTHORITIES
  (" .—(1) After section 2 of the 1999 Act there is inserted—
  INCLUSION IN 1999 ACT LIST ON REFERENCE BY CERTAIN AUTHORITIES

    Power of certain authorities to refer individuals for inclusion in list.
    2A.—(1) A person to whom this section applies may refer to the Secretary of State an individual who is or has been employed in a child care position if—

    (a) on the basis of evidence obtained by him in the exercise of his functions under Part II of the Care Standards Act 2000 or Part XA of the Children Act 1989, the person considers that the individual has been guilty of misconduct (whether or not in the course of his employment) which harmed a child or placed a child at risk of harm; and

    (b) the individual has not been referred to the Secretary of State under section I above in respect of the misconduct.

    (2) The persons to whom this section applies are—

    (a) the National Care Standards Commission;

    (b) the National Assembly for Wales; and

    (c) Her Majesty's Chief Inspector of Schools in England.

    (3) Section 2(4) to (7) above shall apply in relation to a reference made by a person under subsection (1) above as it applies in relation to a reference made by an organisation under section 2(1) above.
    (4) The reference in subsection (1) above to misconduct is to misconduct which occurred after the commencement of this section."
    (2) In section 1(2)(a) of that Act (duty of Secretary of State to keep list), after "2" there is inserted "or 2A".
    (3) For the sidenote to section 2 of that Act there is substituted "Inclusion in list on reference following disciplinary action etc.".")
    163 After Clause 80, insert the following new clause—

  INCLUSION IN 1999 ACT LIST OF INDIVIDUALS NAMED IN FINDINGS OF CERTAIN INQUIRIES
  (" .—(1) After section 2A of the 1999 Act (inserted by section (Inclusion in 1999 Act list on reference by certain authorities) there is inserted—
  INCLUSION IN 1999 ACT LIST OF INDIVIDUALS NAMED IN FINDINGS OF CERTAIN INQUIRIES

    Individuals named in the findings of certain inquiries.
    2B.—(1) Subsection (2) applies where—

    (a) a relevant inquiry has been held;

    (b) the report of the person who held the inquiry names an individual who is or has been employed in a child care position; and

    (c) it appears to the Secretary of State from the report—

    (i) that the person who held the inquiry found that the individual was guilty of relevant misconduct; and

    (ii) that the individual is unsuitable to work with children.

    (2) The Secretary of State—

    (a) may provisionally include the individual in the list kept under section 1 above; and

    (b) if he does so, shall determine in accordance with subsections (3) to (5) below whether the individual's inclusion in the list should be confirmed.

    (3) The Secretary of State shall—

    (a) invite observations from the individual on the report, so far as relating to him, and, if the Secretary of State thinks fit, on any observations submitted under paragraph (b) below; and

    (b) invite observations from the relevant employer on any observations on the report and, if the Secretary of State thinks fit, on any other observations under paragraph (a) above.

    (4) Where the Secretary of State has considered the report, any observations submitted to him and any other information which he considers relevant, he shall confirm that individual's inclusion in the list if subsection (5) applies; otherwise he shall remove him from the list.
    (5) This subsection applies if the Secretary of State is of the opinion—

    (a) that the person who held the inquiry reasonably considered the individual to be guilty of relevant misconduct; and

    (b) that the individual is unsuitable to work with children.

    (6) In this section—
    "relevant employer" means the person who, at the time referred to in the definition of "relevant misconduct" below, employed the individual in a care position;
    "relevant misconduct" means misconduct which harmed a child or placed at risk of harm a and was committed (whether or not in the course of his employment) at a time when the individual was employed in a care position.
    (7) In this section "relevant inquiry" means any of the following—

    (a) an inquiry held under—

    (i) section 9 of the Care standards Act 2000;

    (ii) section 35 of the Government of Wales Act 1998;

    (iii) section 81 of the Children Act 1989;

    (iv) section 84 of the National Health Service Act 1977;

    (v) section 7C of the Local Authority Social Services Act 1970;

    (b) an inquiry to which the Tribunals of Inquiry (Evidence) Act 1921 applies;

    (c) any other inquiry or hearing designated for the purposes of this section by an order made by the Secretary of State.

    (8) An order under subsection (7) above shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.
    (9) Before making an order under subsection (7) above the Secretary of State shall consult the National Assembly for Wales."
    (2) In section 1(2) of that Act (duty of Secretary of State to keep list), before the "or" preceding paragraph (b) there shall be inserted—
    "(aa) he has been included in the list under section 2B below;".").
    164 Clause 81, page 52, line 1, leave out ("3") and insert ("2B")
    165 Page 52, line 1, after ("Act") insert ("(inserted by section
    980
    (Inclusion in 1999 Act list on reference by certain authorities))")
    166 Page 52, leave out lines 2 to 12 and insert—
    ("2C.—(1) Section 71(4) to (7) of the Care Standards Act 2000 (persons who provide care for vulnerable adults: duty to refer) shall, in the case of any reference under subsection (1) of that section or section (Power of registration authority to refer) of that Act, apply in relation to the list kept under section 1 above as it applies in relation to the list kept under section 70 of that Act, but as if the reference in subsection (7)(b) to vulnerable adults were a reference to children.
    (2) Section 72(4)10 (7) of that Act (employment agencies and businesses: duty to refer) shall, in the case of any reference under subsection (1) of that section, apply in relation to the list kept under section 1 above as it applies in relation to the list kept under section 70 of that Act, but as if the reference in subsection (7)(b) to vulnerable adults were references to children.
    (2A) Section (Individuals named in the findings of certain inquiries) of the Care Standards Act 2000 shall apply in relation to the list kept under section 1 above as it applies in relation to the list kept under section 70 of that Act, but as if the references in subsections (1)(c)(ii) and (5)(b) to vulnerable adults were references to children.")
    167 Page 52, leave out lines 14 to 17 and insert ("this section provisionally include an individual in the list kept under section 1 above, or confirm his inclusion in the that list, unless he provisionally includes him in the list kept under section 70 of the Care Standards Act 2000 or, as the case requires, confirms his inclusion in that list.")
    168 Page 52, line 18, leave out ("subsection (2) above") and insert ("this section")
    169 Page 52, line 24, leave out ("section 71 or 72") and insert ("Part VI")
    170 After Clause 81, insert the following new clause—

  INDIVIDUALS PROVIDING CARE FUNDED BY DIRECT PAYMENTS
  (" .—(1) After section 2C of the 1999 Act (inserted by section 81) there is inserted—
  INDIVIDUALS PROVIDING CARE FUNDED BY DIRECT PAYMENTS

    Local authorities proposing to make direct payments in respect of services.
    2D.—(1) A local authority may refer a relevant individual to the Secretary of State where, as a result of enquiries made, or caused to be made, by it under section 47 of the Children Act 1989, the authority considers that the individual has been guilty of misconduct (whether or not in the course of his employment) which harmed a child or placed a child at risk of harm.
    (2) Section 2(4) to (7) above shall apply in relation to a reference made by a local authority under subsection (1) above as it applies in relation to a reference made by an organisation under section 2(1) above.
    (3) In this section—
    "funded care" means care in respect of a person's securing the provision of which the authority has made a payment under section 17A of the Children Act 1989 (direct payments);
    "relevant individual" means an individual who is or has been employed to provide funded care to a child.
    (4) The reference in subsection (1) above to misconduct is to misconduct which occurred after the commencement of this section."
    (2) In section 7 of that Act (effect of inclusion in certain statutory lists), after subsection (1) there shall be inserted—

    981
    "(1A) Where—

    (a) a person ("the recipient") employs, or proposes to employ, an individual to provide care for a child; and

    (b) a local authority proposes to make a payment to the recipient under section 17A of the Children Act 1989 (direct payments) in respect of his securing the provision of the care,

    the authority shall, if the recipient asks it to do so, ascertain whether the individual is included in any of the lists mentioned in subsection (1) above."
    (3) After subsection (2) of that section there shall be inserted—
    "(2A) Where a local authority is required under subsection (1A) above to ascertain whether an individual who has been supplied as mentioned in subsection (2) above is included in any of the lists there mentioned, there is sufficient compliance with subsection (1A) above if the authority—

    (a) satisfies itself that, on a date within the last 12 months, the organisation which supplied the individual ascertained whether he was included in any of those lists; and

    (b) obtains written confirmation of the facts as ascertained by the organisation."

    (4) In section 1(2)(a) of that Act (duty of Secretary of State to keep list), after "or 2A" there is inserted "or 2D".")
    171 After Clause 81, insert the following new clause—

  TRANSFER FROM CONSULTANCY SERVICE INDEX OF INDIVIDUALS NAMED IN PAST INQUIRIES
  (" .—(1) Section 3 of the 1999 Act (inclusion in list on transfer from Consultancy Service Index) shall be amended as follows.
  (2) In subsection (1), for "This section" there shall be substituted "Subsections (2) and (3) below" and in paragraph (a), for "this section" there shall be substituted "section 1 above".
  (3) After subsection (3) there shall be inserted—
  "(4) Subsections (5) and (6) below apply where—

  (a) a relevant inquiry has been held;

  (b) the report of the person who held the inquiry names an individual who is or has been employed in a child care position;

  (c) it appears to the Secretary of State from the report—

  (i) that the person who held the inquiry found that the individual was guilty of relevant misconduct; and

  (ii) that the individual is unsuitable to work with children; and

  (d) the individual is included in the Consultancy Service Index (otherwise than provisionally) immediately before the commencement of section 1 above.

  (5) The Secretary of State shall—

  (a) invite observations from the individual on the report, so far as relating to him, and, if the Secretary of State thinks fit, on any observations submitted under paragraph (b) below; and

  (b) invite observations from the relevant employer on any observations on the report and, if the Secretary of State thinks fit, on any other observations under paragraph (a) above.

  (6) The Secretary of State shall include the individual in the list kept by him under section 1 above if, after he has considered the report, any observations submitted to him and any other information which he considers relevant, he is of the opinion—

  (a) that the person who held the inquiry reasonably considered the individual to be guilty of relevant misconduct; and

  (b) that the individual is unsuitable to work with children.

  (7) In this section—
  "relevant employer", in relation to an individual named in the report of a relevant inquiry, means the person who, at the time referred to in the definition of "relevant misconduct" below, employed the individual in a child care position;
  "relevant inquiry" has the same meaning as in section 2B above"
  "relevant misconduct" means misconduct which harmed a child or placed a child at risk of harm and was committed (whether or not in the course of his employment) at a time when the individual was employed in a child care position."").
  172 After Clause 84, insert the following new clause—

  TEMPORARY PROVISION FOR ACCESS TO LISTS
  (" .—(1) Any person seeking to ascertain whether a relevant individual is included in—

  (a) the list kept under section 1 of the 1999 Act;

  (b) the list kept for the purposes of regulations made under section 218(6) of the Education Reform Act 1988; or

  (c) any list kept by the Secretary of State or the Assembly of persons disqualified under section 470 or 471 of the Education Act 1996,

  shall be entitled to that information on making, before the relevant commencement, an application for the purpose to the Secretary of State.
  (2) In this section "relevant individual" means—

  (a) in relation to a person who carries on an employment agency, an individual with whom he proposes to do business or an individual of any other prescribed description;

  (b) in relation to any other person, an individual to whom he proposes to offer, or whom he proposes to supply for employment in, a child care position or an individual of any other prescribed description.

  (3) The relevant commencement is—

  (a) for applications relating to the list mentioned in subsection (1)(a) or (b), the commencement of section 8 of the 1999 Act; and

  (b) for applications relating to the list mentioned in subsection (1)(c), the commencement of section 84.

  (4) Paragraphs (b) and (c) of subsection (1) are without prejudice to any right conferred otherwise than by virtue of those provisions.")
  173 After Clause 84, insert the following new clause—

  PART V OF THE POLICE ACT 1997: FURTHER PROVISION
  (" .—(1) The Police Act 1997 shall be amended as follows.
  (2) In section 113 (criminal record certificates)—

  (a) in subsection (3A), after "(3B)," there shall be inserted "or his suitability to adopt a child."; and

  (b) after subsection (3D) (inserted by section 77) there shall be inserted—

  "(3E) The references in subsections (3A) and (3C) to suitability to be employed, supplied to work, found work or given work in a position falling within subsection (3B) or (3D) include references to suitability to be registered—

  (a) under Part II of the Care Standards Act 2000 (establishments and agencies);

  (b) under Part IV of that Act (social care workers); or

  (c) for child minding or providing day care under Part XA of the Children Act 1989, or under section 71 of that Act or Article 118 of the Children (Northern Ireland) Order 1995 (child minding and day care)."

  (3) In section 115 (enhanced criminal record certificates)—
  (a) in subsection (5)—
  (i) after paragraph (e) there shall be inserted—
  "(ea) registration under Part II of the Care Standards Act 2000 (establishments and agencies);
  (eb) registration under Part IV of that Act (social care workers);" and
  (ii) after paragraph (g) there shall be inserted—
  "(h) a decision made by an adoption agency within the meaning of section 11 of the Adoption Act 1976 as to a person's suitability to adopt a child." and
  (b) in subsection (6A), after "113," there shall be inserted "or his suitability to adopt a child,".")
  174 Clause 85, page 54, line 30, after ("school") insert ("or college")
  175 Page 55, line 20, at end insert—
  (""appropriate authority" means—

  (a) in relation to England, the National Care Standards Commission;

  (b) in relation to Wales, the National Assembly for Wales;")

  176 Page 55, line 21, leave out from ("means") to ("of") in line 22 and insert ("an institution within the further education sector as defined in section 91")
  177 Page 55, line 36, after ("to") insert ("an institution conducted by")
  178 Page 55, line 45, after ("is") insert ("an institution within the further education sector, as defined in section 91 of the Further and Higher Education Act 1992, or")
  179 Clause 87, page 57, line 31, at end insert—
  ("( ) Before issuing a statement, or an amended statement which in the opinion of the Secretary of State effects a substantial change in the standards, the Secretary of State shall consult any persons he considers appropriate.").
  180 Clause 89, page 58, line 24, leave out from ("means") to ("of") in line 25 and insert ("an institution within the further education sector as defined in section 91")
  181 Page 58, line 28, at end insert—
  (""further education corporation" has the same meaning as in the Further and Higher Education Act 1992."")
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 139 to 181.
  984
  Moved, That the House do agree with the Commons in their Amendments Nos. 139 to 181.—(Lord Hunt of Kings Heath.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  182 After Clause 91, insert the following new clause—

  CHARGES FOR LOCAL AUTHORITY WELFARE SERVICES
  (". In Schedule 1 to the Local Authority Social Services Act 1970 (enactments conferring functions assigned to social services committee), there shall be inserted at the appropriate place—

  "Health and Social Services and Social Security Adjudications Act 1983 (c. 41)

  Section 17, so far as relating to services provided under the enactments mentioned in subsection (2)(a) to (c)

  Charges for local authority welfare services".")

  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 182.I shall speak also to Amendment No. 289.
  These amendments concern statutory guidance on charges for home care. We have debated these matters on a number of occasions, particularly in relation to the various reports. I refer in particular to the Audit Commission reports concerning the variation in charges by local authorities.
  It is clear that people in similar circumstances in different parts of the country can find that they are paying nothing or over £100 per week for the same level of services. The Audit Commission report, published in May, highlighted the full extent of variations. While there are arguments for local discretion to local councils to take account of local circumstances, real problems come about, as the Audit Commission identified, when charging policies in some councils are not fully thought through and not properly related to the aims of social care in the authority.
  Action has had to be taken to ensure that we consider ways in which we can reduce those variations. That is why we propose the new clause in Amendment No. 182 to allow statutory guidance to be issued under Section 7 of the Local Authority Social Services Act 1970 on home care charges. Amendment No. 289 amends the long title of the Bill accordingly.
  It might be helpful if I inform the House that we hope to consult on draft guidance to be issued in the autumn, with final guidance to be issued by April 2001.
  Moved, That the House do agree with the Commons in their Amendment No. 182.—(Lord Hunt of Kings Heath.)
  Midnight
  Baroness Barker: My Lords, I rise briefly to speak on this matter. This is perhaps one of the most important underpinning elements of the Bill. Unfortunately, now is not the time to discuss it in any great length. That is not because it is about to chime midnight and some of us might turn into pumpkins,

  985
  but because of the statements made earlier this afternoon about the Comprehensive Spending Review and, more importantly, the statement which will be made in a few days time concerning the Government's response to the Royal Commission on the future of long-term care, which will have a fundamental impact on the whole of the care economy. To discuss this matter at any length tonight would therefore be premature and foolish.
  However, before I sit down I should like to say to the Minister that we welcome the fact that the guidance will be statutory. Perhaps I may return to a concern I raised at the beginning of the debate on the Bill on one of the most crucial factors; that is, resources. It is perhaps timely that as we come to the end of this long debate we return to focus on resources. No matter what duties are placed on local authorities by the Government—there are many; they emanate increasingly from the Minister's department—the capacity of local authorities to make a real difference to older and disabled people in terms of practical help is ultimately a matter of resources. It is good to focus our attention on that. It would not be right to say any more now. However, with those few brief words I hope I have conveyed the spirit of the way in which we welcome the new amendment to the Bill.
  Lord Hunt of Kings Heath: My Lords, I fully accept the construction placed on this by the noble Baroness. This can have an impact on overall local authority finances. I shall not go down the route of describing the Government's generous allocation to local authorities. I agree that we need to await further announcements. Perhaps I may also say that, although finance is a consideration, there are other factors which suggest that some local authorities have not done the job properly. There are issues concerning transparency and how charging relates to overall policy. I believe that statutory guidance here is warmly welcomed and will lead to vast improvements to many people.
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  183 Clause 97, page 61, line 14, at end insert—
  ("In subsection (2) and this subsection, references to the Secretary of State include the Secretary of State and the Assembly acting jointly")
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 183.
  I am sure noble Lords will be aware that this large group of amendments, which I shall speak to, concerns various technical matters which are minor and consequential. I seek the guidance of the House as to whether noble Lords would like me to go into those in more detail—
  Noble Lords: No.
  Lord Hunt of Kings Heath:—or whether they would prefer me to move them formally. Perhaps I may move them formally.
  986
  Moved, That the House do agree with the Commons in their Amendment No. 183.—(Lord Hunt of Kings Heath.)
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  184 Clause 97, page 61, line 15, leave out ("The following subsections") and insert ("Subsections (5) to (7)")
  185 Page 61, line 16, leave out ("or the Assembly") and insert (", the Assembly or the appropriate Minister")
  186 Page 61, line 33, at end insert—
  ("( ) The provision which, by virtue of subsection (7), may be made by regulations under the Part of this Act which relates to the Children's Commissioner for Wales includes provision amending or repealing any enactment or instrument.")
  187 Clause 98, page 61, line 39, leave out ("or instrument")
  188 Clause 100, page 62, line 9, after ("England,") insert ("Scotland or Northern Ireland.")
  189 Page 62, line 10, at end insert—
  ("and in relation to England and Wales means the Secretary of State and the Assembly acting jointly")
  190 Page 62, line 11, at end insert—
  (""community home" has the same meaning as in the 1989 Act;")
  191 Page 62, line 15, at end insert—
  (""enactment" includes an enactment comprised in subordinate legislation (within the meaning of the Interpretation Act 1978);")
  192 Page 62, line 15, at end insert—
  (""to foster a child privately" has the same meaning as in the 1989 Act;")
  193 Page 62, line 24, leave out ("mental disorder and")
  194 Page 62, line 27, at end insert—
  (""local authority foster parent" has the same meaning as in the 1989 Act;")
  195 Page 62, line 41, leave out ("only")
  196 Page 62, line 42, after ("State") insert ("or the Assembly)")
  197 Page 63, line 16, leave out from ("if") to end of line 18 and insert—
  ("( ) his sight, hearing or speech is substantially impaired;
  ( ) he has a mental disorder; or
  ( ) he is physically substantially disabled by any illness, any impairment present since birth, or otherwise;")
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 184 to 197.
  Moved, That the House do agree with the Commons in their Amendments Nos. 184 to 197.—(Lord Hunt of Kings Heath.)
  On Question, Motion agreed to.

  COMMONS AMENDMENT
  198 Clause 100, page 63, line 22, leave out from ("care"") to ("does") in line 23
  Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 198. In speaking to this amendment I shall speak also to Amendment No. 200.

  987
  These are technical changes to the definitions at the end of the Bill but are extremely important to the workings of the legislation. The amendments deal with the definition of personal care used in the Bill.
  The definition of personal care is important to the effect of the requirement for certain establishments and agencies to register with the national care standards commission. Personal care is defined in the Registered Homes Act 1984 as,
  "care which includes assistance with bodily functions where such assistance is required".
  That definition has been interpreted, following a High Court judgment—Harrison v. Cornwall—as meaning that personal care could include emotional or psychiatric care as well as physical care.
  The intention of the original definition in the Bill was to reflect that interpretation and not to end up with either a wider or narrower definition than the one that applies now. However, as your Lordships may be aware, there has been a great deal of concern as to whether the definition in Clause 100 would extend the definition more widely than currently applies. The fear has come in the main from those who provide sheltered housing schemes and similar arrangements. Their concern is that they would find themselves required to register as care homes. A similar point was raised about this definition by the noble Lord, Lord Phillips of Sudbury.
  In our discussions it has never been our intention to extend the definition, nor to require organisations such as sheltered housing schemes to register as care homes. We endeavoured to reassure people about this. But one has to record that there has been considerable worry and it has particularly focused on possible loss of DSS benefits. It has become clear that an amendment to the Bill would be necessary to provide the necessary reassurance.
  The reference to "advice and encouragement" has therefore been removed from the definition through Amendment No. 198 and a further amendment, Amendment No. 200, has been made to replicate the provisions of the Registered Homes Act 1984. My honourable friend Mr John Hutton explained fully the intention behind these amendments in Commons Committee, and in particular made clear that the interpretation set out in the Harrison v. Cornwall judgment was intended to apply. We believe that this has now settled the concerns on this issue and I hope that noble Lords will be willing to accept the amendments.
  Moved, That the House do agree with the Commons in their Amendment No. 198.—(Lord Hunt of Kings Heath.)
  Lord Clement-Jones: My Lords, without penetrating too deeply into the legal thickets of this amendment, we will take the Minister's word that taking out "advice and encouragement" from the statute but essentially having it implied by a case is a
  988
  more satisfactory solution. I confess that, even though I am a lawyer, I am not half-way to understanding why that should be so.
  Lord Hunt of Kings Heath: My Lords, I have extensive notes which I desisted from repeating. Perhaps it would be helpful for me to write to the noble Lord, Lord Clement-Jones, with that information. It may make it a little clearer.
  Lord Clement-Jones: My Lords, that would be helpful. The Minister is threatening me with a long speech which, without being discourteous, I am sure none of us wishes to hear. But in the context of discussions on personal and nursing care, which I am sure we will all have as a result of hearing the Government's response to the Royal Commission, that would help us to clarify the situation.
  In closing on this amendment, and since there is no further opportunity, I thank the Minister on behalf of myself and my noble friend Lady Barker for his conduct on this Bill. We have had our disagreements. We had a few votes on the Bill, though not many. In the main we have been united in wanting to see this Bill through and its purposes, which are extremely important, fulfilled. I thank the Minister and his ministerial colleagues for their courtesy and great flexibility throughout the passage of the Bill.
  Lord Astor of Hever: My Lords, I should like to associate myself and my noble friend Lord Howe with what the noble Lord, Lord Clement-Jones, has just said.
  Lord Hunt of Kings Heath: My Lords, on behalf of my colleagues and myself, perhaps I may say how much I appreciate those very kind remarks. This Bill is a tremendous Bill, and one that will lead not only to very great improvement both in terms of the standards of care for many people in this country but also—and we should not forget this—in enhancing the status and quality of social workers and other people in social care.
  It has been a delight to take this Bill through your Lordships' House. There has been a great deal of consensus. I am most grateful for all the contributions that have been made. The Bill has, undoubtedly, been enormously improved.
  On Question, Motion agreed to.

  COMMONS AMENDMENTS
  199 Clause 100, page 63, line 24, at end insert—

  ("(3A) For the purposes of this Act, the person who carries on a fostering agency falling within section 4(4)(b), or a voluntary adoption agency, is the voluntary organisation itself.

  (3B) References in this Act to a person who carries on an establishment or agency include references to a person who carries it on otherwise than for profit.

  (3C) For the purposes of this Act, a community home which, is provided by a voluntary organisation shall be taken to be carried on by—

  (a) the person who equips and maintains it; and

  989

  (b) if the appropriate Minister determines that the body of managers for the home, or a specified member of that body, is also to be treated as carrying on the home, that body or member.

  (3D) Where a community home is provided by a voluntary organisation, the appropriate Minister may determine that for the purposes of this Act the home is to be taken to be managed solely by—

  (a) any specified member of the body of managers for the home; or

  (b) any other specified person on whom functions are conferred under the home's instrument of management.

  (3E) A determination under subsection (3C) or (3D) may be made either generally or in relation to a particular home or class of homes.")

  200 Page 63, line 24, at end insert—
  ("( ) An establishment is not a care home for the purposes of this Act unless the care which it provides includes assistance with bodily functions where such assistance is required.")
  201 Page 63, line 26, at end insert—
  ("( ) For the purposes of this Act an individual is made redundant if—

  (a) he is dismissed; and

  (b) for the purposes of the Employment Rights Act 1996 the dismissal is by reason of redundancy.")

  202 Page 63, line 40, at end insert—

  ("Commissioner

  Section (Children's Commissioner for Wales)")

  203 Clause 102, page 64, line 17, leave out subsection (5)
  204 Schedule 1, page 67, line 14, leave out from ("authority") to end of line 15 and insert—
  ("( ) An authority may make arrangements with persons under which they, or members of their staff, may perform functions of members of the staff of the authority")
  205 Page 69, line 21, leave out ("and")
  206 Page 69, line 25, at end insert ("and
  ( ) in paragraph 1 of Schedule 17 (audit of Welsh public bodies), at the end there shall be inserted "(other than the Care Council for Wales)".")
  207 After Schedule 1, insert the following new schedule—

  THE CHILDREN'S COMMISSIONER FOR WALES

    Status
    1.—(1) The Commissioner is to be a corporation sole.
    (2) The Commissioner is not to be regarded as the servant or agent or the Crown or as enjoying any status, immunity or privilege of the Crown; and the Commissioner's property is not to be regarded as property of, or property held on behalf of, the Crown.

    Appointment and tenure of office
    2. Regulations may make provision—

    (a) as to the appointment of the Commissioner (including any conditions to be fulfilled for appointment);

    (b) as to the filling of vacancies in the office of Commissioner;

    (c) as to the tenure of office of the Commissioner (including the circumstances in which he ceases to hold office or may be removed or suspended from office).

    Remuneration
    3. The Assembly shall—

    (a) pay the Commissioner such remuneration and allowances; and

    (b) pay, or make provision for the payment of, such pension or gratuities to or in respect of him,

    as may be provided for under the terms of his appointment.

    Staff
    4.—(1) The Commissioner may appoint any staff he considers necessary for assisting him in the exercise of his functions, one of whom shall be appointed as deputy Commissioner.
    (2) During any vacancy in the office of Commissioner or at any time when the Commissioner is for any reason unable to act, the deputy Commissioner shall exercise his functions (and any property or rights vested in the Commissioner may accordingly be dealt with by the deputy as if vested in him).
    (3) Without prejudice to sub-paragraph (2), any member of the Commissioner's staff may, so far as authorised by him, exercise any of his functions.

    General powers
    5.—(1) Subject to any directions given by the Assembly, the Commissioner may do anything which appears to him to be necessary or expedient for the purpose of, or in connection with, the exercise of his functions.
    (2) That includes, in particular—

    (a) co-operating with other public authorities in the United Kingdom;

    (b) acquiring and disposing of land and other property; and

    (c) entering into contracts.

    Estimates
    6.—(1) For each financial year after the first, the Commissioner shall prepare, and submit to the executive committee, an estimate of his income and expenses.
    (2) Each such estimate shall be submitted to the executive committee at least five months before the beginning of the financial year to which it relates.
    (3) The executive committee shall examine each such estimate submitted to it and, after having done so, shall lay the estimate before the Assembly with any such modifications as the committee thinks fit.
    (4) Regulations shall specify the periods which are to be treated as the first and subsequent financial years of the Commissioner.
    (5) In this paragraph and paragraph 10 "executive committee" has the same meaning as in the Government of Wales Act 1998.

    Accounts
    7.—(1) The Commissioner shall keep proper accounting records.
    (2) The Commissioner shall prepare accounts for each financial year in such form as the Assembly may with the consent of the Treasury determine.

    Reports
    8. Regulations may provide for the Commissioner to make periodic or other reports to the Assembly relating to the exercise of his functions and may require the reports to be published in the manner required by the regulations.

    Audit
    9.—(1) The accounts prepared by the Commissioner for any financial year shall be submitted by him to the Auditor General for Wales not more than five months after the end of that year.
    (2) The Auditor General for Wales shall—

    (a) examine and certify any accounts submitted to him under this paragraph; and

    (b) no later than four months after the accounts are submitted to him, lay before the Assembly a copy of them as certified by him together with his report on them.

    (3) In examining any accounts submitted to him under this paragraph, the Auditor General for Wales shall, in particular, satisfy himself that the expenditure to which the accounts relate has been incurred lawfully and in accordance with the authority which governs it.

    Accounting officer
    10.—(1) The accounting officer for the Commissioner's Office shall be the Commissioner.
    (2) The accounting officer for the Commissioner shall have, in relation to the accounts of the Commissioner and the finances of the Commissioner's Office, the responsibilities which are from time to time specified by the Treasury.
    (3) In this paragraph references to responsibilities include in particular—

    (a) responsibilities in relation to the signing of accounts;

    (b) responsibilities for the propriety and regularity of the finances of the Commissioner's Office; and

    (c) responsibilities for the economy, efficiency and effectiveness with which the resources of the Commissioner's Office are used.

    (4) The responsibilities which may be specified under this paragraph include responsibilities owed to—

    (a) the Assembly, the executive committee or the Audit Committee; or

    (b) the House of Commons or its Committee of Public Accounts.

    (5) If requested to do so by the House of Commons Committee of Public Accounts, the Audit Committee may—

    (a) on behalf of the Committee of Public Accounts take evidence from the accounting officer for the Commissioner's Office; and

    (b) report to the Committee of Public Accounts and transmit to that Committee any evidence so taken.

    (6) In this paragraph and paragraphs 11 and 12 "the Commissioner's Office" means the Commissioner and the members of his staff.

    Examinations into use of resources
    11.—(1) The Auditor General for Wales may carry out examinations into the economy, efficiency and effectiveness with which the Commissioner has used the resources of the Commissioner's Office in discharging his functions.
    (2) Sub-paragraph (1) shall not be construed as entitling the Auditor General for Wales to question the merits of the policy objectives of the Commissioner.
    (3) In determining how to exercise his functions under this paragraph, the Auditor General for Wales shall take into account the views of the Audit Committee as to the examinations which he should carry out under this paragraph.
    (4) The Auditor General for Wales may lay before the Assembly a report of the results of any examination carried out by him under this paragraph.
    (5) The Auditor General for Wales and the Comptroller and Auditor General may co-operate with, and give assistance to, each other in connection with the carrying out of examinations in respect of the Commissioner under this paragraph or section 7 of the National Audit Act 1983 (economy etc. examinations).

    Examinations by the Comptroller and Auditor General
    12.—(1) For the purpose of enabling him to carry out examinations into, and report to Parliament on, the finances of the Commissioner's Office, the Comptroller and Auditor General—

    (a) shall have a right of access at all reasonable times to all such documents in the custody or under the control of the Commissioner, or of the Auditor General for Wales, as he may reasonably require for that purpose; and

    (b) shall be entitled to require from any person holding or accountable for any of those documents any assistance, information or explanation which he reasonably thinks necessary for that purpose.

    (2) The Comptroller and Auditor General shall—

    (a) consult the Auditor General for Wales; and

    (b) take into account any relevant work done or being done by the Auditor General for Wales,

    992
    before he acts in reliance on sub-paragraph (1) or carries out an examination in respect of the Commissioner under section 7 of the National Audit Act 1983 (economy etc. examinations).

    Evidence
    13. A document purporting to be duly executed under the seal of the Commissioner or to be signed by him or on his behalf is to be received in evidence and, unless the contrary is proved, taken to be so executed or signed.
    Payments
    14. The Assembly may make payments to the Commissioner of such amounts, at such times and on such conditions (if any) as it considers appropriate.

    General
    15. In the House of Commons Disqualification Act 1975, in Part III of Schedule 1 (certain disqualifying offices), the following entries are inserted at the appropriate places—
    "Children's Commissioner for Wales."
    "Member of the staff of the Children's Commissioner for Wales."
    16. In the Northern Ireland Assembly Disqualification Act 1975, the same entries as are set out in paragraph 16 are inserted at the appropriate places in Part III of Schedule 1.
    17.—(1) Regulations may provide that the office of Children's Commissioner for Wales shall be added to the list of "Offices" in Schedule 1 to the Superannuation Act 1972 (offices etc. to which section 1 of that Act applies).
    (2) The Assembly shall pay to the Minister for the Civil Service, at such times as he may direct, such sums as he may determine in respect of any increase attributable to provision made under sub-paragraph (1) in the sums payable out of money provided by Parliament under the Superannuation Act 1972.
    18. In section 144 of the Government of Wales Act 1998 (accounts etc.), in subsection (8)(a), after "the Welsh Administration Ombudsman" there shall be inserted "the Children's Commissioner for Wales".")
    208 Schedule 2, page 70, line 7, leave out ("in")
    209 Page 70, line 8, at beginning insert ("in")
    210 Page 70, line 9, at beginning insert ("in")
    211 Page 70, leave out line 10 and insert—
    ("( ) as a patient in a hospital (within the meaning of the Care Standards Act 2000);")
    212 Page 70, leave out lines 11 and 12
    213 Page 70, line 13, at beginning insert ("in")
    214 Schedule 3, page 72, line 17, at end insert—

    National Assistance Act 1948 (c.29)
    .—(1) Section 26 of the National Assistance Act 1948 (provision of accommodation in premises maintained by voluntary organisations) shall be amended as follows.
    (2) In subsection (1), for "(1B)" there shall be substituted "(1C)".
    (3) For subsections (1A) and (1B) there shall be substituted—
    "(1A) Arrangements must not be made by virtue of this section for the provision of accommodation together with nursing or personal care for persons such as are mentioned in section 3(2) of the Care Standards Act 2000 (care homes) unless—

    (a) the accommodation is to be provided, under the arrangements, in a care home (within the meaning of that Act) which is managed by the organisation or person in question; and

    (b) that organisation or person is registered under Part II of that Act in respect of the home."

    (4) In subsection (1C), for the words from "no" to "person" there shall be substituted "no arrangements may be made by virtue of this section for the provision of accommodation together with nursing".

    Mental Health Act 1959 (c.72)
    . In section 128 of the Mental Health Act 1959 (sexual intercourse with patients)—

    (a) in subsection (1), in paragraph (a), for "or mental nursing home" there shall be substituted ", independent hospital or care home" and in paragraph (b), for the words from "a residential" to the end there shall be substituted "a care home"; and

    (b) after subsection (5) there shall be inserted—

    "(6) In this section "independent hospital" and "care home" have the same meanings as in the Care Standards Act 2000."").
    215 Page 72, line 30, at end insert—

    Local Authority Social Services Act 1970 (c.42)
    . In Schedule 1 to the Local Authority Social Services Act 1970 (enactments conferring functions assigned to social services committee), in the entry relating to the 1989 Act, for "registered" there shall be substituted "private" and for "residential care, nursing or mental nursing homes or in independent schools" there shall be substituted "care homes, independent hospitals or schools".
    216 Page 72, line 44, at end insert ("and for "residential care, nursing or mental nursing homes or in independent schools" there shall be substituted "care homes, independent hospitals or schools"")
    217 Page 73, line 18, leave out ("and")
    218 Page 73, line 25, at end insert ("and
    ( ) in subsection (4), after "(2)" there shall be inserted "or (3)".")
    219 Page 74, line 5, at end insert—

    Magistrates' Court Act 1980 (c. 43)
    . In Schedule 6 to the Magistrates' Court Act 1980 (fees), in the entry relating to family proceedings, in the paragraph relating to the Children Act 1989, for "Part X" there shall be substituted "Part XA".")
    220 Page 74, line 5, at end insert—

    Limitation Act 1980 (c.58)
    . In section 38 of the Limitation Act 1980 (interpretation)—

    (a) in subsection (3), for the words from "within" to the end there is substituted "is incapable of managing and administering his property and affairs; and in this section "mental disorder" has the same meaning as in the Mental Health Act 1983"; and

    (b) in subsection (4)(b), after "receiving treatment" there shall be inserted "for mental disorder" and for "or mental nursing home within the meaning of the Nursing Homes Act 1975" there shall be substituted "or independent hospital or care home within the meaning of the Care Standards Act 2000.")

    221 Page 74, line 7, at beginning insert—
    ("( ) The Mental Health Act 1983 shall be amended as follows.
    ( ) In sections 12(3), 23(3), 24(3), 46(1), 64(1), 119(2), 120(1) and (4), 131(1), 132(1), (2) and (4) and 133(1), for "mental nursing home" and "mental nursing homes" in each place where they occur, there shall be substituted, respectively, "registered establishment" and "registered establishments".")
    222 Page 74, line 7, leave out ("of the Mental Health Act 1983")
    223 Page 74, line 9, at end insert—
    ("( ) In section 34—
    (a) in subsection (1), after the definition of "the nominated medical attendant" there shall be inserted—
    ""registered establishment" means an establishment—
    994

    (a) which would not, apart from subsection (2) below, be a hospital for the purposes of this Part; and

    (b) in respect of which a person is registered under Part II of the Care Standards Act 2000 as an independent hospital in which treatment or nursing (or both) are provided for persons liable to be detained under this Act;" and.

    (b) in subsection (2), for the words from "a mental" to "1984" there shall be substituted "a registered establishment".
    ( ) In section 116(1) (welfare of certain hospital patients), for "or nursing home" there shall be substituted ", independent hospital or care home".
    ( ) In section 118(1) (code of practice)—

    (a) for the first "and mental nursing homes" there shall be substituted ", independent hospitals and care homes"; and

    (b) for the second "and mental nursing homes" there is substituted "and registered establishments".

    ( ) In section 121 (Mental Health Act Commission)—

    (a) in subsection (4), for "and mental nursing homes" there shall be substituted ", independent hospitals and care homes"; and

    (b) in subsection (5), in paragraphs (a) and (b), for "a mental nursing home" there shall be substituted "an independent hospital or a care home".

    ( ) In section 127(1) (ill-treatment of patients), for "or mental nursing home" there shall be substituted ", independent hospital or care home".
    ( ) In section 135(6) (warrant to search for and remove patients) for "a mental nursing home or residential home" there shall be substituted "an independent hospital or care home".")
    224 Page 74, line 10, leave out ("of that Act")
    225 Page 74, line 10, after ("(interpretation)") insert—
    ("( ) after the definition of "approved social worker" there shall be inserted—
    ""care home" has the same meaning as in the Care Standards Act 2000";
    ( ) after the definition of "hospital order" and "guardianship order" there shall be inserted—
    ""independent hospital" has the same meaning as in the Care Standards Act 2000;"
    ( )")
    226 Page 74, line 11, leave out from ("managers",") to end of line 12 and insert ("for paragraph (c) there shall be substituted—
    "(c) in relation to a registered establishment, the person or persons registered in respect of the establishment;" and.
    ( ) after the definition of "Primary Care Trust" there shall be inserted—
    ""registered establishment" has the meaning given in section 34 above;"").
    227 Page 74, line 12, at end insert—

    Public Health (Control of Disease) Act 1984 (c.22)
    . In section 7(4) of the Public Health (Control of Disease) Act 1984 (port health district and authority for Port of London), paragraphs (h) and (i) and the "and" following paragraph (i) shall be omitted.")
    228 Page 74, line 24, at end insert—

    Income and Corporation Taxes Act 1988 (c.40)
    . In section 155A(6) of the Income and Corporation Taxes Act 1988 (care for children), after "section 71" there shall be inserted "or Part XA".")
    229 Page 74, line 27, leave out ("19(1)(c) (review of provision of day care),") and insert ("19 (review of provision of day care, child minding etc.)—
    (a) in subsection (1)(c),")
    230 Page 74, line 28, at end insert ("and
    (b) in subsection (5), for the definition of "relevant establishment" there shall be substituted—
    ""relevant establishment" means—

    (a) in relation to Scotland, any establishment which is mentioned in paragraphs 3 and 4 of Schedule 9 (establishments exempt from the registration requirements which apply in relation to the provision of day care in Scotland); and

    (b) in relation to England and Wales, any establishment which is mentioned in paragraphs 1 and 2 of Schedule 9A (establishments exempt from the registration requirements which apply in relation to the provision of day care in England and Wales);"").

    231 Page 74, line 31, leave out ("(d)") and insert ("(e)")
    232 Page 74, line 32, after ("home;"") insert—
    ("( ) after subsection (2) there shall be inserted—
    "(2A) Where under subsection (2)(aa) a local authority maintains a child in a home provided, equipped and maintained by the Secretary of State under section 82(5), it shall do so on such terms as the Secretary of State may from time to time determine."").
    233 Page 74, line 39, after ("children),") insert ("as it has effect before the commencement of section 4 of the Children (Leaving Care) Act 2000—
    (a)")
    234 Page 74, line 40, at end insert ("and
    ("(b) in subsections (2)(d)(ii)) and (l2)(c), for "residential care home, nursing home or mental nursing home" there shall be substituted "care home or independent hospital".
    ( ) In section 24 (persons qualifying for advice and assistance) as it has effect after that commencement—

    (a) in subsection (2)(c), for "registered" there shall be substituted "private"; and

    (b) in subsection (2)(d)(ii), for "residential care home, nursing home or mental nursing home" there shall be substituted "care home or independent hospital".

    ( ) In section 24C(2) (information)—

    (a) in paragraph (a), for "registered" there shall be substituted "private"; and

    (b) in paragraph (c), for "residential care home, nursing home or mental nursing home" there shall be substituted "care home or independent hospital".")

    235 Page 74, line 43, leave out ("59(1)") and insert ("59")
    236 Page 74, line 43, at end insert—
    ("( ) in subsection (1),")
    237 Page 74, line 44, leave out ("(d)") and insert ("(e)")
    238 Page 74, line 45, at end insert ("and
    ( ) after that subsection there shall be inserted—
    "(1A) Where under subsection (1)(aa) a local authority maintains a child in a home provided, equipped and maintained by the Secretary of State under section 82(5), it shall do so on such terms as the Secretary of State may from time to time determine."")
    239 Page 74, line 45, at end insert—
    ("( ) In section 60 (registration and regulation of voluntary homes)—

    (a) for the sidenote there shall be substituted "Voluntary homes."; and

    (b) for subsection (3) there shall be substituted—

    "(3) In this Act "voluntary home" means a children's home which is carried on by a voluntary organisation but does not include a community home."")
    240 Page 75, line 8, leave out ("63(11) (which introduces Schedule 6)") and insert ("63 (children not to be cared for and accommodated in unregistered children's homes)—

    (a) for the sidenote there is substituted "Private children's homes etc.";

    (b) in subsection (11),")

    241 Page 75, line 9, at end insert ("and
    (c) in subsection (12), after "treated" there shall be inserted ", for the purposes of this Act and the Care Standards Act 2000,".")
    242 Page 75, line 19, leave out from beginning to first ("the") in line 20 and insert ("for subsection (3)(b) there shall be substituted—
    "(b) the applicant's right to appeal under section 65A against the refusal to").
    243 Page 75, line 23, leave out ("Act") and insert ("section and section 65A")
    244 Page 75, line 26, at end insert—
    ("( ) After section 65 there is inserted—

    Appeal against refusal of authority to give consent under section 65.
    65A.—(1) An appeal against a decision of an appropriate authority under section 65 shall lie to the Tribunal established under section 9 of the Protection of Children Act 1999.
    (2) On an appeal the Tribunal may confirm the authority's decision or direct it to give the consent in question."").
    245 Page 75, line 26, at end insert—
    ("( ) In section 66 (privately fostered children)—

    (a) in subsection (1)(a) after "accommodation" there shall be inserted "in their own home"; and

    (b) after subsection (4) there shall be inserted—

    "(4A) The Secretary of State may by regulations make provision as to the circumstances in which a person who provides accommodation to a child is, or is not, to be treated as providing him with accommodation in the person's own home."")
    246 Page 75, line 34, after ("home") insert ("or independent hospital")
    247 Page 75, line 42, leave out ("81(1)(d) (inquiries)") and insert ("81(1) (inquiries)—
    (a) in paragraph (d)")
    248 Page 75, line 42, at end insert ("and—
    (b) in paragraph (e), for "a residential care home, nursing home or mental nursing home" there shall be substituted "a care home or independent hospital".
    ( ) In section 82(6) (financial support by Secretary of State), in the definition of "child care training", for "residential care home, nursing home or mental nursing home" there shall be substituted "care home or independent hospital".
    ( ) In section 83 (research and returns of information), in subsections (1)(c), (2)(c) and (3)(a)(ii), for "residential care home, nursing home or mental nursing home" there shall be substituted "care home or independent hospital".
    ( ) In section 86—

    997

    (a) for the sidenote there shall be substituted "Children accommodated in care homes or independent hospitals." and

    (b) in subsections (1) and (5), for "residential care home, nursing home or mental nursing home" there shall be substituted "care home or independent hospital"

    ( ) For the sidenote to section 87 (welfare of children accommodated in independent schools) there shall be substituted "Welfare of children in boarding schools and colleges".")
    249 Page 75, line 42, at end insert—
    ("( ) In section 102(6)(a) (power of constable to assist in exercise of certain powers to search for children or inspect premises), after "76," there shall be inserted "79U,".")
    250 Page 75, leave out line 43 and insert—
    ("( ) In section 105 (interpretation)—
    (a) in subsection (1)—")
    251 Page 76, line 2, at end insert—
    ("( ) in the definition of "day care", after "care"" there shall be inserted "(except in Part XA)";")
    252 Page 76, line 2, at end insert—
    ("( ) in the definition of "hospital", after "hospital" there is inserted "(except in Schedule 9A)";")
    253 Page 76, line 2, at end insert—
    ("( ) after the definition of "income-based job-seeker's allowance" there shall be inserted—
    ""independent hospital" has the same meaning as in the Care Standards Act 2000;";").
    254 Page 76, line 7, leave out from ("home;"") to end of line 10
    255 Page 76, line 10, at end insert—
    ("(b) after subsection (5) there shall be inserted—
    "(5A) References in this Act to a child minder shall be construed—

    (a) in relation to Scotland, in accordance with section 71;

    (b) in relation to England and Wales, in accordance with section 79A."").

    256 Page 76, line 10, at end insert—
    (". In Schedule 3 (supervision orders), in paragraphs 4(2)(c)(ii) and 5(2)(c), for "or mental nursing home" there is substituted ", independent hospital or care home".")
    257 Page 76, line 14, leave out from beginning to ("and") in line 19
    258 Page 76, line 20, at end insert—
    ("( ) In paragraph 5(1) of Schedule 7 (foster parents: limit on number of foster children), after "treated" there shall be inserted ", for the purposes of this Act and the Care Standards Act 2000".")
    259 Page 76, line 20, at end insert—
    ("( ) In Schedule 8 (privately fostered children)—

    (a) in paragraph 2, sub-paragraph (1)(b) shall cease to have effect, and in sub-paragraph (2), for "(1)(b)" there shall be substituted "(1)(c)"; and

    (b) in paragraph 9(1), for "2(1)(d)" there shall be substituted "2(1)(c) and (d)", and at the end there shall be inserted—

    "But this sub-paragraph does not apply to a school which is an appropriate children's home."")
    260 Page 76, line 20, at end insert—
    ("( ) For paragraph 2(1)(f) of Schedule 8 (privately fostered children) there shall be substituted—
    "(f) in any care home or independent hospital;".").
    261 Page 76, line 31, at end insert—

    Criminal Procedure (Insanity and Unfitness to Plead) Act 1991 (c.25)
    . In paragraph 4(2)(a) of Schedule 2 to the Criminal Procedure (Insanity and Unfitness to Plead) Act 1991 (supervision and treatment orders), for "hospital or mental nursing home" there shall be substituted "independent hospital or care home within the meaning of the Care Standards Act 2000 or in a hospital".")
    262 Page 76, line 33, leave out ("61") and insert ("61(2)")
    263 Page 76, leave out lines 35 to 40 and insert ("for the words from "voluntary" to the end there shall be substituted "persons carrying on an appropriate children's home for the provision or use by them of such accommodation".")
    264 Page 76, line 40, at end insert—

    Water Industry Act 1991 (c.56)
    . In Schedule 4A to the Water Industry Act 1991 (premises that are not to be disconnected for non-payment of charges), for paragraphs 8 and 9 there shall be substituted—
    "8.—(1) A care home or independent hospital.
    (2) In this paragraph—
    "care home" means—

    (a) a care home within the meaning of the Care Standards Act 2000;

    (b) a building or part of a building in which residential accommodation is provided under section 21 of the National Assistance Act 1948;

    "independent hospital" means an independent hospital within the meaning of the Care Standards Act 2000.
    9. A children's home within the meaning of the Care Standards Act 2000."

    Local Government Finance Act 1992 (c.14)
    . In paragraph 7 of Schedule 1 to the Local Government Finance Act 1992 (persons disregarded for purposes of discount)—

    (a) in sub-paragraph (1)(a), for "residential care home, nursing home, mental nursing home" there shall be substituted "care home, independent hospital";

    (b) in sub-paragraph (1)(b), after "home" there shall be inserted ", hospital";

    (c) for sub-paragraph (2), there shall be substituted—

    "(2) In this paragraph—
    "care home" means—

    (a) a care home within the meaning of the Care Standards Act 2000; or

    (b) a building or part of a building in which residential accommodation is provided under section 21 of the National Assistance Act 1948;

    "hostel" means anything which falls within any definition of hostel for the time being prescribed by order made by the Secretary of State under this sub-paragraph;
    "independent hospital" has the same meaning as in the Care Standards Act 2000."
    (d) in sub-paragraph (3), for ""mental nursing home", "nursing home" or "residential care home"" there shall be substituted ""care home" or "independent hospital"".")
    265 Page 76, line 40, at end insert—

    Water Industry Act 1991 (c.56)
    . In Schedule 4A to the Water Industry Act 1991 (premises that are not to be disconnected for non-payment of charges), in paragraph 12 for "section 71(1)(b)" there shall be substituted "Part XA".")
    266 Page 77, line 33, after ("registration") insert ("under"")
    267 Page 77, line 38, at end insert—
    ("( ) In section 2 (inclusion in list on reference to Secretary of State)—

    (a) in subsection (2)(b), for "or retired", in each place where those words occur, there shall be substituted ", retired or made redundant";

    (b) in subsection (8)(a), for "or retiring" there shall be substituted ", retiring or being made redundant" and for "or retired" there shall be substituted", retired or been made redundant".")

    268 Page 77, line 39, leave out ("7(2)") and insert ("7")
    269 Page 77, line 40, after ("1988)") insert—
    ("(a) after subsection (1) there shall be inserted—
    "(1A) Where a child care organisation discovers that an individual employed by it in a child care position is included in any of the lists mentioned in subsection (1) above, it shall cease to employ him in a child care position.
    For the purposes of this subsection an individual is not employed in a child care position if he has been suspended or provisionally transferred to a position which is not a child care position." and.
    (b) in subsection (2),")
    270 Page 78, line 3, leave out ("65 of or paragraph 8 of Schedule 6 to") and insert ("65A of")
    271 Page 78, line 20, leave out ("12(1),") and insert ("12 (interpretation)—
    (a) in subsection (1)—
    (i)")
    272 Page 78, line 22, at end insert ("and
    (ii) after the definition of "harm" there shall be inserted—
    ""local authority" has the same meaning as in the Children Act 1989;";").
    273 Page 78, line 22, at end insert ("and
    (b) after subsection (3) there shall be inserted—
    "(3A) For the purposes of this Act, an individual is made redundant if—

    (a) he is dismissed; and

    (b) for the purposes of the Employment Rights Act 1996 the dismissal is by reason of redundancy."").

    274 Page 78, leave out lines 23 and 24
    275 Page 78, line 40, at end insert—
    ("Powers of Criminal Courts (Sentencing) Act 2000 (c.6)
    . The Powers of Criminal Courts (Sentencing) Act 2000 shall be amended as follows.
    . In paragraph 5(3)(a) of Schedule 2 (additional requirements which may be included in probation orders), for "a hospital or mental nursing home" there shall be substituted "an independent hospital or care home within the meaning of the Care Standards Act 2000 or a hospital".
    . In paragraph 6(2)(a) of Schedule 6 (requirements which may be included in supervision orders), for "a hospital or mental nursing home" there shall be substituted "an independent hospital or care home within the meaning of the Care Standards Act 2000 or a hospital".")
    276 Page 78, line 40, at end insert—

    Amendments of local Acts
    .—(1) Section 16 of the Greater London Council (General Powers) Act 1981 (exemption from provisions of Part IV of the Act of certain premises) shall be amended as follows.
    (2) For paragraph (g) there shall be substituted—
    "(g) used as a care home, or an independent hospital, within the meaning of the Care Standards Act 2000;"
    (3) For paragraphs (gg) and (h) there shall be substituted—
    "(gg) used as a children's home within the meaning of the Care Standards Act 2000 which is a home in respect of which a person is registered under Part II of that Act;"
    (4) Paragraph (j) shall be omitted.
    .—(1) Section 10(2) of the Greater London Council (General Powers) Act 1984 (exemption from provisions of Part IV of the Act of certain premises) shall be amended as follows.
    (2) For paragraph (c) there shall be substituted—
    "(c) used as a care home, or an independent hospital, within the meaning of the Care Standards Act 2000;"
    (3) For paragraph (d) there shall be substituted—
    "(d) used as a children's home within the meaning of the Care Standards Act 2000 which is a home in respect of which a person is registered under Part II of that Act;"
    (4) Paragraphs (f) and (1) shall be omitted.")
    277 Schedule 4, page 79, line 16, at end insert—

    Children's Commissioner for Wales
    .—(1) The Part of this Act which relates to the Children's Commissioner for Wales has effect, in relation to times before the commencement of any other relevant provision of this Act, as if references—

    (a) to regulated children's services in Wales; and

    (b) to the provider of such services,

    were or included references to services which would be regulated children's services in Wales, or (as the case may be) to the person who would be the provider, if that provision were in force.
    (2) Sub-paragraph (1) has effect subject to any provision made under sections 97 or 98.")
    278 Schedule 5, page 80, line 6, at end insert—

    ("1981 c. xvii.

    Greater London Council (General Powers) Act 1981.

    Section 16(j).

    1983 c. 20.

    The Mental Health Act 1983

    In section 145(1), the definition of "mental nursing home".")

    279 Page 80, line 9, at end insert—

    ("1984 c. 22.

    Public Health (Control of Disease) Act 1984.

    In section 7(4), paragraphs (h) and (i) and the "and" following paragraph (i).")

    280 Page 80, line 11, at end insert—

    ("1984 c. xxvii.

    Greater London Council (General Powers) Act 1984.

    Section 10(2)(f) and (1).")

    281 Page 80, line 25, column 3, after ("of") insert (""child minder",")
    282 Page 80, line 25, column 3, after ("of") insert (""mental nursing home"")
    283 Page 80, column 3, line 38, leave out from beginning to ("9") in line 39
    284 Page 80, line 43, column 3, after ("Schedule 8,") insert ("paragraph 2(1)(b) and")
    285 Page 80, line 47, column 3, at end insert (", in paragraph 73, sub-paragraphs (2) and (3) and in paragraph 74, sub-paragraphs (2) and (4)")
    286 Page 81, column 3, leave out lines 32 to 34 and insert—

    ("Section 13(3) and (4).")

    287 In the Title, line 5, after second ("agencies") insert (", nurses agencies")
    288 Line 10, after ("workers;") insert ("to establish a Children's Commissioner for Wales;")
    289 Line 15, after ("1957;") insert ("to amend Schedule 1 to the Local Authority Social Services Act 1970;")
    Lord Hunt of Kings Heath: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 199 to 289.
    Moved, That the House do agree with the Commons in their Amendments Nos. 199 to 289.—(Lord Hunt of Kings Heath.)
    On Question, Motion agreed to.
    An amendment (privilege) made.
    House adjourned at ten minutes past midnight.

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