Sitting of 21 June 2000

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

PRIVATE BUSINESS
CITY OF LONDON (WARD ELECTIONS) BILL (BY ORDER)
Order for further consideration, as amended, read.
To be further considered on Wednesday 28 June.

Oral Answers to Questions
  NORTHERN IRELAND
  The Secretary of State was asked—
  NORTHERN IRELAND

    Punishment Beatings
    Mr. Michael Connarty: If he will make a statement on the incidence of punishment beatings in Northern Ireland. [125476]
    The Secretary of State for Northern Ireland (Mr. Peter Mandelson): From 1 January to 11 June this year there were 111 paramilitary-style attacks, comprising 54 shootings, with 33 by loyalists and 21 by republicans; and 57 assaults, with 33 by loyalists and 24 by republicans. The Government condemn without reservation the activities of those on both sides who plan, carry out and attempt to justify these barbaric attacks. We call on all political leaders to use their influence to bring these attacks to an end now.
    Mr. Connarty: Does my right hon. Friend agree that it is time we stopped calling the attacks punishment beatings and started calling them illegal paramilitary acts, underlining the fact that, now that we have democracy in Northern Ireland, we should also have the rule of law and demilitarisation? In that vein, we should be asking the groups' representatives to stamp out their use of violence. We should make it quite clear to the UFF that it should not threaten citizens with shootings for acts of vandalism as it has done in the past few days.
    Mr. Mandelson: I echo my hon. Friend's sentiments. The fact is that politics is now working in Northern Ireland and there is no excuse for anyone to turn away from politics to the violence of the past. My message to those who think that they can go around threatening violence or stirring up trouble—particularly as we enter the marching season—and get away with it is simple: they will not get away with it.
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    There is no place for violence and I will be watching very carefully indeed to see whether, in the coming weeks and months, there are any paramilitary organisations involved in violence of any kind, be it in Belfast, Drumcree or elsewhere. If there is evidence of such involvement, I will draw the appropriate conclusions about the state of the ceasefires and the implications for any further prisoner releases.
    Mr. William Ross: Since the Secretary of State has been paying careful attention to statistics, he will be well aware that the evidence and the statistics show that the terrorist organisations have been able to switch the level of their terrorist mutilations on and off at will over the past two or three years. Is he further aware that those are simply a means of these people imposing their will on their respective communities and trying to introduce mafia rule throughout Northern Ireland? Intelligence reports show that they are trying to extend their influence beyond the major conurbations and into the towns and villages of Northern Ireland. What intelligence reports, rather than evidence, does he have that Mr. McCoy was murdered by the IRA?
    Mr. Mandelson: I am not going to comment on a particular case about which I have no evidence. I of course condemn the cold-blooded murder of Edmund McCoy. It is not yet clear who is responsible. The Chief Constable has said that he retains an open mind. The police investigation continues, but if it becomes clear that the Provisional IRA was responsible, that will have a direct impact on my assessment of the state of its ceasefire.
    Mr. Lembit Öpik (Montgomeryshire): Does the Secretary of State agree that the full implementation of the Patten proposals through the Police (Northern Ireland) Bill should further undermine what little legitimacy these vigilantes can claim as local peacekeepers and law enforcers, and that the two symptoms of that happening would be, first, the reduction of paramilitary beatings and, secondly, the elimination of paramilitary flags, which are often used to mark out an area of assumed control by paramilitaries on both sides?
    Mr. Mandelson: The hon. Gentleman is right to say that we are making a fresh start, a new beginning, in policing in Northern Ireland. That is what the Patten report and the Police (Northern Ireland) Bill, which is in Committee, are all about. If we successfully introduce those reforms, it will make a positive contribution to the new political dispensation that we want in Northern Ireland, in which violence should, must and will play absolutely no part whatever.
    Dr. Norman A. Godman (Greenock and Inverclyde): I think that we should stop, now, calling these attacks punishment beatings, as my hon. Friend the Member for Falkirk, East (Mr. Connarty) suggested. Of the criminal assaults committed by loyalists, how many can be laid at the doorstep of the Ulster Defence Association? What is my right hon. Friend's reaction to the latest threat by

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    spokesmen of the UDA to sever the ceasefire? Are we now looking forward to a dissident or Continuity UDA, or is a dissident within the UDA making this threat?
    Mr. Mandelson: I do not want to speculate about the genesis of yesterday's statement, except to say that, disturbing as it was, the response to it was very encouraging indeed. It was condemned right across the political spectrum, from loyalism to republicanism, as well as by the mainstream parties. I believe that Northern Ireland political opinion was united in the view that threatening violence is simply unacceptable in today's society. I think that we should draw encouragement, therefore, from the comprehensive condemnation of that statement. They should draw the obvious conclusion that that type of threat will not be tolerated by any part of Northern Ireland's society any more.
    Mr. John M. Taylor (Solihull): Does the Secretary of State agree that there is still an utterly unacceptable level of beatings by paramilitaries? Will he say that those beatings in themselves constitute a breach of the ceasefire? Will he confirm that, in as much as the beatings have been carried out by the so-called Ulster Freedom Fighters, that will influence his policy on prisoner release?
    Mr. Mandelson: I will certainly confirm that. I keep all the ceasefires under constant review. If I receive any evidence whatsoever that the ceasefires are being breached by any of the paramilitary organisations, it will lead directly, when the time comes in the next few weeks, to my assessment on the further planned prisoner releases which may take place. I assure the hon. Gentleman and the House that I take those actions and threats and any breach of the ceasefires very seriously indeed. I will draw the appropriate conclusions, and I will take the appropriate action.
    Mr. Robert McCartney: Does the Secretary of State appreciate that it is his limited definition of what constitutes a breach of ceasefire—namely, attacks on military or security personnel, economic targets or members of the opposing community—that is feeding and encouraging those beatings, which are not seen by those who perpetrate them as falling within the Secretary of State's definition of a breach of the ceasefire?
    Mr. Mandelson: I do not accept that for one moment. I have left all the paramilitary organisations in no doubt whatsoever about how I will interpret the ceasefires and their maintenance, how I will assess whether there is a breach of those ceasefires, and what conclusions I will draw. I have made public statements; I have made private statements. They are in no doubt at all about the consequences that will flow for further prisoner releases if there is any breach of the ceasefires.

    Paramilitary Organisations
    Mr. Michael Fabricant (Lichfield): What estimate he has made of the number of people who have joined Continuity IRA and the Real IRA since 1998. [125477]
    The Minister of State, Northern Ireland Office (Mr. Adam Ingram): Only broad judgments on such matters can be made based on intelligence information. However, whoever those people are, and however many of them there are, the security forces remain vigilant and able to combat their threat. Both of the Governments and the people of Ireland, north and south, are united as never before against those groups and their evil activities.
    Mr. Fabricant: I thank the Minister for his answer. What estimate has he made of the number of prisoners who have been released early but have joined either Continuity or Real IRA? Does he believe that any of those early-release prisoners might have been involved in the recent Hillsborough bombing or the bombing at Hammersmith bridge, in London?
    Mr. Ingram: Obviously, we never share intelligence information on such matters across the Dispatch Box. I would, therefore, never speculate on those particular estimates. Any released prisoner is subject to licence conditions. To date, only one of the more than 300 prisoners who have been released has been in breach of that licence and has been returned to prison. We have made it very clear that any breach of the licence as provided in law will be viewed very severely and treated appropriately, as we have shown in the past.
    Mr. Malcolm Savidge: Given yesterday's statement by the West Belfast UFF and the continuing activities of groups such as Continuity and Real IRA, will the Minister assure the House that paramilitaries in either community who refuse to renounce violence and killing will be pursued vigorously?
    Mr. Ingram: I can give that absolute assurance, as I did in my earlier comments. The security forces at all levels remain highly vigilant against the activities of those groups. We need the co-operation, however, of the wider community in bringing them to justice. I again make the plea that anyone who has evidence on the activities of those individuals or on the groups of which they are members should bring that information to the security forces, so that we can bring them to justice.
    Mr. William Thompson: What evidence have the Government that those two organisations—the Continuity IRA and the Real IRA—may be coming together and acting together in operations as one? What representations are being made to the Government of the Republic of Ireland to take drastic action to prevent those two organisations from expanding further?
    Mr. Ingram: I think that everyone aware of the level of those groups' activity in Northern Ireland will know that the level of co-operation between the security forces north and south of the border has never been higher as they try to bring those responsible to justice. Every effort will be made in that regard, but we do not hide the fact that the dissident groups pose a very potent threat. The solution does not lie only with the security forces. It is down to everyone, north and south, to condemn those groups unreservedly and, if they have evidence, to help the security forces and the justice system to bring them to justice.

    Decommissioning
    Mr. Martin Salter: When he expects to receive a further report from General de Chastelain. [125478]
    Mr. Geoffrey Clifton-Brown (Cotswold): What assessment he has made of when progress will be made on arms decommissioning. [125479]
    The Secretary of State for Northern Ireland (Mr. Peter Mandelson):The Independent International Commission on Decommissioning is responsible for supervising progress on putting paramilitary arms completely and verifiably beyond use. It is a matter for General de Chastelain to decide when it is appropriate to provide a report. In the first instance, that will depend on when the two independent arms inspectors, Mr. Ramaphosa and Mr. Ahtisaari, report their findings to the commission.
    Mr. Salter: I thank the Secretary of State for that answer. Sinn Fein said on Monday that it wanted all commitments made by the IRA to be fulfilled. However, does my right hon. Friend agree that the sooner the independent weapons monitors can visit the IRA arms dumps, the more firmly entrenched the peace process will become?
    Mr. Mandelson: Yes, I do. Building confidence across the community in Northern Ireland depends on measures such as the one to which my hon. Friend referred. I hope that Mr. Ramaphosa and Mr. Ahtisaari will be able to begin their inspection shortly. It is, of course, a matter for them to take forward. However, when they do, I am confident that they will be able to report progress to the decommissioning body. I look forward to that happening without much further delay.
    Mr. Clifton-Brown: Is it not the case that paramilitaries are still carrying out punishment beatings, maimings and killings, and that they continue to run protection rackets? Is it not therefore an absolute precursor to the Belfast agreement that quantifiable and verifiable arms decommissioning should take place before the agreement can be fulfilled?
    Mr. Mandelson: Yes, I broadly agree with the hon. Gentleman. However, the difference is that we have moved on from talking about the arms issues to getting a process of decommissioning under way. The Provisional IRA has made a clear and unequivocal commitment to put arms completely and verifiably beyond use. We have never had such a statement from the IRA before. That is what the Northern Ireland Arms Decommissioning Act 1997 requires, and I look forward to action being taken to fulfil that commitment without further or undue delay.
    Kali Mountford (Colne Valley): Martin McGuinness made the statement on Monday that all commitments by the IRA should be fulfilled. Does not my right hon. Friend interpret that as a very encouraging sign that all parties
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    are now fully committed to the peace process? Should we not celebrate that progress, and make sure that the peace process is fully in place?
    Mr. Mandelson: Yes, I strongly echo the sentiments expressed by my hon. Friend. This is the first Question Time to be held since the new institutions in Northern Ireland, the Executive and the Assembly, were restarted, and I know that all hon. Members will applaud the resumption of their work. Of course difficulties remain, but the difference now is that we have a political process, within which we can deal with the differences that remain in Northern Ireland. That process may creak and strain a bit as we try to digest a particular problem here or there, but the important thing is that we have a process within which politics can work and the difficulties can be resolved. That process should continue to enjoy the full commitment of all those parties and organisations in Northern Ireland who believe in a democratic and peaceful way forward for that society.
    Mr. Ken Maginnis: Does the Secretary of State share and understand the frustration of Unionists in Northern Ireland who know that if they publicly press the IRA to fulfil its commitments—not just those made in May, but those made over a period of two years—the reaction will be that, somehow, we are pressuring the IRA? General de Chastelain shares that frustration in terms of any statement that he may make to encourage disarmament by paramilitaries. If he says anything, he will be deemed to have lost the confidence of those organisations. [HON. MEMBERS: "Question!"] I always worry that some of the Secretary of State's colleagues are not very keen to hear criticism of the IRA—[Interruption.]
    Madam Speaker: Order. The House is waiting for a question from the hon. Gentleman.
    Mr. Maginnis: My question is whether, in terms of the Belfast agreement, it is obligatory for the Irish Government and our Government to work together consistently to ensure that promises are fulfilled. The Irish Government advise Unionists. Why do they not put pressure on the IRA?
    Mr. Mandelson: There is within the hon. Gentleman's words an extremely sound point. It is this: on the one hand we do not want to start issuing deadlines and ultimatums and appear to be seeking to impose undue public pressure on people to fulfil the undertakings that they have made for fear that that would have a counter-effect. On the other hand, the public and all the political parties in Northern Ireland want to maintain the pressure on everyone to fulfil their side of bargains and deals that have been made. It behoves us all—the British Government, the Irish Government, the American Government and everyone across the community in Northern Ireland—to keep people up to the mark in terms of what they have agreed to do, without making unreasonable demands in terms of the timetable within which they do it.
    Mr. Andrew MacKay (Bracknell): As it is now some six weeks since the Provisional IRA made what appeared to be a positive statement that it would put its arms

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    verifiably and completely beyond use, and as it is some three weeks since the Executive was set up and it is now successfully running, does the Secretary of State share my concern that there have yet to be any confidence-building measures by the IRA, and the longer that takes the more confidence will drain away?
    Mr. Mandelson: I do not yet share the right hon. Gentleman's concern because I maintain my confidence that the IRA, having made commitments, will honour those commitments. I have said in the past that IRA statements for good or ill have a certain rugged honesty about them. I know that people will be extremely disappointed if what the IRA has said it will do is not done before further time elapses.
    Mr. MacKay: Naturally, I hope that the Secretary of State's confidence will not be misplaced, but I take him back to what the Prime Minister said at the Dispatch Box a few weeks ago—that the confidence-building measures which we hope will happen very shortly are only the first stage and they must be very quickly followed by the decommissioning of all illegally held arms and explosives, as the IRA promised to do under the Belfast agreement. Will the right hon. Gentleman again confirm that that must happen quickly after the confidence-building measures?
    Mr. Mandelson: I do confirm that. The IRA has made a clear and unequivocal statement to put its arms completely beyond use. All this must be independently verified under the supervision of General de Chastelain's commission. I believe that it will happen, but if it does not I have confidence in General de Chastelain and his colleagues to blow the whistle and sound the alarm if they believe that the IRA is resiling from its commitments.

    British-Irish Council
    Mrs. Maria Fyfe (Glasgow, Maryhill): If he will make a statement on the progress being made on the British-Irish Council. [125480]
    Mr. Hilary Benn (Leeds, Central): If he will make a statement on the progress being made on the British-Irish Council. [125482]
    The Parliamentary Under-Secretary of State for Northern Ireland (Mr. George Howarth): The next summit meeting of the British-Irish Council is likely to be held after the summer. At its inaugural summit in December, the members of the council agreed an important and wide-ranging work programme covering subjects such as transport, drugs and the environment. These are being taken forward by each of the participating Administrations. [Interruption.]
    Madam Speaker: Order. Before we proceed, the House must come to order. Conversations are much too noisy and the Minister can barely make himself heard.
    Mrs. Fyfe: I thank my hon. Friend for that answer. Will he join me in paying tribute to the work done over the past 10 years by the British-Irish Inter-Parliamentary Body, which has worked behind the scenes to promote
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    understanding between our two islands? Does he agree that the British-Irish Council could profit from that experience?
    Mr. Howarth: Like all institutions, the British-Irish Inter-Parliamentary Body, and all the other bodies associated with it, has been important in maintaining dialogue and bringing people together to discuss issues of common interest in a period when that would not otherwise have been possible. I share my hon. Friend's sentiments—the British-Irish Inter-Parliamentary Body has been important in creating space and opportunities that would not otherwise have existed.
    Mr. Benn: What distinct contribution does my hon. Friend think the council has to make to taking forward the peace process in Northern Ireland? In view of the answer that he has just given, could he build on those parliamentary links by including Assembly Members from across the British Isles as a way of demonstrating that the political process is now working?
    Mr. Howarth: As my hon. Friend implies, the process has the capacity to develop and to go in new directions. However, I think that the council's important contribution is to look at areas of policy in which there is a common interest—not just issues of security and political development but health, for example—and consider how they can be taken forward. The problems of the past in Northern Ireland were of a divided society and two divided communities. The future must be in finding ways forward, not in looking back.
    Mr. Roy Beggs: When the British-Irish Council next meets, will the Minister use his best efforts to persuade it to make representations to the Irish Government to appoint a High Court inspector to investigate the operation of International Investments Ltd. in Dublin and its Irish subsidiaries, which resulted in more than £7 million being lost by British and Irish investors? Will the hon. Gentleman accept from me that the failure of successive Governments to appoint a High Court inspector suggests that there may have been a cover-up, and that if such a decision is made, even at this late stage, it could be a confidence-building measure?
    Mr. Howarth: I think that the hon. Gentleman will, on reflection, accept that that is not an appropriate matter for the Government to raise at the British-Irish Council. If, however, he believes that it is a matter of importance to Northern Ireland, it is open to the First Minister, the right hon. Member for Upper Bann (Mr. Trimble), to use the opportunity that the British-Irish Council creates to raise it.
    Miss Anne McIntosh: Will the Minister confirm whether the next meeting of the British-Irish Council will consider policing in Northern Ireland, particularly the issue of future policing meeting the requirements of the European convention on human rights?
    Mr. Howarth: The Patten proposals are being considered in Committee under the Police (Northern Ireland) Bill, and there is a declaration on the front of the Bill, as there is on all legislation, that it is compatible with the European convention on human rights. In general

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    terms, as my right hon. Friend the Minister of State said earlier, there is a great deal of scope for co-operation between the Republic of Ireland and Northern Ireland on policing. We take those opportunities seriously. We also recognise that it creates a better environment in which to police not only terrorism but some of the problems associated with smuggling across the border.

    Security Situation
    Mr. Tony McWalter (Hemel Hempstead): What recent progress has been made in creating a more normal security environment. [125481]
    The Minister of State, Northern Ireland Office (Mr. Adam Ingram): In line with the Chief Constable's announcement on 9 May, work has commenced to demolish the Cookstown base and the Cloghoge observation base in South Armagh and to vacate Fort George in Londonderry and the observation posts at Broadway and Templer House in Belfast.
    The Belfast and East Tyrone roulement battalions have also been withdrawn, leaving 13,500 troops in Northern Ireland—the lowest number since 1970.
    Mr. McWalter: I thank my right hon. Friend for that answer and congratulate him on the work that he has done on that matter. May I seek his assurance that the number of the security forces will not increase significantly during the difficult period ahead—with parades and other such activities?
    Mr. Ingram: I cannot of course give my hon. Friend that assurance; as we have said constantly, the level of the security presence will depend on the degree of threat. Obviously, considerable amounts of public disorder sometimes justify a higher security presence on the ground. We are ever alert and ever vigilant. We shall take whatever measures are necessary.

    The Prime Minister was asked—
    PRIME MINISTER

      Engagements
      Ql. [125506] Mr. David Chidgey (Eastleigh): If he will list his official engagements for Wednesday 21 June.
      The Prime Minister (Mr. Tony Blair): This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further such meetings later today.
      Mr. Chidgey: The Prime Minister may not be aware that my constituents in Eastleigh have just lost their post office in Pitmore—to add to the hundreds of others that are closing across the country. He will be aware, however, that the Post Office has just lost £264 million because its new computerised system cannot even pay for itself. Does that not demolish the claim that a new, modernised Post Office can recoup the revenue it is losing because benefit payments are being transferred to bank accounts? When
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      will the right hon. Gentleman produce a sound plan to provide our post office network with the strength it needs to ensure that it serves us in the future?
      The Prime Minister: The short answer is that we shall be doing that in the next few days. Of course, we accept not only that it is important to introduce the new technology—that is important for post offices—but that it is right to give them a role and a function for the future. The Government have indicated that we are prepared to support that.
      As the hon. Gentleman will be aware, the difficulty with the Horizon project that we inherited when we came into office is that hundreds of millions of pounds—literally—were wasted on it. As a Government, we have had to make provision to try to get ourselves out of that situation. When we publish our plan, I hope that it will give the rural post offices a sound and viable future, but one that is allied to modern reality.
      Mr. Paul Goggins: Will my right hon. Friend the Prime Minister join me in congratulating Age Concern and the citizens advice bureau in Trafford on the success of their recent pensioners benefit take-up campaign? During a period of 18 months, they helped 715 pensioners to claim an extra £827,000 in benefit. Will the Government enhance the work of those organisations by doing something that the Conservatives never did and ensure that, in providing help for all pensioners, they give priority to the poorest?
      The Prime Minister: There may be 700 in my hon. Friend's constituency, but across the country more than 400,000 pensioners have been contacted so far to make them aware—if they are poorer pensioners—that the new minimum income guarantee support is available for them. About 1 million pensioners will be up to £20 a week better off. Of course, all pensioners get the £150 winter allowance, and the over-75s will get free television licences. The one thing we know for certain is that each and every one of those things will be taken off them by the Conservatives.
      Mr. William Hague (Richmond, Yorks): The Prime Minister will have seen the news report that the Government may soon receive advice to end the availability of beta interferon on the national health service. It is, of course, a preliminary report, but the right hon. Gentleman will understand that it will have caused immediate and deep concern to thousands of families. Will he now acknowledge that, after three years of a Labour Government, there is more rationing in the NHS than ever before?
      The Prime Minister: First, as the right hon. Gentleman says, it is indeed a preliminary report. It is important to emphasise that no one who gets beta interferon at present will be affected by the report. However, it is important that we end postcode prescribing in the NHS. I remind him that it was his Government and he who introduced it.
      Mr. Hague: It is no good the Prime Minister talking about postcode rationing. Now there is a threat of rationing where no one gets it, and the postcode is Downing street, SW1. Have not the Government tried to pass the buck by adding, after the passage of the original

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      legislation, the criterion of affordability to the remit of the National Institute for Clinical Excellence—NICE—when its advice should be based on medical considerations? Ministers should decide on affordability in the NHS. As the drug is in use all over Europe, is it not vital that, whatever happens, there is continued freedom to prescribe in particular cases, backed up by an exceptional medicines fund within the NHS—as we have proposed?
      The Prime Minister: Let me correct the right hon. Gentleman on two facts. First, nobody who gets the drug now will be denied it. Secondly, he said that it is available to all multiple sclerosis sufferers elsewhere in Europe. In fact, in France, Germany and Italy only 12 per cent. of MS sufferers receive it.
      As for the right hon. Gentleman's claim that he is opposed to any form of cost-effectiveness being involved in the test, let me remind him of the document that was put out by the previous Government in 1995 when he was Secretary of State for Wales. He put out a Government document, "New drugs for multiple sclerosis", to the health service, saying that the key aims were to target the drug appropriately at patients most likely to benefit. The document then had a chapter on resource implications and funding and said that providers would need to consider the likely impact on resources of continued prescribing and, in particular, the impact on hospital drugs projects.
      Let us have no more of this opportunistic pretence that somehow, when the right hon. Gentleman was in government, people had all the drugs they wanted. In fact for the first time, rightly, there is now an independent institute that can advise the Government. This Government has increased the drugs bill by 9 per cent. in real terms.
      Mr. Hague: Whatever the right hon. Gentleman is responding to is an entirely different question from the one that I actually put to him. The chief executive of the MS Society said today that
      thousands of people are waking up this morning with the icy fingers of dread closing round their hearts.
      [Interruption.] Those are the words of the chief executive of the MS Society.
      Do not the Government have a responsibility to find a way through this issue for the future? Instead of trying to attack other parties on the issue, why does the Prime Minister not respond to a constructive proposal? Will he tell us, when he answers the question, whether he will look seriously at our proposal for an exceptional medicines fund that will reimburse GPs directly for expensive drugs in particular cases, and will avoid arbitrary rationing by health authorities?
      The Prime Minister: If the right hon. Gentleman does not like to be reminded of what he did in office, let me just quote—[Horn. MEMBERS: "More, more."] The right hon. Gentleman asked me to continent on his proposal, so let me read what his health service spokesman said three weeks ago about it. He said:
      In any limited budget, priorities have to be set … There will therefore be a system of more clear … and transparent priority setting. Anything else would simply mean putting our heads in the sand and pretending the problem doesn't exist.
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      As a result of the national institute coming into being, we will now, for example, make taxanes for the treatment of cancer available to everyone. The logic is that we have an independent institute that advises us. Of course it is important to examine how much money the health service can spend, but we are the people who are giving it the biggest increase that it has ever had.
      I remind the right hon. Gentleman that although it is all very well to put his proposal to me, there is one flaw with it, and perhaps he will respond to it when he next rises to speak. Under his proposals for private medical insurance, he will take £1 billion out of the health service—money that will no longer be there to be used for beds, nurses, doctors or drugs. That is why our proposals are rather better.
      Mr. Hague: The Prime Minister cannot escape his responsibilities—[Interruption.]
      Madam Speaker: Order. The House must come to order.
      Mr. Hague: The Prime Minister cannot escape his responsibilities with trivialised fiction about Opposition policies when we are asking him to respond to a specific proposal. There is now a serious problem of arbitrary rationing in different health authorities. There is a solution on the table—an exceptional medicines fund, which would reimburse GPs directly. We are asking him only whether he will look at that proposal instead of trying to blame everybody else for every problem that ever comes his way. Will he look at that proposal?
      The Prime Minister: First, the right hon. Gentleman is right to say that an arbitrary system is in place. It is called postcode prescribing and it was introduced by his Government. Secondly, I have told him that finance is the flaw in his proposal. Unless we can fund everything that we want to fund, we cannot fund the drugs that people need. Perhaps the right hon. Gentleman will give us an explanation. How will he fund his proposal when £1 billion would be taken out for private medical insurance?
      Mr. Hague: The Prime Minister knows—[Interruption.] Once again, this Government blame everybody else for every problem. They blame problems that they created on the Opposition. They blame the media for the way in which the Government get publicity—[Interruption.]
      Madam Speaker: Order.
      Mr. Hague: No one is proposing to reduce the national health service's budget. The proposal is to use NHS money to set up an exceptional medicines fund and use it in a particular way, otherwise the problem that is now arising with beta interferon will arise on many other issues in future. If the Prime Minister thinks that he is not responsible for finding a way through that, when thousands of people are desperately worried about these things, he is not fit to hold the office of Prime Minister or sit on that Bench.
      The Prime Minister: I appreciate that people are worried. However, the right hon. Gentleman is proposing

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      to take out £1 billion for private al—[Interruption.] Is it his proposal to have private medical insurance tax relief? A nod of the head would do. The problem with the right hon. Gentleman's exceptional drugs fund is finance. The question is, therefore, who can the nation trust with finance and the health service? We are putting in the largest ever settlement for the NHS. The right hon. Gentleman is committed—or has been until today—to private medical insurance that would take £1 billion out of the NHS. Under this Government, there are 5,500 more nurses and 2,000 more doctors, and the new hospital building programme is under way. All of that would be cut.
      How can the right hon. Gentleman say that he would fund absolutely everything that he wants in the health service when he has a tax guarantee in place that would mean tax cuts for a few at the very top and savage cuts in public spending? Just for once, let the right hon. Gentleman get up and explain his policy.
      Mr. Hague: The Prime Minister should not worry, as it will not be too long before I am answering the questions and he is asking them. We will get some answers then. If the Government are not prepared to consider a single constructive proposal because they did not think of it themselves, they will continue to betray the NHS.
      The Prime Minister: I have already said that the entire basis of the right hon. Gentleman's proposal is that there should be a £1 billion fund. That is the cost, is it not? I have been asked to consider the proposal, so I will. How can the right hon. Gentleman spend £1 billion more when he is dedicated to taking £1 billion out? I would have thought that even he could work out that numeracy and literacy.
      The plain fact is that, of course, there are problems, as there always have been in relation to drugs in the NHS. However, the question is whether we carry on with the old postcode prescribing or have an independent body to advise us. We have established an independent body—which was the right thing to do—and are funding it. What the right hon. Gentleman would do would mean that people would lose their ability to get those drugs, as his finance plans have a £1 billion deficit which he cannot fill.
      Mr. Joe Ashton (Bassetlaw): Is my right hon. Friend aware that, in two and a half weeks, a decision will be taken on whether England will host the world cup in 2006? Is he aware that the Football Association and the Government have mounted a magnificent campaign over the past two years, pointing out to the world that we have the best stadiums and organise football better than any other country? They have also pointed out that our police have no problems with crowds in Britain. The hooligans go abroad, but in this country we have a magnificent record of crowd control—[Interruption.] We do. The statistics show that the figure for arrests is 10 per cent. of what it was 20 years ago.
      Will my right hon. Friend ask television and the tabloids, and some Tories, to start backing England and telling people how good we are, instead of constantly retelling the events of a Saturday night abroad with a
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      bunch of hooligans? Tory Members are dwelling on that as much as some of the tabloids are, and it is time that we started shouting our support for England.
      The Prime Minister: Nothing could excuse the appalling behaviour of those hooligans, who are not connected with football but are simply mindless thugs. It is worth pointing out that the last tournament that we hosted here, Euro 96, was very well policed, very peaceful and very friendly. I have no doubt that the same would happen again.
      Mr. Charles Kennedy: Why does the Prime Minister think that today's World Health Organisation report rates our health service ninth in Europe and 18th in the world?
      The Prime Minister: I am pleased that the right hon. Gentleman has asked me that question as it enables me to say two things to him. First, one would think, to read the reports, that we were rated 18th out of about 20; we are 18th out of more than 190 countries in the world. Of course, that is not to say that we do not need to do a lot better, and it is true that we fall behind France in the table. However—this point will interest Conservative Members who want the American health care system in this country—we are in front of the United States and in front of Germany, Sweden, Canada and Australia. There is a lot more that we need to do, but in many ways, particularly on the fairness of funding, the report was complimentary to the UK.
      Mr. Kennedy: Such was the commendable detail of that reply that one might almost think that the Prime Minister had received advance warning of the question. Funnily enough, however, after this morning's press reports, this was one of the quieter mornings outside my office, and there was nothing to be heard at all.
      Is it not a fact that the number of people waiting for consultant appointments has doubled, that the waiting times are as persistently long as ever, and that on the eve of the last election the Prime Minister said that the country had only 24 hours left to save the health service? Which 24 hours was he talking about, and is not it time that, in government, Labour started sticking to the pledges that it made in opposition?
      The Prime Minister: If the right hon. Gentleman wants to discuss election pledges, I point out that the Liberal Democrat pledge on the health service was to spend £500 million more. We are spending billions more on the national health service. As for the in-patient waiting list pledge, that has been met. It is correct that the out-patient lists went up, as they did for many years, but they are now coming back down. There are more nurses and doctors in the health service.
      However, nobody should be in any doubt that there is an awful lot more to do, which is why we are publishing the national health service plan in the next few weeks. We need more nurses in the health service, we need better equipment, and we need better systems to reduce waiting times and lists. All those things have to be done, but they will be achieved only by the combination of investment and reform to which we are committed.

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      As for the WHO report, as I said, 18th out of 190 is not good enough, but it should debunk any absurd notion that Britain has a third-world national health service; it does not. We should be proud of our health service but recognise how much more it should be improved.
      Mr. Gwyn Prosser (Dover): Last night in Dover, local people gathered at the docks near the area where 58 people were found dead in the back of a container lorry on Monday night to hold a vigil to remember the dead and express the compassion of the town. As we come to terms with that terrible tragedy and as the Prime Minister considers what areas he should look at, such as international co-operation, to ensure that similar tragedies do not occur in future, will he investigate the following reports? First, it is alleged that some four weeks ago the 60 victims were deported from Belgium without an escort. Secondly, it is reported that the tell-tale characteristics that drew the attention of the customs officers in Dover were detected by those in Zeebrugge some time before the vessel left, and when timely intervention could have saved lives.
      The Prime Minister: The short answer to the last two points is that I do not know whether those allegations have any substance. Of course they should be looked at, although it is important that, until we know the full facts of what happened, we reserve judgment. No one could fail to be appalled at the tragic loss of human life or at the wickedness and evil of that trade. It can only be tackled by having the right measures here, which is why it is important that we now have measures that allow us to detain people who come here and to search the vehicles, to ensure that we penalise and punish properly those who are engaged in the trade.
      That emphasises yet again the need to take action at international and, in particular, European level. It seems almost certain that those people travelled through several European countries before they came here. That underlines, once again, the need for some of these issues, particularly that of organised crime—and it is organised crime—to be tackled on a Europe-wide level.
      Dr. Vincent Cable (Twickenham): Can the Prime Minister clarify Government thinking on civil liberties? The Government have recently restricted the freedom of movement of people from outside Europe into this country; they are proposing to restrict, through surveillance, internet business operations—but at the same time they have upheld the civil liberties of football hooligans who wish to travel freely between this country and the continent, and upheld the freedom of an American rapist to operate his trade in this country. What is the consistent thread running through those Home Office decisions?
      The Prime Minister: First, let me correct the hon. Gentleman on a point: there is no question of intercepting everyone's e-mail. There are intercepts now in telephone communications, and intercepts in e-mail will be done on the same basis for very necessary reasons. There are circumstances, especially with organised crime and the drugs trade, in which we need such powers. All Governments have recognised that in the past. As for football hooligans going abroad, this Government have introduced measures to restrict their movement and to
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      impose not just domestic but international banning orders. Following the announcement by my right hon. Friend the Home Secretary on Monday, we shall consider what further measures we will take.
      Ms Margaret Moran: Is my right hon. Friend aware that a report was launched yesterday on an online consultation with the survivors of domestic violence and with parliamentarians? Is he further aware that 90 per cent. of those who referred to their children in that consultation spoke of their fear of further violence or abuse, because the courts almost automatically grant child contact orders to violent parents? Will he undertake to review the legislation and the Government's domestic violence policy, "Living without fear", to ensure that we protect those most vulnerable women and children?
      The Prime Minister: As my hon. Friend knows, we have in fact taken several measures to strengthen the law on domestic violence and to ensure that acts of domestic violence are properly reported. I am aware of the report to which she refers, and we will of course look into it and study its findings very carefully.
      Mr. David Amess: How does the right hon. Gentleman justify the fact that the Chancellor of the Exchequer used two different rates of inflation so that the increase in tax on petrol—[Interruption.]
      Madam Speaker: Order. I shall issue some Members with editions of "Erskine May"—they can read the appropriate chapter—because of the farmyard noises they are making, which are not allowed in the House.
      Mr. Amess: I have brought some food for them, Madam Speaker.
      How does the right hon. Gentleman justify the fact that the Chancellor of Exchequer used two different rates of inflation so that the increase in tax on petrol was three times the increase in the basic retirement pension?
      The Prime Minister: Very simply, my right hon. Friend the Chancellor used precisely the method for calculating pensions that has been used since 1987. I have no doubt that the hon. Gentleman will remember that from his days as Member of Parliament for Basildon.
      Mrs. Eileen Gordon (Romford): Is the Prime Minister aware that many of my constituents in Romford work for Ford at Dagenham, either directly or for contractors that work within Ford, or for companies that rely on Ford for work? Obviously, they are deeply worried about their futures because of the proposed closure of the assembly plant. I know that he has taken a personal interest in this issue, and I thank him for that, but can he tell me and my constituents what support is being given to the work force, what assurances he has had from Ford about its long-term future and commitment to Dagenham and the United Kingdom, and whether he believes them?
      The Prime Minister: I will certainly continue to take a personal interest in this matter. We will make sure that Ford sticks to the commitments it has given, which are

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      important. It is worth emphasising that Ford still employs more than 36,000 people in the United Kingdom. This is a very important country for Ford as a market in Europe.
      We will play our part in helping the people who have been or will be affected by the announcement of job losses. We have announced a comprehensive plan for the regeneration of Dagenham, including retraining, assistance for small businesses and the development of a science park. Ford has committed funding for that, but I well understand people's anxieties. It is true that the time when the job losses will take effect is some way off, but we will want to work closely with the company to make sure that all the undertakings it has given are indeed honoured.
      Mr. Michael Mates: In the context of the Prime Minister's much-vaunted health initiative, is he aware that a fine hospital in my constituency with a long-standing reputation for excellence in orthopaedic surgery, the Lord Mayor Treloar, is standing idle with two state-of-the-art theatres, two further theatres and upwards of 50 beds available, because the health authorities want to knock it down and sell the land for development? If he really means what he says, will he look at that scandalous waste of resources in an area with orthopaedic waiting lists of between a year and 18 months, and show us that his initiative is more than just fine words?
      The Prime Minister: I am not aware of the particular situation to which the hon. Gentleman draws my attention, but of course I will look into it for him. He says that we offer only fine words on the national health service. However, this year alone we have put in an additional £2 billion. The facts are, of course, that waiting lists are still too high and waiting times are still too long. Precisely for that reason, we need the extra investment in nurses, doctors and hospitals. We are committed to that.
      Mrs. Sylvia Heal (Halesowen and Rowley Regis): Does my right hon. Friend recall that at every stage of its parliamentary process, the minimum wage was opposed by the Conservative Opposition? Although I welcome their policy U-turn on the minimum wage, has he heard rumours that they would exempt many of this country's small firms, which would mean that more than 2,000 workers in my constituency and millions across the country who benefit from the minimum wage would be betrayed? Does he agree that that would indeed be a betrayal and that the Opposition's new-found commitment to the minimum wage is no more convincing than their new-found commitment to the national health service?
      The Prime Minister: Following the earlier exchanges on the policy of the right hon. Member for Richmond, Yorks (Mr. Hague), it is interesting that when my hon. Friend mentioned the Opposition's policy, or non-policy,
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      of exempting small firms, one half of them nodded their heads and the other half shook theirs. That is the state of the Conservative party.
      I am proud that the Labour party introduced the minimum wage and I believe that it provides good protection for low-paid workers. However, it is also important that it is combined with other measures such as the working families tax credit. For that reason, there is a concerted attack involving the issues of skills and poverty, and encouraging people back to the workplace. We now have almost a million extra jobs in the British economy.
      Mr. Humfrey Malins (Woking): Given the Government's expressed desire to help Gulf war veterans, will the Prime Minister personally consider the case of my very brave constituent, Paul Connolly, who was a civilian attached to and working with the military in the Gulf conflict? Paul Connolly is now a very sick man with a bad kidney disease. His life expectancy is not great. The disease may well have been caused by exposure to depleted uranium. He was a civilian as opposed to a member of the military, and it seems that no Army or other pension is available to him. He lives on £70 a week incapacity benefit. Will the Prime Minister consider very carefully those civilians who did so much in the conflict and who are now suffering?
      The Prime Minister: I will, of course, look carefully at the case of the hon. Gentleman's constituent, and I understand that both he and Mr. Connolly have been in contact with Ministers at the Ministry of Defence. Detailed research, which will take some time, is under way, but I know of the concern of many of those people who are Gulf war veterans, either military or civilian. We are trying to ensure that the research is a priority, and I will look into the case of the hon. Gentleman's constituent.
      Mr. Dennis Turner: I have very good news for the Prime Minister. Is he aware that my right hon. Friend the Secretary of State for Health—bless him—last Friday announced a £12 million, state-of-the-art cardiac centre for Wolverhampton? That investment will improve the health and life chances of thousands of our citizens in Wolverhampton and the black country. Is not that an example of good old-fashioned public spending in modernising our health service?
      Hon. Members: Give us an answer!
      The Prime Minister: It is a hard question, but the answer is yes. It is not just that cardiac surgery centre which is a good example, but the new hospital that I opened in Carlisle last week. There are another 30 new hospitals being opened and every accident and emergency department in England is being modernised, with more nurses and doctors. Yes, there is a long way to go, but under this Government we will get there.

European Council
3.32 pm
The Prime Minister (Mr. Tony Blair)rose—[Interruption.]
Madam Speaker: Order. Will Members who are leaving please do so quietly?
The Prime Minister: With your permission, Madam Speaker, I wish to make a statement. Together with my right hon. Friends the Chancellor of the Exchequer and the Foreign Secretary, I attended a meeting of the European Council in Feira, Portugal, on 19 and 20 June. A copy of the Council's conclusions is available in the Library of the House.
I also had a series of meetings in the margins of the Council, with the Prime Minister of Belgium on illegal trafficking in people and football hooliganism, with the Prime Minister of Greece, Mr. Simitis, in the wake of the appalling killing of Brigadier Saunders, with the Spanish Prime Minister on economic reform, and with the French Prime Minister on French plans for their presidency.
The most contentious issue at the Council itself was the question of how best to tackle the problem of cross-border tax evasion within the European Union. For many years, the Commission, and indeed most member states, have argued that the best way to deal with that issue is through tax harmonisation—by requiring all countries to introduce a withholding tax on savings income paid out to non-residents. For our part, we have argued consistently that an EU-wide withholding tax would not only be seriously damaging for the City of London, but would be completely ineffective in tackling tax evasion. However, we have also made it clear through the long and complex negotiations that we fully agree with the objective of fighting international tax abuse caused by banking secrecy.
The outcome that my right hon. Friend the Chancellor and I achieved at Feira was fully in line with the principles and objectives we set out. It was, as I said yesterday, a personal triumph for the Chancellor. This is a comprehensive agreement, which fully protects the competitiveness of the City. All 15 countries have now agreed to accept exchange of information, not a withholding tax, as the way forward for the EU, and implementation of the European Union regime will depend on the progress made in agreeing similar measures with third countries and dependent territories. Even in the transitional period, only two of the 15 countries have said that they will definitely retain a withholding tax. This is an excellent agreement for Britain and for Europe, and it shows once again how the strategy of positive engagement in Europe both protects and indeed enhances the country's national interest.
That was also demonstrated at the last European Council at Lisbon, where we agreed a radical 10-year programme of economic reform for Europe. Since Lisbon, there has been progress in taking this agenda forward, including directives on electronic commerce and electronic money, agreement in respect of copyright, and new proposals on public procurement. At Feira, we agreed a charter for small enterprises, a new strategy on scientific and technological research and a hugely ambitious action plan on electronic Europe which will underpin efforts to
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create a dynamic knowledge economy in Europe. At the same time, we invited the Commission to accelerate work on the single market in financial services, energy liberalisation and aviation.
Heads of Government discussed the proposed charter of rights. I made clear my view that the charter should pull together in a single document the rights that European citizens enjoy, that it should be political in nature, not legally binding, and that it should not impose new legal obligations on member states. The House will welcome the fact that there was a good deal of support for that approach from other Heads of Government. The charter will be one of the main issues for discussion at the Biarritz European Council in October.
On enlargement, we agreed on the need to keep up the momentum in negotiations with the candidate countries.
On the European Union's preparations in the intergovernmental conference, we heard a progress report from the Portuguese presidency, setting out the options for re-weighting votes in the Council of Ministers in favour of the larger member states such as the UK, for reforming the size and structure of the Commission and for looking again at which issues should be decided by qualified majority voting.
We also discussed the arrangements agreed at Amsterdam to allow closer co-operation among a group of member states. Such arrangements of course already exist, for example in Schengen. We will need more such flexible co-operation in an enlarged European Union, but, in this context, the Council reaffirmed in its conclusions the need for coherence and solidarity in an enlarged EU.
We also made further progress on European defence. Close working links between the European Union and NATO are being put in place, together with special consultation arrangements with those European allies who are not in the EU. The priority now is on how Europe will deliver on the headline goal that we set ourselves at Helsinki, and that will be the focus of work in the next six months. We also adopted targets for the civilian aspects of crisis management, such as the provision of police officers.
Finally, we discussed a range of international issues—Russia, the Balkans, the middle east peace process, and Africa on which President Thabo Mbeki of South Africa addressed the Council.
The summit was, again, a successful one for Europe and the United Kingdom. I have no doubt at all that it is vital for British industry, British jobs and British influence that we continue the policy of constructive partnership with the European Union and, under this Government, that is precisely what we shall do.
Mr. William Hague (Richmond, Yorks): I start by welcoming several elements of the communiqué, including the commitment to the internal market and greater co-operation on tackling drugs. I congratulate the Prime Minister on one particular diplomatic triumph: after many years of difficult negotiation, carefully crafted compromises and repeated isolation, he finally got the Foreign Secretary and the Chancellor to talk to each other. Having said that he will not fight over every headline any more, he is leaving the job to those two, and they are extremely good at it.
I offer the Prime Minister our strong support for his reported attempts to stop incorporation into the treaties of the charter of fundamental rights. Must he not also ensure

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that it is not attached, even as an annexe, to the treaties; that it is not adopted in any way that could lead to it later becoming politically binding; and that it does not contain any new rights from those already discussed? Can he give all those assurances today? Will he comment on the fact that, while he has been trying to prevent it becoming legally binding, his Members of the European Parliament voted on 16 March to make it legally binding? When will he get an increasingly divided Labour party under control on this subject?
On the withholding tax, the Prime Minister has claimed success for the Chancellor over resisting something which, of course, he could have stopped at the very beginning. Has not a Commission spokesman said of the Government's comments that their "relentless spin" is "grossly misleading"? What a surprise.
Was it not a great mistake to continue at the summit down the path of an EU security and defence policy that is increasingly autonomous of NATO? The Prime Minister's assurances on the matter seem to be undermined by the comments of the French Minister responsible for European affairs, who said last week in connection with defence policy:
We don't agree with the "Americanisation" of the world … We are saying that together we can build a new superpower … and its name will be Europe.
Do not such comments suggest that those who say that there is no danger to NATO from the initiative are rather naive?
Will the Prime Minister comment on reports this morning that Turkey has indicated its intention not to allow NATO to lend weapons or equipment for the automatic use of the EU, and its statement that the decision taken at Feira is not the final one? Is there not a danger that the initiative is beginning to drive a wedge between members of NATO, of which we have always warned?
Midway through the crucial intergovernmental conference, was it not a unique opportunity to put the case for the type of Europe that the British people want to see? Was it not the ideal time to set out a comprehensive vision of a Europe that is more flexible, outward looking and reformed? Why did the right hon. Gentleman not stand up at Feira for the vision of a more flexible Europe in which nation states can work together? Is it not time that he put the case for greater flexibility, given that he was apparently ambushed by President Chirac and Chancellor Schroder, who told him that they would proceed with closer integration themselves, whether he liked it or not? Why does the Prime Minister instead continue to be carried further down the alternative, integrationist route? Why, after Feira, is a further loss of the British veto on European legislation still on the cards? Why is the French presidency still poised to launch an ambitious so-called social agenda, as it has promised? Why will rights and powers continue to be lost from our national Parliament?
Why, after the summit, is there still no specific timetable for enlargement? The Prime Minister claimed yesterday that the IGC agenda was focused on the reforms necessary for enlargement, so why is he not pressing for reform of the policy which, more than anything else, is holding up enlargement—the common agricultural policy? Why, after all the talk, is real CAP reform still not on the agenda?
One issue was noticeable by its absence from the statement: the single currency. The Prime Minister has now issued a helpful clarification, saying that he is in
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charge of the Cabinet; now that he is in charge, let him tell the country where he stands. Does he agree with the Foreign Secretary and the Secretary of State for Trade and Industry that the Government should be putting the case now for the euro; or does he agree with the Chancellor and the Minister for Europe that they should not? Does he agree with the Chancellor's assertion that the Treasury is the guardian of the so-called five tests, or with the Deputy Prime Minister, who immediately contradicted that assertion? Perhaps he agrees with the Secretary of State for Northern Ireland, who is reputed to have told friends that the Chancellor has a territorial fetish about the euro. All those Ministers agree that they want to scrap the pound, but they cannot agree on whether to do it openly or by stealth.
In the meantime, the cases for real reform in the EU and for flexibility are not being put, so the case for ever-further European integration is winning by default. While the Cabinet is busy tearing itself apart, Europe continues to move in the wrong direction.
The Prime Minister: The one advantage of all that is that the right hon. Gentleman has tried to put forward some policies of his own. It is worth analysing them.
Incidentally, on the question of divisions among Members of the European Parliament, I spoke to one or two MEPs from both the Conservative and the Labour groups. The one point on which they were agreed is that there is no group less disciplined and more disunited than the Conservative group in the European Parliament.
Let me go through the right hon. Gentleman's policy positions. First, it is absolutely clear from his remarks that he would block defence progress altogether. He says that the defence initiative that we have undertaken is in danger of dividing people and pulling NATO apart. NATO has endorsed the defence initiative—it is in favour of the defence initiative—for a perfectly sensible reason: it is an initiative to be undertaken when NATO does not want to be engaged in peacekeeping and humanitarian tasks. It is fully accepted by everyone that that is sensible. If we opted out and took no part in the debate in Europe, it would be run by those who are hostile to the whole idea.
The right hon. Gentleman says that we never needed to fight the withholding tax. Only a few months ago, the shadow Foreign Secretary said:
The debate is no longer about whether the withholding tax is going to be imposed on Britain. It is now simply about how much damage it will cause and to whom—
so the right hon. Gentleman might have been a little more gracious. Now we see the important difference between our two parties. He would say that we should have vetoed the measure right from the start. It is true that we could have done so, but, as a result, on every other issue on which we needed other countries' support to get things done, we would not have had their support, because we would not have put our case positively or constructively, or argued for it, but simply wielded the veto and then found the veto used against us in ways that we did not like.
The right hon. Gentleman goes on about the policy on the euro being somehow by stealth, but the Government are committed to a referendum on the euro. He will not allow people a referendum on the euro in the next Parliament, even if it were in the interests of British jobs, industry and investment. If he rules out the euro on

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principle for the next five years, why not rule it out for ever? The truth is that he has a principal policy position, which is to rule out the euro for the next Parliament, but to contemplate it for the Parliament after that. I cannot imagine anything more foolish as a policy for this country.
The right hon. Gentleman wants us to go faster on enlargement—that is what he said. His policy is to renegotiate the treaty of Rome and to block the treaty on enlargement until that renegotiation is followed through. He is shaking his head, but the right hon. Member for Horsham (Mr. Maude) is nodding. The policy of the Leader of the Opposition is to block enlargement. To achieve that renegotiation, he needs every other state in the European Union to agree. Not one agrees with him. In other words, he would have to go to a European summit to block the very enlargement that he has the cheek to stand at the Dispatch Box and tell me that he wants more of.
As for the extension of qualified majority voting, we know why the right hon. Gentleman has come up with that policy. Let me ensure that I have it right: any extension of qualified majority voting results in a referendum. Is that right? [Interruption.] This is the only way to get policy out of the Conservatives. One has to resort to cross-examination. Therefore, any extension of that voting would result in a referendum.
The shadow Foreign Secretary also said that, if this Government agreed to a treaty at Nice, he would reopen negotiations if the Conservatives were elected and, presumably, he would have a referendum on that. Doing so would put the entire position in Europe in a state of complete chaos.
How come any extension of qualified majority voting deserves a referendum? When the right hon. Gentleman and other individuals on the Conservative Benches were all Ministers at the time of the Maastricht treaty, they denied the British people a referendum. The largest extension of qualified majority voting was agreed by a Conservative Government, first in the Single European Act and secondly at Maastricht—but there was no referendum. The Conservatives have done that because Mr. Sykes has come along with his money and made them do it. If anyone believes that it was a coincidence that that new policy was announced one day and that Mr. Sykes divvied up the money the next, they must be very naive indeed.
Now, there is one major difference between us on Europe, quite apart from everything else. The policy of the Labour party and of the Government is not for sale; the policy of the Conservative party is.
Mr. Charles Kennedy: The Prime Minister shares the incredulity of many hon. Members of all parties that the much-vaunted new referendum come-what-may approach of the Conservative party did not even merit a question from the Leader of the Opposition between last week and this week, which probably tells us all that we need to know about consistency from that quarter where Europe is concerned.
On the withholding tax, does the Prime Minister agree that the welcome progress that the Government have made, both before and after the summit, must be followed
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up at a more global level as well as closer to home? What further proposals do the Government have to help to bring pressure to bear on offshore financial centres that operate within our jurisdiction to make good the progress achieved?
On the charter of rights, given that the right hon. Gentleman has said that the "gravity" of opinion is now swaying in a British direction, does he agree that, as the European convention on human rights has already been incorporated into Scots law—a considerable issue with which to grapple—and that that prospect is forthcoming for English law later this year, there may well be an argument for the EU as a body subscribing or becoming a high contracting party to the ECHR? If we are to move in that direction, rather than the charter direction, we believe that there is a strong case for a proper written constitution for Europe that clearly delineates the powers, responsibilities and jurisdictions of all levels within the EU. Does he agree, and is that something that the Government will further consider?
Finally, on the euro, if the message—largely credible—of the summit was that, where Britain engages rationally and positively, effective influence can be exerted, does not the same argument apply to the development of the eurozone and our participation in it? Given that our influence is virtually nil because we do not subscribe beyond the position already adopted by the Government, whose words have been mixed words of late, does the Prime Minister recognise that those of us who favour increasing engagement in the argument are worried that the headcase tendency wants to take this country out of Europe? Membership of the euro is but a fig leaf for that argument. The danger is that the prepare-and-decide policy espoused by the Government is beginning to look very much like the wait-and-see policy of the right hon. Gentleman's predecessor. Will the Prime Minister at all costs resist the temptation to follow his predecessor's lead, which we know ended in tears?
The Prime Minister: Let me revert for a moment to the headcase tendency. I meant to say that it is truly bizarre that the Conservative party is committed to a referendum on any extension of qualified majority voting, even a minute extension, but will not offer an opportunity for a referendum on the single currency in the next Parliament.
On the withholding tax and exchange of information on tax issues, yes, it is important that we pursue that. One of the most important aspects of the agreement that was secured is that we are pursuing, in parallel, exchange of information at an international level with countries such as the United States and Switzerland. That is important. Exchange of information, greater transparency and an end to banking secrecy are all worthwhile objectives, because they help to make sure that people pay the tax that they owe. However, it is important that we do not end up with the EU adopting rules to that effect, and find that, in a global economy, money simply goes to tax havens elsewhere. That is why we must pursue the matter at an international level.
On the charter of rights, I do not take the view that the Conservative party takes. It is sensible that we have a strong commitment to human rights and liberties in the European Union. We need to make sure that that does not unintentionally result in new laws which we in this country have not had an opportunity to scrutinise properly. We must guard against that.

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With respect to positive engagement, this country's position is far stronger in Europe than it has been for many years. [Interruption.] Conservatives Members said that we just give in. That is after a summit at which the others changed their minds on the withholding tax; we did not change ours. Conservative Members cannot get their minds round that.
On the eurozone, we play a constructive part now in European economic policy. In one sense, because of the Lisbon economic summit, we have been leading the debate on that, along with other countries. It is important that the five economic tests are met for successful British participation. The position of the previous Government was not the previous Prime Minister's fault. Some members of his party were in favour of the principle of the single currency and some were wholly opposed to it.
That is not the present situation. We are in favour of the principle of British membership of a successful single currency but, for it to work, the five economic tests must be met. That is a sensible, pragmatic position. It allows us to make the tests, as the vast majority of the British people would want. Moreover, by allowing people the final choice in a referendum, our position is democratic as well.
Mr. Giles Radice: After the breathtaking lack of generosity on the Conservative side, may I congratulate my right hon. Friend and the Chancellor on their success in getting the European Union to accept that tax evasion should be tackled on the basis of exchange of information, rather than through a withholding tax? In his view, would the same excellent result have been achieved if, instead of using patient and tough diplomacy, we had threatened to use the veto?
The Prime Minister: No, it would not. The tragedy of the Conservative party's position is that, despite what people say has been its tradition, for the first six or seven years, even under Margaret Thatcher, it was prepared in the single European market, for example, to combine effectively with other countries. Indeed, it gave up a larger extension of qualified majority voting power than has been done since, apart from under the Maastricht treaty, which it signed.
It is so obvious that when we are in co-operation and partnership with 14 other countries, the sensible way to get the best for one's own country is to form alliances, to engage constructively and to be positive. That approach yields results for this country.
The Conservative party would now be blocking the very enlargement that is the next focus of the European Union. [Interruption.] It is no good Conservative Members saying that they would not. They are committed to blocking enlargement unless they renegotiate the treaty of Rome, and they cannot point to any country that is prepared to agree with them on that. The dangers of a destructive approach are not only connected with Europe; a destructive, negative approach to Europe is a betrayal of the British national interest.
Sir Peter Tapsell (Louth and Horncastle): Does the Prime Minister recognise that, although virtually no serious politician is advocating that Britain should leave the European Union, British public opinion is steadily moving in that direction, and that that movement will
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become an irresistible political flood unless the steady erosion of British democratic sovereignty is seen to be ended?
Did the right hon. Gentleman at the European Council over the weekend, and will he at Nice when the next treaty is being negotiated, make it clear that Britain will not permit any further extensions of majority voting, and that we shall retain our right to protect our vital national interests, as was promised to us in the 1972 referendum, by retaining our power of veto where we believe that our national interest is threatened?
The Prime Minister: I suppose that it is of some consolation to the hon. Gentleman that increasingly he is the voice that represents where the Conservative party is today. He says that the tide of opinion is moving in the direction of withdrawal from the European Union. I do not think that that is true, and I believe that it would be disastrous for the British people.
Three million jobs are dependent on the EU. More than 50 per cent. of our trade is with the EU. When the hon. Gentleman says that any qualified majority voting is a bad thing, I beg to differ with him. It is important in certain instances, especially in the completion of the single Europe market. That could not be completed unless we had qualified majority voting rather than a veto. In areas such as tax, defence or social security, I shall fight hard to retain the veto. Elsewhere, I shall consider what is in the British national interest. I regard the Single European Act as being in the British national interest, as is the single market. It would be wrong for the United Kingdom to divorce itself from Europe. Whether that is popular or unpopular, we should continue saying it if we truly have the best interests of this country at heart.
Mr. Bill Rammell (Harlow): Does my right hon. Friend share my sense that Conservative Members have never been as quiet following a European Council statement, perhaps indicating that over the withholding tax their fox has been shot? Does he agree that having referendums on every issue that comes out of the forthcoming intergovernmental conference would bring the business of the European Union to a standstill and would delay enlargement indefinitely? Is it not the case that the Tory party's stance on this issue has nothing to do with national interest and principle and everything to do with the £20 million that is on the table from Paul Sykes?
The Prime Minister: That is right. Mr. Sykes has made it clear that he believes—he is entitled to do so—that Britain should get out of the European Union. He has made it clear that he wants and requires a referendum on any extension of qualified majority voting and on any treaty that is agreed at Nice. The Conservative party has now agreed to those policies. However, they would be disastrous policies for the country. We would be a laughing stock in the rest of the world if we ended up saying that any extension of qualified majority voting would result in a referendum of the entire British people. If we went one further, which is what Conservative policy is now, and said that we would block enlargement unless there were a renegotiation of the essential treaty—[Interruption.] Conservative Members say that they will not do that.

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The Conservatives' policy is to go for a new position under the treaty of Rome where, as the Leader of the Opposition said, one can pick and mix and match any policy one wants. I cannot think of even another conservative party in Europe that supports such a thing. I do not know whether any Opposition Members can. If there is not even a conservative party that supports that, and there is no Government who support that, it will not happen. Yet the right hon. Gentleman's position is that he would block any treaty on enlargement unless such a provision were agreed to. It is impossible to think of a more irresponsible and foolish policy. In my view, it is directly linked to those people who now fund the Conservative party.
Mr. David Curry (Skipton and Ripon): Is there any aspect of the eventual decision whether to join the euro that depends upon political as well as economic judgment?
The Prime Minister: The short answer is that the tests are economic tests. We have resolved the political issue. Of course, there are political implications. There are constitutional implications. But each of those has been resolved by the Government. [Interruption.]
Madam Speaker: Order. I wish that right hon. and hon. Members on the Opposition Front Bench would not cry out. I expect better behaviour from those on the Front Bench.
The Prime Minister: In the Chancellor's October 1997 statement all those issues were resolved, which is why we have said that, in principle, successful membership of the single currency is in the British national interest. We have also said, rightly, that if the test is the national economic interest, those five economic tests have to be met. That is a sensible position. It allows us to engage constructively. I simply say—I imagine that the right hon. Gentleman agrees—that if the Government, or any Government, were to say that we were ruling out the single currency, there would be a flood of inward investment out of this country virtually overnight.
Mr. Roger Casale (Wimbledon): Does my right hon. Friend agree with the conclusions of the report of the European Scrutiny Committee on the intergovernmental conference that, as institutional reform is an essential precondition of enlargement, the IGC should focus specifically on the institutional reform issues left unresolved at Amsterdam, so that enlargement can take place?
Does my right hon. Friend have an answer to the shadow Foreign Secretary, the right hon. Member for Horsham (Mr. Maude), who, in last week's debate before the Council meeting, asked what was the point of seeking constructive engagement, of trying to reach consensus and of further institutional reform of the EU at this stage? Many Labour Members were left with the distinct impression that many Opposition Members failed to see the point of the EU at all.
The Prime Minister: The point of enlargement is clear. This country has entered into a binding commitmen
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to help enlargement. As the EU enlarges, it simply makes no sense whatever for us not to debate and then decide the key things that have to change to make enlargement work. If the EU expands from 15 to 20 or 25 countries, it will obviously be important to take account of that in the institutions of the EU. That is why the intergovernmental conference is necessary, and that is why it would be completely irresponsible to block it.
Mr. Michael Howard (Folkestone and Hythe): Why is the Prime Minister so implacably opposed to a flexible Europe? Why do we not say to our European partners, "We don't want to stop you doing what you want to do, as long as you don't make us do what we don't want to do"?
The Prime Minister: I am not opposed to a flexible Europe at all. As I said in my statement, enhanced co-operation must be part of our discussions in the European Council in Nice. What I am opposed to, however, is Britain opting out to the slow lane in a two-speed Europe, and letting other countries determine the circumstances in which we can then join the fast lane. That has been one of the great dangers of British foreign policy towards Europe for a number of years. I am all in favour of enhanced co-operation, but I want to know its terms and rules, and I want to make absolutely sure that in determining that, we do not opt out of the debate and then find that others have determined how Europe develops, and that we have lost influence in it.
Mrs. Alice Mahon (Halifax): Did any discussions take place on the increase in killings and kidnappings and the continued ethnic cleansing of minorities in Kosovo that was almost certainly carried out by the Kosovo Liberation Army, now called the Kosovo Protection Corps? Did any discussions take place on the discovery of the huge cache of arms approximately half an hour from Agim Ceku's headquarters? Will the KLA be allowed to ethnically cleanse Kosovo?
The Prime Minister: There was an extensive discussion on Kosovo in the summer. There are significant problems with some of the extremists on the Kosovan side who attempt to drive Serbs from their homes. However, we should not ignore the fact that enormous progress has been made in Kosovo, despite its difficulties. We should never forget that if we had not taken action in Kosovo, 1 million more refugees—genuine asylum seekers—would be touring Europe.
We have much more to do; the United Nations force is working hard with the civil authorities, which are in a position to help to run the country. We are doing everything we can to prevent the sort of extremism to which my hon. Friend referred. However, it would be wrong for people to think that the whole of Kosovo was marked by such outrageous and wrong disturbances, and by elements of ethnic cleansing. On the whole, the new administration is settling down; elections will be held and there is every possibility of a stable future for Kosovo. It is obvious that the UN force will have to stay there for some time. However, I emphasise that if we had not taken action, the position would have been much worse.
Mr. William Cash (Stone): Does the Prime Minister accept how deeply the Turkish Government were

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offended by events in Feira at the weekend? Does he know that one of the greatest problems that faces European defence and security policy is the issue of secrets between us and the United States of America within NATO? How will he deal with that question? Has he discussed it with President Clinton? Has he reached a solution? In the light of increasing movement towards a common foreign, security and defence policy, how will he find the resources that should be made available for the sort of policy that he is pursuing? Average defence spending is 2.5 per cent. of gross domestic product, and to achieve the objectives, not only would that figure have to be increased to between 5 per cent. and 7 per cent., but the whole of Europe would have to be taxed on a massive scale.
The Prime Minister: The trouble is that one knows that the hon. Gentleman is simply opposed to anything that comes out of Europe. The defence proposals are for peacekeeping and humanitarian missions in circumstances in which NATO does not want to be engaged.
Mr. Cash: The Prime Minister knows that that is not true.
The Prime Minister: It is true. It is sensible for the European Union to have that facility. It is extraordinary if we are always in a position whereby even if the United States of America does not want to be involved, Europe has no capability for peacekeeping and humanitarian missions. The matter will be decided by unanimity. We take the lead in that debate and we are shaping it in the right way. There are issues that relate to intelligence; I have no doubt that they can be resolved. As I said earlier, both NATO and the United States support the initiative.
If we did not support the initiative but turned our back on it, what would happen? There would still be a common defence policy and a common security policy in Europe, but this country, which probably has as much to contribute to such a policy as any other European country, would not be part of the debate and the discussions. I emphasise to Conservative Members a point that would be immediately recognisable to any Conservative Prime Minister of the past 30 or 40 years: if we do not co-operate positively and constructively in Europe, this country suffers. We gain nothing by isolation or by being at the margins. If we engage in such a policy, we undermine the very national interest that we want to advance.
Mr. Tam Dalyell (Linlithgow): Was Wim Duisenberg right or wrong to suggest that there was a window of opportunity for entering the euro, and might a decision not to join now be an historic mistake of Messina-like proportions? Will my right hon. Friend look at the case study of the Inveresk Paper Corporation, which has plants in the Chancellor's constituency and in mine? The company is very efficient and used to export to Europe, but finds that the strong pound makes that impossible. Not only that, but its home markets are now invaded by Europe, driving people to extraordinary lengths to maintain a traditionally important industry.
The Prime Minister: I do not believe that any issue concerning the exchange rate on a day-to-day basis can be a reason for joining or not joining the euro. We have
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to take a longer-term perspective and ensure that the economic tests and conditions that have been set out are met. The principal criterion is sustainable economic convergence. When one studies Wim Duisenberg's comments carefully, one sees that he believes, of course, that there is an opportunity for the United Kingdom to join the euro, but that it is important for the economic conditions to be right, and they are not right at the present time.
We have taken the sensible position, which is to prepare for the euro, to agree in principle that Britain should be part of a successful single currency, but to ensure that, as I said yesterday, we do not repeat the mistakes with the exchange rate mechanism and join in circumstances in which the economic conditions are not right. That is why our position is in the long-term interests of British industry.
Mr. Crispin Blunt (Reigate): When the Prime Minister tells us that he will agree to a charter of fundamental rights that is political in nature, but not to one that is legally binding, is he not being a little naive, as experience tells us that such politically aspirational documents are used by the European Court of Justice as a guide for the judgments that it makes?
The Prime Minister: I think that at one point I was told that I was being naive over the withholding tax. The important thing about the charter of rights is that it is not legally binding. We will have pretty broad support on it from most other countries in the European Union Fifteen, and I think that people can exaggerate the dangers hugely. We have to deal with the question of whether the European Court of Justice could, by some side wind, end up extending our national legislation, or whether we can ensure that that avenue is closed off, which I believe we can.
Mr. Paul Marsden (Shrewsbury and Atcham): I welcome my right hon. Friend's statement and I congratulate him, the Chancellor and the Foreign Secretary on their achievements at the European Council. What progress has been made to bring to justice the killers of the British military attaché in Greece, and to prevent another such atrocity from being committed in the future?
The Prime Minister: First, let me repeat what I said yesterday—that we extend every sympathy to the family of Brigadier Saunders following this appalling terrorist act. I had a long discussion with the Greek Prime Minister about the measures that Greece is taking to find those responsible. For our part, we have said that we will co-operate with the Greek Government in any way, including giving them help—as we, unfortunately, have our own experience of dealing with terrorists. We will give any help that we possibly can to bring those people to justice. Brigadier Saunders committed himself to his country and did very valuable work for it, and it is an absolute tragedy that his life was cut short in that way.
Mr. William Ross: Will the Prime Minister consider using the term "murder" instead of "killing" for such terrorist acts, because the word "killing" tends to sanitise them in a way that the people of this country will not understand?

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Will the Prime Minister also reflect on the fact that, although our continental companion countries had a problem that led them to come up with the idea of a withholding tax, that is not the only means of cross-border tax evasion in the European Union? Is he aware of the huge sums that are being laundered following the cross-border smuggling of fuel between Northern Ireland and the Irish Republic, which is spreading, I believe, throughout the United Kingdom?
The problem of the differing rates of duty on tobacco and alcohol of late has led to similar problems in the south of England, at tremendous cost to the Exchequer. Has the Prime Minister discussed those matters with the Government of the Irish Republic over the past few days, and what action do the Government intend to take to end such smuggling operations?
The Prime Minister: As the hon. Gentleman will know, the Treasury has published proposals to address the smuggling issue. Of course I understand the concern about petrol price rises—although it is not unique to the United Kingdom. It is fair to say that in the past year, the biggest rises have really had more to do with the price of oil than with fuel duties. None the less, there is a price differential between Northern Ireland and the Republic of Ireland. However, we have other benefits in our country. It is important to recognise that although it was painful to raise duties in that way, it was necessary to do so because of the very large deficit that we inherited. I do not believe that interest rates would be at 6 per cent. today if the public finances were not in such sound order.
Mr. Alan W. Williams: What is our European partners' view of Britain's membership of the single currency? Are they enthusiastic, or even impatient, that we join? Does my right hon. Friend agree that once we are well in line with the convergence criteria, there will still be interest rate and exchange rate problems that rule out early entry? Although the euro has strengthened by 10 per cent. against the pound in recent weeks, do we not need a similar strengthening in the next year or two? In a sense, would not the general election, and the referendum, be better later rather than sooner?
The Prime Minister: The point that my hon. Friend makes is of course right, and shows why it is important that the economic tests are met. There is a convergence in long-term interest rates between us and the eurozone—between the United Kingdom and continental Europe. I
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think that this is the first time in my lifetime that that has happened. It has happened as a result specifically of the monetary and fiscal policy and measures that have put our country's economy on the strongest footing that we have had for several decades. However, there is still a short-term interest rate differential, and there are also the issues that my hon. Friend has raised. That is why, as I said, it is important that whatever the position in principle, in practice the economic tests have to be met.
Sir Geoffrey Johnson Smith (Wealden): The right hon. Gentleman seems to think that once the economic standards are met and we join the euro, that will be the end of the matter. In his mind, other tests—such as the political one, and, some would say, the constitutional one—do not seem to be a problem. Can he correct any false impression that he has given today that he does not realise that joining would entail such implications?
The Prime Minister: Yes, I think that I can correct any false impressions. I am not saying that there are not political or constitutional issues. I am saying that as far as we are concerned as a Government and as a political party, we have resolved the constitutional issue in this way: we do not believe that there is a constitutional barrier to a single currency. If one believes that there is a constitutional barrier to a single currency, one's policy on joining should be "never". What is absolutely absurd is for Conservative Members to say, "Never—for five years."
I do not doubt that there will be a big debate, politically and constitutionally, on the single currency; of course there will. That is the very reason why, on an issue of this importance, we have said that there has to be a referendum. Therefore, if we recommend to people, should we be re-elected, that we should join the single currency in the next Parliament, there will be a referendum on that subject. I have no doubt that people will make their political and their constitutional points. All I am saying is that, as far as we are concerned, the key test is the economic one of whether joining is good for British jobs, British industry and British investment.
As I said, in my view, for any United Kingdom Government to rule out membership of a single currency would have a devastating effect on this country's power and influence and on jobs and industry within the European single market.
Several hon. Members rose
Madam Speaker: Thank you, Prime Minister. We are going to move on now.

Community and Amateur Sports Clubs (National Standards)
4.19 pm
Mr. Andrew Reed (Loughborough): I beg to move,
That leave be given to bring in a Bill to establish national standards for community and amateur sports clubs; and for connected purposes.
First, I must declare an interest. I am a member of Birstall rugby football club and an honorary president of Loughborough Athletic football club, as well as a member of Leicester Tigers rugby club. However, my Bill is about helping our sporting tradition across the whole country.
My Bill is simple in its purpose, yet its benefits to sport could be enormous, because it will tightly define community and amateur sports clubs in law. Setting out that definition in the Bill will allow such clubs to be recognised by bodies such as, for example, the Charity Commission, the Inland Revenue, the Treasury and local authorities, for the purpose of deciding matters such as rate relief.
All hon. Members know—or we think we know—what we mean by the term "sports club". I am sure that all Members present today recognise the enormous benefits that such clubs bring to their constituencies. However, the Bill defines community and amateur sports clubs clearly so that in future we will all know exactly what we mean when we use the term "amateur sports club". I should like to pay tribute to Lord Phillips, who has done a tremendous amount of work in another place to develop a legal definition.
Sport is an integral part of British life. It provides enjoyment for millions of participants and spectators, and it can unite the whole country behind our top competitors and teams. Events in Belgium and on the cricket field over the past week or so have done nothing to dampen that enthusiasm, but sport is more than simply entertaining—it is hugely important too. It can play a key role in tackling social exclusion, stimulating economic regeneration and giving young people the best possible start in life through better health and education.
In the past, unfortunately, the value of sport has been overlooked. Many people have seen how it benefits individuals, without realizing how it helps society as a whole. Spending on sport has tended to be seen as an avoidable cost, not a necessary investment. As a result, other services have fared much better in the allocation of finite public resources.
Now is the time to act. Each of the main political parties has accepted sport's economic, social and educational benefits. It is one of the issues that crosses party lines in this House. Many progressive local authorities have set excellent examples for others to follow, and the Government have emphasized the importance of joined-up thinking, encouraging people to tackle multi-dimensional problems in new, integrated and imaginative ways. This is an area that needs genuine joined-up thinking across Government Departments, and I make no apology for using that overused phrase.
This Bill is not about Manchester United, Leicester Tigers, or Tim Henman at Wimbledon. It is about the local community clubs struggling to afford new nets, a kit or new balls for their youth section. It is about clubs that cater for sport for people with a disability, for increased
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participation among ethnic minorities and for women's sport. Their work is just as important, but is never properly funded.
The hon. Members who took part in yesterday's match against Wimbledon football club's disabled section at the millennium dome know only too well how hard it is to beat such players, and how important the game was for them. For the record, the House of Commons won 9–7.
In every community there are people—volunteers—who give their time and effort to make sport happen. Their efforts should be rewarded, not penalised. As the Rugby Football Union said on behalf of its volunteers:
Finance is a key issue … we share the frustration that the extra funding they attract through fetes, car boot sales, and raffles is then decimated by government taxes.
Most importantly, for many people, sport counts. The 1996 general household survey found that 46 per cent. of the population participate regularly in sport and recreation, and that 71 per cent. had participated in the past four weeks. As a country, we spend more than £11 billion a year on sports goods. The leisure industry is one of the fastest growth sectors in the economy, accounting for 2.6 per cent. of total consumer spending. However, at the same time Britain is increasingly described as a nation of couch potatoes, and a wide range of studies confirms that trend. Evidence is growing that many local sports clubs are closing, and participation rates are falling.
Last year, the Select Committee on Culture, Media and Sport concluded that active participation in sport
complements academic elements of education; and
it encourages social skills. Authoritative research indicates that exercise and participation in sport help combat social exclusion and improve health. There is proven research to show that participation in sport has a positive impact on crime, particularly among young people. The new sports action zones could make a real difference in tackling social exclusion in some of the most deprived areas in our country. I hope that the health benefits of a nation taking regular exercise are self-evident.
The Government are committed to the principle of volunteers helping to rebuild communities, and earlier this year called for a step change in volunteer action. I recognize that volunteering at a local sports club may not be the first thing that springs to mind when we talk about the giving age, but what could be more giving than the referee who gives up his or her weekend to make sure that competitive games are taking place all over the country? What could be more giving than to run around and be abused and unloved? Right hon. and hon. Members should know all about that.
Unpaid members of sports clubs and volunteers provide the bedrock of competitive and recreational sport in the United Kingdom. In 1995 it was estimated that 1.5 million people freely gave of their time to help provide sporting opportunities. That volunteer investment is estimated to be worth £1.5 billion per annum.
The Government's sports strategy, "A Sporting Future for All", recognises that, and places heavy emphasis on the role of sports clubs in delivering a better sporting chance for future generations. It says that people need
the amateur sports club with well trained adult volunteers to make sport and healthy exercise a life long habit.

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It also rightly recognises that sports clubs offer the only chance of keeping young people participating in sports after they have left school or college. For many, including myself, they offer sport at a suitable level. I still compete week in, week out, albeit at a very low level. They are also the grounding base for our future elite athletes—although I fear that it is too late for me.
At present, many sports clubs are treated as businesses in terms of taxation and local authority rates. Although it is obvious that the richest football clubs have great wealth, we all know that the fact that there is big money in football—for example, the £1.1 billion deal for the television rights to the premiership—does not mean that every football club is rich. Indeed, some would argue that money is disappearing from the grass roots as fast as it comes in at the top. Because all sports clubs are treated in the same way, many are heavily penalised, and my Bill would make a difference
The Bill has received widespread support from the sporting community, including the Football Association, the England and Wales Cricket Board, the Rugby Football League, the Amateur Swimming Association, the Rugby Football Union, the Lawn Tennis Association, UK Athletics, Sport England and the Central Council of Physical Recreation, as well as many local clubs throughout the country, such as the Lincoln Canoe Club, the Heather Sparkenhoe Cricket Club, York District Sports Council and—an excellent example of a community and amateur sports club—the Liverpool Harriers and Athletic Club.
There will be increased rate bills for many sports clubs arising from the revaluation of properties this year. Most importantly, many sports clubs do not receive rate relief because many local authorities find it difficult to afford the 25 per cent. that is required after offsetting from the national non-domestic pool. Rate relief also varies too much between different parts of the country. Some local authorities are very good and give 100 per cent. rate relief despite only getting 75 per cent. back from central Government. The CCPR estimates that rate relief for sports clubs would cost the Treasury just £35 million per annum, which is not too high a price to pay.
It seems clear to me that a legally defined status for community and amateur sports clubs would clear up that sorry mess. As it stands, the law stops short of recognising the promotion of any particular sport as a charitable purpose per se. I understand that the issues are complex, and that there has been consultation about the status of community and amateur sports clubs following the test case of North Tawton rugby club in Devon in 1995.
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I know that the Charity Commission has been looking at the matter closely, and I hope that it can see the massive discrepancies caused by the current definition.
We are not asking a great deal—simply for clubs to be put on the same footing as arts organisations. My Bill would define the status of clubs that would qualify under the Recreational Charities Act 1958. The Government's social exclusion report, PAT 10, recognised the need for the charitable status route in the case study of community work carried out at Leyton Orient community sports programme.
Sport is most effective when delivered in partnership with local authorities, central Government and sports governing bodies and their member clubs. Sports clubs offer a focal point for local communities and are one of the key links in the chain of talent identification and development.
This short Bill would simply define the legal status of community and amateur sports clubs. Its scope is limited and I commend it to the House.
Question put and agreed to.
Bill ordered to be brought in by Mr. Andrew Reed, Mr. Gareth R. Thomas, Mr. Ian Pearson, Mr. David Drew, Mr. Andrew George, Mr. Alan Simpson, Miss Anne McIntosh, Mr. Bob Blizzard, Mr. Crispin Blunt, Mr. David Taylor, Mr. Bob Russell and Gillian Merron.

COMMUNITY AND AMATEUR SPORTS CLUBS (NATIONAL STANDARDS)
Mr. Andrew Reed accordingly presented a Bill to establish national standards for community and amateur sports clubs; 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 146].
4.30 pm
Mr. Ian Bruce: On a point of order, Madam Speaker. We keep getting news that our English football team, and, unfortunately, our tug-of-war team are all losing. I seek your guidance, Madam Speaker, on how one can get a victory recorded in Hansard. As the president of the House of Commons sailing club, I am pleased to tell you that the House of Commons has just beaten the House of Lords, bringing the series equal at six all. We are looking forward to next year, when perhaps we can take the lead in that series as well.
Madam Speaker: I am delighted to be given that news, and to know that this House licks the other place in some things at least. On Monday night I was very disappointed when, yet again, we did not win the tug-of-war, so that news is very well received. Thank you.

Order of the Day
  Children (Leaving Care) Bill [Lords]

    Children (Leaving Care) Bill [Lords]
    Order for Second Reading read.
    4.31 pm
    The Minister of State, Department of Health (Mr. John Hutton): I beg to move, That the Bill be now read a Second time.
    Three years ago, the Government published Sir William Utting's review of the safeguards for children living away from home, which revealed a dismal catalogue of failure. Many children who had been taken into care to offer them help and protection had been neither protected nor helped. Some had actually suffered harm at the hands of those supposed to help them. Others had just been badly let down. They had been moved from placement to placement, from school to school, and were then turned out to fend for themselves when they reached 16. We know that three quarters of looked-after children leave care with no qualifications of any kind. Many experience unemployment and homelessness.
    These grim facts point to a failure of the whole system, for which we must all accept responsibility. However, the Government have a special responsibility to provide leadership, proper resources and clear direction in children's social services. We are now doing those three things.
    Perhaps more importantly, we need radically to change the system so that we begin to develop the same ambition and aspiration for children being looked after that we all naturally want for our own children. Such cultural changes within any service will take time—everyone accepts that—but with this Bill, and with the new resources coming on line in quality protects, we have a golden opportunity to make this step change, which is so badly needed.
    This will mean a major programme of change—a modernised service offering a clear framework for delivering the care, security, support and opportunities that children need. Whatever difficult and traumatic experiences they had before being taken into care, children who are looked after by local authorities are entitled to the same opportunities as all children. They are entitled to a good education, to the health care and other specialist services they need, and to consistent support, advice and practical help to guide them into adult life. This has not always been the case, but it must be so in the future.
    Today we are concerned with young people in care. The risks that they face include unwanted parenthood, failure at school, failure to gain employable skills, and failure to find a job or somewhere to live. The Bill addresses all these issues, and forms part of a concerted effort to improve the life chances of looked-after children.
    Quality protects is a key part of this effort to tackle the social exclusion of young people. Eighteen months ago, my right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) launched the quality protects programme to modernise children's services and tackle the failure of the local authority care service with a £375 million investment in children's social services.
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    When my right hon. Friend launched the programme, he asked us to keep two questions in mind. Would this have been good enough for me when I was a child, and would this be good enough for my children? That is the approach that we have followed in developing quality protects. We need to understand that these children are not just someone else's problem—they are the children of our country, the children of us all. That approach also underpins the Bill.
    The programme of reform that we have launched since 1997 is a major challenge to local authorities, the health service and the voluntary sector. It sets a series of new objectives for children's services, aimed at raising standards through the whole cycle of the "looked-after" regime. It includes ensuring that looked-after children gain maximum life chances from educational opportunities, health care and, of course, social care.
    It will help to ensure that, by the time young people come to leave care, they already enjoy good prospects for their adult life. Through all of that, we want to ensure that young people leaving care are not isolated as they enter adulthood, and that they participate socially and economically as full citizens of our country.
    Those are tough objectives, but we believe that they are achievable. Indeed they must be achieved if we are not to fail children in care once again.
    Mr. Hilton Dawson (Lancaster and Wyre): Recently, I held a conversation with a young person who spent a considerable amount of time in care as a child, and who expressed grave scepticism about the ability of local authorities to deliver on that ambitious and far-reaching programme. Can my hon. Friend reassure me on the Government's commitment to ensuring that local authorities do just that?
    Mr. Hutton: I can certainly reassure my hon. Friend. Furthermore, I pay tribute to the work that he has done as a Member in drawing attention to those matters. We have taken on board the issue of monitoring the performance of local authorities; we have a new system of performance assessment for them. We also have new powers, under the Local Government Act 1999, to intervene—if necessary—when a social services department is failing.
    The early signs of progress under quality protects are most encouraging. There is much more to do, as I am sure my hon. Friend and the whole House would accept. It is certainly true that no local authority will be able to opt out of the programme of change that we have developed. The challenge is being embraced with some enthusiasm by local government.
    My hon. Friend and I and many others in this place have been concerned for some time about the support that care leavers receive from local authorities. There has been an increasing trend to discharge young people from care early. Every year, about 5,000 young people aged 16 and 17 leave care. The proportion of care leavers aged between 16 and 18 who left care at the age of 16 increased from 33 per cent. in 1993 to 46 per cent. in 1998. That is completely unacceptable. It is part of the disturbing pattern of too many children and young people leaving care without a single qualification and of too many being unemployed and homeless.
    We are determined to reverse that trend. The Government believe that care leavers should be able to expect support from their parent—the local authority.

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    I am pleased to see that services for care leavers are beginning to improve. The Bill will ensure that they improve for all eligible care leavers, right across the country.
    In July last year, we published a consultation document entitled "Me, Survive Out There?", setting out all those issues and our proposals for dealing with them. We had a very good response. More than 160 organisations, authorities and individuals replied; more than 83 per cent. of the responses supported our proposals. We are most grateful to all those who replied. The Bill is the result of that consultation exercise.
    We believe that local authorities' responsibilities towards young people in and leaving care should correspond more closely to those of responsible parents. That means providing support and assistance for children beyond the age of 16. That is why clauses 1 and 2 place new responsibilities on local authorities to assess and meet the care and support needs of children aged 16 and 17 who are in their care, or who have left care. Such support includes providing accommodation and maintenance as necessary for the child's welfare.
    In future, the local authority that last looked after a child who has left care will be responsible for continuing support wherever that young person is living. That will clear up the unacceptable confusion about responsibility that often occurs at present.
    Mr. Patrick McLoughlin: The Minister will recall that we recently corresponded about the care case of a child who is being looked after by grandparents. Often, grandparents step in to provide a stable background when parents are unable or unfit to look after their children. However, a problem arises if the grandparents want to adopt the child, to give it an even more stable background, because the local authority relinquishes any system of support for the child. Does the Bill contain any provisions that would overcome that problem?
    Mr. Hutton: I am familiar with the issue raised by the hon. Gentleman through our correspondence. However, the measure is about children who are being looked after by local authorities. I am not entirely sure whether the case he described would fall within it. He asked about post-adoption support arrangements. The Bill contains no provision for such matters. The arrangements that we are discussing are for looked-after children—the children who remain within the parental responsibility of a local authority. The wider issue of the arrangements for adoption and any reform of those arrangements are with my right hon. Friend the Prime Minister. He is considering the report that he received last month, and announcements will be made in the usual course of events to deal with that issue.
    Mr. John Bercow (Buckingham): Will the regulations that flow from clause 2 be subject to the negative procedure, which does not allow for debate, or to the affirmative procedure, which does?
    Mr. Hutton: The regulations under clause 2 will be subject to the negative procedure. However, the
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    arrangements in relation to clause 6 that affect benefit entitlement will be subject to the affirmative procedure. The hon. Gentleman huffs and puffs about the negative versus the affirmative procedure, but he often huffs and puffs. However, he should not be surprised by the regulatory arrangements that will be made under the Bill, because it uses the normal procedures. When the Bill affects a person's benefit entitlement, that will be a perfectly appropriate issue to come before the House under the affirmative resolution procedure.
    It is wrong for the hon. Gentleman to suggest that the House will not have the opportunity to consider the proposals in the normal course of events; of course it will. I shall be very interested to learn whether he wishes to take part in debate in the Standing Committee about the regulations. We should look forward to his contribution, but I would be surprised to see him there. However, stranger things have happened.
    Rev. Martin Smyth: In answer to the hon. Member for Lancaster and Wyre (Mr. Dawson), the Minister said that he thought he had sufficient powers to cope. However, in this mobile age, is he aware that social workers face increasing difficulties in keeping in touch with families and children? Do we have enough social workers to do that job?
    Mr. Hutton: Social workers do an important job and it is the responsibility of Government to make sure that they have the right resources and can attend the right courses so that they obtain the educational and professional qualifications that will enable them to develop their skills as their careers progress. We are doing that. The Bill is specifically about looked-after children, and its arrangements will significantly improve the ability of local authorities to keep in contact with children who leave care. That is one of the most fundamental aspects of our proposals. We all accept that social work is not easy. Social workers do difficult jobs, sometimes in very difficult circumstances. We want to ensure that they have the support that they need.
    Clauses 1 and 2 will place new responsibilities on local authorities. In future, the local authority that last looked after a child who has left care will be responsible for continuing support. Responsible local authorities will have a duty to keep in touch with the young people wherever they move to, an issue to which the hon. Member for Belfast, South (Rev. Martin Smyth) alluded. That duty will apply beyond the age of 18, and at least until the age of 21. No longer will local authorities be able to forget their responsibilities to the young people who leave their care.
    It is important that young people are helped to prepare and plan for their future to enable them to achieve their aspirations. That is why from their 16th birthday—or as soon as they become eligible under the new arrangements—young people in and leaving care will have a pathway plan. The plan will map out a clear pathway to independence and will cover education, training, career plans and the support to be provided by the local authority.
    Ms Julia Drown: My hon. Friend said that the Government should, as far as possible, reflect for children in care what parents want to do for their own children. Does he agree that we should be trying to reduce

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    the number of age limits in the Bill, because parents try to maintain their help and support for their children no matter what their age? Will he keep that aspect of the Bill under review?
    Mr. Hutton: That is an intriguing question, but I am not sure how a Bill such as this could be constructed without any reference to age limits. That would be a difficult job.
    We are trying to align more closely the responsibilities of good local authorities with the behaviour of responsible parents. There are key milestones in the life of a young person, and reaching the age of 18 is one of them because it is the age of majority. The Bill will allow a local authority to continue to support a young person beyond the age of 18. We are therefore giving local authorities important new responsibilities, which meet what my hon. Friend and I both accept is a need to ensure that these young people get the support that they require.
    Does my hon. Friend the Member for Stourbridge (Ms Shipley) wish to intervene?
    Ms Debra Shipley (Stourbridge): I was hovering; I thank my hon. Friend for anticipating my wish to intervene.
    I welcome and applaud the Government's excellent and long-overdue initiative on pathways, and thank my right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) for getting it going. Professionals in the front line in my Stourbridge constituency welcome the initiative, but have doubts about its resourcing. Machinery and pathways will be put in place and people will act as parents. However, parents not only give their children support and caring, but put a lot of money into their upbringing. Will my hon. Friend comment on that?
    Mr. Hutton: My hon. Friend said that I anticipated her intervention; she has anticipated a matter that I wish to discuss in due course. Of course we will not ask local authorities to discharge new responsibilities if they are not properly resourced. We are not unreasonable. I am sure that my hon. Friend will understand that some decisions about resources connected with the Bill must wait for the spending review that will be announced later this summer. However, we will implement the Bill sensibly, if that is what my hon. Friend is concerned about. We certainly will not put local authorities in a position in which they have to discharge extensive new responsibilities without being provided with resources.
    I was trying to set out some of the aspects to be covered by the pathway plan. We want young people themselves to be directly involved in drawing up their plan, along with other interested parties. The plan will be reviewed regularly to develop alongside the young person's changing circumstances and ambitions. The plan will continue in effect and be regularly reviewed until the young person reaches the age of at least 21; it will continue beyond that when the young person is in education or training.
    We also intend to introduce a parallel duty to provide these young people with young persons' advisers. Many young people are unaware of the services available to them or how to access them. It is essential that, under the new arrangements, young people receive the support and assistance they need in a co-ordinated and accessible way.
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    The young person's adviser will provide a single point of contact for the young person and will be easily contactable in times of crisis or whenever advice is needed. He will be able to put the young person in contact with other specialists, such as careers advisers. The adviser will be responsible for overseeing the pathway plan and ensuring that the young person receives the advice and support to which he is entitled. The adviser will be expected to fulfil the local authority's duty to keep in touch with young people who have left care.
    The Bill also deals with support for young people aged 18 and over.
    Ms Ann Coffey (Stockport): Before my hon. Friend leaves the subject of the young person's adviser, will he say something further about who that designated person might be? For example, does he envisage that the adviser will always be a local authority social worker, or will other people employed by the local authority or voluntary agencies be able to take on that role? As he will be aware, young people leaving care often have a lack of trust in the social work system.
    Mr. Hutton: My hon. Friend is right. As she intimated, there is no reason to restrict who can act as a young person's adviser, and we do not intend to do so. There is no reason why the young person's adviser has to be a local authority social worker, and that will not always be the case. We intend to develop that in regulation-making powers under the Bill, which relates to a matter to which the hon. Member for Buckingham (Mr. Bercow) alluded. There will be an opportunity for hon. Members and those outside to be consulted on that.
    Mr. Simon Thomas (Ceredigion): The Minister mentioned possible regulations on young persons' advisers. Will he confirm that those regulations will specify the need for the adviser to be culturally and linguistically appropriate to the young person? In Wales, for example, Welsh-speaking advisers would be needed to advise Welsh-speaking young people. Certain areas of England would need minority language and ethnic minority language-speaking advisers to be available for young people. That is an important aspect of such advice services.
    Mr. Hutton: I certainly accept the hon. Gentleman's concern in relation to Wales. Regulations made under this part of the Bill will be the responsibility of the National Assembly for Wales, not my right hon. Friend the Secretary of State. I am sure that the National Assembly will want to ensure that any such regulations cover the points to which the hon. Gentleman has referred.
    I have forgotten what point I had reached in my speech, but I do not suppose it makes a great deal of difference, so I shall continue.
    We believe that young people continue to need help and support even after they leave care and legally become adults at 18. However, they must be supported as adults, in the adult world. The Bill provides that the responsible authority must continue to keep in touch with such a young person until he is at least 21, and must continue to provide him with a young person's adviser and a pathway plan.
    The Bill also introduces a new set of duties to assist those young people. The responsible authority has a duty to provide general assistance, in cash or in kind, and

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    assistance with the costs associated with employment, education and training until the young person reaches 21, so long as his welfare requires it. If he is in education or training, the responsible authority must assist, if necessary, until the end of the agreed programme of education or training, even if that takes the young person past the age of 21. If the young person is in higher education, the responsible authority must provide vacation accommodation, or the means to secure it, if necessary.
    Since the pathway plan will continue to be revised and updated at least every six months to take account of the young person's changing needs and achievements, it is possible to envisage a case where someone coming late to education started his GCSEs at, say, 20, did well and was supported by the local authority through A-levels, a degree and even beyond.
    It is important to be clear about what those new duties mean. This is not the same duty to accommodate and maintain which applies to the younger group of 16 and 17-year-old eligible and relevant children. There will be no changes to the benefits regime for those of 18 and over, and they will be expected to find the bulk of their funding through the same routes as anyone else. The new duties are, however, a significant advance on the present position, whereby those young people are able to fall back only on local authority powers, not duties, to assist them—powers that we know are not used as extensively or as consistently as we would like.
    Mr. Dawson: Will my hon. Friend confirm that the new duties on local authorities will ensure that those young people for whom it is appropriate will be able to remain in foster care and residential care beyond the age of 18?
    Mr. Hutton: Yes, I have no difficulty in giving my hon. Friend that assurance.
    The Bill also extends authorities' powers to assist care leavers with education and training, which are both important. Currently, they can do so up to the age of 24 only if the young person starts the course before the age of 21. Clause 4 will get rid of that restriction, allowing local authorities to provide assistance whenever the young person starts the course. That provides a further safety net for young people aged 21 to 24 who fail to take up education options while the authority still has a duty to assist them. As I said, clause 4 also places a new duty on local authorities to assist such care leavers in higher education with vacation accommodation where it is needed.
    All those new arrangements for young people in and leaving care will be underpinned by a new financial regime, the foundations of which will be laid by clause 6. We believe that one reason for the trend of children leaving care at 16 is the perverse financial incentive for local authorities to push them on to benefits and so on to the benefits budget. The new financial arrangements will remove that incentive and recognise that young people in and leaving care need proper support and guidance, and not just cash.
    The funds from income support, housing benefit and jobseeker's allowance—to which those young people are entitled—will, therefore, be transferred to a new budget,
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    to be allocated to local authorities to support those young people properly. The budget will be based on local authorities' existing spend on that group, drawing in additional resources from the children's social services special grant and making extra money available to ensure that local authorities are able to fulfil their new duties to this vulnerable group.
    We want local authorities to act more like responsible parents towards the children in and leaving their care. We recognise that, at present, certain 16 and 17-year-olds, such as disabled children and lone parents, are eligible for income support even if they live at home with their parents, which acknowledges that they have special needs. The new financial arrangements will continue to recognise that those groups have special needs.
    Ms Julie Morgan: Many young people in Wales, particularly those from the Voices from Care group whom I have met, have expressed great concern about their transfer to the local authority from the benefits system. They are concerned that they might not have access to some of the services that they can use at present, such as crisis loans, and that the regulations that guide the benefits system will not apply. Can my hon. Friend reassure me on those points?
    Mr. Hutton: I am very anxious to reassure my hon. Friend on those points. Young children leaving care will not be worse off under the proposed arrangements. There is every possibility that they will be better supported by local authorities. That aspect of our proposals drew strong support from children's organisations in the consultation exercise undertaken on "Me, Survive Out There?". They could see the benefit of it.
    We are trying to make it easier for children to get the support that they need. The benefits system is a complex one through which to navigate a path and many young children leaving care do not get the support that they need from that system. We shall not reduce the amount of support for young children leaving care—far from it. We are looking at ways to increase the support that young people can enjoy in future.
    The new financial arrangements will continue to recognise that those groups have special needs. Clause 6 contains provisions that will allow the Secretary of State to except certain groups from the new financial arrangements, and we intend to use that power to ensure that disabled children and lone parents keep their present entitlements to income support.
    In combination with other related initiatives to help that age group, the Bill should mean that fewer young people will be discharged from care as soon as they reach their 16th birthday; more young people will stay in contact with the responsible authority and receive support for as long as they need it; more young people will live in suitable accommodation and maintain a stable tenancy; more young people will be in education, training and employment; and fewer young people will become socially excluded—that means fewer will be sleeping rough, in prison, dependent on benefits and living in poor and unsuitable conditions.
    Young people of 16 and 17 will no longer be forced to rely on the benefits system for their support. The local authority will be under a duty to provide for them, whether they stay in care or not. To ensure that no one

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    loses out, we shall set minimum standards for support in statutory guidance. I hope that that will reassure my hon. Friend the Member for Cardiff, North (Ms Morgan).
    The new duties to assist care leavers until they are at least 21 are especially important for education and training. Young people coming through the care system are likely to have lost ground relative to their peers. We shall give them the chance to catch up and gain the qualifications that are so important to making a career in the modern world.
    The Bill and the other initiatives that we are taking forward, including our strategies to tackle social exclusion, should ensure that young people in and leaving care get a fair deal at long last. For too long many young people have fallen into the trap of poverty, joblessness and homelessness after leaving care, because no one gave them the help they needed. The Bill will provide that helping hand and give care leavers a better opportunity to realise their true potential.
    In legislating in this way, and by means of the other steps that we are taking, the Government are making two very clear statements. First, we will act to correct injustice and poor provision wherever we find it. We will put the interests of those young people who have been badly let down by the system first and foremost, and we will make the necessary investment now to secure their futures.
    Mr. David Kidney (Stafford): I am glad that my hon. Friend is determined to take action, under the Bill and other measures, where standards fall below what is expected. Will the Government be assisted by the children's rights director or a children's rights commissioner in ensuring that they live up to their word on that?
    Mr. Hutton: Yes, certainly the children's rights director will have a specific remit on the regulated services for which the National Care Standards Commission has responsibility, including children's homes and local authority adoption and fostering services. The children's rights director will have an important contribution to make in ratcheting up the standard of services.
    Mr. Kidney: I am grateful to my hon. Friend for being so patient with me. Clearly, the children's rights director will be involved in children's homes under the new National Care Standards Commission, but what about all the other looked-after children who are not in children's homes? Will a director or a commissioner assist my hon. Friend in ensuring that the new entitlements are secured for those children?
    Mr. Hutton: I am grateful to my hon. Friend. I said in response to his first intervention that the children's rights director clearly has a responsibility, especially in adoption and fostering services. I am sure that he will find—he knows about the subject—that many looked-after children are in foster placements, so the role of the children's rights director goes beyond regulated children's homes.
    The Government's objective is to ensure that no looked-after child will go without help, that every child is included, that every child will have the chance to make the best of his or her life and that we will never allow another generation of looked-after children to be discarded in the way others have been.
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    The second clear statement that we are making is that we want to pursue those radical changes in partnership with all those who share our view that it is right and proper to put the needs of those who have been marginalised for too long centre stage in the programme of change.
    The future holds out the prospect of further progress and opportunity in all those areas. Of course we have not yet done everything that needs to be done—a lot more needs to be done—but we have started a process that I believe can make a difference to the lives of some of the most damaged children and young people in our society. I am sure that the whole House wants to see that happen. I commend the Bill to the House.
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    Mr. Philip Hammond (Runnymede and Weybridge): I start by confirming for the record that there is a substantial degree of cross-party consensus in the House on the Bill, although it is perhaps not so clear that there is such a consensus in the Scottish Parliament. That is important in the context of the way that the Bill works, and I shall return to that point.
    The Bill builds on the Children Act 1989, both in terms of the principles behind it and its very architecture. It responds directly to the recommendations and findings of Sir William Utting's review of safeguards for children living away from home, following the inquiry established by the previous Government. As the Minister explained, the Bill in its original form, as introduced in the House of Lords, sought to address the needs primarily of 16 and 17-year-olds either in or leaving care—that is, the needs of children. He described the perverse incentive in the present system for local authorities to shuffle children off their budgets and on to the social security budget, and the discontinuity in responsibility for the care of those who move away from their home local authority areas.
    The Bill removes that perverse incentive, provides a series of duties to support 16 and 17-year-olds who are or have been in care and places the responsibility squarely on the local authority that last looked after those children. The Bill's objective, as the Minister described it, is to increase the number of 16 and 17-year-olds staying in care and to extend support to those who leave it. No one can argue with that objective. We have a moral responsibility to ensure equality of opportunity for children who grow up in care. We also have a pragmatic responsibility to address the issues that the Bill seeks to address: as the Minister also said, too many of those children and young people end up homeless or in trouble with the law, with their futures blighted by that poor start for the rest of their lives.
    However, the Bill now goes further. As amended in the House of Lords, it extends the obligations of local authorities and, through that, extends the rights of adults who were formerly cared-for children, in some cases up to the age of 24. I shall say more about the implications of that later.
    I say now, quite clearly and for the record, that this is a good Bill. It provides an extension of support for some of the most vulnerable children and extends that support to adulthood in ways that represent a sensible and largely cost-effective investment in young people leaving care, to try to secure their futures in the world beyond care. However, that does not mean that the Bill is perfect.

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    The Minister has spent the past 20 minutes or so detailing the purposes of the Bill and the positive benefits that it will bring. I found myself nodding for a great deal of that time. I shall not bore the House by repeating the arguments in favour of the Bill, but I shall outline the areas that we believe need further improvement—perhaps strengthening—or on which we need further assurances from the Government. Some areas are significant; others are more minor.
    I hope that the Minister will take my remarks in the spirit in which I make them. They are intended to be a positive contribution to a constructive debate and are designed to make the Bill workable and robust. I can assure him that we shall engage constructively in Committee, with the aim of ensuring that the Bill that is reported back to the House will achieve the objectives that Members on both sides of the House share.
    When the former Secretary of State, the right hon. Member for Holborn and St. Pancras (Mr. Dobson), announced the measure in November 1998, he said that the principal objective was to ensure that local authorities' responsibilities for children up to the age of 18 and beyond corresponded more closely to those of a good parent. I confirmed then the Opposition's support for that concept and for the Government in the process of implementing the recommendations of the Utting report. I also confirmed our continued support for the Government in their efforts to ensure the safety of children living away from home and, for that reason, we supported the quality protects programme. I am happy to confirm again today our support for the broad thrust of the Government's programme for continuous improvement of children's services, so that we can work together to make steady advances. Within that broad support, however, we must reserve the right to probe the details where necessary.
    I come now to some of the concerns that we have about the Bill. During its passage in the other place, important issues were raised about local authority obligations to those who are over 18—which is to say, adults—who have been in care but have now matured to adulthood. As the Minister recounted, local authorities have historically had powers in relation to people who were formerly in care, and the Bill as originally drafted would have strengthened those powers. However, on the basis of persuasive arguments advanced by my noble Friends and others in the other place, the Government agreed to amend the Bill to create obligations—as opposed to powers—for local authorities in respect of people between the ages of 18 and 21, and in some cases up to the age of 24 when those people are care leavers. By extension, those obligations create corresponding rights for those people.
    As the Bill stands, local authorities have a duty to keep in touch with adult care leavers, wherever they are, and to re-establish contact with them if contact is lost, for whatever reason. The local authority will also have an obligation to appoint a young person's adviser and to maintain and review a pathway plan for all such people who were last cared for by that authority. I fully accept that for many young people that will be a welcome safety net, providing the reassurance that the family and the family home provides for millions of other, more fortunate, young people. It will be somewhere to turn to when things go wrong in their lives. It is also a significant
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    step towards the Bill's goal of creating circumstances for care leavers that resemble, as closely as possible, those enjoyed by other young people. That is an entirely laudable objective.
    However, we must remember that we are dealing with adults, and the obligation on the statutory services to maintain contact and to re-establish contact with those adults is—potentially—highly intrusive. Essentially, the local authority will be required to track the whereabouts of an adult care leaver, to monitor his life style, and to report and record what he is doing. At its most extreme, tracking people down and maintaining a pathway plan for them, once they are adults, could be sufficiently intrusive to risk falling foul of article 8 of the European convention on human rights.
    Mr. Dawson indicated dissent.
    Mr. Hammond: I see that the hon. Gentleman disagrees, but that is not intended to be a criticism of the fundamentals of the Bill. I remind him of the history. The Bill was originally drafted to deal with 16 and 17-year-olds and its scope has been extended, rightly, during its passage through the other place. However, that has introduced a complication, because what is acceptable in relation to a child, from an authority exercising a parental role, could—I emphasise that word—become oppressive in relation to an adult. Apart from the criminal justice system and the Mental Health Act 1983, I cannot think of any other significant areas that allow the statutory authorities to intervene in that way in the life of a competent adult. I stress again that the majority of care leavers will welcome the provisions as a safety net, but the duty to re-establish contact may be a step too far in some cases. The message to young people who have left care and moved on into adulthood must be that help and support is available if it is wanted, perhaps at the end of a telephone line. I am afraid that assertive outreach, if that is what is required in seeking to discharge the duty to re-establish contact, might be misguided, morally indefensible and potentially highly counter-productive for such care leavers.
    Mr. David Hinchliffe (Wakefield): The hon. Gentleman is making some interesting points; I have listened carefully to him. He used the term "competent adult". We will need to explore in Committee the issue that he is rightly raising. One concern that I have, not about the Bill but about the entire principle of how we follow through with young people leaving the care system, is that a number of young people—I know many from my work background—will never be able to cope without some assistance. The cut-off point is 24 years old—perhaps we need to make it 64; I do not know. The hon. Gentleman has touched on some important points, but the issue of competence must be explored in detail in Committee.
    Mr. Hammond: I am grateful to the hon. Gentleman for his comments. I look forward to exploring that issue with him in Committee. I do not claim to be an expert on all aspects of the subject, but I have racked my brains and cannot think of other examples of mentally competent adults, who have committed no offence, who have not fallen foul of the criminal justice system, being subject to such monitoring by statutory authorities.

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    The hon. Gentleman's point is that there will be some for whom the duty to re-establish contact will be clearly wrong and intrusive, and others for whom we will all feel that it is right. I suspect that the difficulty—we shall explore this in Committee—is definition. Unless there is some statutory procedure to define incompetence, which would render someone subject to continuous monitoring by the statutory authorities, the matter might be difficult to deal with.
    Ms Shipley: The hon. Gentleman used the term "assertive outreach" and queried it. Would not a decent parent take exactly such a positive, assertive approach? A 22 or 23-year-old might well think that he is an adult and out on his own, but would not a parent say, "I want to help my child"? Surely that is what my hon. Friend the Minister is attempting to enact.
    Mr. Hammond: The hon. Lady makes an interesting point. My own children are too young for me to claim any direct experience of the best way in which to deal with teenagers, but I was talking to a parent of late teenage children just last night who said that, if the child is determined to go their own way, the sensible parent very often stands back and waits for the call for help. I accept that that will not always be so, but we must recognise the significant difference between a regime that we can legitimately implement to look after children and one that seeks to track and monitor adults. I merely flag up the issue; it is not fundamentally fatal to the principles behind the Bill, but we will want to consider it in Committee.
    I hope that the Minister agrees that, although a care leaver who is an adult should have access to such additional support, he must be respected as an adult and not stigmatised as merely an overgrown child. If the care leaver makes it clear that he does not want to be traced, contacted or planned for by somebody in a distant office, his wishes must be respected.
    Mr. Frank Dobson (Holborn and St. Pancras): Does the hon. Gentleman therefore agree that, in fairness to the staff who might be involved, the House would need to acknowledge that the social worker and managers concerned would not be belaboured by officialdom or the newspapers if one such young person decided that they wanted to be excluded from the system and turned into a rent boy a year later?
    Mr. Hammond: The right hon. Gentleman of course makes a good point. We will explore that in Committee. The idea that I had in the back of my mind was some exit procedure from the powers and responsibilities—but it should never be a permanent exit. I am sure that we would all want to assert that someone at the age of 19 who felt that he wanted to be left alone, that he was an adult and wanted to do his own thing—perhaps to go abroad—must always have the option of picking up the telephone, dialling the number and knowing that help was there when it was wanted. That is the way in which a responsible parent would respond.
    The problem with the Bill as drafted is that it places a requirement on local authorities to use reasonable endeavours to re-establish contact with an adult care leaver. I understand that, under the quality protects programme, guidance to local authorities is that such
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    contact should be made at least four times a year, at three-month intervals. I can envisage circumstances in which to be contacted every three months would be regarded as unnecessary and intrusive, for example, by an adult who had moved on from care, succeeded in putting that stage of his life behind him and was moving ahead in the world. I hope that the Committee will be able to explore that issue.
    Mr. Dawson: I accept the tenor of the hon. Gentleman's remarks, but does he accept that he is in danger of creating a loophole that would enable the sort of local authority that, scandalously, encourages young people to leave care at 16, to renege on the responsibilities that the Government are trying to impose?
    Mr. Hammond: Obviously, one does not want to create loopholes for irresponsible local authorities. A balance has to be struck, but I hold dear the rights and liberties of individual competent adults in our society, so I urge the House to think carefully about how we deal with people who, legally, are adults.
    The second issue we must address is the balance between rights and responsibilities. By creating new and significant obligations for local authorities, we, by definition, create new rights for 16 and 17-year-olds who are in care or who are care leavers, and for young people aged 18 and over who have been in care. The hope is that many more will take advantage of the opportunity offered by that additional support to pursue further and higher education or training. Those who cannot or who choose not to do so will be supported and helped to find work. The object is to simulate as nearly as possible the support that a child could reasonably expect from his own family at that stage of his life.
    Families are all different, but many—perhaps most, and certainly mine in my younger days—expect children and young people to acknowledge certain obligations in exchange for the support and maintenance they receive. Few of us will not remember being told at some point, "If you're not going to buck up your ideas, don't think you're going to lounge about for ever under my roof'. So should it be for the children and young people covered by the Bill.
    During the Bill's passage, I intend to seek assurances that it will be made clear—perhaps through regulations or directions issued by Ministers—that local authorities' support, for example, for continuing education must be matched by a commitment to learning by the child or young person, much as an averagely demanding parent would expect from his child. We should not expect local authorities, any more than parents, to continue to support a child in education if that support is abused—for example, by persistent truancy or disruptive behaviour in school or college.
    Mr. Jonathan Shaw (Chatham and Aylesford): We were all young once. Does the hon. Gentleman agree that all young people make mistakes and that it important to allow care leavers to make those mistakes and have another go? We should not tell a young person, "You've got one chance and if you don't co-operate, you've

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    blown it." It is important that we give young people leaving care many different options and allow them to learn by their mistakes, like most young people do.
    Mr. Hammond: I agree—no one would be minded to say, "One strike and you're out." However, let me develop my argument further, as it might answer the hon. Gentleman's points.
    We must repeatedly ask ourselves what a child who was living with his family would reasonably expect from a parent in similar circumstances, and what the parent would reasonably expect of the child. In the case of a child covered by the Bill, the answer would seem to be compliance with the agreed pathway plan.
    Dr. Peter Brand (Isle of Wight): Does the hon. Gentleman recognise a certain contradiction in his speech? He is saying that local authorities ought to have the same obligation as good parents. He was objecting to authorities having the power to monitor children and young adults, but now he is suggesting that authorities should have the power to compel. Care should not be conditional; it should be available.
    Mr. Hammond: The hon. Gentleman has missed the essence of the point. The scope of the Bill was extended in the House of Lords, so we are dealing with two distinct groups: children under the age of 18, who are the legal responsibility of the local authority, which is their corporate parent, and adults over the age of 18, who may need support and assistance but who are legally adults, competent in their own right and entitled to be treated with the respect that that brings.
    I am concerned that it is not clear from the Bill what remedies or sanctions will be available to a local authority, for example, to deal with a 16 or 17-year-old who persistently truants from school or college—who simply refuses to get on with learning—has his pathway plan changed so that he can go into training, refuses or fails to attend, has the plan changed again to say that he will be supported to find work, and fails to make appropriate efforts to do that. I hope that only a tiny minority would do so, but the local authority must have some sanction. No benefits will be payable under the system, so there is no question of those being withdrawn.
    My understanding of the Bill is that the obligation on the local authority to maintain and support children in that age group is not subject to exclusions. I fear that that may send the wrong message to the minority of young people who do not want to play the game: the message that 16 or 17-year-olds who are minded to do so can reject education, training and work while the local authority retains the obligation to support them. If that is the case, it does not pass my test of what the reasonable parent would require of a child.
    Ms Shipley: I disagree with the hon. Gentleman for the first time during the debate. It cannot be right to talk of sanctions and of withdrawing whatever from vulnerable young people. They have not had the best start in life and they have not had parental or family support. My hon. Friend the Minister wants to put in place a caring system, which will not give up on the young adult because he or
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    she does not do as we would want. We are saying, "No, we'll keep in there with you. We will keep on and on and we will be there for you." As the hon. Gentleman said, he is probably talking about a very small number of young people. We can afford to support them over and over again. They are vulnerable and they have had a bad start in life.
    Mr. Hammond: I hope that the hon. Lady is right and that it will only be a tiny minority, but I look forward to engaging in that debate with her if she is fortunate enough to be a member of the Standing Committee.
    We will also want to seek the views of the people who will have to make the system work. There seems to be a parallel with the problems in schools. Everyone understands the desire not to exclude pupils and to try to include them for as long as possible, but doing so has consequences that have to be considered. I am thinking of the practical effect for those who are trying to make the system work.
    Mr. Simon Thomas: Will the hon. Gentleman give way?
    Mr. Hammond: One last time, and then I must make progress.
    Mr. Thomas: Will the hon. Gentleman take it from me that he is missing the trick? The pathway plan, which is agreed with the young person and his or her adviser, who is there to offer support, will introduce greater compulsion than exists at present. The Bill provides for more help, support and direction than is now on offer.
    Mr. Hammond: The problem with the hon. Gentleman's analysis is that it is not clear to me—perhaps the Minister will make it clear when she winds up—what the sanction is, and how the system will deal with the child who persistently fails to stick to the agreed course of action in the pathway plan. That is the problem that I am identifying. I see it as a practical problem for the people who will have to make the system work. I hope that we can return to the matter in Committee.
    The third aspect that I want to address relates to the engagement of voluntary organisations in the process. Many of the major organisations dealing with children and young people already have nationwide networks. They will often be in a far better position than any local authority can be to maintain contact in a mobile population, wherever individuals happen to be. They also carry less of a stigma than social services for the individuals concerned. The hon. Member for Lancaster and Wyre (Mr. Dawson) alluded to the benefits of bringing voluntary organisations into the loop.
    I want to make sure that the arrangements set out in the Bill allow local authorities to exploit to the full the potential of those voluntary organisations in discharging their duties under it. In my county, Surrey, working under the quality protects programme, there is already a multi-agency youth support service, including a leaving care team designed to deliver precisely what the Bill requires.
    That service is provided by a voluntary organisation, which can reach and communicate with young people far more effectively than the social services department or

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    other statutory agencies could reasonably expect to achieve directly, and it does not have the stigma of statutory services attached to it. We want to ensure that such arrangements become the norm in delivering the services envisaged under the Bill or, at the very least, that they are properly considered as an option in determining a model of service delivery by an authority.
    Mr. Hinchliffe: I look forward to the publication of the Conservative policy documents on children in care, to answer one or two concerns that I have. I do not disagree with the hon. Gentleman's point about voluntary organisations, but I am concerned about the message that we send out. It started with Lady Thatcher. The Leader of the Opposition has mentioned the involvement of Church organisations—putting Church organisations in charge of children in care. I link that to the point made by the hon. Member for Woodspring (Dr. Fox), in the debate on care standards, that every child entering care should have an adoption plan. Whether the child is in care for 10 minutes or three days, he will have an adoption plan. The alternatives posed by the Conservative party seems to be that a child is either adopted or placed with the Christian Brothers—
    Mr. Dawson: And sent to Australia.
    Mr. Hinchliffe:—and sent to Australia, as my hon. Friend says. I should welcome further explanation. Does the Conservative party intend to produce a document that fits all the parts of its policy together, so that we can fully understand it?
    Mr. Hammond: I can assure the hon. Gentleman that before he has to make the difficult decision of how to cast his vote at the next general election, he will have the benefit of the Conservative party's manifesto, which will include our proposals for children's services.
    It is slightly disingenuous of the hon. Gentleman to misquote my hon. Friend the Member for Woodspring (Dr. Fox) on the subject of adoption. The hon. Gentleman knows very well what my hon. Friend meant. He was not referring to children in care for very brief periods; he was talking about children in long-term care and the desirability—[Interruption.] The hon. Gentleman can quote the words from the Official Report, but he knows as well as I and everyone in the Chamber what my hon. Friend was referring to. He was simply expressing the view that for children in long-term care, the objective should be adoption, wherever possible. I believe that the hon. Gentleman would not disagree with that view.
    I shall deal now with local authority finance. I know that the Minister would be disappointed if I did not mention the financial aspects. The Minister told us that money spent in various ways, including benefits, on 16 and 17-year-old care leavers is to be re-branded in a ring-fenced special grant to local authorities. The Government made it clear in the House of Lords that the extension of assistance to over-18s that is provided for in the Bill would require new money, and that no commitment to bring that section of the Bill into force could be given until the outcome of the comprehensive spending review is known.
    The cost impact on different local authorities will vary. The rules specifying which authority is responsible, as clarified by the Bill, will presumably lessen the burden on
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    authorities in London and other magnet areas. We need to know from the Minister whether the funding will be made available on a reimbursement or a per capita basis for each category of child or young person on a local authority's books, as it were.
    Given the pressure that many local authority social services departments are under, especially in the south-east, it is vital that funding meets the costs and does not provide any perverse incentives. We understand that funding arrangements will not be part of the Bill, but I hope that the Minister will be able to reassure us that, perhaps before it is considered in Committee, she will be able to make available draft proposals on the calculation of the sums that are to be paid, even if not on the amounts. Without that information it will be difficult, if not impossible, to receive a full and informed response from local authorities about the practical effect of the Bill.
    Ms Shipley: Will the hon. Gentleman give way?
    Mr. Hammond: I would like to move on. I have been speaking for quite a long time already.
    I shall take up the implications of the devolution settlement. The measure is what I am calling a new hybrid Bill—it involves both reserved and devolved matters. There may be consensus in this place on the Bill, but apparently that is not so in the Scottish Parliament. The sticking point there appears to be the withdrawal of access to benefits for 16 and 17-year-old care leavers. The Scottish National party has recently tabled an amendment to a Government motion that is supportive of legislation similar to the Bill. It ends by calling upon the Executive to delay any moves to introduce such legislation pending the results of its recently commissioned research into the effectiveness of provision.
    Reading between the lines, that is an intention to try to slow down the introduction of similar legislation in the Scottish Parliament. It is possible that there may be a less smooth ride in Scotland, where the parliamentary arithmetic is less favourable to the Government.
    Mr. Tom Clarke (Coatbridge and Chryston): The hon. Gentleman has raised an extremely important point. Will he distinguish between the position of one political party which is not part of the coalition which is in government, and the position of the Executive in Scotland, which broadly takes the same view as the Government, but agrees that dialogue should continue between this place and the Scottish Parliament?
    Mr. Hammond: Surprise, surprise, the coalition Executive takes the same view as the Westminster Government. The objection to which I am referring is an opposition objection in the Scottish Parliament. Whereas the Bill can expect a smooth ride through this place, with support from both sides of the House, it is not clear that similar legislation will enjoy a smooth ride with cross-party consensus in Scotland.
    The Government's amendments in the other place—
    Mr. Clarke: Does the hon. Gentleman not see the parallel between parents giving children the right to pursue their adult lives once they have been given that

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    opportunity, and this Parliament, having devolved power to another Parliament, allowing it to exercise the very powers that we gave it?
    Mr. Hammond: The hon. Gentleman is right. I am not qualified to say whether the Bill is the first measure that we have dealt with since the devolution settlement that contains both clauses that are the subject of devolved responsibility and clauses that are reserved matters. In this instance, clause 6 deals with the withdrawal of social security benefits.
    There are complications in implementing such legislation. The Government who answer to this place can control, so long as they have a working parliamentary majority, the implementation of clauses 1 to 5, 7 and 8, but they cannot so directly control the implementation of clause 6 in Scotland. The Government's amendments in another place to clause 8 clearly envisage that legislation mirroring the non-reserved parts of the Bill may not be in place in Scotland when the Bill comes into effect in England.
    The Government's proposed response is to delay implementation of clause 6, which removes the right to benefits for 16 and 17-year-olds, until Scottish legislation placing similar obligations on local authorities to those that the Bill seeks to impose on local authorities in England is in place. That shows a flaw in the devolution arrangement. Where non-reserved and reserved matters interact and the Scottish Parliament is disinclined simply to mimic English legislation within a time scale that fits the Government's purpose, there will be a gap.
    In this instance, there is potentially a real danger. If clause 6 is not implemented in Scotland at a time when the rest of the Bill is in force in England and Wales, benefits will continue to be available in Scotland to 16 and 17-year-old care leavers after they are withdrawn in England. That will make Scotland precisely the magnet for young people who want to access cash benefits that London and other areas have been under the present arrangements. If local authorities are, as the Minister has told us, actively encouraging 16 and 17-year-olds to leave care and put themselves on to the social security budget, there must be a danger, depending on the financing arrangements for local authorities, that there will be an incentive during the interim period to encourage 16 and 17-year-olds to go north.
    It is clear that there is no intention behind the Bill to encourage young people to migrate from the area where they have been looked after. Indeed, the intention is precisely the opposite. It is also not the intention to give an incentive to local authorities to push them out. However, the difficulties in relation to Scotland may undermine the Government's intentions and create in Edinburgh and Glasgow the magnets that we have seen in London. The hon. Member for Chatham and Aylesford (Mr. Shaw) may have read the Bill more closely than I and may be able to correct me, but it seems from my reading of it that young people may be able to have it both ways, with their local authority in England retaining a statutory duty to support them even when they move away, while being able to claim cash benefits in Scotland.
    The inevitable conclusion is that there is a case for delaying implementation of the Bill until that can be done on a United Kingdom basis, to avoid unintended
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    consequences. The ideal situation from the point of view of the Bill, if not from that of the devolution settlement, would be the Government prevailing upon the Scottish Executive to introduce the necessary legislation, reflecting the English legislation, within the same timetable. Otherwise, the Bill may not work as well as we all hope.
    I have outlined our principal concerns. I hope that Labour Members will treat them as constructive contributions to the debate and as issues that can be thrashed out and resolved in Committee. If I am wrong on any of these concerns, I shall be the first to admit that. However, I think that they all require further investigation. Some of them are more serious than others, but none of them is fatal to the Bill or to any of its underlying objectives. They can all be accommodated within the Bill's structures, either by amendment or by ministerial clarifications and the use of regulations or guidance.
    I re-emphasise that we support what the Government are doing with the quality protects programme. We support the Bill and we shall continue to support the cross-party consensus on building progressively on the Children Act 1989, to strengthen and broaden the protection that it offers to vulnerable children and young people wherever they may be.
    5.39 pm
    Mr. Frank Dobson (Holborn and St. Pancras): I wholeheartedly welcome the Bill, in part because it keeps promises that I made on behalf of the Government. I congratulate my hon. Friend the Minister on the huge amount of work that he has done in fleshing out those original promises, and also on the speed with which he gathered up the topic when it was handed on to him by our right hon. Friend the Member for Brent, South (Mr. Boateng) who initiated a great deal of the work, for which he did not receive as much credit as he should have done, and for which I received more credit than I deserved.
    More importantly, I welcome the Bill because it is a major step towards ending what can only be described as Britain's abject failure to look after children in care. A great deal of attention was paid to the problem of molesting children in care, and rightly so, but, until recently, little attention has been paid to the general failure to provide decent care for young people who were in care.
    Children in care form less than 1 per cent. of the child population, but 38 per cent. of young people in prison and 30 per cent. of young people who are homeless have been in care. It is also worth bearing in mind that, unless my memory is playing tricks on me, they are usually two to three years less mature than other children of their age, a matter which is relevant to the points made by the hon. Member for Runnymede and Weybridge (Mr. Hammond) in relation to competent adults. Generally speaking, their mental development, their maturity, is a long way behind that of other young people of the same age, and we should bear that in mind.
    We must remember that children and young people in care have been designated by officialdom on our behalf as needing care and protection. In many cases, it is clear that they have received neither. That was not just the fault of social services or individual care staff. We were all responsible for those failures—care staff, social services

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    managers, councils and councillors. Police, lawyers, courts and schools did not do their job properly. Voluntary organisations, including religious organisations, did not do their job properly. Neighbours did not give sufficient attention to what was happening. The news media did not give the matter sufficient attention, and nor did Government Departments. There was an abject failure on behalf of the Government's social services inspectorate. This Parliament did not give the matter enough attention. Ministers did not give it enough attention, and the previous Labour Opposition did not give the matter the attention that it deserved. There were some honourable exceptions in those categories, but not many, and the time has come to put things right.
    The quality protects programme, launched in 1998, which relates to all children's services, is making a start. The introduction of the National Care Standards Commission will be a step forward, and the Bill, which deals particularly with preparing people for leaving care, delaying them leaving care and providing them with more help, and more concerted and thought-out help, after they have left care, will also be a huge step forward.
    Almost half of all the children in care leave care in the year that they are 16. After that, the statutory duties on local authorities are too feeble to think about. They bring to mind the old saying that they offer every assistance short of actual help. Councils have the power to provide help, but they have no duty to do so after the age of 16. That legislative shortcoming, combined with the benefit rules, have provided a huge incentive for officialdom to encourage young people to leave care. That is wrong, as I think that we all accept, and the Bill changes all that.
    Throughout the development of the policy, as my hon. Friend the Minister was kind enough to say, I always said that the basic questions should be, "Would this have been good enough for me when I was a child? Would this be good enough for my children now?" We have an obligation to provide for children in care nothing less than we would want to provide for our own children.
    The Bill basically proposes two major changes. Children will be looked after until they are 18 rather than 16, and, all being well, that age limit will be raised later to 21. I shall come to that. It also specifies that a person—not a machine, a council or a department, but a person—will be responsible for helping these young people to plan their lives, and then for helping them to carry out that plan, initially when they are in care, and then after they have left care. The Bill tries to make society, as corporate parents, do what might be described as what normal parents do. We should aim to provide what John Betjeman once felicitously referred to as
    the love that in a family dwells.
    It is difficult for officialdom to do that, but that is what we must try to achieve.
    We asked officials to prepare a paper spelling out what ordinary families do or try to do, not necessarily continuously, but intermittently, for their own children between the ages of 16 and 21. The main thing is to provide a home to live in, or return to. Then there is the shoulder to cry on, the encouragement to do a bit more work at school or college, the morale-boosting chat before going to an interview, the consolation afterwards if the interview goes wrong, or the celebration if it goes right. Young people want someone to provide a lift when they want to go somewhere, a meal, or, when they are a bit
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    older, someone to take them for a drink, someone to get the washing done, someone to touch for a tenner when they are skint, someone to keep an eye on them, someone who cares about them.
    The intention is that, as a result of the Bill, and as a result of a lot of hard work by a dedicated staff, young people leaving care will have someone who knows and cares for and helps them, and they will both know what obligations one has to the other. That is what the Bill tries to provide. That is why it is so welcome. These changes in the law are necessary and they are long overdue.
    Mr. Hammond: The right hon. Gentleman read out a list of parents' functions, which he used in the November 1998 statement, which I have here. Is it his understanding that the young persons' advisers to be appointed under the Bill will be able to carry out all those functions?
    Mr. Dobson: I was spelling out what a normal family, if there is such a thing, and a normal home, tries to provide for its children. In so far as officialdom can attempt to do what a family does, we should try to enable the person who is designated as being responsible for a young person td do all those things, or to arrange all those things, in so far as that is possible. No doubt, others can think of other things. They are not just the more obvious things; it is the casual help, the feeling that there is some base to go back to, that there is someone there who cares and who will do a bit of thinking on the young person's behalf and try to help him or her. That is what most families try to do.
    If that is to be done, additional resources will certainly be needed. There was some argument in the House of Lords, where the Bill was considerably improved, about the Government's intention to ring-fence the funding. It was argued that to ring-fence the funding for children leaving care would fetter the discretion of local authorities. Until local authorities can demonstrate a rather better record than they have had up to now, we should fetter their discretion. Some of them have exercised their discretion by actively encouraging young people to leave care. I may fall out with some of my friends in local government for saying that, but that is not as important as trying to ensure that some of the most deprived young people in the country are properly looked after in future. Apart from the additional resources, all the people responsible will have to make a new commitment.
    As the hon. Member for Runnymede and Weybridge said, the quality protects programme is already creating some improvements. I shall give one or two examples. In Blackpool, there is a significant increase in the number of people approaching their 18th birthday who are staying in care; in Thurrock, there is a fourfold increase in the number of young people who receive support after leaving care; In Tameside, 96 per cent. of young people who were born in 1980-81 and for whom the local authority is responsible have what it regards as appropriate accommodation. Matters were much worse in the past. All those developments should be encouraged.
    We must make sure that policy developments in other spheres are not harmful to young people in care. I urge those—I believe that that includes Conservative Members—who say that all schools should be able to choose their pupils and decide their admissions policies to pause and ponder whether children in care are likely to

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    be among the chosen. If the answer is no, the policy of schools choosing the pupils cannot be reconciled with a commitment to looking after young people in care.
    We must consider when the age limit will change not only from 16 to 18 but to 21. The average young person leaves home at the age of 22. It cannot therefore be right to tell young people in care, "You're on your own" when they are 18, any more than it is right to say that when they are 16. I welcome the fact that the Government have said that raising the age limit is not a question of "if' but "when". Freed as I am from the limitations of Cabinet responsibilities, I can say that I believe that the limit should be increased from 16 to 21 now.
    I wish the Minister success in his negotiations in the comprehensive spending review, and I emphasise to my former Cabinet colleagues that, for all practical purposes, the decision on the age limit must be made now or never. If the money to increase it from 18 to 21 cannot be found in the forthcoming comprehensive spending review, when do they seriously believe that it will be found?
    I urge the Government to find the money now for three reasons. First, it is right and just to do that. Secondly, it will benefit enormously many of the most deprived young people. The third reason should appeal to the Treasury: it will be a good bargain because it will reduce the huge number of young care leavers who go to jail, where they contribute nothing to society and cost us a fortune; sums that are vastly in excess of the cost of providing proper care up to the age of 21.
    The Bill is a good measure. It was improved in the House of Lords, where it was welcomed by all parties. The thoughtful contribution from the Conservative Front Bench suggests that it may be improved again in the House of Commons. The sooner it becomes law, the better. I commend the measure with a quotation, which I discovered recently, from someone who is not usually associated with child care. Queen Elizabeth I, who had a rather chequered childhood, said:
    We are more bound to them that bringeth us up well than to our parents.
    We should bear that in mind.
    5.54 pm
    Dr. Peter BrandIt is a privilege to follow the right hon. Member for Holborn and St. Pancras (Mr. Dobson). I am glad that, with the help of some of my noble Friends and others, the Government have listened and accepted the right hon. Gentleman's original premise, which he presented so clearly to the Select Committee on Health and in his statement to the House two years ago.
    We welcome the Bill, which is long overdue. It rightly places a duty of care on local authorities for those children who are in their charge and have no one else to look after them. I am worried that it also appears to grant local authorities powers that are beyond those of normal parents. I shall revert to that later.
    It is right for the Bill to define eligible children, but I want to ensure that the definition is not too tightly drawn. Families break down most frequently not only when children and young people become more difficult, but when child abuse is at its most rife. Young people may
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    have to leave home and go into care when they are 15 or 16. They would not have enough time in the care system to qualify under the new system. We should not forget that many young people have to leave home at 16 or 17 because they have no option. They would not be helped by the Bill, but would have to rely on an inadequate benefits system.
    Earlier contributions about the local authorities' duty to keep in touch were interesting. On the one hand, we are told that a postcard at Christmas is inadequate; on the other hand, we are told that there should be a report every three months. I get on extremely well with my sons, but if I insisted on the postcard at Christmas, I would have been disappointed sometimes. Young people have a right to decide whether they want to participate in the process.
    The job of the adviser to some young people will be difficult and require dedication. I do not want to appear to be my usual, optimistic, starry-eyed Liberal Democrat self: I know what the real world is like. It can be extremely miserable for parents, children, social workers and their charges. The personal adviser role is key to the proposals. It is insidious of the Government to suggest that they can simply amalgamate current budgets and find the expert, caring, flexible super-parents that the Bill requires to make it work properly. Much training and thought will have to be expended to make that aspect of the Bill work.
    If trust is not established between the adviser and the young person, the measure will not work. It will become a control mechanism whereby young people can be told, "You turn up for your giro or your housing benefit or we won't look after you." I know that the right hon. Member for Holborn and St. Pancras did not intend that. Parents do not care conditionally; they have a duty of care whether they like the sods or not. It is important not to lose sight of that, and to bear in mind that young people are not always compliant.
    I want to consider briefly benefit withdrawal. When things are working well—we hope that the measure will work extremely well—everyone will benefit from a young person's receipt of practical help in their day-to-day life. That help could be through a foster placement or in a young person's own home, or with going to school, to a job or to a college. When the measure is working well, normal access to the benefits system should be withdrawn.
    That is absolutely right, but I can envisage circumstances in which children and young people feel so alienated from their parents that they would not accept help from them even if it were offered. The same picture could emerge—rarely, one hopes—with a young person and a local authority. I would not want that young person's relationship with the authority, which may be important at a later stage, to be influenced by an insistence that the only means of access to the ordinary benefits system is through becoming pregnant. That seems to be the only means in the Bill of preventing the withdrawal of benefits.
    Young women sometimes become pregnant because they want to start a family and have dependants of their own as a way of demonstrating their independence from parental control. I do not believe that they have babies in order to jump the housing queue—that is a myth. To have babies to demonstrate one's independence is unhealthy, but our benefits system has encouraged it. That is probably one of the reasons why we have such a high rate

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    of teenage pregnancies and of teenagers who remain lone parents. I urge the Government to reconsider the automatic exclusion from the benefits system for those people who come within the remit of the Bill.
    Most of the anxieties arising from the Bill were demonstrated in the thoughtful contribution of the hon. Member for Runnymede and Weybridge (Mr. Hammond). As anticipated, his slant on the command and control structure was slightly different from the Government's. We have a view that the Government have too much of a tendency to want to control the money passing down rather than to allow the recipient to make the decisions, whereas the hon. Gentleman seemed to think that care should be to some degree conditional—or certainly that the goodies should be conditional.
    Stopping people's pocket money is okay if that money is on the fringes of what they need, but if we are talking about having enough to be housed and clothed and to get to school or a place of work, one cannot make that conditional on good behaviour and fitting in with what is required. I hope that the Bill will be amended in such a way that it will work and be a tremendous success, but it can work only if the young people themselves sign up to all the wonderful care pathways and pathway plans that are set out. I can tell hon. Members from my experience that if we try to impose a pathway plan, we will have lost before we have started.
    We welcome the Bill, which is a first stage in looking after young people's needs. Parallel work must be done on the inheritance from the previous Government of the way in which young people are treated by the benefits system. It is ridiculous to expect young people to be dependent on their parents if the parents do not want to accept that dependency. We all see the misery arising from the differential way in which housing benefit is applied to young people. I hope that the Government will take that on board when considering a small but significant vulnerable group of children and extend it to the wider group of those who may be as much at risk as those who have gone through the care system.
    It is right that the Government have accepted that we, collectively, have a parental responsibility for those children whose parents, for whatever reason, do not accept that responsibility, but it is not right for them to discharge their duty purely through local government. They retain a responsibility through the centrally administered benefits system, to ensure that there are no holes in the laudable measure that they are introducing to allow everyone to have an opportunity in life and to avoid failure setting in at such an early age that people have no way of improving themselves and making a positive contribution to society.
    6.6 pm
    Mr. David Hinchliffe: We have had an excellent debate. The contributions so far have without exception been very constructive, and important points have been made. It is a pity that not one Conservative Back Bencher was present to hear what the hon. Member for Runnymede and Weybridge (Mr. Hammond) had to say, as he made some very relevant points.
    Mr. Robert Syms: I was here.
    Mr. Hinchliffe: The hon. Gentleman is a Front Bencher.
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    I welcome the consensus that has developed around the measure. The most recent similar consensus that I recall was around the Children Act 1989. In a recent debate on the Care Standards Bill, my right hon. Friend the Member for Coatbridge and Chryston (Mr. Clarke) referred to the fact that several of us had served in Committee on the Bill that became that Act. We recognised that it was a landmark measure and we all tried to ensure that we put on the statute book the best possible solution to some of the problems that we faced.
    One or two of us thought then that we needed to go further on the issue of leaving care. We tabled amendments on the subject, which were rejected. I recall my very good friend Joan Lestor speaking passionately and at length on the subject.
    I thank the Government for finding time for this measure. I know that it is difficult to fit such measures into the timetable, and I pay tribute to the Secretary of State and his ministerial team—and a special tribute to my right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson). I know how passionately he feels about these issues, and his contribution today evidenced the anger that he feels about the way in which we have maltreated so many youngsters over many years. As he says, we are all responsible. I join him in paying tribute to the Minister of State, Home Office, my right hon. Friend the Member for Brent, South (Mr. Boateng), who made a detailed contribution to the development of the Bill.
    I also want to mention one or two people whom I have known for a long time who have campaigned long and hard—indeed, in some instances, they have devoted their lives—to bring about a measure of this nature. Way back in the 1970s I met Professor Mike Stein of York university, who has specialised in this area. He argued long and hard 30 years ago for steps such as those that we are taking in the Bill. I pay a sincere tribute to his work.
    I must not forget my hon. Friend the Member for Lancaster and Wyre (Mr. Dawson). It says a lot when someone from Yorkshire pays tribute to someone from Lancaster. It shows how much I admire the work that he has done since entering Parliament. He has dedicated himself to fighting on this issue, and has brought together many children and young people behind his efforts.
    I also pay tribute to the campaigning work that young people who have been through the care system have done over many years to get a better deal. In the Select Committee on Health I had the great privilege of listening to witnesses who we thought might not perform but who outperformed even former Secretaries of State in terms of their confidence and their ability to argue their corner. The hon. Member for Isle of Wight (Dr. Brand) was present at that sitting, and I know that he would share my view.
    I speak with some feeling, because I worked with children in care for many years. I can get quite emotional about what I saw of some of the youngsters with whom I had dealings who left the care system in circumstances that were far from desirable.
    I have continued contact with some of those young people, some of whom have done very well in life. A couple of years ago, I was moved to be visited at my surgery by a lad whom I had thought was one of my failures. He came to tell me that he had got a job as a charge nurse or psychiatric nurse in the community,

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    and was doing extremely well. He had achieved something in life, which I never thought that he would do. We should never lose sight of the fact that very many youngsters from the care system do well. Despite the problems that are put in their way, often by us, many of them come through.
    As my right hon. Friend the Member for Holborn and St. Pancras said, however, the clear pattern for far too many males is to move from care into the prison system. I think that about 25 per cent. of all prisoners have been in care, and that—as my right hon. Friend said—about 38 per cent. of young prisoners come from the care system. I also agree with his point on costs. If we are arguing in the comprehensive spending review for more resources, for goodness' sake, let us make the point that giving youngsters a decent start in life helps to avoid the huge costs and other impacts created when they spend time in prison. It is a way of making long-term savings.
    Too often, females go from care to prostitution. I have terrible experience of that fact. One of the Yorkshire Ripper's victims was a young lady whom I knew when she was in care. She left care in the usual way, went into prostitution and was murdered by Peter Sutcliffe. I will not forget that as long as I live.
    Frequently, when travelling between Leeds and Wakefield, I pass the part of Leeds where prostitutes assemble at night. Sadly, far too often I see faces that I knew many years before, when I worked in the care system. I feel deeply that we need to do something about young people moving from care into prostitution.
    Since the passage of the Children Act 1989, report after report has said that we have to take action about young people leaving care. The Utting report has already been mentioned in detail today. We have also had the Waterhouse report on the situation in Wales. I was proud to be able to take part in the Health Committee's inquiry into looking after children, which was the first major inquiry of this Parliament. I pay particular tribute to my hon. Friend the Member for Preston (Audrey Wise)—who has not been well recently, although I am pleased to hear that she is doing better now—for her part in that. No one devoted more energy than she did to the inquiry and to addressing the issue, and I give her full credit for it.
    In our inquiry, the Committee considered the priority given to children's issues by successive Governments. One fact that we established was that successive Governments—I blame not only the present Government but the previous one as well—have failed to fulfil a key requirement of the 1989 Act, which was to present to Parliament an annual report on the Act's operation. Perhaps that fact indicates that we should give a bit more thought to what we do for children and young people. It is worrying that requirements in legislation passed by the House can simply slip off the agenda.
    I believe that we have to ensure that the Bill provides a vigorous independent voice, locally and nationally, for children in care. I welcome the concept of a personal adviser for children. In our report, the Health Committee picked up the concept of an advocate for children and young people in the care system.
    Nevertheless, I suspect that I am speaking on behalf of many of my hon. Friends who are in the Chamber when I urge the Government to look again at the role of the
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    children's rights commissioner. The commissioner's role will have to go wider than dealing only with children in the care system. So many agencies are involved in the issue that that proposal simply cannot deal with it. We have to listen to the arguments—which I accepted many years ago—for a children's rights commissioner. I have seen the concept work in many other countries, and I believe that a commissioner could do a huge job for vulnerable children and young people in the United Kingdom.
    I have one or two other concerns. My hon. Friend the Minister raised the issue of resources. Although I understand the Government's position on the comprehensive spending review, the entire history of United Kingdom social legislation is one of good intentions backed by entirely inadequate resources. We have to learn the lessons of the many Bills that have been passed by the House and been widely welcomed, but for which there has been no money for implementation. I realise that colleagues from local government will hold up their hands in horror and say, "We agree with that, but where will the money come from?" The Government will have to address the resourcing issue.
    I shall also nit-pick on one small matter—some of the terminology used in the Bill. I hope that in Committee, Ministers and their team will examine some of the archaic terminology, such as "eligible children", "relevant children" and "former relevant children"—that is, children over 18 who were previously relevant or eligible. Some of the terminology is Sir Humphrey-style gibberish at its best, and was probably dreamed up at Richmond house by the same Department of Health official who came up with the official distinction between "community care" and "care in the community", which continues to baffle me—and most of those who end up in community care.
    I hope that that matter will be examined in Committee, because the point underpinning the legislation is that all children should be relevant. The words "relevant" and "irrelevant" are nonsense and should perhaps be replaced in Committee. I am sure that we will be able to do that.
    I seek further assurances about the development of a national strategy to investigate the reasons why children come into care. I genuinely appreciate the action that the Government are taking with various measures to deal with poverty and unemployment. I have always been concerned, however, about the fact that such initiatives are not always knitted together, and are occasionally completely contradictory.
    Specifically, what are we doing to deal with the perpetuation of physical and sexual abuse over the generations? So many of the sexually abused children with whom I have worked had parents who themselves were sexually abused. We have to examine how we can break that cycle, and we have not yet got a grip on the issue.
    I want the Bill, and all legislation affecting children in care, to help to prepare children for life outside the care system as soon as they enter it. We should prepare children for leaving care from the word go. Of course I am not talking about preparing babies to leave, but we have to ensure that our system is geared to enabling young people to leave the care system prepared and competent to deal with life, just as we should hope that our own children are able to deal with life.

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    The education system has caused me great concern, and I echo the comments on schooling made by my right hon. Friend the Member for Holborn and St. Pancras. In our inquiry, the Health Committee picked up on concerns about the way in which the education system rejects kids who come from the care system. My right hon. Friend was bang on in his comments about league tables and choice, which lead us to reject youngsters.
    It is often easiest for schools to leave out those children. In some respects it is helpful to schools if those children do not attend, because the schools do not believe that they will be achievers. Often, social services are not unduly worried about youngsters missing school, so long as they are not in trouble. We have to address that crucial issue and tie it in with broader thinking on the implications of league tables and competition between schools.
    My hon. Friend the Member for South Swindon (Ms Drown), who is not in the Chamber, asked about age limits. That issue was also touched on by the hon. Member for Runnymede and Weybridge (Mr. Hammond). I not only listened carefully to his speech but intervened in it, because the issue of competence has to be well and truly addressed in Committee. The point that he and I were trying to make is that so many youngsters will never survive without help.
    Through my wife, I am involved in an organisation based in Leeds, called Caring for Life. It takes children from across west Yorkshire who have been in the care system and takes care of them for life—just as its name says. Against the background of struggling to raise money, it looks after some very vulnerable young people and older people. We have to understand that some youngsters will never cope independently, but do not fit easily into the other care categories—such as those involving mental health—for which provision is made.
    I mentioned the Conservative policy of placing children with religious organisations. I seriously hope that Conservative Members will seriously consider the United Kingdom's experience with such a policy, which was not particularly good. One or two of the Conservative Members who served on the Health Committee will give the hon. Member for Runnymede and Weybridge the reasons, chapter and verse, why some of us have reservations about returning to the Christian Brothers as the basis for our care system.
    I hope that my hon. Friend the Minister will take note of the fact that the Bill talks about care leavers. Some of us have had dealings with care leavers who were victims and went through the child migration scheme that the United Kingdom operated until 1967. Some of those people are now my age, and others are in their 80s or 90s. Children were sent to Australia, New Zealand, Zimbabwe, Canada and elsewhere. Thousands are still alive, and still suffering.
    In the context of the wider debate about people who have left care, I hope that the Government will look again at the funding arrangements for the Child Migrant Trust. That organisation is struggling to cope with the demands of people who are still trying to get into contact with their natural mothers, fathers, brothers and sisters.
    The trust bid for £800,000 a year, but received only £130,000. That is more than it used to get, but it is nowhere near adequate to meet the demands placed on it. A trust representative told me today that cases remain
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    unallocated, and that even when parents' whereabouts are known, those now elderly people are dying before they can be linked up with their children. That is unacceptable.
    I hope that the Government will look at the travel fund for child migrants, which was worth £1 million over three years when it was established. That total has been eaten up rapidly by the demands placed on it. This is a matter of humanity, and the Government's response to the Health Committee report was constructive, so I feel able to ask for a bit more money to be given to the trust. It would make a huge difference.
    Australia week takes place in early July, and the Australian Prime Minister and his entire Cabinet will be in this country. Might not that be an appropriate time to suggest that people in Australia could play a bigger part than hitherto in addressing a scandal that stemmed from the policies of both Governments?
    I shall conclude my limited observations by congratulating the Government on the introduction of the Bill. One or two points need to be sorted out in Committee, but it addresses the needs of a group of people who have been left behind far too often. The Bill will offer youngsters a future, and I welcome it very warmly.
    6.22 pm
    Mr. Robert Syms: I, too, broadly welcome the Bill. The Utting report was published after there had been a catalogue of disasters over the past few years. The Select Committee on Health, on which I am privileged to serve, looked into the case of children looked after. It is fair to say that Governments of all political persuasions have done less than they should have done to safeguard the future of the children who became their responsibility.
    About 5,000 people aged 16 or 17 leave care every year. The proportion leaving at 16 has risen from 33 per cent. to 43 per cent. More than 75 per cent. have no academic qualifications, and more than 50 per cent. are unemployed after they leave. Moreover, 17 per cent. of girls leaving care are pregnant. Among prisoners, 23 per cent. of adult inmates have left care, as have 38 per cent. of young prisoners. In addition, 30 per cent. of young single homeless people have left care.
    In many ways, British Governments have been penny wise, pound foolish with regard to children leaving care. The cost to society—of prison, and of the catalogue of disasters and horrors that the statistics show befall people leaving care—is very great. It is clear that society as a whole would benefit if we could respond to the problems a little earlier. Moreover, it should be borne in mind that the statistics that I quoted apply to about 1 per cent. of the total in that age group. That is a horrific and frightening thought.
    I welcome many of the measures in the Bill, which will at least start to improve matters. When the Health Committee inquired into this matter, we found that most youngsters leaving a home at 16 are not encouraged to go back. When they leave, the posters come down, the bed goes, and that is it. Yet most of us who leave our parents' homes know that we can always go back, and we often do so. When we have to make choices or decisions in our lives, we know that our parents will always provide a home, a bed and a square meal. In contrast, many children leave care and then get lost.
    Broadly speaking, the approach adopted in the Bill is the right one. The Health Committee wanted 21 to be the key age. I agree with most of the comments made in the

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    debate so far, and I hope that the Government will use 21 as the key age. That would make much more sense, given the current economic background and the comprehensive spending review.
    Many of the Bill's proposals are sensible, such as the duty to keep in touch. Although people who do not want to be found will not be found, the proposal at least means that local authorities will have to pay attention to where people go when they leave care, and to what happens to them afterwards. If pathway plans are to be introduced, there will be a great need for more information about the welfare and progress of children who have left care.
    My hon. Friend the Member for Runnymede and Weybridge (Mr. Hammond) made a good point about sanctions in connection with pathway plans. However, the most important thing is that the Bill provides some sort of measure by which to judge a person's progress. If that information is regularly reviewed, it will be possible to judge people's aims and prospects, and pathway plans will be useful.
    Personal advisers are another important element in the Bill. The question of whether they should be trained has been raised, but the most important thing is that they should be trusted. All hon. Members know that people who work for local authorities, or social services professionals, would not necessarily be the best people to have as advisers, and that they would not always be able to inspire trust. That is a key issue. When the Health Committee investigated the question of children looked after, we found that having someone who can act as an advocate—just as a parent would—is of critical importance to children.
    The Bill moves matters on by providing for vocational support, assistance with employment, and education and training support, all of which are important. People who leave their parental home expect their parents to pay attention to what they do, and to offer help and support. The Government cannot be a substitute for that, but it is better for them to intervene in this way than to leave children to their own devices. The hon. Member for Wakefield (Mr. Hinchliffe) recounted some of the horror stories about what young people have suffered because no one is especially concerned about them once the state's responsibilities for them are over.
    Clause 6 deals with removal of benefit, and Save the Children has pointed that one of the most important lessons for people leaving care concerns the management of money. We must be careful about removing benefit from young people, as it is important to allow them to have responsibility for some money so that they can make choices about their lives.
    As I said, I broadly welcome the Bill. Many of the details, such as the problem with definitions mentioned by the hon. Member for Wakefield, will have to be considered in Committee. Improvements can be made, but this is a good start. I pay tribute to the former Secretary of State, the right hon. Member for Holborn and St. Pancras (Mr. Dobson), as much progress has been made in a matter to which hon. Members of all parties pay a lot of attention.
    We must value our young, or the consequences of the statistics that I gave earlier will be pretty dramatic. I am pleased to have been able to participate in the debate.
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    My hon. Friend the Member for Runnymede and Weybridge described a difficulty with what might be called the Scottish problem. So long as that can be ironed out, the Bill will immeasurably improve the prospects of young people leaving care. If we can achieve that in the lifetime of this Parliament, we will have done a good job.
    6.29 pm
    Mr. Tom Clarke: I am grateful that the hon. Member for Poole (Mr. Syms) concluded on what he called the Scottish problem, which is a major issue in today's debate. The hon. Member for Runnymede and Weybridge (Mr. Hammond) did the House a great service by raising it in the way that he did, and I shall return to what he said later in my speech.
    I welcome the Bill. It is an excellent Bill and it follows logically on the unfinished business of the Children Act 1989 and the Children (Scotland) Act 1995. I am grateful to my hon. Friend the Member for Wakefield (Mr. Hinchliffe), not only for the tremendous comradeship that he offered in 1989 when we both served on the Standing Committee considering the Children Act, but for saving me the trouble of rehearsing some of the major points that are relevant to tonight's debate. I welcome what he said about the late Joan Lestor, who would certainly have welcomed everything that we are saying and the progressive tone of our discussions. I also recall what my hon. Friend had to say in 1989, and his recollections tonight reminded me of the tremendous impact that was made on that Committee by the young people whose problems we were debating, even though at the time—and perhaps later—we still did not reach a firm conclusion.
    I am not at all surprised that Barnardos and Barnardos Scotland have provided excellent briefings. Some of my thinking in this short speech tonight has been influenced by them, particularly in respect of the Scottish issue.
    Those of us involved in the passage of the 1989 and 1995 Acts will remember the dreadful stories that we heard. Times have not changed very much. We heard harrowing stories about what actually happened to many young people leaving care. I remember being appalled when we heard that they were told, "You can't get a job unless you've got a house and you can't get a house unless you've got a job." We heard about the great poverty that affects older children leaving care.
    I remember too—and I am sure that things have not changed very much since 1989 or 1995—young people telling us that every Monday morning they would queue outside Marks and Spencer and Tesco in order to obtain food that was past its sell-by date. That seemed an extraordinary way of addressing young people at that vital and vulnerable age.
    I am glad that the Bill seeks to address many of those problems. It presents practical solutions which, when they are followed through, as I have no doubt they will be, will help to solve problems that have not been properly addressed until now. The pathway plans that are on offer are absolutely excellent, but there is a major change; and here I come to the speech by the hon. Member for Runnymede and Weybridge, which I praised earlier. He dealt with an issue that was raised in another place in respect of devolution, and I agree that it still has not been resolved. However, I can offer some hope to the hon. Gentleman and to the House.

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    The hon. Gentleman addressed, in passing, the debate that is taking place in Scotland. The Bill clearly deals with the DSS aspects of the problem, whereas the Scottish Parliament deals with the local authority aspects, and the Westminster Parliament deals with both in respect of England. If the hon. Gentleman accepts that, as we have decided on devolution, the hybrid aspects of the Bill should be dealt with by the Scottish Parliament, I encourage him to believe, as I do, that at the end of the day the Scottish Parliament will reach the right decision. I am encouraged by the dialogue that I understand is taking place between Ministers in this Parliament and those in the Scottish Executive.
    I realise what the problems are. The hon. Gentleman may not have known it, but he touched on an important constitutional issue—which is the reason why I and a majority of Scottish Members take the view that social security, among other matters, should remain a matter for the United Kingdom Parliament. If that were not so, the prospect of the abuses that the hon. Gentleman envisaged in his speech would be wide open. We cannot have young people who may not have access to social security in England going from Carlisle to Dumfries to get it there. I accept unreservedly, as the Bill does, that we should try to prevent that from happening.
    Looking at the more positive aspects of the Bill and what is planned thereafter, one can see that the commitment to a pathway plan for young people leaving care is splendid. Although I do not want to dwell on Scotland, let me for a few moments confirm my optimistic outlook by quoting just a few brief comments from the document issued by the Scottish Executive. The hon. Member for Runnymede and Weybridge will recall that I pointed out in an intervention that his concerns seemed to be about the views of the Scottish National party, which does not have a majority in the Scottish Parliament. It is arguing its case, but I do not believe that it will carry the day. I believe that the views of the Scottish Executive will carry the day, and those views are consistent with our arguments today.
    Mr. Hammond: I accept the point that the right hon. Gentleman is making, which is that the Scottish National party does not have a majority in the Scottish Parliament; but does he accept that there is a flaw in the devolution settlement, if legislation like this being workable depends upon the same party being able to command control in both the Scottish Parliament and the Westminster Parliament?
    Mr. Clarke: No. I am trying desperately hard to please the hon. Gentleman, but I do not agree that there is a flaw in what we have done in respect of devolution. To return to what he said about children leaving home or leaving care, there comes a point when one cannot instruct them to do as one would like them to do, but almost inevitably they end up taking the right decision anyway. I confidently believe that the Scottish Parliament will do the same, in terms of the powers that we have given it. Again, I seek to reassure the hon. Gentleman. Let me quote what the Scottish Executive said about the responsibilities that we have given them:
    The most efficient and effective method would appear to be a transfer of resources from DSS to local authorities, thus enhancing the resources already available to them to carry out their duties under the 1995 Act.
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    That was a firm statement. They also said:
    The Scottish Executive proposed that young people requiring throughcare and aftercare should receive support in a co-ordinated way from local authorities in line with the principles of the 1995 Act.
    That reflected the 1989 Act in respect of the United Kingdom. They continued:
    This parallels proposals for England and Wales. Dependent on the results of consultation, the aim would be to introduce the relevant changes to primary UK legislation at the earliest opportunity.
    They continued in bold type:
    Scottish Ministers are therefore seeking views on the proposal that the mixture of current spending on local authority aftercare, support services and DSS benefits should be drawn together in a single fund which would be used by local authorities to provide support and assistance to 16 to 18 year olds requiring throughcare and aftercare.
    I am particularly confident on that point.
    Let me return to the main thrust of the Bill in so far as it applies to the United Kingdom. I welcome the proposals that are being made, particularly on the pathway plans. A minority argue that we really ought to leave things as they are and let young people spend their benefits as they wish. Set against that, the experience that has been gained, not least the overwhelming reaction of the voluntary bodies that responded to the Government and the Scottish Executive by fully supporting the direction of the proposals, shows that there is a problem here. The hon. Member for Poole gave the figures: 75 per cent. of children leaving care have no qualifications; 50 per cent. of them are unemployed; and 38 per cent. of young prisoners have come from care. Given that situation, the pathway plans are long overdue and it is right that we should move in that direction.
    I want to turn briefly to an important issue. Encouraging local authorities to appoint advisers and seeing that through is welcome, but I think that we should be more positive about their role. Let me give an example. I worry tremendously about children leaving care having access to higher education. Whereas I was able to obtain the statistics that I just gave fairly easily, and I imagine the hon. Member for Poole was too, I could find no figures, not even from our excellent Library, relating to young people leaving care and entering higher education. I assume, therefore, from the anecdotal evidence, that very few do. That is unacceptable. We must challenge such a state of affairs, and encourage the advisers to take the same view.
    I should like to turn to the impact of the Bill on disabled children. Even now, many disabled children leave home. There are no advisers or advocates, and often there is no involvement in any decision that affects the future of disabled children. I hope that that will be put right, and I think that the Bill offers an opportunity to do it, particularly in the areas of education and employment.
    The most acute area is probably that of children with learning difficulties. They, above all, are in need of the kind of advice, the kind of pathway plan, that the Bill seeks to achieve elsewhere. If the Minister is of a mind to embrace the priority that I seek to promote, I would greatly welcome her remarks.
    The wider issue of financial support has already been touched on by other right hon. and hon. Members. I can imagine local authorities in each constituent part of the

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    United Kingdom saying, "We like Parliament's proposals, but once again we are being given responsibilities without the necessary resources." I would not expect my hon. Friend the Minister to comment on that, but given that the comprehensive spending review is now being considered, I offer her the support that I think she and her Department want. I am sure that the House wants this measure to work, and I am sure that that is also true of another place, but to achieve that, resources are crucial. The Treasury must take that on board.
    These provisions are inspiring as well as practical. When the legislation is in place, there should be proper training. The advisers should be properly trained and have the opportunity to bring themselves up to date from time to time with the demands and challenges of the society in which they work. After all, we will be asking a great deal of them.
    The Bill seeks to help these young people achieve genuine fulfilment, given that in the past they have not exactly been up front in their achievements in employment, education, housing, leisure and recreation and higher education. Many of these young people have been in the House today and earlier this week, and they are right to tell Parliament that they are here and their problems are here. If they can be positive about their problems, the least we can do is be positive about their future, and I think that the Bill achieves that.
    6.44 pm
    Mr. Simon Thomas: I warmly welcome the principles behind the Bill. Plaid Cymru, the party of Wales, hopes that the Bill will reach the statute book and be operational in Wales in quickly as possible. With a few amendments that I hope will be made in Committee, the Bill will provide a huge advance in the way in which our society looks after young people.
    The Bill places a duty on local authorities to assess and meet young people's needs. It is done in a jargonistic way, as the hon. Member for Wakefield (Mr. Hinchliffe) remarked. What is important is that young people are part of the planning process for their future, however. They will have advisers with whom they will be able to build relationships and trust. Although that is not the same as the family support that we would all wish every child to have, it is a significant improvement on the present haphazard services, where postcodes are a factor and services differ according to county.
    I particularly welcome the amendments made to the Bill in the House of Lords. The extension of eligibility to 21, and to 24 for education and training, is an important amendment, and I hope that it will progress with full Government support.
    Ensuring that children leaving care can participate fully in society goes a long way to tackling social exclusion. I support the Government's intentions in that respect. However, we have a huge task ahead of us. It is partly about funding, but also about how to deliver these services at the right level. I would like to illustrate the task ahead by briefly outlining the work done in my constituency by a voluntary organisation that works with children leaving care, and the difficulties that it encounters in the present regime. I shall outline some of the improvements in the Bill that I hope will help that voluntary organisation, as well as my local authority, in delivering better support services.
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    Hope for Young People Everywhere—HYPE—has been going for just two years. It deals with 80 young people a week in the small, rural town of Aberystwyth alone. Eighty young people a week come through HYPE' s doors, looking for assistance. They are mostly local school children, students and unemployed care leavers. Many are either on their way into foster care or on their way out of foster care, as the volunteers put it. Many have extreme difficulties and have been excluded from school in the recent past.
    The benefits system presents a great many problems. Many of the young people seen by HYPE do not know their rights, and are at a loss as to where to go. They have support from other young people in the town—there is an informal family arrangement among many young people who support themselves. They often have difficulty accessing the benefits that are available to them. In that regard, the provisions rejigging the benefits system for 16 and 17-year-olds could be a significant step forward. The onus will not be on young people to find out what benefits and support they are eligible for and to try to fight through the system. Instead, the Bill puts the onus on the local authority to ensure the right delivery of services and support to young people.
    Care leavers are let down by the present system of crisis loans, which is discretionary, and the lack of support in the housing benefit system for young people, which leads in particular to many care leavers living in poor accommodation.
    HYPE identifies the problem as authorities not taking full responsibility for children leaving care. Nor are the guidelines that are already in place being fully followed. With all the improvements in the Bill, it has to include a warning to local authorities and the other partners that they must follow correctly the procedures and guidelines laid down and fulfil their responsibilities.
    Having said that I welcome the Bill, I should like to pose a few questions on parts of it that may need looking at again. The withdrawal of benefit support for young people aged 16 and 17 could prove a significant step forward. However, at present it is difficult to see how that will occur unless we establish the right national standards of support for those young people. I do not want an ad hoc system to evolve whereby local authorities use that method of support in different ways for their children and young people leaving care.
    Incidentally, I think that we should use the term "young people"; it is confusing that the Bill refers to children and young people. We are talking about young people, although I accept that the Government may have included the word "children" so as to have regard to the Children Acts.
    In Wales, where the National Assembly will have full discretion over the regulations that result from the Bill, I hope that we shall introduce national standards. I also hope that the Assembly will receive that package of ring-fenced money provided by the amalgamation of the various support arrangements—revenue support grants, housing benefit, income support and so on—so that we can deliver a national standard for Wales to ensure that young people are fully cared for at the relevant time. I assume that similar measures will be adopted in England.
    A real problem in my rural constituency is the dumping there—I cannot use a less strong word—of care leavers from other areas. Local authorities wash their hands of

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    difficult children in care—especially those in foster care. They use private foster care arrangements to farm out children—literally so, in my rural area—so that the children are far enough away from their own local authority area to be no longer a problem or a concern.
    The problem under the arrangements is that, when such children leave care, they cease to be the responsibility of the authority that put them, say, in Ceredigion and become the responsibility of Ceredigion. The Bill will produce an improvement, because the authority that was first responsible for the child will continue that support. However, I have a question about the pathway plans and the arrangements for personal advisers. How can we ensure the delivery of such services over long distances? We need to consider how that will be achieved.
    Mr. Shaw: I agree with the point that the hon. Gentleman makes about young people and children being placed with private foster agencies outside their local authority area. Such agencies are not regulated at present. Does he agree that it will be crucial for the National Care Standards Commission to regulate them? It is most important that the practice to which he referred be stopped.
    Mr. Thomas: I agree with the hon. Gentleman. In Wales, we hope to appoint a commissioner with overall responsibility for standards. I hope that the commissioner would be able to achieve even more—to ensure that the standards wanted both by the hon. Gentleman and by me are met. If that occurs, I am sure that people in England will want to learn from and follow our example.
    I understand that the Government intend the pathway plans to be drawn up with full consultation and in partnership with the young person; they should be worked out jointly between the adviser and the young person. The hon. Member for Runnymede and Weybridge (Mr. Hammond) raised the spectre of young people failing to follow, or disrupting, their plans. There may be a handful of such cases, but we do not need to consider such possibilities under the Bill; they are practical matters to be dealt with on the ground. If young people are properly involved in the pathway process, they will want to achieve the goals in their plan. They will own the plan. That is an essential aspect of the improvements.
    It is important that the pathway plan can be changed according to circumstances. I feel strongly that the financial constraints on an authority should not be a guiding consideration in the contents of the plan. Advisers should be as independent of local authorities as possible. I agree with many of the comments about the need for voluntary organisations to be heavily involved in the process. Many young people might be reluctant to discuss their future directly with local authority staff. We must accept that reality, even if we do not think it right. The voluntary sector thus has a large part to play.
    I hope that the Government will consider the problem of accommodation for care leavers. They might need to introduce further measures in future. In many areas, including mine, people leave foster care and go straight into bed-and-breakfast accommodation that has never been inspected by the individual nominally responsible for the young person. No doubt that will change.
    There is a huge strain on the system at present. Will accommodation be considered under the standards for young people leaving care? In another place, at another
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    time, and as the remit of another Minister, will the Government deal with the poor standard of HMOs—houses in multiple occupation? There is little regulation of such dwellings, where so many foster care leavers end up.
    Mr. Dawson: The hon. Gentleman draws attention to a serious problem. Local authorities have substantial resources and access to housing resources. Does he agree that a crucial part of the corporate parenting role of local authorities is to ensure that, when young people leave care, they can have local authority accommodation, or can be given priority by the local authority in securing housing association accommodation?
    Mr. Thomas: I do not want to follow that point too far, as I may be out of order. I certainly agree with the main points made by the hon. Gentleman. There is a lack of accommodation specifically for young people leaving care. There is certainly a shortage in my area, although I am pleased that the county council put supported accommodation for such young people at the top of its strategy for this year. That policy is being pursued with the help of a local housing association. Despite such examples of good practice, we need legislation—especially on HMOs.
    I want to touch on some of the aspects of the delivery of the provisions in rural localities. The adviser must have the right skills, training and knowledge to deliver the service in a particular area. Advisers need the right cultural, linguistic or gender background. In a rural area, they need to be able to travel so that they can be close at hand. Although we may choose to move away from our own parents, we would probably all agree that the personal adviser needs to be nearby. In the Welsh context, the advisers should be able to speak Welsh and English. I am sure that other languages would be needed in areas throughout England so as to provide the best services to young people.
    We need to consider the possibilities for the use of the leaving care grant in rural areas. The grant will be governed by national standards, but I should like to it to be used for driving lessons for young people leaving care. The driving licence should also be paid for. For example, under the new deal, there are payments for driving lessons but not for the provisional licence. That would be nonsense for many young people. We need to ensure that they receive the necessary support in order to find a job.
    There are difficulties with rent bonds. My local authority set up a rent bond project last month. It is most welcome. Only 20 rent bonds are available for the year. I understand that social services have bought several of them for young people leaving care, but given that about 80 people a week use a drop-in service, 20 bonds for the whole county is quite low. We should consider how the leaving care grant and other resources might provide assistance.
    The Bill could be improved. Under clause 4, local authorities will be allowed to give educational assistance to young people aged up to 24. The point has been made by Voices from Care and Children in Wales that the provision needs to be re-examined to determine whether local authorities should be under an obligation to provide assistance. If we follow the good parent principle, we expect any parent who can afford it to provide educational assistance to their children, even though that

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    may be of a tapering nature. There is no doubt that local education authorities need to have that responsibility placed on them, and I hope that we shall explore that issue in Committee.
    I want to conclude by saying a few words on resources, and particularly on resources as they affect Wales. I have the official civil service briefing to the Health and Social Services Committee of the Welsh Assembly; it was produced on 8 December last year, when the Bill was discussed during the consultation process, and it clearly states:
    It is therefore the responsibility of the Department of Health to ensure that resources are made available to cover any additional costs that result from the requirement to introduce Young Person's Advisers in Wales.
    Whatever the other benefits of the devolution settlement in Wales, the Barnett formula does not deliver sufficient funds to accommodate extra expenditure if they are not forthcoming from the Department.
    If many young people are able to realise their potential, to have successful careers, to leave care, to participate fully in society and to go to college or university to gain skills, they will be less likely to be socially excluded, less likely to need state support and less likely to end up in prison. Young people want to lead independent and successful lives. The Bill, if amended, will save the Government considerable sums compared with the long-term resources that would be needed to pick up the pieces of a failed system.
    7.2 pm
    Ms Julie Morgan: I welcome the opportunity to speak in this important debate. The provisions in the Bill should ensure that we never again hear the shameful statistics that we have heard from many Members today. However, it is worth repeating them because it is important to realise how children and young people in care have suffered. Many of them end up homeless, and the vast majority do not obtain any educational qualifications. Many of them have to cope in the wider world long before they are ready to do so.
    Like many other Members, I have worked with young people and I remember with shame the way in which many of them were left to cope with circumstances that were far from ideal. I welcome the Bill as a tremendous step forward in addressing their needs. The Bill gives us the opportunity to protect care leavers and to help them fulfil their potential, which far too often they were not able to do in the past.
    I was very pleased that, at an early stage in the Bill's development, I was able to arrange for a group of young people from Wales to come to this place to discuss their concerns directly with Welsh Members of Parliament and with others. I pay tribute to those young people and to the Voices from Care group for the tremendous work that they have done on the Bill and other legislation. The Bill will be successful only if it takes on board and reflects the views of the young people who have been involved in the process. I also pay tribute to Children in Wales, which has worked hard to influence the process and to join the groups that have been organised by my hon. Friend the Member for Lancaster and Wyre (Mr. Dawson).
    I also want to convey some of the views that people from Wales have expressed to me so that they can inform the Bill as it proceeds through the House. They greatly
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    welcome the Bill as a huge step forward, but there are ways they would like to see it improved. I shall go through some of those points later.
    I warmly welcome the Government's promise to extend aftercare services for care leavers up to the age of 21, and to 24 for those in full-time education. There is clear evidence of the need for that. I am thinking of a young man who came to see me recently in my surgery in Cardiff. He had no family contacts and left care at the age of 16. He left school with no qualifications and had difficulties with literacy after a disrupted education, having been moved from place to place. He experienced problems in retaining work, and was moved to a bed-sitting room in another town out of his home area.
    The young man was advised how to claim benefits, but he has faced endless difficulties since that time. There was no plan to prepare him for independence, no funding to help him catch up on his education and no on-going contact with a social worker to help him establish himself. Four years later, he still faces tremendous difficulties and, to our shame, we could tell a similar tale about many young people who have left care. I welcome the Government's promises to raise the age limit, and support my right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) when he says that that should be done immediately.
    I also wish to comment on the pathway plans. The Bill rightly includes the requirement for all care leavers to have a personal education plan. That will help young people to move towards independence. However, young people in Wales have expressed concerns to me that there is no explicit duty to fund the pathway plans. I welcome the reassurance that my hon. Friend the Minister gave earlier, but I would like to hear more about that.
    Young people fear that a way forward could be agreed on how to provide them with basic literacy services but that there would be no funding for it. I want to ensure that all the aspirations that are set out in the personal education plans, which are an excellent idea, are achievable by young people and that they will not be an empty concept with nothing to back them up. There should be a duty on local authorities to fund the pathway plans and they should have the money to ensure that that is done.
    Like my hon. Friend the Member for Wakefield (Mr. Hinchliffe), I shall refer to the terminology used. One of the issues that has been drawn to my attention is that clause 1 states that the
    local authority shall … prepare a pathway plan for him.
    We are talking about teenagers, and I suggest that all parents would acknowledge that teenagers prefer to have something planned with them rather than for them. Could not the terminology be changed to make it more attractive to young people so that they feel that the plans are made jointly by them and the adviser working with them? Language is important, so it would be useful if that particular provision could be changed.
    There should be a duty to support education and training for care leavers for courses commenced before the age of 24 years, and it would be ideal if the provision covered those aged 24 as well. Earlier, we heard an exchange on whether we should introduce any age limits at all. It was suggested that such limits did not apply to children who live at home with their parents, but I understand that, practically, we must have them. Therefore, would it not be possible to extend the provision to those aged 24?

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    Evidence from young people and Voices from Care has shown—this is commonly accepted—that many care leavers take time to resolve the other priorities in their lives and to catch up on their education before they are able to plan for a higher education course. A small-scale study in Wales found that children in care are more likely than their contemporaries to be at least one academic year behind at school. As has already been said this afternoon, 75 per cent. of care leavers finish school without educational qualifications and need time to progress their basic qualifications before being able to go on to higher education.
    Mr. Simon Thomas: Does the hon. Lady recall the briefing that she organised in this House at which Voices from Care suggested that the obligation should continue until the age of 30 because of the need to sort out young people's priorities before starting education? The Minister may blanch at that figure, but a statutory duty until the age of 24 would be a reasonable compromise.
    Ms Morgan: I accept that. At the briefing, young people were asking for the age to be set much higher than it is in the Bill. We should make the duty continue until the care leaver reaches the age of 24 as a small step towards meeting those wishes.
    It is clear that care leavers are not moving through the education system in step with their contemporaries. I am sure that we all accept that that is not a matter of ability but a result of the system that they have been in. We must go out of our way to enable them to develop their skills later than young people who have not been through the care system.
    There are clear reasons why we should ensure that local authorities have a duty to support care leavers up to and including the age of 24. That is important, as experience shows that local authorities do not have a good track record in this field. For 50 years, local authorities have had discretionary powers to give aftercare and support for care leavers' education, as provided for in the Children Acts 1948 and 1989. They have not used that power, so I have doubts about discretionary powers in this field. One local authority in Wales, for example, currently has 200 care leavers, but has no budget to finance education and training for them.
    Care leavers and representatives from Voices from Care say that they have not even been told by local authorities that they may be able to receive assistance to pursue their education. They had no idea that they could receive discretionary assistance—that seems to be a common problem among local authorities in Wales. It is therefore not surprising that so few young people leaving care go on to higher education. That is a disgraceful situation which must change, and the Bill gives us an opportunity to change it.
    Not getting any training and education has severe consequences for young people, but there is clear evidence that we can do something about that. In research done in Wales, Professor Sonia Jackson studied care leavers with good academic qualifications and found that those who had qualifications ranging from a minimum of 5 GCSEs to degrees all ended up with secure careers and housing. The education system offered them opportunities to achieve and take part in the mainstream of society. However, only one member of the control group of
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    approximately 100 care leavers without any educational qualifications had secure work and housing. That is a gloomy statistic. Education and assistance with education seem to be the key to helping those young people move ahead. We should help people not only in the short term but in the long term.
    I said earlier that young people in Wales were sending a strong message that they did not wish benefits to be transferred to local authorities. They assure me that their consultations show that that feeling is shared by all young people in Wales. I accept the intention behind the proposal to transfer benefits from the Department of Social Security to local authorities. However, young people have told me forcefully that they feel that they are being treated differently from other young people who are not able to live at home. I accept that it can be argued that we are trying to make local authority provision more like a real home for care leavers, but I want to put it on the record that young people fear that a transfer may result in their losing out on additional benefits from the DSS, even though, as has been said, such benefits are a maze and difficult to get.
    Many young people in care do not have a good relationship with the local authority and feel that they have often been let down by social workers. Lots of them do not have social workers who have worked with them for a long time. I am not attacking social workers, as that is not their fault, but perhaps the system is not properly resourced. Young people are sceptical of the local authority and are anxious about the transfer of benefits from the DSS to local government. Is it possible to have further consultation with young people on the issue, as we need to reassure them that they will not lose out and that there will be a better and easier system?
    The National Assembly for Wales will be responsible for the distribution of benefits to local authorities in Wales. The Bill specifies that money going to the local authorities will be ring-fenced, and we want that for Wales, although how it is done will be up to the National Assembly. If the money is not ring-fenced, I would have a grave fear that some of it would be lost in local authority budgets.
    Finally, I want to take the opportunity to publicise the need for all further and higher education colleges and institutions to recognise positively the particular needs of care leavers. Ground-breaking work done in this field by Howard Firth at Hampshire county council in partnership with local universities and colleges has led to passports to education, which are positive routes for care leavers to help them into further and higher education. That involves work before the young person goes to college, exploratory visits, support and other assistance which helps to make higher education more accessible. It is leading to real results and achievements, which can be an inspiration to others.
    All the research evidence shows that care leavers are under-represented in further and higher education. Their parents have in effect been local authorities, and more must be done by colleges and universities to ensure that an appropriate number of young people from care enter further and higher education.
    In summary, I am aware that some of my proposals would add to the resources needed for the Bill. However, it is important to recognise that if we provide the money now, we shall not have to provide it later. Whatever we

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    do, we must change the situation whereby young people end up in an expensive prison system or homeless on the streets, which involves a great cost to the individuals concerned.
    7.19 pm
    Mr. David Amess: For the first time in this Parliament, I truly welcome a Government Bill, although I hope that I do not come to regret that. I am not going soft, but I feel that I should give credit where it is due. I congratulate the Government on a Bill which, in every sense, is a measure of common sense. As with all such debates, it seems that there is little to say because all hon. Members have said that they agree with the measure. The few points that we want to make will be best made in Committee. Having said that, I should still like to put on record a few thoughts.
    The Action on Aftercare Consortium comprises of Barnardos, Centrepoint, Childline, the National Children's Bureau, Action for Children, the National Foster Care Association, First Key, Save the Children, the Children's Society and Voice for the Child in Care, all of which support the Bill. Many of us have great contact with them in our constituencies. Perhaps the Government needed no encouragement because they have acted on the Utting report, but those organisations must take some of the credit, and I pay tribute to them.
    The statistics for children in care are absolutely horrendous. The circumstances under which many children go into care are too awful to describe. Many hon. Members have come from a loving, caring, family environment, and it is difficult to imagine the awful circumstances of some children, who eventually drift into crime and take drugs. They may become pregnant when they do not wish to do so, and they then have children, and one cycle follows another. I welcome the fact that the Bill will address some of those problems.
    We heard from the hon. Member for Wakefield (Mr. Hinchliffe), the Chairman of the Select Committee on Health, of which I am a member. I was not serving on the Committee when the report to which he referred was produced, but I pay tribute to it for that report, especially three of its proposals. It said:
    It is clear that in many cases undue pressure is put on young people to leave care as soon as they are 16, irrespective of how well or badly prepared they may be for independent living so early in their lives.
    I am glad that the Government have taken that proposal on board.
    The Committee's second proposal states:
    The social services must not turn their backs on young people when they have left care … We support the proposal by Sir William Utting and others that the Children Act 1989 should be amended to convert the discretionary powers contained in section 24 into duties imposed on local authorities to offer appropriate support to care leavers in the form of services, in-kind assistance and cash. We recommend that this duty should extend to young people up to and including the age of 21, and should exist as a discretionary power up to and including the age of 25, or beyond in exceptional circumstances. The Government should ensure that the resources necessary to achieve this end are provided.
    Several hon. Members have already mentioned that.
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    The final point—I do not think that the Minister mentioned it in opening the debate—is that the Select Committee said:
    We recommend that the Government should take the necessary steps to improve the quality of statistical information available on service provision for and outcomes of care leavers.
    I hope that the Minister—
    Mr. Hutton: I am grateful to the hon. Gentleman for giving way because he will probably not receive a response to that point if I do not respond now. He will be aware that the work that is being done on the quality protects programme has hugely increased the resources and data available on such issues. We hope to publish the second national overview report of the management action plans shortly. I hope that he and his fellow members of the Select Committee will pleased about the progress that we are making on data collection.
    Mr. Amess: Excellent. I thank the Minister for that instant response. There are beacons of good practice around the country. I am trying to be politically neutral, but I have struggled to find a reference to a Liberal council.
    Dr. Brand: The Isle of Wight.
    Mr. Amess: The hon. Member for Isle of Wight (Dr. Brand) wants me to mention his local authority, but the Local Government Association's briefing particularly praises Westminster city council for linking care and aftercare services, Wakefield metropolitan district council for the signpost project, the royal borough of Kensington and Chelsea for the good parent model, and Suffolk county council for working in partnership. I do not know why the LGA did not include a Liberal council, but the hon. Gentleman has certainly put that right.
    There are wonderful examples of good practice throughout the country, in which appropriate resources are set aside, but there are some examples of very poor practice. Some local authorities seem to take the first opportunity to cast out youngsters from the system and make them fend for themselves. There have been perverse incentives for local authorities to shove the cost on to the social security budget. I am so pleased that this little Bill of just eight clauses will address that point, and I congratulate the Government on that.
    My noble Friend Earl Howe, among others, successfully argued in the other place that the age should be 21, as Utting suggested. I am pleased that the Government have accepted that. I understand that an undertaking was given in the other place on assistance for care leavers in connection with job training, educational qualifications and employment up to the age of 24. Perhaps the Minister in the other place was simply trying to placate and shut up my noble Friend, but we might be able to test that in Committee.
    I was sent a briefing by the British Association of Social Workers, which the Minister may or may not have had an opportunity to read. It seems to make one or two critical points on legislative changes. For example, it states that the proposals for helping the youngsters are
    inadequate. The aim of preventing destitution … is too modest. The proper course in these circumstances is to give the area authority a duty to provide services and a power to re-charge the care authority until such time as the care authority is able to assume responsibility

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    for service provision. The care authority's desire to regain control of their own expenditure should prove a sufficient incentive to prevent drift in this situation.
    The Minister may be able to respond to that in Committee.
    As the Minister knows, the LGA supports the Bill, but, with others, it is concerned about resources, which will be no surprise to the Minister. It believes:
    The proposals cover new and extended duties, new staff and the administration of benefits. The association is keen to ensure adequate levels of funding so that young people are not let down. Access to related benefits and to employment and careers support should continue. There needs to be additional funding to cover the administrative costs of implementing the proposals.
    The simple transfer of current benefits to the ringfenced "account" to support young people will not be adequate to meet needs such as accommodation, as under 25's receive reduced benefits and underclaim. There will need to be higher levels of support.
    I am privileged to do some organised voluntary work with Barnardos, which also supports the Bill, but it is concerned that the Bill does not cover the full 47,000 disabled children who live away from home. The right hon. Member for Coatbridge and Chryston (Mr. Clarke) touched on that fact. Barnardos believes that disabled children and young people who are placed in residential schools on full-time placements, or those who receive care during school holidays, are not officially looked after, and it is concerned about their position. It believes that those young people will spend most of their childhood living away from their families and are unlikely to return to them when they finish their education.
    The transition planning requirements address the transfer from education and children's services to adult services, but I am advised that there is no requirement for those young people to have an adviser or advocate and that decisions about their future are often made without reference to their wishes and feelings. Frequently, assumptions are made about their abilities, and they are not given the opportunity to consider independent living or access to mainstream education and employment services. That group of marginalised and excluded young people are denied rights available to others, and I hope that the Minister will be able to give us a steer on that in Committee.
    The issue of the advisers was raised in the other place, and it is important that they are given proper training. Their job will be an enormous responsibility and they should be tutored in child welfare, so that they are not just a cheap version of what is on offer at the moment. I hope that the advisers, with all the responsibility they will face, will receive first-class training.
    My five children are still dependants, and I am told that the idea that when they grow older I will be able to really enjoy life and they will never come back, with all their hopes and anxieties, is complete nonsense. Above all else, the children leaving care, who are the victims of such terrible circumstances, deserve the best possible support. I hope that the Bill will ensure that they get it.
    7.31 pm
    Mr. Jonathan Shaw: I apologise for being absent for part of the debate, but I had an urgent meeting. We all arrive here through a variety of circumstances, and that brings a rich mixture of knowledge and varying degrees of expertise. We all have great hopes of seeing changes in areas of policy that we might have a particular interest in or experience of. I have
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    spoken in many debates and I have welcomed legislation in the belief that it will change and improve the lives of the constituents whom I represent, but the Bill fills me with an immense sense of pride. I am proud because I know, from my work with young people leaving care, that the measures it contains will improve their lives—they are among the most vulnerable members of our community. I am also proud that it is my party in Government who have listened to and—importantly—understood the concerns of young people in care.
    The Bill is also great testimony to the campaigners, who have been mentioned by hon. Members on both sides of the House, who have worked tirelessly to get the measures in the Bill accepted by Parliament. As other hon. Members have said, we want the Bill implemented as soon as possible.
    It is important to discuss why we need the Bill. We have heard that 75 per cent. of young people leaving care do so without any educational qualifications, and 50 per cent. of them are unemployed. That is hardly surprising when the majority have to leave their homes at 16 or 17, and that figure has been rising steadily. They leave home and have to run their own home. Then they have to start their college course, and they might need to supplement that college course by working at the local supermarket. They have no family to back them up. They might have been sexually or physically abused. They might have experienced the turmoil of adoption breakdown. All that at 16. We, the policy makers, decide that they can cope with all that at 16. It is a disgrace. Was there ever a better entitled consultation document than "Me, Survive Out There?" What do we expect? It is not rocket science to work out that the odds are stacked heavily against those young people.
    Despite all the adverse circumstances, it is important to acknowledge that many young people who leave care are great survivors and do remarkably well. However, when we congratulate them, we should feel a sense of shame, because it is despite the policy makers and the laws that are in place that the young people do so well. Like my hon. Friend the Member for Cardiff, North (Ms Morgan), I was privileged to meet a group of young people from Kent, who came to the House with their social workers to discuss aspects of the Bill, including issues such as housing, training, foster carers, supportive lodgings and money—the sort of issues that one would expect young people in care to want to discuss.
    Those young people gave a positive welcome to the Bill, but in their eyes—and to some extent, in mine—it will succeed or fail depending on whether we grasp the nettle and raise the statutory leaving age to 21. That is crucial for the success of the Bill. We should pay tribute to my hon. Friend the Minister, who is no longer in his place, because I know from conversations that I have had with him and from speaking to others that he has worked hard to see that the amendment tabled in the other place made it into the Bill. I thank him for that, and all the young people in care and everyone involved in their welfare should pay tribute to him. We should send a loud and clear message to young people in care that we want to see the change to 21 made as soon as possible, so that they can stay in care until the age of 21 and, if they are in education, until the age of 24.
    As my right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) said, we should ask whether what we provide would be good enough for our children.

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    A background of abuse followed by the requirement to leave home at 16 and live in a bedsit is not good enough. We must give young people the opportunity to stay in a family home until they are 21. Nothing less will do.
    One of the young people whom I met told me about the time he was preparing for his A-levels. He is an exception, because few young people in care get to that point. Three months before sitting his exams, he celebrated his 18th birthday. We all remember doing that, but for him it meant that he had to leave his foster home and move into a bedsit. That was not what his foster carers wanted or, obviously, what he wanted. Not surprisingly, given the distress that the move caused him, he went on to fail his A-levels. He did so because the system had let him down. I am glad to say that, through his own efforts, the wrong was righted. He has a place in a supportive lodging scheme and is progressing well. Sadly, in my experience, his story is not uncommon.
    I have seen too many young people leave home before they were ready. Is that the fault of the social workers, the foster carers or the local authority? There are cases in which all could have done a lot better. I know that I could and should have done a lot better in certain cases. However, as my noble Friend Lord Hunt of Kings Heath said in the other place, much comes down to money. It simply has not been there.
    There are examples of good practice, as the hon. Member for Southend, West (Mr. Amess) pointed out. Many local authorities are held up as beacons of excellence in the services that they provide for young people. In Kent, I am pleased to say that they have developed a model, recommended in the Utting report, of dedicated services for 16-year-olds and older. With the assistance of some £3 million over the next three years, an excellent team has been set up that is doing some good work with young people throughout the county. The Government are putting their money where their mouth is, and the quality protects programme has been welcomed on both sides of the House.
    The Bill will have cost implications. It is proposed that young people should stay in care until they reach 21, but the recruitment and retention of foster carers is a problem now. The Government are doing their level best to recruit extra foster carers for the children in care now, but we will have a new group of 18 to 24-year-olds, some of whom will be in foster care, which adds a whole new dimension for foster carers. That will require some specialist training, which will mean extra resources. Foster care is a demanding job, particularly with 16 and 17-year-olds, but I know that all foster carers with whom I have worked do not want young people to leave care at such a tender age.
    The Bill rightly places great emphasis on preparation and pathway plans. It is vital that we get that right. Many young people from as early an age as 15 have a cloud hanging over their heads; they are told that they should prepare for independence. Let us imagine what that might feel like. One can imagine the insecurity that that creates among 15-year-olds who have been abused or have entered care for other reasons—there are all sorts of reasons, as the hon. Member for Southend, West said.
    Being 15 years old is not that easy anyway—nor is it easy for parents or any of us to cope with them. I remember running away from home for a couple of days
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    when I was 15, causing my parents problems. The reason was that I did not want to have my hair cut. Sadly, I am reminded of my folly every time that I look in the bathroom mirror in the morning.
    Introducing independence preparation too early can be very damaging. It is important that we get the matter right and focus on the important issues. The experience of leaving care can jeopardise a young person's future. When they should be thinking about their examinations, enjoying themselves, worrying about their haircuts and doing all the things that 15-year-olds do, they should not have to cope with the constant thought of leaving care in two years' time.
    That is particularly so given that the preparation is heavily focused on practical life skills. Young people aged 15 and 16 are expected to know about bank accounts, how to cook and where the jobcentre is. I did not know all that when I was 15. Young people in care are great survivors, but-emotional support and educational achievement need to come first. If we get those right and provide for young people to stay in care for as long as they need, we will have provided the best pathway plan. That is the best way in which we can assist young people to survive out there.
    If young people are to succeed when they leave care, there must be a sea change in culture. A youngster leaving care at the age of 17 or 18 must be the exception, not the norm as at the moment. We must allow young people on leaving care to get it wrong. They may choose at 18 to move into a bedsit, but if that does not work out and they have difficultly paying bills, they should be able to return to care. Any other young person in such circumstances would go home, saying, "I am sorry; I got it wrong," and their parents would take them back. That is exactly what should happen to young people who have been in care. They should have such back-up, which will give them confidence and enable them to get the most out of their lives. That means no half measures: 21—nothing less.
    I should like to make a few comments on other aspects of the Bill. First, the proposals to move benefits are entirely right, but I wonder whether some flexibility should be built into the system. If it can be demonstrated, through due process, that a young person's relationship with a local authority has broken down or that they have moved on, it might be appropriate for them to receive benefits in the normal way.
    Secondly, setting up home is crucial for youngsters leaving care. The Green Paper on housing widened the category of priority groups to include care leavers, which is welcome. I hope that there is a Bill to that effect in the next Session. Parental responsibility should involve housing authorities. Kent operates a two-tier system of local government. Several district councils operating in an area means that resources vary greatly from one housing authority to another. Unfortunately, so does willingness to participate in assisting young people, which does not cost a great deal but is very important. There should be a clear requirement on housing authorities to be so involved.
    The hon. Member for Ceredigion (Mr. Thomas) mentioned houses in multiple occupation. In the interests of joined-up government, I hope that a Bill in the next Session licenses HMOs. Local authorities and their representative bodies have been calling for that for many years. Although HMOs are a necessary part of housing provision, a landlord should have a licence and a clean

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    bill of health for the premises before he opens his doors to any young persons and receives benefit payments. That would raise the standard of such housing stock.
    Thirdly, the provision of young persons' advisers is welcome. Let us hope that such advisers will be an additional advocate and a positive force for rights and quality. It is crucial that young people trust, and have confidence in, those individuals. I would be interested to hear from my hon. Friend the Minister for Public Health how their performance will be monitored and whether there will be a mechanism in clause 5, concerning complaints procedures, for which there will be regulations, for a young person to be able to change their personal adviser if they see fit.
    I was completing my social work training just as the Children Act 1989 was completing its passage through the House. The legislation was heralded as a bringing together of all the various Acts and there was great support for it in the House, but a number of commentators were saying—I said so in my law paper—that it was a missed opportunity. Its one glaring failure was that, rather than stipulating duties, it simply gave powers to assist care leavers. As a consequence, over the decade since that Act came into force, young people have missed opportunities to fulfil their potential—because they have left home at 16. As hon. Members have mentioned, the cost to those leaving care, and to society, has been enormous as a result.
    As long ago as 1948, local authorities were given powers to assist young people leaving care. More than half a century later, most authorities do not use those powers. We need to stipulate the age of 21 and we need young people to stay in care until such an age—and as soon as possible. I wish my hon. Friends all the very best in negotiations on the comprehensive spending review.
    I want to make one final point, to which my hon. Friend the Member for Wakefield (Mr. Hinchliffe) referred. Child migrants are a forgotten section of the community of children who leave care. The Child Migrants Trust experiences difficulties in funding all the work that lands on its desk. It has 130 families on its books waiting for social workers. Just recently, a mother aged 86, who had been looking for her child in Australia, died before any reconciliation. There are not enough social workers to do the work. That man in Melbourne will shortly be told that his mother has died and that the opportunity for reconciliation has passed.
    Finally, I wish my hon. Friend the Minister good luck with the comprehensive spending review. I know that there is enormous competition, but it is right that we assist children who are the responsibility of the state. We have let them down too often in the past and, by helping child migrants, the Bill will go a long way to righting many wrongs.
    7.50 pm
    Mr. David Kidney: It is fair to say that this is a brilliant Bill, packed full of excellent measures. 1 welcome it as representing the coming of age of public policy on children and young people looked after by local authorities. The way in which we have let down vulnerable young people, time after time, has been catastrophic for them because it has damaged their ties to family and the wider community, and it reflects badly on our society as a whole.
    I am pleased to tell hon. Members that I do not intend
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    to take them on another tour of the Bill's contents as other speakers have done; instead, I shall set the Bill in two of its immediate contexts and raise two specific points that have already been raised but which, even in a debate of such high quality, have not been focused upon. The two contexts are quality protects and the Care Standards Bill, both of which have been mentioned many times in the debate.
    Quality protects was launched in September 1998. It is important to remember that the Bill relates to children and young people in care and leaving care, whereas quality protects has a far broader application, covering all local authority services for children, including those for young people looked after by local authorities. Let me illustrate the sea change that is already taking place as a result of quality protects, by referring to Staffordshire social services.
    Even before quality protects began, a leaving care team was in place in Staffordshire, and the social services department was already moving in the direction in which that programme later pushed everyone. In May 1998, before the launch of quality protects, I organised a conference in Stafford to discuss how better to support children leaving care, and the local social services department was a strong supporter of the conference. The department picked up and ran with several recommendations on best practice that emerged from the day, which put it in a good position later, when quality protects was launched.
    Staffordshire social services department's most recent publication sets out its response to quality protects. It says:
    A lot has started to happen for children and young people we look after.
    Some examples of changes on the ground include the appointment of a children's voice officer and complaints officers, and the institution of formal and informal methods of consultation. There are now mentors for children leaving care, trained and supported by a joint co-operative venture between the department and the Prince's Trust. I was pleased to award the first volunteers their certificates of competence at the end of their training and to meet the people who want to help and support youngsters leaving care.
    A project called Sustain provides immediate help to youngsters in placements that are in danger of breaking down; it tries to save the placement and keep the children safe. Planning is carried out to avert the need to receive children and young people into care, to keep them with their families and to support them in the community. Finally, there are effective links with education and health services in Staffordshire. Those examples of local action remind us that while the Bill is being implemented, quality protects will be running alongside, developing and pushing local authority social services in the same direction.
    That brings me to the Care Standards Bill, which deals with much more than children. Where it does deal with children, it relates specifically to those living in residential care homes and to fostering agencies and voluntary adoption agencies. The intention is to protect vulnerable people from abuse and neglect and to promote a consistently high standard of care in all care homes. All children's care homes will come within the remit of the new National Care Standards Commission and its inspection regime.

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    When the Government were under pressure to establish a children's rights commissioner, the concession they offered to those pressing for such a post was to promise that the new commission would appoint a children's rights director. That brings me to the first of the two issues that I want to highlight, which are, first, the arguments surrounding the children's rights commissioner, and secondly, advocacy for children and young people. I am but one of many voices calling for a commissioner to be appointed.
    Dr. Brand: Does the hon. Gentleman share my surprise that although 13 speeches made on Second Reading of the Care Standards Bill focused on the need for a children's rights commissioner, amendments based on the Children's Rights Commissioner Bill promoted by the hon. Member for Lancaster and Wyre (Mr. Dawson) were not accepted by the powers that be?
    Mr. Kidney: I was not so much surprised as disappointed. I intend to urge Ministers to think again.
    In discussions with Department of Health officials about the reasons behind the objection to a commissioner, the official response to my arguments in favour of the post being established was that with all the other developments already in train, nothing additional would be gained by such an appointment. I do not agree. First, the post of commissioner would secure the advances now being made against future watering down or neglect. Secondly, it would provide a focus for children and those who are concerned for children and want to help them. Thirdly, a commissioner would be an authoritative figure to provide guides to best practice, to pull up those who fail to do what they should do, and to be either the whistleblower or the person to whom a whistleblower turns to draw attention to something wrong.
    Earlier this year, in a debate in Westminster Hall, the Minister, my hon. Friend the Member for Barrow and Furness (Mr. Hutton), said of the proposed children's rights director:
    In recognition of its role in safeguarding children, the national care standards commission will appoint a children's rights director, whose job it will be to ensure that children's rights and welfare are at the heart of all its responsibilities for regulating children's services.—[Official Report, Westminster Hall, 3 February 2000; Vol. 343, c. 253WH.]
    I believe that his statement could—and should—properly be adapted to read as follows: "In recognition of his role in safeguarding children, the Secretary of State will appoint a children's rights commissioner whose job it will be to ensure that children's rights and welfare are at the heart of all public policies that govern children's services."
    Have the Government given any further consideration to the creation of the post of a children's rights commissioner? Am I right in thinking that the Bill's long title precludes an amendment being made in Committee that would create such a post? If I am right, what is the role—if any—of the new children's rights director established under the Care Standards Bill in ensuring that children and young people can gain access to the new rights granted under this Bill?
    The Under-Secretary, my hon. Friend the Member for Pontefract and Castleford (Yvette Cooper), told me earlier that the director would be able to help children who are
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    in residential care, who are fostered through a fostering agency or who are adopted through a voluntary adoption agency. However, I am sure that a moment's reflection would enable her to think of many children covered by this Bill who do not fall into any of those categories. Those who come to mind immediately are children in care who are placed with their own parents or relatives from their wider family, and also those mentioned in the Bill—eligible, relevant and former relevant children who were in care.
    Many young people must be out of their foster placement or children's home by their 18th birthday, despite the assurance that the Minister gave my hon. Friend the Member for Lancaster and Wyre (Mr. Dawson), and I suspect that under the proposed set-up none of them would have access to the children's rights director. That would be a loophole, and would lead to a terribly uneven application of the brilliant suggestion that there should be someone for children to turn to. That is why I think that there must be a children's rights commissioner.
    Finally, on advocacy for children, many years ago Staffordshire contributed the expression "pindown" to the lexicon of child abuse. Young people were restrained in residential homes by having their outdoor clothes taken away and being locked in their rooms. No advocacy services were available for those young people—apart from access to the traditional lawyer. Eventually the practice came to light because of a solicitor's legal action on behalf of some young residents. How much better it will be when children and young people have ready access to trained advocates, be they paid professionals or well trained volunteers. They would be non-lawyers who were ready and able to stand by children and young people and articulate their points of view for them.
    Advocates are not needed in every situation, nor for every young person, but the greater the vulnerability and the more difficult the task of speaking up for themselves, the more compelling is the case for providing that service. A number of organisations concerned with the welfare of children and young people have put to the Government the case for an advocacy service. They are a powerful coalition of some of our more respected organisations, and I support their call for the Bill to include a provision for advocacy services. Will the Minister tell us whether the Department is now persuaded by the force of those arguments and is willing to incorporate the provision in the Bill?
    A great story is waiting to be told about the Government's tremendous effort to improve public policy towards children, from the attack on child poverty to the drive to raise educational standards. High up in the list of achievements will be the civilised, decent measures taken to care for the most vulnerable children, which include some of those looked after by local authorities. For quality protects, for the Care Standards Bill and for this Bill, I say a hearty, "Well done" to the Government.
    8.3 pm
    Mr. Hilton Dawson: It is an absolute privilege to take part in this debate and, in particular, to follow some of the other contributions. The Government inherited a care system that hon. Members on both sides would acknowledge was a shameful disgrace—a system in which a lack of investment,

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    of coherent policy, and, frankly, of interest for many years resulted in the shocking abuse of children in care, as is well documented.
    The situation got worse in the 1990s, when young people were turned out of care at 16, or even younger, in increasing numbers. Basic rights were denied to those children in care—the right to education and to the ordinary experiences of growing up in modern society, and to being listened to and cared for properly. It is remarkable that in only three years under this Government we now have a national voice for such children, the new National Organisation for Young People in Care. We now have quality protects, the £375 million investment in improved standards and management accountability.
    Soon we will have the National Care Standards Commission, the children's rights director and the General Social Care Council. In this Bill, we have the biggest prize of all: the extension of the statutory duty on local authorities to assist looked-after young people up to the age of 21 and, while they are in education, to 24.
    Those policies, coupled with the new education policies, which will require local authorities properly to attend to the education of young people—to set proper individual plans for their education—and to appoint staff to manage the policies, and with full implementation of the Protection of Children Act 1999, will transform the care system. That is a triumph for the Government. It is a triumph for the Minister, my hon. Friend the Member for Barrow and Furness (Mr. Hutton), who has picked up the baton in exemplary fashion and run with it tremendously well, and for his direct predecessor, now the Minister of State, Home Office, my right hon. Friend the Member for Brent, South (Mr. Boateng), and, above all, for my right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson), whose justified anger, passion and determination to change the care system have carried these measures through—[Interruption.] Excellent, my right hon. Friend comes in on cue. I was just saying what a good chap he is.
    The measure is a triumph for campaigning organisations, such as the Who Cares? Trust, First Key, the National Care Leavers Association, Children in Wales and Voices from Care. It is also a triumph for the Select Committee on Health and its estimable Chairman, my hon. Friend the Member for Wakefield (Mr. Hinchliffe), who can rest assured that I was born in Northumberland even though I represent the glorious city of Lancaster. Above all, however, it is a triumph for the brave, resilient and amazing young people in care, whom many of us have the privilege to know. We can dwell for ever on the sad facts of life in care in previous decades, but it is incredibly important to understand that children in care—anyone who has listened to them could understand it—know more about the care system than we ever will. Frankly, they are more intelligent and articulate than most of us. They have endured situations and survived distress that would have finished many of us, more fortunate, Members here. It is great that the Bill will allow them educational chances and give them the support that they need.
    The Bill must succeed. It must receive the required resources from the comprehensive spending review. Quality protects should be replenished with further resources, too. The Bill must be fully implemented by local authorities. Their supreme failure for years has brought us to this pass. On paper, we have had good
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    legislation in the past, but statutory duties have not been properly fulfilled and powers have been totally neglected. The one most crucial message of all is that we should forget about giving local authorities powers over young people who are looked after. If we want the job done, we must give them duties, and then make them carry them out and keep them to the letter of the law.
    The operation of quality protects, the National Care Standards Commission and the children's rights director, and the Government's passion for, commitment to and anger about the care system will ensure that, across the country, the care system is transformed.
    The Bill represents the culmination of a series of events, and constitutes great social policy from a great reforming Government. All the implications of that policy and the Bill must be implemented. However, the Bill needs to go further. I agree with my hon. Friend the Member for Stafford (Mr. Kidney) that young people should have a statutory right to advocacy. Young people leaving care should have a statutory right to be housed by the local authority.
    My right hon. Friend the Member for Holborn and St. Pancras never said a truer word than when he challenged local authorities to be corporate parents, and urged them to take on the simple requirement of social work and measure their achievements against what a good, responsible, ordinary parent would do. A good, responsible local authority would not send children into bed-and-breakfast accommodation, for goodness' sake, or into temporary accommodation. It would ensure that children in whom it had for many years invested time, money, work, care and support left care for decent accommodation and were decently supported through their early adult years.
    I do not believe that that is an over-ambitious proposal for all young people in care in this country. We did it in Lancaster when I worked there, and in Wyre when I worked there. Every young person who remained in care until the age of 18 was guaranteed the opportunity of a local authority tenancy. That should obtain for all young people in care and should be written into the Bill.
    We should acknowledge that legislation is not enough. Procedures are important and policy development is vital. We must engage all elements of the system—local authorities, voluntary societies and, above all, young people—in developing practice.
    The Bill represents an historic moment for social policy. It is clear evidence that the Government are listening, learning and working with all concerned to achieve change, and are producing great reforming legislation. We should all recognise the significance of this day and celebrate a victory for care, compassion, decency—and especially for the hundreds of thousands of children who will pass through our care system and benefit from the Bill in the future.
    8.13 pm
    Mrs. Caroline Spelman: The debate has the air of a Friday debate on a private Member's Bill on which there has been consensus in all parts of the House. I have good news for the hon. Member for Wakefield (Mr. Hinchliffe), who said that he remembered such consensus last breaking out in relation to the Children Act 1989. I am pleased to tell him that, from my short time in the House, I recall a similar consensus on the Carers and

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    Disabled Children Bill, and I am reminded by my hon. Friend the Member for Runnymede and Weybridge (Mr. Hammond) that that was the case also when we debated the Protection of Children Act 1999.
    When we discuss children's services, consensus breaks out in all parts of the House. We are working together to make sure that those services are improved. That is why the Bill has received support from the Opposition.
    Mr. Dawson: Will the hon. Lady give way?
    Mrs. Spelman: I should like to make progress. The hon. Gentleman has just spoken. As he has just had his turn, perhaps he will allow me to get going, but I shall give way later when we get on to the substance.
    The hon. Gentleman spoke about parenting. We must be realistic about the role of the corporate parent. It can never be quite as good as a relationship with a mum or dad who sees the child through the truculent transition from childhood to adulthood, with all the powers, good will and love for the child that a parent has.
    The bare statistics cited by hon. Members in all parts of the House during the debate reveal that the state has made a poor fist of trying to be a corporate parent. I shall not rehearse all the statistics, but there is one that I find particularly sad: one in seven young women leaving care is pregnant or a mother already—in other words, those young women fell pregnant before they reached the age of 16. Clearly, as corporate parents we have not done well. That is why we support the Government in their efforts to improve that appalling situation, and why we have given our support to the quality protects programme.
    Our purpose today is to help the Government improve the Bill. If we think ourselves into the role of parenting a troubled teenager, we know that teenagers resent being dictated to or bound by rules and sanctions that they regard as petty and offensive, so we must strike a balance, as any successful parent does. There must be give and take during the teenage years, and young people need to know that if all goes wrong, we are still there for them. That is what we must convey and transform into practical reality through the Bill. Many of the youngsters with whom it deals have only a broken experience of such unconditional love.
    Ms Shipley: Does the hon. Lady agree with what I said in my intervention on the hon. Member for Runnymede and Weybridge (Mr. Hammond), when I suggested that if the teenager refuses to participate in the programme that we suggest or in some other way does not comply with our wishes, we cannot withdraw, as a sanction, the structure proposed by my hon. Friend the Minister of State? We must keep going and keep offering love, support and care.
    Mrs. Spelman: I heard the hon. Lady's earlier intervention. Common sense is needed in working out the pathway plan. Adults at their wits' end must try to use common sense as young people make the transition, and advisers will have to use common sense when dealing with youngsters unwilling to follow the route that we suggest for them. It is against the ideal of being a really good corporate parent, which is hard to achieve, that we are trying to assess the Bill.
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    It is important that we try to ensure that young people have a choice when it comes to personal advisers. The independence of personal advisers may be the key to trust. A phrase that came home to me when I was talking to some of the voluntary organisations was that children in care sometimes see those who are there to help them as part of a "hated establishment". If the advisers are seen as insufficiently independent of that establishment, they are unlikely to be trusted. Surely the young individual should have the right to reject any advice thrust upon him if, after a trial period with an individual adviser, the process is not working.
    I support the argument of my hon. Friend the Member for Runnymede and Weybridge that, at 18, a young adult must have the right to say, "Thanks, but no thanks." However, that must be balanced in the Bill with the right for that young adult to come back if he changes his mind. Striking that balance will be part of our skill in getting the proposed legislation right.
    Where the Bill will succeed or fail lies in the future ability of local authorities to overcome the natural antipathy and mistrust of young people in their care towards them. We have been told so often by those working in this area that that is the nub of the argument. That is one of the reasons why we strongly advocated the greater use of voluntary organisations. In the example given by my hon. Friend, they can often do better.
    Communication between local authorities will be vital if the Bill is to work. Young people are naturally mobile, and they may move from the authority area in which they are in care to another. The Bill holds the original authority responsible for the financial and social support of that individual. There will have to be a new spirit of interdependence between local authorities.
    As in one case study that I saw, if the local authority in Hull is asked to pick up the tab for a care leaver who lives, studies and needs help in, for example, London, good communication between the two authorities will be required.
    The Government may have to use their powers under the Local Government Act 1999, as the Minister made clear. It contains powers to direct a local authority which fails in its obligations under the Bill. These powers have not yet been implemented, despite having been law since April. If the Bill is to have effect, these powers will have to be seen to work. It is only when local authorities are brought to book if they fail, that confidence in the system will be restored.
    There is the question of the looming Scottish anomaly. We do not want a repetition of the student fee situation. However, it could arise where care leavers can continue to get hold of existing benefits from social security in Scotland whereas, under the Bill, that will be stopped in England, Wales and Northern Ireland. I am sorry that the right hon. Member for Coatbridge and Chryston (Mr. Clarke) is not present because I have to say that that involves two-way traffic.
    Scottish care leavers coming to England will still be entitled to benefits unless parallel legislation is achieved pretty quickly in the Scottish Parliament. It is not impossible to imagine a situation, unless the anomaly is rectified, where somewhere such as Glasgow becomes the care leavers' capital of Britain. I am sure that the local authority in Glasgow would not wish that to happen.

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    Voluntary organisations such as the Action on Aftercare Consortium have considerable evidence of young people having trouble accessing the existing complaints procedure. The Bill lacks a new model with sufficient independence to inspire confidence in a complaints procedure. I support the view of the hon. Member for Stafford (Mr. Kidney) that it would be helped by greater use of advocacy. The voluntary organisation First Key and a host of other organisations believe passionately that every child should have access to an independent advocate. I hope that is something that we shall be able to explore in Committee.
    Mr. Hutton: I am not sure whether the hon. Lady is aware that yesterday we published a consultation document about possible reform of social services complaints procedures. We have asked specific questions about the role of advocacy. We have always made it clear in relation to the Bill that we shall ensure that looked-after children have access to proper advocacy arrangements.
    Mrs. Spelman: I thank the Minister for that helpful intervention. I was unaware that the document had been published. That helps me.
    A host of other practical issues will be brought forward in the form of appropriate amendments in Committee. To allow the Government time to think about some of them, it is worth flagging up a few. For example, why restrict the provision of vacation accommodation to those on higher education courses only?
    The hon. Member for Cardiff, North (Ms Morgan) made an important point about the value of further education. Only a few care leavers aspire to university qualifications. However, many aspire to more practical qualifications that are obtainable through further education. Of course, FE colleges also have vacations, and that is something that we need to consider if we are to commend this part of the Bill.
    An important point was made in the other place about the means-testing of financial support. As far as I am aware, that point has not been taken up today. I would like to know the Minister's thinking on protecting care leavers who have been granted compensation for criminal injuries. That could arise particularly in cases of child abuse. In that instance, that compensation should definitely be excluded from any means-testing of the financial support that the individual receives. We want to ensure that that point is not lost.
    Hon. Members raised a number of other technical points, and at times the debate almost resembled a Committee stage. Therefore, I simply re-emphasise the Opposition's support for the Bill. In Committee, our opposition will consist of constructive suggestions on how to improve the Bill. There needs to be a touch of gritty reality about dealing with the needs and aspirations of troubled youngsters who have had some of their life chances seriously dented, and we must be careful not to make matters worse. Sadly, there is too much evidence of the state doing just that.
    We recognise that the Bill will place a considerable additional burden on social workers, and they will need plenty of support. We must be particularly aware of the fact that, as the hon. Member for Chatham and Aylesford (Mr. Shaw) said, social workers are already in short supply in certain areas.
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    Several hon. Members made important points about resources. For the Bill to work, it needs to be properly resourced. At least one practical problem that will need to be addressed is that savings in the administrative costs of benefits will remain with the Department of Social Security unless they can be transferred to support the new financial support arrangements for care leavers under the Bill. We are anxious to ensure that resources that were once available for care leavers from one Department will now be available from another, so that there are sufficient resources to ensure that the Bill can be put into effect.
    Mr. Dawson: I am not a chap for spurious consensus, and some of the hon. Lady's remarks cause me to shudder a little. I am committed to the role of the voluntary sector and the private sector, but when we hear from the spokesperson of a party which comprehensively failed for so long to deal with these issues that it is sceptical about the role of the state, it makes me wonder. The role of the state will be crucial in ensuring that standards are raised. If we rely on the Churches, the voluntary sector, other private sector organisations or odd little organisations coming together, however worthy they are, we will not tackle the fundamental issues that the Conservative party so signally failed to deal with for so many years.
    Mrs. Spelman: I regret giving way to the hon. Gentleman. He provokes me into referring to the tone of his speech, which stuck out like a sore thumb as it was the only one that did not represent the cross-party consensus. I would have glossed over it but for that last intervention, which was particularly provocative. I do not think that he was present at the beginning of my speech when I said that we are seeing a continuum in terms of the improvement of children's services, which started with the Children Act and was greatly informed by the inquiry, set up by the Conservative Government, into what had gone wrong in children's services. We have learned a great deal and now we are working together to try to improve what is available. There was no necessity for that intervention.
    Mr. Dawson: Will the hon. Lady give way?
    Mrs. Spelman: No, I shall certainly not give way again. The hon. Gentleman has burned his boats. He will have to content himself with the one intervention.
    In Committee, we must seek to infuse the debate with the practical experience of those who work with children leaving care, which I am sure several members of the Committee will be able to do. We should also include the independent views of voluntary organisations, which have a great deal of experience of best practice to offer. We may find ourselves the corporate parents of young people in our care system, but they will not thank us if we impose unworkable solutions, cut off their money and let them down.
    8.30 pm
    The Parliamentary Under-Secretary of State for Health (Yvette Cooper): The debate has been extremely positive and I welcome the support of many hon. Members for the Bill. To his horror, even the hon. Member for Southend, West (Mr. Amess) expressed support for a Government Bill for the first time; I trust that it will be the last. The measure is morally right as well as common sense.

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    Many detailed points and constructive comments have been made. I shall try to deal with as many as I can. However, I do not apologise for leaving some for the Committee stage. For example, my hon. Friend the Member for Wakefield (Mr. Hinchliffe) made suggestions about the language in the Bill. That is clearly a subject for the Committee.
    Many hon. Members eloquently described why the Bill is essential. I join others in paying tribute to those who have campaigned for so long, including hon. Members—not least members of the Select Committee on Health, who have raised the issue many times. I pay special tribute to my right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson), who has done so much to ensure the Bill's existence, for his great personal commitment to ensuring that the Bill secured parliamentary time, and for being the driving force behind its genesis and the consultation paper, "Me, Survive Out There?", which was published almost a year ago.
    There is no argument about the duty that we owe vulnerable young people who have been looked after by local authorities and have no other family to turn to for support. To face making one's way in the world at just 16 is daunting for any teenager. How much more difficult is it for someone whose childhood has been disrupted, troubled and complicated by family circumstance, tragedy or abuse?
    Children in care arrive as victims of circumstance, and seldom through any fault of their own. They are often seriously damaged by experiences before they arrive in care, and they have often grown up without the security of a family network to support them and sustain them emotionally as well as materially when they try to strike out on their own. As most parents and teenagers know, no matter how independent a 16-year-old feels, family support makes a huge difference for many more years in tangible ways—for example, through education, a home, encouragement for exams or job interviews, advice on bank accounts and career choices, help with driving lessons, the chance to borrow a car and the unquantifiable benefit of unconditional support from someone who cares.
    Teenagers leaving care rarely have any of that support to fall back on, yet they need more help than other young people and children if they are to make the most of the opportunities of adult life. We are considering a matter of social justice and opportunities that other young people take for granted. It is not right that they are not provided to all young people as they begin their adult life.
    The Bill is morally justified as well as pragmatic and sensible. Plenty of evidence supports it; hon. Members have mentioned much of it in their speeches. I shall not repeat many of the points that were made. However, I shall try to respond to some of them. I will begin with those about 16 to 18-year-olds. The hon. Member for Runnymede and Weybridge (Mr. Hammond) suggested introducing sanctions. I emphasise that we are talking not about adults or over-18s, but about teenagers, many of whom have extremely troubled backgrounds and may struggle with chaotic lives. We are considering teenagers for whom things will go wrong.
    A 17-year-old who tries to get a job, changes her mind, tries to start a course, finds that that goes wrong and tries something else, but has no back-up at home, is in a
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    difficult position. She may keep changing her pathway plan, but she still has a right to support from the local authority, including help with housing and maintenance. We are not proposing to make that support conditional on the pursuit of the pathway plan.
    Mr. Hammond: I appreciate that the Minister was not here during the relevant part of my speech, but—[HON. MEMBERS: "She was."] I did not think that she was; if she was, I apologise.
    What support is to be put in place for the people at the sharp end who have to deal with these very difficult situations, if there are no sanctions and nothing whatever that they can use as a lever to try to ensure compliance with the agreed pathway plan?
    Yvette Cooper: For the record, I was in the Chamber and heard every detail of the hon. Gentleman's speech. His language is perhaps revealing when he talks about seeking levers for compliance. The idea of the pathway plan is that it is to be agreed with the young person and is meant to provide support. We must accept that the plan may change many times and that these are young people who may need a lot of support. Clearly, the young persons' advisers and the local authority support network will need to be able to respond to changing needs. We are not talking about sanctions or compulsion; this is about an agreed pathway plan to provide young people with the support and opportunities to which they have a right.
    Several hon. Members, including the hon. Member for Isle of Wight (Dr. Brand), spoke of the need to support other vulnerable teenagers, and my right hon. Friend the Member for Coatbridge and Chryston (Mr. Clarke) referred to the possibility of having young persons' advisers for disabled teenagers.
    We are keen to extend to other groups the principle of support through young persons' advisers, and that is why the Department for Education and Employment is piloting the connexions scheme, which aims to provide a personal adviser for all young people aged 13 to 19 to help them to move into a career, and to provide more intensive support for those who need it most. We will need to build on that.
    The transfer of benefits to the local authority, with financial support for the authority, gained a lot of support during the consultation, not least from the Foyer Federation, which pointed out how completely baffling the benefits system, designed for adults, can be for 16 to 18-year-olds.
    My hon. Friend the Member for Cardiff, North (Ms Morgan) had some concerns about transferring support to local authorities. I can reassure her that care leavers will not be worse off and that we will set minimum standards. The aim is to improve the support for young people and to get around the perverse incentive for local authorities to shift people out of care and on to benefits because that does not block up their balance sheet.
    Dr. Brand: The Minister rightly castigated hon. Members for wanting inappropriately to use levers, but if young people are not to have a choice about whether to accept a package from the local authority or through the

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    benefits system, is not she establishing an even more powerful lever that can be used against the wishes of the young person?
    Yvette Cooper: We are talking purely about the arrangements up to 18. After 18, the benefits system will continue to work as normal. People have the right to maintenance, accommodation and support. Arrangements must be made in discussion between the young person and the adviser. This is not about compulsion; it is about providing support. Frankly, most of the young people to whom this will apply require more than simply a cheque at the end of the week. They need proper support, help and advice.
    Several hon. Members expressed strong support for the changes introduced in the Lords to strengthen support for 18 to 21-year-olds—and upwards—in education. I welcome that strong support, because it must be the right thing to do. With the age of majority at 18, there is clearly. a difference in the support that we provide for under-18s and for over-18s. However, it is also clear that needs stretch far beyond 18 when it comes to providing support, advice and guidance for care leavers in the way that a family would.
    The hon. Member for Runnymede and Weybridge expressed concerns that that support might constitute monitoring and be intrusive. I strongly disagree with him on that, and think that his concerns may rest on a complete misunderstanding of the approach for over-18s. The obligation is on local authorities to keep in touch and on the young person's adviser to contact the teenager, and the duty is to provide assistance as agreed in the pathway plan. If a young person does not want help or to discuss a pathway plan, nothing in the Bill would compel her to do otherwise. There is nothing in the Bill about compulsion, monitoring or tracking. The Bill is about keeping in touch, providing support and ensuring that young people do not simply disappear, with no one knowing or caring where they are.
    Mr. Hammond: Does the hon. Lady agree that there is something in the Bill requiring a local authority to make reasonable efforts to get back in touch with a care leaver with whom it has lost touch?
    Yvette Cooper: Exactly so; it is absolutely right that local authorities should take reasonable action to get back in touch, and the young person's adviser has an obligation to do exactly that. The hon. Gentleman seems to be talking about tracking down young people in London, with visions of police using dogs to search for leavers. That imagery is entirely out of touch with the ideas expressed in the Bill.
    Mr. Dawson: Does my hon. Friend agree that the cracks in the consensus are clearly showing, and that, if the United Kingdom had had the grievous misfortune, on 1 May 1997, of seeing Conservative Members winning the general election, we would have none of the policies on young people in care that the Government have introduced?
    Yvette Cooper: It is certainly true that the Bill's provisions are long overdue, and that young people leaving care have been left in a very vulnerable situation,
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    with no support, for far too long. As has been said, the Bill is not rocket science and could have been introduced long ago. It is well overdue.
    Mr. Hammond: In view of the hon. Lady's provocative remarks, would she just remind the House of when Sir William Utting reported?
    Mr. Dobson: Remind the House about when he was chief inspector of social services.
    Yvette Cooper rose—
    Mr. Graham Allen (Vice-Chamberlain of Her Majesty's Household): Give way to our right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson).
    Mr. Deputy Speaker (Mr. Michael Lord): Order. I think that the Minister should respond to the initial intervention.
    Yvette Cooper: The concerns expressed by Sir William Utting, at the end of 1997, were clearly important in informing the Bill. However, it should not have required Sir William Utting to point out that care leavers were in a vulnerable situation. It should not have required Sir William Utting to point out that care leavers were far more likely to be unemployed, to become teenage parents, to leave school with no qualifications and to be in grave need of support. Young people leaving care have been denied the opportunities that they have a right to and which other young people have been given. This is about social justice. It does not require magic to work out that it is a serious problem that should be dealt with.
    Mr. Dawson: Does my hon. Friend accept that the issues of leaving care that we have discussed today—such as the inadequacy of preparation for young people before they leave care and the lack of support available to them after they leave care—were raised with me by young people in 1988?
    Yvette Cooper: I am sure that those issues were raised with my hon. Friend in 1988, and that they have long been raised with hon. Members. It is about time that we addressed them.
    Hon. Members have discussed the need to introduce provisions for 18 to 21-year-olds as soon as possible. I assure the House that that is our intention. However, we shall not place duties on local authorities that we cannot resource. That is why we have indicated our commitment to provide extra resources through quality protects. For future years, we will depend on decisions made in the spending review, as hon. Members mentioned earlier.
    Several questions were raised about the possibility that Scotland could become a magnet or a honeypot if it retained its benefits system provision.
    Mr. Shaw: Does my hon. Friend agree that most young people leaving care lack the confidence to travel much? People who travel the world have a firm background and a lot of confidence and support. The idea that young people will travel from Meriden to Musselbrugh to seek extra benefits is for the birds.
    Yvette Cooper: It is true that claiming that young people will travel some distance in pursuit of benefits

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    assumes that they have the confidence to travel and a sophisticated knowledge of the benefits system. In practice, many of them find it complicated and baffling.
    I shall clarify the situation in Scotland. Until clause 6 is implemented there, Scottish looked-after children who come to England will be supported through the benefits system. England will not be a magnet for Scottish young people, but neither is Scotland likely to be regarded as a magnet for English looked-after children. To state otherwise assumes that the present benefits system in some sense gives beneficial and preferential treatment to looked-after children. I do not believe that.
    The new arrangements will provide better and more easily accessible support, including financial support and cash, than the present benefits system provides. That is why the proposals were so warmly endorsed throughout the consultation period.
    My hon. Friends the Members for Lancaster and Wyre (Mr. Dawson) and for Chatham and Aylesford (Mr. Shaw) referred to advocacy. My hon. Friend the Minister of State has already mentioned that we issued a consultation paper recently on the complaints procedure stemming from the Children Act 1989, which covers advocacy issues. We will certainly use the powers in this Bill to ensure that care leavers have advocates to speak on their behalf.
    My hon. Friend the Member for Cardiff, North referred to the need for real educational support going beyond a pathway plan and providing real opportunities. I agree: that is why the Bill introduces duties to provide general assistance and to assist with education and training that goes beyond the age of 21.
    That is what proposed new section 23C of the Children Act 1989, in clause 2, is all about, and it deals with one of the most important matters of all. We know that children who are looked after tend to have very poor educational records. It is especially important that pathway plans are not confined to immediate material and emotional needs, but that they also look to the longer-term opportunities that teenagers leaving care have been denied for far too long.
    The Bill is about giving care leavers a second or even a third chance to return to education and to the activities denied to them in childhood, but not denied to other children and teenagers. It is about providing a strong framework to encourage young people to go back into education and catch up on qualifications so that they have the educational foundation that will serve them throughout their lives.
    Examples of best practice exist around the country already. The hon. Member for Southend, West referred to some. I can tell him that I have visited the signpost project
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    in Wakefield, which supports teenagers and care leavers from my constituency. The work done there, by the local council and Barnardos in partnership, is very impressive, not least because young people there say that the support that they receive, and the advice on housing, jobs and training, is essential.
    More importantly, however, they have somewhere to go back to, where there is someone they can talk to, and keep talking to. The most impressive thing of all is the way that the signpost project helps young people to develop ways to support each other. As a result, they are providing mentoring and friendship to other care leavers, teenage parents or other young people in need.
    Similar examples exist throughout the country, but we must build on them. The Bill gives us the framework to do exactly that. It meshes with a range of initiatives across the board to tackle social exclusion, and to ensure that all our young people get the best chance in life, and the best help to take those chances.
    The Bill is about providing opportunity for every young person, regardless of background or start in life. All young people deserve those opportunities—not just the few.
    Question put and agreed to.
    Bill accordingly read a Second time, and committed to a Standing Committee, pursuant to Standing Order No. 63 (Committal of Bills).

    CHILDREN (LEAVING CARE) BILL [LORDS] [MONEY]
    Queen's recommendation having been signified—
    Motion made, and Question put forthwith, pursuant to Standing Order No. 52 (1) (a),
    That, for the purposes of any Act resulting from the Children (Leaving Care) Bill [Lords], it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to the Act in the sums which are payable out of money so provided by virtue of any other Act.[Mr. Allen.]
    Question agreed to.

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

    CONSTITUTIONAL LAW
    That the draft Scotland Act 1998 (Modifications of Schedule 4) Order 2000, which was laid before this House on 25th May, be approved.—[Mr. Allen.]
    Question agreed to.

    Regional Policy
    Motion made, and Question proposed, That this House do now adjourn.[Mr. Allen.]
    8.50 pm
    Mr. Andrew George: I am delighted to have secured tonight's Adjournment debate on the Government's policy towards the regions and I am pleased to open the debate earlier than many of us had anticipated. When I was preparing for this debate, a number of hon. Members asked me to mention Cornwall and the Isles of Scilly. In view of their requests and by popular demand, I shall not disappoint hon. Members who may read the debate tomorrow, or may indeed be following it elsewhere.
    My purpose tonight is to probe the Government's plans for the devolution of power to the regions, particularly in relation to Labour's manifesto commitments. There will, be no surprises for the Minister because, in the spirit of constructive dialogue, I have done my best to ensure that she is aware of the issues that I intend to raise. Do the Government plan to establish regional assemblies and if so, what timetable will apply to them? How do any such proposals relate to discussions here and elsewhere about the appointment of city mayors? What plans do the Government have, if it is perceived that the establishment of regional assemblies would result in too many layers of Government, and which layers, if any, should be removed?
    Will there be an opportunity to debate the Government's definition of the regions? I raised the issue in an Adjournment debate in April 1998 and I should like to pursue some of the questions that I raised then. What factors will be considered in such a debate? I intend to probe the Government's intentions, raise a few technical questions about objective 1 regions and encourage the Government to engage in an agenda that is all about the celebration of distinctiveness, and to welcome difference across this diverse land which is the United Kingdom.
    A brief trip to Iceland last year with the Select Committee on Agriculture brought into sharp focus my growing concern about Cornwall's slide over the precipice into extinction. Icelandic people are proud and distinctive. Their pride and distinctiveness is the bedrock from which they can concentrate on their priorities and on success. Since achieving independence from Denmark in 1944, this relatively poor island has become one of the wealthiest nations on earth. It has a higher gross domestic product per person than not only the United Kingdom, but France, Germany and Japan. It has achieved low inflation and a high standard of living. It has one of the highest life expectancy levels in the world and enviable economic prospects for the future. Yet the population of Iceland is only 270,000—little more than half the population of Cornwall, which is about 500,000. Places such as Cornwall should learn lessons from this, but Cornwall seems to be drifting in the other direction.
    I am not suggesting that Cornwall should declare independence—that would be absurd, unrealistic and patently unobtainable. However, Cornwall and Scilly might learn that, through being clear about our strengths, knowing what we want to achieve, standing up for ourselves and going out there determined to succeed, we might be taking destiny by the scruff of the neck instead of sleepwalking into oblivion with our cap in our hand.
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    As a Cornishman, I have always respected the noble art of self-deprecation. Some say that it is a chronic and untreatable condition, brought on by centuries of deference to the Saxons, since King Athelstan drew a line at the River Tamar between England and Cornwall in 936.
    Mr. Simon Thomas: Shame.
    Mr. George: The hon. Gentleman says "Shame", but it is a historical fact. Perhaps the king concluded at that point that the Cornish were not worth the effort of inevitable annihilation.
    But perhaps it is time to turn self-doubt into self-belief. Once honourably distinctive, Cornwall now runs the risk of becoming indistinguishable. It faces the paradox of being one of the most distinctive regions in the United Kingdom while its services are more merged with others than anywhere else.
    The record of recent years shows that the Ministry of Agriculture, Fisheries and Food office has moved to Exeter, the Camborne police operations room is to move to Plymouth, and the Cornwall careers service, magistrates court and learning and skills council have all merged with services in Devon. The Government have plans to merge Cornwall's probation service, and there are fears that the fire service will go the same way. A number of Labour party spokespeople who came to Cornwall during the election campaign supported the call for a Cornish development agency, but in fact, when the agency came, it was for a standardised region of the south-west.
    The worry is what will happen next. Will education, social and health services be merged and amalgamated as well? If so, that would leave Cornwall as little more than a souped-up parish council. The contrast with Iceland could hardly be more stark. While a country with a population half that of Cornwall forges on relentlessly to greater and greater success, Cornwall cannot even plan its own training for post-16s, manage its magistrates court, advise its young people on their future career, manage its police service, plan the development of its economy, organise support for its farming and fishing industries or manage a whole range of other subordinate services.
    The conventional arguments against a place such as Cornwall thinking, planning and acting for itself, even on these relatively insignificant matters, are that it is too small, it does not have the clout in the corridors of power, and it cannot achieve the economies of scale. As time goes on, such justifications ring more hollow. It is the modern equivalent of the emperor's new clothes—justifications are repeated, mantra-fashion, as the unquestioned and accepted wisdom of the day.
    I need to make it clear that the people of Cornwall absolutely love the people of Devon and the wider south-west. They are wonderful people, and Devon is the most beautiful county in England. I am sure that my hon. Friend the Member for Torridge and West Devon (Mr. Burnett) will be pleased to hear me say that. It is unquestionably true that there is love and strong regard there, one for the other.
    I am not saying that Cornwall should not co-operate with other areas on a project-by-project basis. If I may continue with the metaphor of human relationships, the occasional liaison with other areas, Devon or elsewhere, can bring renewed vitality, but an enforced marriage can kill off any lust to succeed, and usually ends in tears.

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    Whether it is the Government's intention gradually to merge Cornwall into extinction, or whether it is not intentional, it is only right that we have an opportunity to debate it rather than having things slip away over time. It is not that I believe that we in Cornwall should join the tiny handful of certifiable people who want Cornwall to be cut off from the rest of the world—quite the opposite. It is time for Cornwall to cut itself in on the action happening around the United Kingdom, Europe and elsewhere. Cornwall has much to contribute to the celebration of diversity in Britain, in Europe and in the wider world.
    Naturally, I welcome and applaud the Government's devolution achievements in Scotland, Wales, Northern Ireland and Greater London. I also welcome the recent establishment of the campaign for the English regions. I hope that exciting development will prosper. I am pleased that the north-east constitutional convention and the campaign for the north-east seem to represent the settled will in that area. The campaign for Yorkshire and the Humber and the west midlands and north-west constitutional conventions are unquestionably exciting developments and should be encouraged. I hope that the Government will do what they can to promote them.
    I am concerned, however, that uncritical acceptance of the Government's standardised regions could ultimately undermine those initiatives. I have just received a letter from the campaign for the English regions in Newcastle, inviting me to the inaugural meeting of the south-west constitutional convention steering group. In Cornwall, the routine and resounding uninterest and apathy with which the general populace of that standardised region respond may serve only to encourage such initiatives.
    If we explain to people the prospects of devolving power—which the majority of people in the House and in the country would support—in the existing regions rather than in standardised regions, we stand a rather greater chance of success. In Cornwall, most normal folk demonstrate a degree of enthusiasm and patriotism for the standardised Government region of the south-west that extends to being able barely to stifle a yawn at the merest hint of the subject.
    It is interesting that, as an enthusiastic decentralist, I attended the recent House of Commons launch of the campaign for the English regions in order gently to point out what was unfortunate in an otherwise good cause. At that launch, we were presented with some magnificent achievements, mainly in the north of England, which we all welcome. However, the pressing questions were about when the assemblies could be set up, what powers they would have and how they would relate to local government, quangos and so on. It was exciting stuff.
    I was concerned that we were getting carried away. I felt like the boy who pointed out that the emperor had no clothes. I did not want to be churlish, but I had to ask:
    What do we do if the region doesn't actually exist?
    The question was met with stunned incomprehension. To many people, it was tantamount to asking whether we could redefine the boundaries of God—a question that one does not ask.
    I felt that the question needed to be asked. I have to acknowledge that the good people of Yorkshire are lucky. The Government region defined for bureaucratic
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    convenience happened to coincide, more or less, with a region that had its own recognisable identity. It was the same in other areas to a greater or lesser extent. For Cornwall and Scilly, however, the so-called south-west is a Soviet-style construction for people who are happy to be dragooned into a soulless bureaucracy without a shred of identity.
    The campaign enthusiasts thought that I should be asking how soon a south-west campaign could be started. However, it would not make sense. Why destroy a region that has a unifying identity—Cornwall and the Isles of Scilly—only to create a synthetic region without an identity? It simply does not make sense.
    Those of us who are concerned about the increasing apathy and low turnouts at elections have a double reason to give the creation of standardised regions not a single crumb of comfort or encouragement. The pathetically low turnouts at the latest local elections and the poor turnout at the European elections will surely be eclipsed by new heights of lethargy among an unimpressed electorate faced with bland, uniform and characterless regions. Electors would stay at home in droves if we went ahead with the standardisation of devolution in that way. I am not against decentralisation, but it must be done correctly.
    If we were to decentralise powers from an over-centralised state, we should give them to places and regions that actually exist—to territories that people give a damn about. We should ensure that in the enthusiasm to decentralise, we do not simply replace a uniform state with bland and uniform regions purely for bureaucratic convenience.
    For Cornwall, the only region is Cornwall—and Scilly, if it were to choose to come on board and have its distinctiveness respected. However, that idea faces such established misunderstandings that it is difficult to take so-called conventional wisdom much beyond a mindless "base camp". The first criticism is always one that dismisses and diminishes the concept. The argument goes, "Don't be silly. You can't be serious," but if one considers the alternatives, the idea is the only serious option available.
    Secondly, we are told that such a notion is inconvenient; it is too late, and would cause too many problems—and where would it leave everyone else? However, that argument fails to recognise that decentralisation in its proper form can be untidy. A settlement that reflects community identity and idiosyncrasy does not fall neatly into uniform bureaucratic patterns.
    The third criticism—and the one most often made—is that Cornwall is too small. It has a population of about 500,000 when, according to the Government, standardised regions are supposed to have populations 10 times that size. Our problem is that we in the UK have become too insular in our outlook. If we lift our sights above the narrow horizons of the UK, we need only look at regions in Europe and elsewhere to see that regions and provinces vary in size.
    A recent brief visit to Canada demonstrated that point to me. Provinces such as Prince Edward Island with a population of 138,000, New Brunswick with one of 755,000, Newfoundland with a population similar to that of Cornwall, and Nova Scotia with a population of 939,000, all have the same powers as Quebec and Ontario, which have populations of 7.3 million and 11.5 million respectively. When service delivery, such as specialist

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    medical services, requires economies of scale or a large critical mass, that presents no problem. Administrators in Canada say that the problem is easily overcome by co-operation between the provinces.
    Even the criticism that a Cornish region would be too insular does not stand up to analysis. Any such initiative would open up opportunities for Cornwall in a wider world. Instead of cutting it off, it would enable it to cut itself in—to the celebration of diversity that I mentioned earlier.
    The primary downside is that such an initiative might give succour to a handful of people with dubious and certifiable views about Cornwall and the Cornish as a race. Such people are few in number and there would be no tolerance of such views. The prospect of compulsory kilt wearing and constant reference to genealogy would soon become tiresome.
    The Liberal Democrat spokesman, my hon. Friend the Member for Bath (Mr. Foster), agrees with the proposal. Our party policy is that we should not have a set size for regions and that it is acceptable to have variable speed, variable powers, variable geography and variable size. That would help to create a distinctive relationship with the centre—the relationship between a place and central Government. We do not always need to use the same format and the same uniform approach. There is significant support for that view in Cornwall.
    In recent weeks, 1,600 people in my constituency alone have signed documents, written letters and lobbied on this matter. Since I was elected, not one person in Cornwall, or in the Isles of Scilly, which are in my constituency, has lobbied me or written to me demanding that a standardised south-west regional assembly be set up.
    Cornwall has opportunities. It has achieved European objective 1 status, and all those involved in securing that, especially the Government, must be congratulated. That result was also due to a popular campaign in Cornwall, and those who were in the area when it was at its height would have seen thousands of people supporting it. That required a statistical, but amicable, divorce from Devon, which allowed the distinctiveness of Cornwall and the Isles of Scilly to win through. The Government must be congratulated on that.
    We now have an opportunity to build on our geographical strengths and our distinctiveness so that we can establish our own brand identity, culture and community, which are necessary to sell Cornish produce. However, we can do that only if our distinctiveness is properly recognised.
    As the Minister knows, I want assurances from her. I accept that the Government genuinely intend to simplify the processes involved, but objective 1 regions are finding it difficult to achieve a simplified approach. Ideally, there should be a single point of entry and a single application form for the objective 1 programme, which has been achieved in Ireland and Brittany.
    The separate budget heads mean problems of accountability, both in the UK and in Europe. Objective 1 partners are meant to implement joined-up government policies on the ground, but there are four structural funds in Europe, for which four commissioners are responsible. That is not the Government's fault, but within the UK, six Government Departments have an interest in the objective 1 regions. The Department of Trade and Industry even has separate silos of funding in its own
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    department. What is the Government's thinking about the move towards simplification and the empowerment of partners in objective 1 regions?
    Since they secured objective 1 status, Cornwall and the Isles of Scilly have realised that their own distinctiveness must be grasped and enhanced, and their agenda must be taken forward in a positive celebratory way that uplifts and inspires the community and the economy, and that process must be inclusive. We should be taking advantage of the opportunity to make our case, rather than having it dismissed, patronised or undermined. If that distinctiveness is not harnessed for good, it could be driven down and diverted for bad.
    In recent months, for example, there has been concern in Cornwall about the vandalism and daubing out of signs and logos on the roadside and at some heritage monuments. The sign of the English rose for tourist destinations and the English Heritage sign have been affected. The two organisations responsible for those logos perhaps need to recognise that Cornwall is passionate about its distinctiveness, and many of its heritage sites were lived in and vacated long before Athelstan drew the line at the Tamar.
    There is a great opportunity to develop the sense of distinctiveness in Cornwall, rather than having people express their frustration negatively through vandalism. We want to be inclusive, but we also want that distinctiveness to be recognised and harnessed, and it would not take a lot for the Government to do that. We want to unlock the door to a positive future. We want to build on the opportunity of distinctiveness rather than see it submerged in uniformity.
    Perhaps the Minister will accept that the Government, certainly in recent months, have been susceptible to being criticised for control freakery. They have a chance to change that by loosening up and allowing communities and wider society to engage in a debate about diversity. In the spirit of constructive dialogue, I implore her to accept and support our agenda. We should recognise that standardisation does not help and that diversity is a good thing—something we can celebrate.
    9.16 pm
    Mr. Simon Thomas: I shall not detain the House for more than a few minutes, although my remarks are slightly longer than an intervention. I support many of the comments made by the hon. Member for St. Ives (Mr. George). The Cornish are the west Welsh, who happen to have been cut off by an unfortunate accident of history. They lost the wrong battle at the wrong time. The Cornish are excellent engineers—they built many of the lead and silver mines in my constituency—and the hon. Gentleman must be congratulated on engineering such a long Adjournment debate on regional policy. He is a worthy successor to Trevithick in that respect.
    I was concerned to hear that people in the hon. Gentleman's land—his nation, his county—using some spurious Celtic reasoning, want the kilt to be introduced. I am afraid that we have similar people in Wales, but I hope that we can form a Celtic alliance against such fashion fads and spurious ideas. The substance of the hon. Gentleman's remarks, however, was not spurious, nor historical forgery nor some Celtic daydreaming. What he had to say was extremely important for the future of regional policy in England, and I hope that the House will accept a few remarks from Wales on that subject.

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    What is a nation and what is a region is a matter of historical accident. The European Union has set up the Committee of the Regions to look after the regions in Europe, and a number of areas that are represented, such as Lombardy and Saxony, were once kingdoms. They are now regions in the EU. Luxembourg was once nothing more than a small minor region, but for some reason it has become a nation state. To take a lesson from Wales, after the Act of Union a part of Wales called Monmouth was unfortunately included in the Oxford judicial circuit. For four centuries, there was a wrestling match as to whether Monmouth was part of Wales or not, and it was not settled until the 1960s, with the establishment of the Welsh Office.
    There is a lesson there for people in Cornwall and the south-west of England. They should identify with the real regions and not allow institutions and the Government to decide for them how their institutions should be organised. If the people of Cornwall want to stand up for Cornwall as an area for regional government, their voice should be clearly heard. If the Government are trying to increase public participation in government, in local elections and in the regional government to come—I think that they are intensely serious about that—the regions that are set up must identify with the people who live in them. Those regions must also identify with the communities.
    I welcome the moves to regional government in England, which can only help devolution throughout the United Kingdom and support diverse and distinct communities. I was saddened when the hon. Member for St. Ives painted a picture of the destruction of Cornish institutions. I understand that Cornwall does not have a university, and that Cornish institutions have been sucked in by greater regionalisation. In Wales, we have had a long, hard battle for the past century, starting with the battle to disestablish the Church in Wales, to have institutions in Wales that reflect what the Welsh people want from their institutions. It led in time to a greater demand for self-government. The hon. Gentleman may not be ready for that yet—perhaps in a century's time!
    Institutions at the right regional level build self-confidence and pride, and economic confidence can follow. I am sure that the hon. Gentleman and the Minister want to see Cornwall emerge from the situation, which Wales shares, in which we need objective 1 money to build for the future and a strengthened economy. That involves building a sense of pride into the area. One of the key steps is to have institutions at regional level that reflect and channel that pride and energy.
    I welcome the debate and the comments by the hon. Gentleman, and I give him my support from across the water. Indeed, only last week, I signed the petition for a Cornish assembly, although it was sponsored by another party in Cornwall; he may not take that approach. If the Government want regional government to work, they must put the right institutions in place. They must allow regional government to reflect the way people feel in their communities, and I hope that the hon. Gentleman's views will be heard by the Government.
    9.21 pm
    The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Ms Beverley Hughes): For a debate on Government policy on the regions, we have reached some philosophical heights tonight, and I shall do my best to respond without straying beyond my departmental brief. Feelings are obviously strong, and I acknowledge that. I thank the hon. Member for St. Ives (Mr. George) for his courtesy in letting me know some of the areas that he wished to cover, because that was helpful. I congratulate him on obtaining the debate, which is an opportunity—at perhaps more leisure than he would normally have had—to raise some of the issues he mentioned. It is good that he has been able to do so.
    The hon. Gentleman started by talking about directly elected regional assemblies, and he wanted clarification of the Government's policy. He knows that the Government's longer-term policy—reflecting our commitment to the principles and practical implementation of devolution and decentralisation, which we have already demonstrated with what we have achieved—is to provide for the establishment of democratically elected regional assemblies in the English regions, where there is popular demand as demonstrated by referendums.
    Mr. Colin Breed: Does the Minister accept that it is possible that existing regional development agencies may respond to more than one regional assembly?
    Ms Hughes: If that is a point about the existing boundaries, and whether in the future a regional development agency might cover more than one area governed by a regional assembly, I have to say that at the moment we do not have a blueprint for those assemblies or a time scale for their introduction. Those policies have not yet been drawn up. I would imagine, however, that in time the assemblies would be expected to become accountable for a range of strategic issues and bodies at the regional level. That is a point to which I shall return in responding to some of the issues raised by the hon. Member for St. Ives.
    We may not yet have a blueprint, but I assure hon. Members that that does not mean that we are not thinking about it. For example, on regional government in England, the Department of the Environment, Transport and the Regions has produced the first stage of a review of literature and research findings, which has broadly considered the international evidence on the range of different models of directly elected regional assemblies and their functions. We are just about to publish that first research document, which will be followed by others. We are beginning our thinking by looking at provision in other countries—some of those the hon. Gentleman mentioned, and also more widely in Europe.
    Mr. George: Does the Minister know whether the document will deal with the question of size and its variability? She has not yet mentioned that issue.
    Ms Hughes: The document is the first stage of some longer-term research. We are looking at what exists internationally and thus considering not only different models of directly elected assemblies but different sizes of population covered and the different functions that

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    have been ascribed to such bodies. When the document is published, the hon. Gentleman will see that there is much diversity in the models, range of functions and sizes of population for which directly elected assemblies in different countries are responsible. That is one of our starting points.
    The hon. Gentleman asked how directly elected assemblies would work with the existing layers of democratically elected local and central government. He asked whether, for instance, a tier of government would be removed to provide for regional government. We are not in the business of adding to government specifically, but we want to make government better. I agree with the hon. Member for Ceredigion (Mr. Thomas) that that means bringing it close to the people. There must be a democratic mandate.
    If there is such a mandate for a directly elected assembly, our policy, as we have demonstrated, would be to draw down functions from the centre, not pull them in from the localities. That would be the direction of our thinking. It is too early to say what that would mean in practice for each region, but we would need to take careful note of what people in each of the regions think. Several options needs to be explored before decisions are made. I hope that the hon. Member for St. Ives accepts that.
    Our basic starting point is that regional government not only cannot happen, but will not increase democratic participation—the hon. Gentleman made this point—without popular consensus, understanding and support among local people. To achieve that, we must be satisfied that people in the regions are absolutely clear about the aims, functions and expectations of any new regional tier, so that they feel motivated to support it.
    Mr. George: In view of that, has the Department or the Minister had an opportunity to review any lessons learned from last year's European elections when, for the first time, they were based on the standardised Government regions and in which, certainly in most areas, there was concern about low turnout?
    Ms Hughes: I do not know whether the hon. Gentleman is trying to draw me into a debate on some form or other of proportional representation as a means of increasing democratic participation, but I shall not be drawn down that route. He will know that the aim of increasing participation in local, European and, indeed, national elections concerns us. Turnouts in local elections and, in some areas, European elections are of great concern. We need to address that issue because as politicians we cannot feel that we have much of a mandate unless more people participate in elections.
    The hon. Member for St. Ives briefly raised the question of how regional government might relate to our proposals for city mayors. I welcome the opportunity to comment on that. As the hon. Gentleman said, the Local Government Bill provides for strong mayors—possibly city mayors—based on existing local authority areas and functions. That raises some interesting questions. We share the public's belief, revealed in a number of surveys, that mayors offer a good prospect of rejuvenation of local democracy in some areas. City mayors have the potential to be important players on the regional scene.
    Debates about regional governance have to engage with the local agenda. Through the Local Government Bill and the opportunities it provides, we are deliberately
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    attempting to create the potential for greater plurality and fluidity in the democratic landscape at regional and sub-regional level. We have started from the belief that if we can infuse some diversity into our democratic arrangements, we are likely to arrive at different arrangements in different areas which are more likely to engage local people. We are approaching a state of fluidity.
    Through the Local Government Bill, we are attempting to strengthen local authorities and give them a power of well-being and some strategic responsibilities, and to enable the establishment of elected mayors. In all of that, we are trying to change the stultified and unified form of local democratic structures. The implications for the future of regional government are that different arrangements will unfold in different regions. To the extent that that was the thrust of the argument advanced by the hon. Member for St. Ives, I agree with him.
    Mr. David Drew: I would recommend the Spanish model. That country had to learn how democracy functions very quickly; it did so by allowing its different regions to develop at different speeds. It is no use asking the Spanish how it works: their response would be, "It works." Rather than look at all the concepts and theories, they simply allow their democracy to flourish.
    Ms Hughes: My hon. Friend makes a very valid point, citing an extremely interesting example.
    With devolution at a higher level in Wales and Scotland, and our efforts to strengthen local government and create fluidity, a climate is generated in which we cannot foresee the way in which the political landscape at regional and sub-regional level will pan out. We are providing for difference and diversity. Perhaps the end result will not be what the hon. Member for St. Ives wants, but we are creating the potential for different arrangements to be arrived at according to different time scales in different parts of the country. We shall have to wait and see how that works out. A key element in any future arrangement will be local people's perception of what is right for their area.
    We have begun by creating regional development agencies to address urgent economic and regeneration issues in the regions. They are beginning to have a considerable impact, both individually within each region, and collectively to even out performance as between the regions. People will want take into account the RDAs' impact if and when they decide whether they want to go further and establish directly elected assemblies. The extent to which a local RDA has an impact will have a bearing on the formulation of local people's views on that issue.
    In addition, we now have chambers in all the eight regions. It is important to mention those, as they are widely inclusive partnerships of all the stakeholders. They are not directly elected, but they comprise the elected representatives of the constituent authorities. They are developing an interesting role in different parts of the country and they are certainly adding value in many areas. The south-west of England regional chamber, in particular, has worked closely and constructively with the

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    South West of England regional development agency on economic strategy and is working on planning guidance. The agencies have a real role to play.
    One of the core arguments of the hon. Gentleman's speech concerned what he referred to as the Government's "definition" of the regions. When we drew up the boundaries of the regional development agencies, we decided to base them on the areas covered by Government offices for the regions. Obviously, there were administrative and common-sense reasons for doing so. The boundaries already existed and had become familiar building blocks to constituent institutions, such as local authorities, and the areas offered population levels at which it was felt that regional economic strategies could make a difference.
    I was interested in the hon. Gentleman's comment about the hon. Member for Bath (Mr. Foster), who leads for the Liberal Democrats on policy in this area—the hon. Gentleman said that his hon. Friend was now convinced that regions could be of different sizes and have different boundaries from those of Government offices and RDAs. One of the key points in a paper produced by one regional Liberal Democrat party in January on directly elected regional assemblies was that such assemblies would take over from the RDA and the Government office. That implies a clear acceptance of the existing regional boundaries.
    I accept politically all that the hon. Gentleman said about celebrating diversity and difference and about that being an important part of our national heritage and cultural life. I would add another argument to his analysis, however, as I do not think that that celebration necessarily requires that all the administrative and strategic structures should be coterminous with the area one thinks has a clear coherent cultural identity.
    Another question that we need to ask, in terms of a democratically elected institution, or an organisation such as an RDA, for example, is what the regional structure is for. There are questions about the sort of strategic decision making and the area for which it is sensible to think about that—whether it is for transport, economic development and regeneration or whatever. What sort of area is it sensible for the institutions to cover to have the scope to make the sort of strategic decisions that will have an impact on the people who live there?
    Mr. George: I do not know where the paper to which the Minister referred came from, but I spoke to the Liberal Democrat party's official spokesman before this debate and party policy is certainly clear, as I set out.
    On the subject on which the hon. Lady was elaborating, does she accept that there is a potential conflict? I mentioned branding. Clearly, a place with a distinctive identity could use it for economic purposes and gain. However, if a region without an identity surrounds it and wants to establish its own identity, there could be a conflict. It would be far better to establish a region that recognises cultural diversity because there are clear economic as well as administrative benefits.
    Ms Hughes: In response to the hon. Gentleman, I am minded to cite my region in the north-west. The regional development agency, and any future directly elected
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    assembly, will cover the north-west region. The organisations involved in the convention are not discussing any boundary other than the existing north-west Government office boundary as a suitable boundary for any future directly elected assembly.
    Within that area, there is no difficulty with Manchester, Greater Manchester, Merseyside, Liverpool and parts of Cheshire and Lancashire having, for other purposes, under the umbrella of the north-west region, their own clear branding and institutions of their own to market and propagate that branding for inward investment purposes. From my experience, there does not seem to be a contradiction. Sub-regions may have distinct identities and may perform certain functions and yet be part of a larger region that might be necessary for other strategic purposes. It may make sense to have the scale of population, area or resources of the larger region, to bring about the changes that will benefit all the people in all the sub-regional divisions.
    I hear what the hon. Gentleman says, and I know that he comes to the debate with a great deal of feeling. I acknowledge that, but I point out to him another argument. Noting and celebrating cultural diversity does not necessarily mean that the area that is culturally distinct must, for all purposes, have its own directly elected body or administrative agency. The celebration of diversity and difference is entirely compatible with a wider regional identity for other strategic purposes for which that makes sense.
    The hon. Gentleman mentioned objective 1, the control of bureaucracy and red tape, and the possibility of a single point of entry as a means of overcoming problems that existed in the past. The Government office will provide a single point of entry for project applications, although discussion is still taking place with the Ministry of Agriculture, Fisheries and Food. There are still issues to be resolved, but the Government office is working hard to achieve a single point of entry.
    I am delighted that Cornwall and Scilly have secured objective 1 status. As the hon. Gentleman knows, that will bring in a substantial amount of additional money over the next seven years. That will offer an important opportunity to help to turn around Cornwall's economy. There is great potential for the local partners to have a say in the programmes and projects through which the money will be spent and change will be achieved.
    In the various initiatives that we have taken, particularly the new deal for communities, and continuing through the strategy for neighbourhood renewal, it is a hallmark of this Government that we have learned the lessons of the past. Such projects and programmes are not sustainable unless they are owned by the people whom they affect, and unless the people feel that they have a real stake in what is done and the way in which it is done. Through the priority management groups and the programme monitoring committee, which is made up of representatives of the various sectors within the region, the local partners will have a substantial say.
    The hon. Gentleman said that the Government seem intent on the gradual extinction of Cornwall, but we have no such objective. We certainly do not want Cornwall to become extinct. We want it to continue to celebrate its

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    many strengths and to build on those to the benefit of its people. For the reasons that I have outlined, I cannot say here and now that, in future, Cornwall will have its own directly elected assembly; but the Government are not into control freakery. We want the communities in the regions to engage in the process of enhancing democratic participation and to feel that they have a stake in the
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    future of their area, and I hope that the hon. Gentleman will acknowledge that the Government are doing a great deal to achieve that. We shall support Cornwall in future in any way we can.
    Question put and agreed to.
    Adjourned accordingly at fourteen minutes to Ten o 'clock.

Preamble
[MR. MICHAEL J. MARTIN in the Chair]

Supermarket Competition
[Relevant document: Second Report from the Environment, Transport and Regional Affairs Committee, Session 1999–2000 (HC 120).]
Motion made, and Question proposed, That the sitting be now adjourned.—[Mrs. McGuire.]
9.30 am
Mrs. Gwyneth Dunwoody: Planning in a small island is not a bureaucratic idea or an idiosyncratic response to some people wanting to build wherever and whenever they can; it is an absolute necessity. Throughout the planning history of this country, there have been determined attempts to create civilised and cultured towns and cities, and a positive balance has been sought to ensure that our industry and commerce live alongside our residential areas in peace and harmony. One would have thought that that was a straightforward and useful idea.
During the 1950s and 1960s, we saw the evolution of sensible planning policies. When we moved on, it became clear that some commercial interests regarded aspects of planning as inimical to their economic development. That was a misleading approach, but some people regarded the decision to consider where development took place as a positive bar to them.
The Select Committee on the Environment, Transport and Regional Affairs was concerned when it heard some of the arguments about supermarkets. Supermarkets are ubiquitous; a person would have to be unusual to say that he had never benefited from or enjoyed their services. They are like rhododendrons, in that they may be attractive and interest people in large numbers but they destroy every other plant.
During the 1980s and 1990s, the positive rash of supermarkets that were built out of towns had an immediate and destructive effect. When we look around many of our smaller towns and villages and see so many charity shops and boarded-up properties, we realise that supermarkets can be not only competition, but destructive competition. They are like a series of private monopolies built on the outside of our cities. With their free car parking, they encourage people to come and buy not only one aspect of their shopping, but everything. As a result of the influx of American marketing techniques, the supermarket may increasingly seek to provide more than our weekly shop in terms of groceries, wines and beers, by providing textiles, household goods and other important items in our weekly budgets.
It became clear that if we were to rescue and improve the centres of our rural towns and cities, we would have to do something serious about the supermarket. That was an agreed policy, and we began to accept the fact that trade in the centre of a town was distorted if the area became over-supermarketed. That has happened to one town in my constituency, which has at least seven supermarkets on the edges of its small rural community.
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It was a welcome development when it was recognised that supermarkets could not be allowed to continue becoming larger and attracting an increasing amount of trade away from the centres of our towns and cities. I should have thought that that was a straightforward conclusion that was not difficult to support. Unfortunately, however, there seems to be a body of opinion among some economists and management consultants—such as McKinsey & Company, the Department of Trade and Industry and even, possibly, some Treasury officials—that more out-of-town supermarkets and more competition would bring down prices. That flies in the face of the fact that most supermarkets fight one another for only about 3 per cent. of the business and are prepared to commit murder to change their overall figures by an extremely tiny amount. I am afraid that consultants who say that there should be more non-food retailing have not thought through the implications.
The Committee decided that some anxieties were even more pressing. Last summer, the Director General of Fair Trading referred supermarkets to the Competition Commission, asking it to consider matters related to the planning regime. When the Committee began to inquire into the circumstances, it was worried to learn that that had been done without any evidence being taken from planning consultants or anyone involved, on the basis of the fact that some people thought that it might be a good idea to change the planning laws on science clusters.
If we are to make major changes in how we develop our towns and cities on the basis of some people's opinion, without having taken evidence, I can recommend to the Government a series of my own particular prejudices, not only in relation to the Department of the Environment, Transport and the Regions. I could give them a shopping list of the changes that I feel should be made, without any evidence to back it up. It is worrying that that decision was taken without any advice from planners.
We asked the Department about its attitude to that development. The Under-Secretary of State for the Environment, Transport and the Regions, my hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford), who gave evidence to us, should be comprehensively praised. Not only was he clear and decisive, but he made it plain that no major change in policy had taken place. That makes it even more difficult to understand why we face such circumstances. I trust that the Government will not change their policy.
Mr. James Gray: Does the hon. Lady agree that the clarity of the evidence given by the Under-Secretary of State for the Environment, Transport and the Regions, the hon. Member for Greenwich and Woolwich, contrasts starkly with the complete muddle of evidence that we received from the Under-Secretary of State for Trade and Industry, the hon. Member for Leicester, West (Ms Hewitt), on the same subject?
Mrs. Dunwoody: I believe that the problem was that the Department of Trade and Industry got into a bind, which was slightly bizarre.
If the Treasury is dictating that changes be made to planning law on the basis not of planning evidence but of having been told by one of its consultants that in

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future some science industries might like to be treated differently from other industries, everyone is in trouble. I trust that that is not so, and that the Under-Secretary of State for the Environment, Transport and the Regions, my hon. Friend the Member for Stretford and Urmston (Ms Hughes), will make it clear that such decisions will be taken by the Department of the Environment, Transport and the Regions on the basis of the aspects that are most important to us.
The Competition Commission published a remedies statement, which states that the commission does not at present believe that major changes should be made to the planning regime. However, the commission seems to be considering recommending a system of selective planning permission, whereby, for instance, in cases in which Sainsbury is the major company, Sainsbury would not be able to obtain planning permission for new stores, but others could. That is the very antithesis of planning law, which has always been based precisely on such difficulties.
The Committee considered all those questions, said that it was extremely worried, and made several plain and unequivocal statements:
We support the Minister for Planning's statement on competition. It is a well-established principle of planning control that planning decisions should not favour one company against another but should be even-handed between firms…We are appalled that before referring planning matters to the Competition Commission, the OFT took no evidence from planning experts and did not consult the DETR. In failing to take into account such expert evidence, it has behaved irresponsibly.
If the commission suggests that it can distort the planning rules to profit one particular section, it is being shortsighted and irresponsible. We cannot understand how we have got into such a situation. The Government must say what is meant by the reference in planning policy guidance note 6 to
sites in town centres which are suitable, viable and available within a reasonable time period.
What is suitable for the size of store and format, and who decides those aspects?
We do not believe that there should be any more super supermarkets built outside towns. The decisions that have resulted in the growth of smaller supermarkets in city centres are already beginning to pay dividends. The large supermarkets that have followed that trend, including Sainsbury and Tesco, are responding to some very real worries. To confuse that issue or fudge the lines would not only put that process into reverse but make our aims unclear in the long run. In all but very exceptional circumstances, supermarkets should be in urban centres.
Supermarkets should also be better designed. Let us consider the quality of the buildings in our towns and cities. We all have to live with those erections, so let us not imagine that we can go on blithely irritating the eye and depressing the spirit with the most sad and unimaginative architecture.
The report is good; it is short, but says plainly that we do not know how or why we got into the situation in which we find ourselves. We believe the Minister for Housing and Planning when he says that he is clear in his mind about the Department's aims. However, if that is
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true, why was he not consulted? Why was the decision about the reference taken without anyone asking on what basis it was made? If the Office of Fair Trading now takes two or three steps back and says, "Oh well; we didn't really mean it, guv," I would not regard that as evidence of a responsible or balanced approach.
It would not be acceptable if the Competition Commission's findings were published in late July after the House has risen. It would fuel the view that the decision was taken in a hole-in-the-corner manner, for the worst reasons and on the basis of prejudice rather than evidence. The final results of that decision may be to hasten the demise of our smaller towns and cities. It does not provide a balance across a commercial field so that customers can get what they want when they want it. The development of a duopoly or even of three or four large supermarkets will not, in the long run, act in the customers' interest. The Committee has set out its worries in plain terms and I hope that the Minister can put our minds at rest.
9.43 am
Miss Anne McIntosh: I am most grateful for the opportunity to contribute to the debate and am privileged to follow the hon. Member for Crewe and Nantwich (Mrs. Dunwoody).
I make my comments against the backdrop of the balance in my constituency between small market towns and 30 per cent. of a major city—the outskirts of York. The results of the inquiry that the Environment, Transport and Regional Affairs Committee conducted into the environmental, impact of supermarket competition, which are published in our second report, encapsulate the problem. I wholeheartedly agree with the hon. Lady about the part of the report that suggests that, although the planning regime serves the planning system well, we could tweak it and improve it. It was clear from the evidence that we received that planning policy guidance note 6 has the support of leading experts in planning and retailing, planning associations, local authorities and supermarkets.
Parking standards is probably the area of competition that impinges most on market town shops and corner shops on the outskirts of major cities. A major superstore on an out-of-town site is bound to have a clear advantage over those shops by offering greater car parking facilities that will attract people into the store. The Select Committee must ensure that planning policy guidance note 13 is observed and is as tightly construed as possible. It must not be interpreted in too lax a fashion.
Design is important. The high standard of evidence in the Select Committee report shows the importance of design and of not using the rhododendron scenario to attract people into the store. If we are now considering how to attract more supermarkets on to town sites, it is important to ensure that their designs blend in with the surroundings.
We did not have the opportunity to investigate in depth the impact of the unified business rate in market towns. It is significantly high and affects shops in small market towns and corner shops on the outskirts of major cities. A high unified business rate compounded by a high rent makes it difficult for those shops to compete effectively with out-of-town superstores.

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We are all conscious of the development of charity shops, which we welcome to a large extent. We appreciate their special contribution to the community and the role of the volunteers who man them, but we do not want sites to be left empty for long periods. When we took evidence in Thirsk for the urban White Paper, we found that one shop had been empty for two or three years—almost as long as I have been Member of Parliament for the area—as a result of the combination of a high unified business rate and a high rent. We should pursue such matters, perhaps in the next stage of the competition report if we are fortunate enough to be able to do so before the recess.
I was struck by the evidence that we received from Mark Wood Associates about the margins of food store operators. The company said:
Moreover the extract also shows that…the four leading operators (Tesco, Sainsbury, Asda and Safeway) increased their combined market share from 59.4 per cent. in 1996 to 61.4 per cent. in 1997, a rise of 2 per cent. in just one year. Total sales from these four operators amounted to over £40 bn.
The average sales per store is continuing to increase at a significant rate equating to around £2 m. per store for Tesco and over £3 m. for Asda.
That increase puts the shops competing for business with supermarkets—especially out-of-town superstores, at least one of which I represent in my constituency—at an almost unfair competitive disadvantage because of the size of the superstores and factors such as parking facilities. I hope that we can pursue several of the issues that we highlighted in that valuable contribution. It must be ensured that PPG6 continues to be respected and built on, and that we forcefully consider the evidence from the Competition Commission against the backdrop of the planning regulations. To ensure that the competitive advantages enjoyed by out-of-town superstores are not repeated in future, we must integrate future supermarkets into market towns, having regard to the design of surrounding buildings.
I believe that the way forward is to meet a balance of interests, consumer needs and minimum competitive standards. I hope that we can put more supermarkets with better designs where required in town centres. That would allow sufficient competition in our market economy between supermarkets and, more important, between supermarkets and the market town and corner shops that I shall continue to hold dear.
9.50 am
Mr. Bill O'Brien: I welcome the opportunity to take part in the debate. I hope that the Competition Commission, in addition to studying the report of the Select Committee on Environment, Transport and Regional Affairs, will read the comments of hon. Members on the subject. The concerns voiced by the hon. Member for Vale of York (Miss McIntosh) about the effects of supermarkets on small urban areas, corner shops and small communities are shared by many of my constituents.
Out-of-town supermarkets have been the cause of many problems in town centres and the countryside. They increase car use, and the resulting congestion creates problems for people in the countryside, as some of the supermarkets are built in the green belt and on the edge of cities. I am, therefore, pleased that planning policy guidance note 6 restricts the development of supermarkets outside cities and urban areas.
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The Government's aim in the planning policy guidance is to concentrate retail development in existing urban areas. I hope that they will push that policy and ensure that applications for supermarkets to be built outside towns will be firmly rejected, so that there is no misunderstanding of what the Government mean in the planning guidance.
I am not anti-supermarket. I would welcome and support supermarkets where needed, in towns and urban areas. I want good, structured planning, which means developing our town centres. The growth of out-of-town shopping developments over the past 20 years has had a traumatic effect on town centres, villages and corner shops.
There are small urban communities, such as Ossett, Horbury and Normanton in my constituency, that have suffered because shopping centres have been located on the borders of Leeds and Sheffield. Access to those centres is easy by car, which has an effect on the smaller towns. Much of their retailing trade has disappeared as a result of closures caused by the large developments.
Car parking is also a factor. Local authorities are advised that they must capitalise on land use for car parking—hence charges. Such charges are an anomaly, given that supermarkets have free parking. I hope that planning policy guidance note 13 will address that, and that local authorities will take it into consideration when they consider the application of integrated transport policy.
PPG6 deals with out-of-town shopping and greater protection for town and city centres. I want the Minister to provide assurances that there will be an increased focus on planning aims within urban areas, and a restriction of developments outside. Applications are being made to extend large supermarkets outside town and city centres, especially by Asda. The Wal-Mart principle is being developed—the desire to extend an existing unit and develop the larger supermarket.
In relation to applications for out-of-town developments, we are witnessing the phenomenon of architects submitting, on behalf of a supermarket chain, proposals for a small, compact unit on the edge of the town, so as not to give offence, but then, when the request is granted, applying to develop the unit further. We are all aware that that is happening in our constituencies. I hope that the Minister, who is familiar with such scenarios, will accept that such applications should be rejected, regardless of their size, because of the impact on urban areas.
Dr. Alan Whitehead: Has my hon. Friend come across the phenomenon whereby applications initially state a particular area for development, but a mezzanine floor is added later? The space above the site is thereby occupied, apparently in breach of planning conditions, but in circumstances which the planning regime is apparently unable to stop. Is that a further example of the phenomenon that my hon. Friend describes?
Mr. O'Brien: I am pleased that my colleague has drawn attention to that matter, as it has an impact on car parking provisions. When a planning application originally included car parking to meet a certain ground floor development, and extended developments follow

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in the form of mezzanine or additional floors, greater car parking problems are created. The Minister should address that issue and strengthen PPG6 to ensure that such piracy cannot happen. Measures to make our towns and cities more attractive must, therefore, be an important part of the strategy of the Department of the Environment, Transport and the Regions.
Furthermore, I should like to draw attention to the fact that, a great deal of money has been spent on introducing pedestrianisation and traffic-free areas in our towns and cities. That is part of the revitalisation of town and city centres. Losing retail outlets in those areas is a significant blow to such developments, which had the agreement of the communities concerned. The issue of supermarkets is not the be-all and end-all of retail shopping. If we want small, competitive retail units in urban areas, we should impress on local authorities the desirability of introducing covered markets, which would allow market traders to develop trade in various areas, so that competition and town centre development is generated through market procedures.
I am advised that, as a result of the closure of retail trades in the town of Ossett, no one can buy a pair of shoes. Ossett has a population of 20,000 or more and it is sad that people cannot buy shoes because of the demise of retail units in the area. We must persuade local authorities to reintroduce covered markets in small towns. I put it to the Minister that there is much to be learnt from the Select Committee report, as there is from the contributions of members of that Committee and others who have an interest in supermarket competition. I hope that they will influence the Competition Commission, which will present a report on the subject in the near future. Good planning is needed. We must reject bad planning. Will the Minister have regard in his response to the argument that small urban areas need regenerating?
We need more traffic-free centres. There must be a curb on planning applications to introduce traffic into pedestrian areas to facilitate supermarkets or other businesses. It is easy for supermarkets to offer planning gain to local authorities. We should put a stop on that, because some local planners can be influenced if they think that they can recruit a social or road development from an application for a supermarket to be developed.
I impress on the Minister and my colleagues that there is much to be said and done about out-of-town shopping. We must insist that PPG6 is applied firmly. Its aim is to strengthen the role of local planners to ensure that there is no further development on the edges of our towns and cities to the detriment of town and city centres.
10.2 am
Mr. James Gray: I was struck by the analogy used by the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) when she said that supermarkets were like rhododendrons. She is right. When rhododendrons are young and fresh, and flower in the spring, we are all attracted to them like bees to the honeypot. That applies equally to supermarkets. While they are young and fresh and necessary, we all use them. But those of us with a passing interest in gardening
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know that when rhododendrons have been around for a year or two, they become gross, overgrown and in need of major hacking back. We may be approaching that situation with regard to supermarkets, too.
We all use supermarkets. There are 20,000 adults in Chippenham, the main town in my constituency. It has three supermarkets, including Safeway, Sainsbury and Somerfield. I am told that 88,000 people pass through the tills at Safeway each month, so everyone in Chippenham uses Safeway four times a month, in addition to Somerfield and Sainsbury. Eighty-six per cent. of all food shopping in the United Kingdom is carried out at supermarkets. The average weekly shop is six supermarket bags, weighing 84 lb.
Mrs. Dunwoody: All carried by women.
Mr. Gray: Yes, and nearly all by car. I accept the argument about the use of cars; none the less they are needed to carry six supermarket bags weighing 84 lb. As my hon. Friend the Member for Vale of York (Miss McIntosh) correctly pointed out, supermarkets turn over £44 billion a year in groceries—an enormous turnover.
Whatever else we may say about them, all of us in the nation use supermarkets to do our daily shopping. It is wrong to pretend that we do not. Our expectations, way of life and standard of living have increased greatly as a result. We presume that we can go to a supermarket on Christmas day and buy avocados, which were not even heard of in this country until 20 or 30 years ago. We can get fresh strawberries and vegetables all the year round—and not the sort of vegetables that I remember as a child. We used to have a bit of soggy cabbage in the winter and, if we were lucky, something slightly better in the spring. Now we can expect pre-packed, pre-washed, high quality, first class vegetables, eggs, meat and so on all the year round. The standard of beef that we buy in supermarkets is second to none. The quality, colour, size and texture of the fresh food that we get is first class. Our standards have increased enormously as a result of the supermarket revolution, and it is luddite to suggest anything else. We need them and rely on them.
In 1986 there were only 457 superstores in this country, but by 1997 that figure had increased to 1,102. I remember the debates that we had about that increase when I became a special adviser in the Department of the Environment in 1992, when my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) came into the job. He considered whether we should allow that exponential increase in supermarket sites to continue. The decision was taken at that time, with the first draft of planning policy guidance note 6, that we should control the increase in supermarkets because it was not sustainable.
We all use supermarkets and like them, and the nation depends on them. None the less, in recent years, we have begun to move against them—the rhododendron is becoming overgrown. In that context, the Competition Commission has loomed on to the scene. Most people would agree that the damage done to village shops, town centres and our environment as a result of the use of cars, and of the lorries that take goods from depots to supermarkets, is a bad thing. Most would agree that we should save our green belts by restricting supermarket

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development, and that PPG6 is right, even when they continue to use supermarkets. That is not a controversial view.
The Under-Secretary of State for the Environment, Transport and the Regions, the hon. Member for Greenwich and Woolwich (Mr. Raynsford), said that there was no question that the planning policy would be changed. He said, "We are passionate supporters of PPG6. There will be no more supermarkets built out of town. That is certain, so do not worry about it, ladies and gentlemen. Everything is tickety-boo." As the hon. Member for Crewe and Nantwich said, he made a robust defence of the PPG6 measure initiated by my right hon. Friend the Member for Suffolk, Coastal.
The following week, the Minister for Small Business and E-Commerce, the hon. Member for Leicester, West (Ms Hewitt), gave evidence before the Committee. We asked her what the purpose was behind the referral of competition of supermarkets to the Competition Commission, to which she answered that she was not certain, but she was sure that it was a good thing. Like the hon. Member for Crewe and Nantwich, I hope that the commission reports before the House rises; otherwise, some serious questions must be asked about the machinery of government.
Let us imagine that the commission says, "We have a problem in Chippenham because Tesco has no site there. The town uses supermarkets to a huge degree and prices are slightly higher there than in London. We believe there may be a competition problem. If we can find a site for Tesco, the prices may be brought down again. The extra competition might depress the prices a little bit, so maybe that is a reason for relaxing the stringent planning controls around Chippenham to allow Tesco to have a site. Tesco is seeking sites in Chippenham, Malmesbury and Tetbury and trying to find a toe-hold throughout the Cotswolds; it is desperate to get in somewhere. Asda is seeking sites all the time. Perhaps we should relax planning controls to accommodate that perfectly sensible competition."
If that is the case, what are we to make of the assurance by the Department of the Environment, Transport and the Regions that PPG6 must remain sacrosanct? That is what the Department said, robustly and straightforwardly—that there will be no increase in the number of supermarkets in our countryside. If that is the case, what on earth is the purpose of the referral to the Competition Commission? What shall we do with the commission's report if, for example, it refers to Chippenham in the way that I described? However, if it says that there is plenty of supermarket competition and no reason to change planning, what would be the point of the referral?
When the Minister replies to this debate, which is useful and timeous in the light of the report, she must tell us precisely why the Department of Trade and Industry referred the matter to the Competition Commission, when the commission will reply and what consultations there were between planning Ministers in the Department of the Environment, Transport and the Regions and the DTI before that referral.
More important, the Minister must tell us why the referral was made. What will happen if the report says that there is a restriction on competition between supermarkets in England? What will happen if it calls
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for a relaxation of PPG6 in order to accommodate that concern? Does the hon. Lady think that PPG6 can be relaxed, or does she agree with the hon. Member for Greenwich and Woolwich that it cannot? Alternatively, if the Competition Commission says that it has wasted its time and that there is no supermarket competition problem, will she tell us why public money was wasted on an unnecessary inquiry?
Leaving aside the pros and cons of supermarkets, there is some confusion in the machinery of government. The Minister must at least try to shed a little light on what seems to be a murky subject.
Mr. Deputy Speaker (Mr. Frank Cook): Before I call Front-Bench speakers at half-past 10, I should like to be able to fit in the three remaining speakers. Hon. Members should, therefore, be concise and alert in their contributions.
10.11 am
Dr. Whitehead: It seems to be the form that we should preface our remarks with references to rhododendrons, and I shall not fail the Chamber in that. The analogy, which was made by my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody), is a good one inasmuch as there can be many different colours of rhododendrons and selective breeding increases the number of colours and types available to gardeners. None the less, they are still rhododendrons and still do what rhododendrons do. That seems to be the nub of the problem.
The owners of supermarkets say in public and to the Select Committee that there has never been a more intense period of competition, that the public are tremendously served for choice and that everything is great. There is a conundrum, however. Although there is greater competition between supermarkets, in wider and subtler ways there appears to be a diminution of competition at the same time. I am concerned about the approach of the McKinsey report, and to some extent that of the Office of Fair Trading, whereby the definition of competition is based on the narrow principle of price. My contention, which is reflected by the Select Committee report, is that supermarket competition is much more widespread and subtle.
The assumption of space has already been mentioned. Supermarkets are all generally dedicated to larger units wherever possible, although there has been some welcome variation with the rise of inner-city supermarkets as a result of planning policy guidance note 6. Common assumptions have been made about location and what is in the store. Recently, I read an interesting book called "Consuming Passions", which sets out the psychology of retailing. It mentions supermarket layout, anti-clockwise movement, different temperatures, products at certain heights and smells from the delicatessen and the bakery section. Those are always the same for every supermarket in order to homogenise the overall product but, within that, competition is available.
Secondly, a logistical assumption is made. Methods of supply are based on just-in-time management. The product must be in the store by the following afternoon. If the supply does not fit the requirement that the product be in the store the following afternoon, the

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product is excised. Therefore the product available for competition is one that can be delivered by truck to the supermarket by 4 o'clock in the afternoon, to be put on the shelf immediately. Bakeries increasingly conform to that pattern, whereby products are delivered just in time, using frozen ingredients; if a product cannot be baked within a limited time, it is not made available.
The relationship with suppliers has fundamentally changed. There has been an inversion of the traditional brand-to-shop idea. Now it is the shop that decides which brands will be stocked. Deals that are made with brands can require exclusivity clauses. Under a contract to supply a brand to a particular supermarket, the supermarket can prevent the supplier from providing brands to competitors or non-supermarkets. Consequently, a brand that should be available to anyone in competition has effectively been captured by the method of retailing and the consequent restrictions placed on that brand.
An interesting by-product of that process is the introduction of clones in the form of own brands. We do not need to think very deeply to realise the consequences. Brands are pioneered in the open market, to which a substantial number of brands are still supplied, but 40 per cent. of products sold in supermarkets are own brands and, overwhelmingly, not brands that the supermarket has pioneered. Supermarkets wait until a brand has become successful and then copy it to capture its market. We have witnessed, for example, the extreme coincidence of the rise of a particular corn chip called Doritos and its imitation by a corn chip called Amigos in particular supermarkets. Head & Shoulders dandruff shampoo has resulted in various clone dandruff shampoos appearing on supermarket shelves. If it goes any further, we do not need a great deal of insight to realise that if supermarket own brands are all that remain, there will be no innovation and choice among the brands that are developed and available.
The combination of own brands, the power of purchase and exclusive deals has, in addition to planning constraints and out-of-town developments which we discussed earlier, led to a reduction in independent grocery outlets, as the report, significantly, highlights. The number has decreased from 116,000 in 1961 to only 20,000 in 1997. We may have a great deal of choice among the four brand leaders, but do we as consumers have choice outside those brand leaders?
I conducted a personal investigation into supermarkets' increasing monopolisation of fresh food and vegetables, from the beginning of the supply chain up to the supermarkets. Supermarkets increasingly require their fresh fruit and vegetables to be supplied by a decreasing number of producers, to allow for economies of scale and just-in-time management. Consequently, those who produce fresh fruit and vegetables are becoming large, agro-industrial companies in their own right, effectively pushing out varietals and smaller farmers in the process.
Interestingly, the hon. Member for North Wiltshire (Mr. Gray) underlined that point. He mentioned that we now have fresh fruit and vegetables all the year round. However, that is at the price of one-third of the vegetables produced in this country simply being left to
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rot in the field because they do not conform to what the supermarket wants for its purposes. Particular varietals are difficult to place within those production purposes. The fir apple potato is now virtually extinct as a brand on suppliers' shelves.
In capturing producers, supermarkets now require producers of fresh fruit and vegetables to provide what are known in the business as over-riders. That is a nice term that means that the producer gives the supermarket money in order to be allowed to continue producing fruit and vegetables for it. If that continues, the margins of the company are reduced, as a result of which the innovation of that company in trying to produce a product for the supermarket is taken out of the process and it becomes a machine-like supplier to the supermarket.
I mention those points because they are additions to the planning process, which was highlighted in the report and referred to in the Chamber today. The extent to which supermarkets can effectively dictate the workings of the market seems to be a factor well beyond planning. Whether it serves the British public in the long term with regard to choice is a big question. I urge those who consider such matters, especially the Minister who is to respond to the debate, to assure us that the complexity of competition is active in the Government's mind and that the protection of the consumer will be featured in future debates.
10.20 am
Mr. Hilary Benn: We are having this debate principally because supermarkets have been successful. The hon. Member for North Wiltshire (Mr. Gray) did us a service by reminding us of that fact. Like others, I welcome planning policy guidance note 6, as I do the report, because it fires a powerful warning shot across the bows of any person who is contemplating trying to row back from the decision taken by the previous Government, which I hope that the current Government will continue to support with equal vigour.
The hon. Member for North Wiltshire referred to the fact that the average weight of a load of family shopping is more than 80 lb. We must make it easier for people to continue to benefit from the service offered by supermarkets without necessarily having to use their car. I should like there to be more home delivery services in operation. Tesco leads the field in a modest way; 250,000 people have signed up to its service. I have used it twice and, speaking from experience, I would be keen to give up the pleasure of that weekly trudge up and down the aisles if my purchases were delivered to my home. Let us be imaginative. Why cannot we build into the planning system for new developments a requirement on the supermarket owner to provide a home-delivery service? Some people would welcome the chance not to drive their car to the supermarket, but to have their purchases delivered by van. That may release a few parking spaces.
One characteristic of inner-city areas is the absence of shops, especially in those areas that are in severe decline. The few shops that remain in such areas symbolise the problems that they face, given that they are steel-shuttered and, in a sense, as beleaguered as the communities that they try to serve. I represent a

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constituency with one of the lowest levels of car ownership in the country. The debate about people's freedom to use their cars for shopping does not arise for many of my constituents. If they cannot go by bus to shop, they are denied the range of choice that supermarkets provide, including the right to low prices.
Early this year, the Joseph Rowntree Foundation published an interesting study into the extra costs of being poor in Britain today. A representative bought 20 goods from a supermarket at a cost of £17.88. He then went to the local shop where the same basket of goods cost £29.11. Shopping is 50 per cent. more expensive for poor people who live in areas that do not give them access to a choice of goods at low prices than it is for others. The poorest fifth of households spend nearly a quarter of their income on food; the richest fifth of households spend 14 per cent.
The Leeds Co-op recently opened two stores in my constituency, one of which is a refurbishment in the Selby road. The other is on the Lincoln Green estate, which was the subject of Fergal Keane's "Forgotten Britain" documentary on BBC television about a month ago. The arrival of the store, which is in a former public house—in which there may be some symbolism—has given a lift to the area. It is a small, modest shop, which opens long hours. It has a range of produce, such as fresh fruit, which may not have been available in such quantity previously. It has given a boost to the area, and has played a part in the redevelopment and regeneration process of a run-down inner-city community. I never thought that I would regard the Co-op or any other supermarket as an instrument of inner-city regeneration in that sense. In this modest example, however, that is unquestionably the case. Other supermarkets should recognise that in addition to providing successfully for the market, about which other hon. Members have spoken, they have a responsibility to inner-city areas.
To the extent that PPG6 has encouraged more supermarkets to consider developing inner-city areas, it has been well worth while. To the extent that the report encourages supermarkets to do more of that—and the Government to ensure that they do more—it will also have been extremely useful.
10.25 am
Mr. Tom Brake: I am pleased to have the opportunity to speak in the debate. I join hon. Members in congratulating the hon. Member for Denton and Reddish (Mr. Bennett) on securing it. The subject of supermarkets is important, and Liberal Democrats used an Opposition day debate last year to discuss it.
The rapid expansion of out-of-town superstores and the concentration of market share has undoubtedly hit town centres. Supermarket purchasing and pricing policies have hit farmers but not led to lower prices for consumers. As the report highlights, a new wave of larger superstore developments, predatory pricing to gain market dominance and a squeeze on local producers and traditional retailers has had a heavy impact on town centres. Traditional food retailers and other retailers in town centres have closed, and many jobs have been lost.
The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) likened supermarkets to rhododendrons, and I, too, shall use a gardening
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analogy. I am currently fighting a running battle in my garden with ground elder, which I think that I am losing. Supermarkets can be likened to ground elder, as they continue to spread and strangle anything in their path.
In January 1998, Boots sponsored a report for the national retail planning forum, which showed how great has been the impact of out-of-town food superstores on local retail employment. It studied 15 catchment areas of 93 superstores that opened between 1991 and 1995. Although 10,500 full-time equivalent jobs had been created, no fewer than 25,000 jobs were lost in local specialist food retailers—a net loss of 15,000. A further 10,000 jobs were lost in other non-food retailers. That is an average job loss of 276 employees for every supermarket that had opened. That report was backed up by a study produced by the Department of the Environment, Transport and the Regions.
Supermarkets have not just had an impact on town centres. They have had a wider impact on the environment, to which many hon. Members have referred. For instance, the Government rightly say that they want to develop brownfield sites in town centres. What happens, however, when such sites are not available? The sequential test, which has been praised in the report, leads supermarkets to push for development on the edge of or even outside town centres, but there is nothing in the test to say that that cannot be done. The larger the store, the more likely it is that it will not be able to find a town centre site. It will, therefore, claim that it must rely on an out-of-town site.
Since the last Select Committee report on the matter, three years have elapsed, during which the Government could have defined what constitutes a suitable site. I hope that the Minister can give us that definition.
I believe that everyone agrees with the policy that has been in place since 1996 and the need for the sequential test. However, I am afraid that, once options in town centres are exhausted, supermarkets move out of town. A report published in 1998 by the Environment and Science Research Council said:
Since the mid-1990s…the major food retailers increased floor space by nearly 2.5 million square feet a year, much the same as in earlier years.
It would be nice to think that the vast majority of that new floorspace had been developed in town centres, but I suspect that that was not the case.
Many members touched on the issue of traffic and congestion. The royal commission on environmental pollution producing its report last Friday, and the issue needs to be tackled quickly. The report called for a 60 per cent. cut in CO2 emissions, much of which will have to be achieved by reducing traffic and congestion. I, therefore welcome the new planning policy guidance note 13 and the fact that it will contain maximum, not minimum, parking standards. I hope that they will be tough; the Select Committee was worried that they would be too lax. The Minister will have the opportunity to reassure us that she has not gone soft on congestion.
In one respect, I am disappointed by the Government's response. They point out that, under the Transport Bill, it will be possible to levy a charge on workplace car parking at out-of-town stores. That is positive, but will not apply to customer parking. My hon. Friends the Members for Bath (Mr. Foster) and for

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Tweeddale, Ettrick and Lauderdale (Mr. Moore) tabled several amendments to the Bill suggesting the inclusion of out-of-town shopping complexes. If the Government are not prepared to entertain such proposals, perhaps the Minister could outline how they intend to level the playing field between out-of-town shopping centres without a charge and town centres, where charges often apply.
The development of out-of-town shopping centres leaves dereliction in town centres. There is a role for a greenfield development levy in trying to redress the balance and make the development of derelict sites in town centres more attractive. Value added tax has been mentioned as well, and it could help in levelling the playing field between out-of-town developments and the redevelopment of town-centre premises.
Even if those reforms were implemented, there would be a need for local authorities to make much more of compulsory purchase order powers to assemble sites, as the Select Committee report suggests. That would mean that, if the owners of a possible site in a town centre had different views about its future, the local authority would have the role of pulling all that together to make available a site that might not otherwise be available.
I am happy to endorse the report's views on design and PPG6. Supermarket design leaves much to be desired; there is an example in my constituency where the car park has been put on the high street and the store frontage has been set back. All that one can see when walking down the high street is the concrete of the underground car park. I hope that sometime we may consider not only the visual impact of building design, but the wider environmental impact. Much can be done about the environmental impact of supermarkets. The report's title is misleading, as the report concerns not only the impact of competition but the overall environmental impact of supermarkets.
The Committee report is rightly robust about competition, and I share its worry about the referral by the Office of Fair Trading to the Competition Commission. A relaxation of the planning rules would be disastrous, and I hope that DETR Ministers will hold their ground and insist on pursuing existing policy, if the Secretary of State for Industry has to consider adverse findings.
My time is up, I am told. I finish by saying that I welcome the report and its recommendations on Compulsory Purchase Orders, design, car parking and other aspects of supermarket development. However, I am disappointed by the Government's weak response, and hope that the Minister will enlighten us about their stance on the issue.
10.35 am
Mr. Damian Green: As the world's worst gardener, I will not extend the rhododendron analogy that has dominated the debate; given the greater expertise of other hon. Members, I would not add anything new. I commend the Committee on its report, which deals seriously with a range of serious and complex issues, as the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) showed when she opened the debate.
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I should like to comment on the Committee's discoveries and recommendations and the Government's response, and to question the Minister on some matters. I hope that she can reassure the chamber about the Government's actions so far and their intentions.
First, I congratulate and thank my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), who introduced planning policy guidance note 6, which the Committee report commends. In fact, that is its most clear-cut commendation and it has often been mentioned in the debate. The Secretary of State whose policy is regarded as popular and right not only on the day on which it is introduced but four years later, should be a happy man. It is a rare accolade that he must want to savour. The special adviser in the Department at the time was my hon. Friend the Member for North Wiltshire (Mr. Gray). As his sage advice contributed to a policy that has received universal commendation this morning, he should share in the glory.
We all agree that supermarkets cause a range of problems. The existence of a nearby supermarket is likely to accelerate the closure of village shops, and out-of-town superstores make shopping in town centres more difficult. Because of their buying power, supermarkets can cause problems for farmers, who feel that they are dealing with a leviathan and do not have the countervailing power to extract a fair return for their products.
However, the hon. Member for Normanton (Mr. O'Brien) was right in saying that it is absurd to be anti-supermarket. We all use them and find them convenient, as do millions of our constituents. They have improved the quality of life in this country over the past 30 or 40 years, by providing a range of goods at prices that most people can afford. I was fascinated by the price comparison referred to by the hon. Member for Leeds, Central (Mr. Benn), which shows that, by driving prices down, supermarkets can provide a wide choice of goods, some of which would usually be regarded as luxury goods by the less well-off.
Like the hon. Gentleman, I would be delighted by a growth of home delivery through internet shopping, as it would be an enormous pleasure to give up that weekly routine. I have also discovered that it is a weekly routine that many of my constituents find convenient as a way of finding their Member of Parliament in the supermarket on a Saturday morning. It is a good way of getting things off their chest.
The report does not explain why supermarket competition is the problem, and I remain unconvinced. The quasi-monopoly characteristic of supermarkets is often the real problem. Many difficulties highlighted by the report relate to the areas in which supermarkets can effectively behave as a monopoly or, at best, as an oligopoly, instead of competing with one another. The Minister will have to deal with that central point.
I hope that the Competition Commission reports its findings when the House is sitting, given that the matter is important and controversial. It would be good to have an early and timely debate about it in one form or another. A balancing act must be clearly defined between consumer interests and wider environmental and social interests. At best, the Competition Commission will contribute to achieving that balance. It must be struck and I am sure that we shall continue to take a close interest in it.

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I commend two points in the report, the first of which relates to the need for small supermarkets in town centres. The report says that planners are sometimes relatively inflexible and consider that all supermarket development is bad. The Committee feels strongly that smaller supermarkets in a town centre can help to regenerate the community and keep the town centres alive—something that we would all welcome. The second point concerns design, which was mentioned by my hon. Friend the Member for Vale of York (Miss McIntosh). Paragraph 23 of the report quotes the urban taskforce on the problems of "monotony of design". Planners should pay attention not only to the general design, but to the desirability of using proper vernacular materials. One depressing aspect of many town centres is that, if we were led into them blindfold and then had the blindfold removed, we would have no idea where we were. Far too many towns look like one another. We have lost much of the regional and local vernacular feel in our town centres. We should try to get it back; it is one of the glories of this country.
Much mention has been made of Wal-Mart and its takeover of Asda. Will the Minister say whether there are on-going talks between senior management at Wal-Mart and the Government? At the time of the takeover, we all read the reports of meetings with the Prime Minister. Is Wal-Mart having an effect on future planning regulations? What will be the planning implications if the Competition Commission makes an adverse public interest finding on the issue of competition? We have heard how strong the Minister for Housing and Planning was on the issue, but it would be a different situation if the Competition Commission concluded that the public interest was being damaged. What would be the Government's response to that?
I was slightly disturbed to read paragraph 28 of the report, in which the Minister for Housing and Planning said that there had been
substantial inconsistency between individual local authorities.
That smacks of a desire for centralising micro-management that would not serve the planning process well. Can the Minister give us assurances about that today? Giving local authorities more power to take their own decisions is a good, rather than a bad, move.
The appeals system has not been mentioned this morning. It is widely held to be loaded in favour of the big battalions of the large shops as opposed to community groups that oppose big developments and it is regarded as one of the big problems with the system. It would be interesting to know whether the Government have any plans to change it.
Paragraph 12 of the Government response to the report is extraordinary. It refers to the compulsory purchase policy review advisory group, which will report to Ministers at the Department of the Environment, Transport and the Regions in the next two months. It says:
A decision will then be made whether, and when, to publish it.
I cannot believe that the report will be so sensitive that Ministers will not want to publish it. I assure the Minister that it is highly unlikely that the matter will form a central part of the Conservative party's manifesto at the next general election. If the advisory group makes such sensitive comments, it is all the more
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important to publish the report. I am sure that there are no reasons for not doing so, and I hope that the Minister will assure us that she will.
The final point to which I should like the Minister to respond relates to car parking. This is a good opportunity for her to clarify the Government's position on parking at superstores and, in particular, workplace charges, which have been mentioned. Has the Department done any work on the possible effect on pricing of the introduction of workplace charges at out-of-town superstores? Clearly, that may have an impact on the economics involved.
It seems to us that the long-term solution is decent and sensible guidance from the centre and greater devolution of power to local communities, because there may be a genuinely different balance to be struck in different communities between the advantages and disadvantages of supermarket development. We feel that Ministers should allow local authorities to take more of those decisions, as those decisions would then be more likely to reflect the needs of local communities. I hope that the Minister will reassure the Chamber about those points.
10.46 am
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Ms Beverley Hughes): This has been an important debate in both substance and timing. I congratulate my hon. Friend the Member for Denton and Reddish (Mr. Bennett) on securing the debate, and the members of the Environment, Transport and Regional Affairs Committee on their thorough report. I thank hon. Members for their unequivocal support for our policy of encouraging new retail development in town centres.
We very much value the Committee's continuing vigilance and interest in town centres and shopping. I know that the Committee, rightly, takes great pride in the important role that it played in convincing the previous Government to change their disastrous stance and the outcome of that stance on the issue. The revision of planning policy guidance note 6 was due largely to the Committee's inquiry into shopping centres.
I very much welcome the debate, the timing of which is important because it provides an opportunity to reaffirm the Government's position directly to the Chamber and to confirm the robust defence of Government policy for which the Committee commended my hon. Friend the Minister for Housing and Planning. I shall give hon. Members most of the assurances that they want and I shall try in the limited time available to deal comprehensively with all their arguments.
My hon. Friend the Member for Normanton (Mr. O'Brien) graphically outlined the impact of decisions taken during the 1980s and 1990s. In a debate last night my hon. Friend the Minister for Housing and Planning informed us that half of all post-war out-of-town developments were approved between 1985 and 1990, which illustrates what a step change in practice we witnessed during that period. That step change was not positive. It left a legacy for many of our small towns and city centres, as many hon. Members discussed today. One of the Government's central policies is to start to reverse those destructive trends and to renew, enhance

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and support the role of small town centres and inner cities in the rejuvenation of economic and social life for many of our people.
Mr. Gray: I am sorry to interrupt the hon. Lady; I know that we are short of time. She is trying to make what sounds to those of us in the know like a strong party political point that in the 1980s everything was bad and that this Government are changing that. Will she acknowledge that in 1993 my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) changed the policy, which was coincidental to the Select Committee's report? To try to suggest that the new Labour Government are putting right the planning wrongs of the previous Government is incorrect and lowers the tone of what has been an interesting debate.
Ms Hughes: I do not believe that it lowers the tone. I acknowledge the change of policy and when it occurred, and I said as much. I am sorry that the hon. Gentleman has distracted us from the Select Committee's role at that time in drawing the Government's attention to the effects of their practices, if not policies, in town and city centres. In my constituency, the right hon. Member for Suffolk, Coastal approved the largest out-of-town retail store in Europe some time after the apparent policy change. The policy is not the only important aspect; the way in which it is implemented and the rigour with which local authorities and Ministers take decisions in the final analysis makes a difference.
The Committee's inquiry was prompted by Wal-Mart's takeover of Asda, which has been mentioned by one or two hon. Members, including the hon. Member for Ashford (Mr. Green). At the time, the Opposition tried to suggest that agreement had been reached with Wal-Mart for a relaxation in the planning regime. Despite reassurances at the time, that claim continued to be made. Nothing could be further from the truth, and the passage of time has vindicated our reassurances. I hope that that satisfies the hon. Member for Ashford.
All supermarkets now face a level playing field in planning terms. That is the outcome of the current policy position and the way in which we are trying to implement it. They all face the challenge of finding more central sites for new stores and of adapting their formats. My hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) raised an important point on the subject. Supermarkets need to adapt in terms of scale, design and car parking to try to fit their formats into existing centres. We are mindful of the possibility of applications in which a developer says that a community needs a store of such a size that it can be placed in only one location. We are not stupid; we can see that for what it is, and will not accept that argument as a reason for avoiding the sequential approach and the need to consider whether a small supermarket in a town centre could equally fit the need. We shall not accept the one-model approach of the large-format superstore. We expect supermarket operators to adapt their offers and possibilities to local circumstances. The Committee asked for clarification on the issue; we gave it in our response and I am happy to affirm it strongly today.
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The subject of extensions was raised by my hon. Friend the Member for Normanton. All extensions require applications for planning permission and so will be subject to the test of PPG6. We shall not allow large superstores to be created by increments, in the way that my hon. Friend feared and believed to be possible.
There has been a great deal of discussion this morning about the Competition Commission's inquiry, and of whether it might impose a relaxation of the Government's planning policy. Although I understand those concerns, planning is not a central focus of the inquiry. I must correct the hon. Member for North Wiltshire (Mr. Gray), in that the Department of Trade and Industry did not refer the matter; the Office of Fair Trading did. The commission's report will be given to my right hon. Friend the Secretary of State for Trade and Industry for consideration on 31 July. It will be published two months later—a time that is much more conducive to the sort of parliamentary debate for which hon. Members have called. The timing is not necessarily the problem that it has been thought to be.
Mrs. Dunwoody: My hon. Friend must forgive me, as I am not terribly bright. Is she saying that the report will be published, but that the Government's reply will be made in the recess? Although she may think that more convenient for Members of Parliament, I have a strange old-fashioned idea that we are more useful in this place than when dissipated throughout the country.
Ms Hughes: On that point, I could not agree more with my hon. Friend. The Secretary of State will have two months to consider the report submitted to him on 31 July, which will be published two months later, at the end of September—closer to the parliamentary Session.
Mrs. Dunwoody: In the recess, but closer.
Ms Hughes: I think that that date is preferable to 31 July, if Parliament rises on 28 July. I share my hon. Friend's views and take note of them. I understand and welcome the fact that hon. Members want to discuss the report, and hope that they will press for such discussion.
Hon. Members have expressed concerns about the Competition Commission. Competing objectives are in the nature of planning and balancing different Government policies, but the protection and enhancement of our towns and city centres is a top priority for the Government. I can only endorse again the robust statement that my hon. Friend the Minister for Housing and Planning made to the Committee. The Government regard the policy for the siting of supermarkets as a crucial lever for the wider policy of revitalisation of small market towns and city centres, and we are determined not to relax it. I place that on the record as the view of Ministers, from the Secretary of State downwards, in the Department of the Environment, Transport and the Regions. We will continue to hold that position.
My hon. Friend the Member for Leeds, Central (Mr. Benn) raised another important point. Some people in inner cities are excluded from access to low-priced, good quality shopping with a wide choice. That is the area that we are considering, in so far as we may want to develop PPG6. We are following up the

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proposals about access to shopping made by one of the policy action teams, because we need new approaches to help local communities to develop retail strategies, and to give them choices.
Mr. Chris Ruane: Will the Minister give way?
Ms Hughes: I beg my hon. Friend's pardon, but I believe that he has just come in. I have three minutes to deal with the remaining points that have been raised.
We are firm on PPG6 and intend to consider the matter. The hon. Member for Vale of York (Miss McIntosh) and others have raised the issue of market towns and rural areas. I agree that, although the issue affects inner cities, it also affects the vitality of smaller towns, on which the siting of out-of-town supermarkets has sometimes had a disastrous effect. That affects those people who are least able to go out of town, because they are elderly or disabled or have no car or resources to do so.
Several hon. Members raised the question of supermarket design and the Committee called for an improvement in that respect. Although there are exceptions, we are all familiar with the shed-like structures sited in acres of tarmac that seem to be the hallmark of many of our supermarkets—certainly in out-of-town situations. When supermarkets are located in town centres, their design is often incompatible with the buildings around them.
We want good design to be an aim of all those involved in new development, and we have published new guidance called "By Design", which the Commission for Architecture and the Built Environment helped us to produce. It is not just an average guidance, but provides practical assistance for local authorities to help developers to improve the quality of the designs submitted in applications. The Government are pressing the issue of design, which is important, not only for supermarkets but for housing and public building, and affects the quality of the environment for local people.
Car parking is another important issue that has been raised. We have created a more level playing field for parking through planning policy guidance note 13, which imposes maximum standards as opposed to the minimum standards required previously. Workplace charging will assist in that matter, when local authorities want to introduce it.
In short, we are dedicated to retaining our robust approach to PPG6 because, as I said, it is so important for the achievement of wider Government objectives for regeneration.

EU Structural Funds
11 am
Mr. Martyn Jones: European structural funding is probably the most important issue affecting Wales's economic future for perhaps the next 10 or 15 years. I think that the Welsh Affairs Committee's report reflects the concern of all hon. Members from Wales to realise the opportunity to obtain for Wales possibly £1.2 billion in European funding, which would be a tremendous boost for the Welsh economy and a huge asset for Wales. Although the funding would go to only a part of Wales, Wales as a whole would benefit hugely from it.
The Committee began its inquiry on the matter in 1998–99 when it became apparent that west Wales and the valleys would qualify for objective 1 status in the 2000–06 European structural fund round. The Committee was very concerned to ensure that everything that could be done to prepare for the round would be done. In March 1999 we took evidence from the Wales European taskforce. On 1 July 1999 responsibility for social and economic development in Wales went to the National Assembly for Wales, but there is not a clear dividing line between devolved and non-devolved matters. Additionally, there was widespread concern that, because of UK Government funding restraints, Wales would not be able to benefit fully from the available European funds. The Committee, therefore, decided to continue our inquiry, focusing primarily on UK funding issues.
We took evidence at Westminster from the Secretary of State for Wales. In November 1999 sitting for the first time in the National Assembly building, we took evidence from the chairman of the Assembly's Economic Development Committee. We also took evidence from the Wales European task force and from the Assembly Secretary for Economic Development.
The Committee emphasised throughout our proceedings that we were taking evidence from the National Assembly not to scrutinise how it handled devolved responsibilities, but to obtain information that would enable us more effectively to scrutinise the UK Government. We greatly appreciated the spirit of cooperation shown by Assembly Members in responding to our inquiry.
The report was agreed unanimously on 8 February 2000 and published on 17 February. In it, we attempted to clarify the funding issues, many of which are very complex. There was much confusion about the concepts of public expenditure cover, match funding and application of the Barnett formula. The additionality rules and the UK rebate also confused the issue. We recommended that the Government and the Assembly should jointly publish a simple but authoritative guide on public expenditure and on obtaining UK and European funding.
Public expenditure cover—an authority to spend public money—is required for European funding and for any match funding, which is the local contribution to project costs, that is provided from public sources.
We reported some concern about public expenditure cover for 2000–01, noting that in the first year structural fund payments are expected to be few. As funding for

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projects is effectively scheduled over five to six years, most funding comes in the third or fourth year, so although very little funding was likely to be needed in the first year, there was some doubt that the funding available would be sufficient. We have urged the Government to allow, for additional public expenditure cover in Wales for 2000–01, if structural funds are greater than expected.
Real problems may arise in 2001–02 and beyond if a significant increase in public expenditure cover is not agreed. It is not possible for Wales to meet the costs of objective 1 from its current budget, which has been formulated and allocated to meet the costs of services already being provided by the Assembly. The concern is that, if we do not receive additional funding, we shall not be able to access the £1.2 billion of European funding.
Mr. Nigel Evans: The hon. Gentleman has said that he is happy that there is sufficient funding for year one, although that is only a small sum. Is he really happy that sufficient funds are available? I understand that various local authorities have proposed various projects but have been told to scale them down to only one project each. Could the hon. Gentleman say something about that?
Mr. Jones: I have no knowledge of that, but should be concerned if it were true. All the information that the Committee has received is that money set aside in the Assembly's budget is sufficient to cover foreseen projects. As I have no other knowledge of the matter, I cannot comment further on it. The Committee has to accept that what we have been told is correct—that £25 million will cover the first year's funding. It seems likely that that sum will be sufficient. The evidence that we received on the spending profile over six to seven years supports the view that very little other than, perhaps, seedcorn funding—which is provided for in the £25 million—will be needed.
The Committee is more concerned about the period 2001–02 and beyond. I am sure that at least all hon. Members from Wales will appreciate that some services will be lost if the block grant has to cover expenditure additional to expenditure on the services—such as health and housing—for which it was formulated and the Assembly is responsible. We know that extra public funding will have to be provided to Wales if we are to obtain a percentage of the £1.2 billion. We also know that some of the funding will come from private expenditure. Although that is all to the good, a substantial percentage will still have to come from public expenditure.
The objective 1 area covers 65 per cent. of Wales's population, and objective 2 covers another 9 per cent. In the comprehensive spending review, the Assembly is arguing for an increase in its departmental expenditure limit to provide additional public expenditure cover for all the anticipated European receipts. We urge the UK Government to make a clear and early commitment to increasing Wales's public expenditure cover to allow a full take-up of European funding.
The Assembly will also have to find money for match funding. The situation is confusing, as there are two factors in the calculation. In addition to public
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expenditure cover, which is the authority to spend money, there is a cash element to the extra funding. The Committee believes, as I have implied, that it would not be possible for Wales to raise the estimated extra £885 million of public sector match funding from existing resources. We have therefore urged the Government in the next comprehensive spending review settlement to increase the funding made available to Wales, to meet in full the public sector element of match funding.
In the Government's response, which was published in our fourth special report, we were told essentially that we would have to await the outcome of the spending review. Ministers reiterated their assurance that they fully appreciate Wales's needs and the importance of objective 1 funding. Both as members of the Committee and as hon. Members from Wales, we were very glad to receive that assurance, and at least some of us appreciated that we would have to wait to see the outcome of the comprehensive spending review.
Mr. Elfyn Llwyd: Is the hon. Gentleman aware that, last week, the Minister for Local Government and the Regions gave cast-iron assurances that money would be available to the English regions, whereas such assurances have not been given to Wales?
Mr. Jones: I was not aware of that. If it is true, I am happy that the English regions have received such an assurance, although it would be nice if Wales could receive a similar assurance. The problem may be that it is not as easy for such assurances to be made under the Barnett formula. I look forward to my hon. Friend the Minister responding on that point.
The report's conclusion is clear. It states:
The award of Objective 1 status to West Wales and the Valleys is a sign of how far parts of Wales lag behind the rest of Europe in economic development. The next few years offer an unprecedented opportunity to transform this situation … Unless the UK Government provides a substantial increase in the Assembly's expenditure limits in the Comprehensive Spending Review, Wales will not be able to take full benefit of the European funds available. The current CSR negotiations are a test of the Government's commitment to Wales, and indeed of the Devolution settlement.
That statement still holds good, but if we accept the restraints we must therefore accept the Government's answer that there are problems with the CSR. We understand that it is those problems that have caused the delay, but we hope that the Minister will continue to press the case very strongly for maximum public expenditure cover and maximum match funding for Wales.
We have a unique opportunity to access European funding, which will not come again. The Committee is aware of what objective 1 funding did for Ireland's economy.
Mr. Evans: I understood that, when the proposals were resubmitted to the European Union, a cast-iron guarantee was sought that match funding would be made available by 31 March. That date seems to have disappeared. Has the hon. Gentleman been given any indication that the Government have guaranteed to the

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EU that the £1.2 billion will be match-funded throughout the entire period of the EU structural fund grants?
Mr. Jones: I was not aware of that either, but it seems odd that the Commission would want such an assurance. European funding is project-based: if the projects do not exist, anticipating and accounting for the destination of every penny, ecu or euro of that £1.2 billion would require a crystal ball. If such a demand had been made, I would be concerned, but I do not think that the European Union could have imposed it on the Government. Given that any such demand would have required the assurance that it sought, but that no such guarantee has been given by the Government, I am certain that no demand was ever issued.
Wales has a unique opportunity. I believe that the Government are committed to getting as much money as possible into Wales. I hope that today's debate will strengthen Ministers' collective arms in their negotiations with the Exchequer.
I look forward to the Minister's response.
11.13 am
Mr. Elfyn Llwyd: The Select Committee report derives from a wide-ranging piece of research undertaken in a short space of time. I shall not dwell on the report's conclusions, which were highlighted by the hon. Member for Clwyd, South (Mr. Jones), but its main thrust is to urge the Government to give some cast-iron assurances on the additional funding and match funding that are prerequisites for drawing down moneys for successful structural fund projects.
We also said that we supported
the initiative of the Assembly Secretary for Economic Development in seeking to exempt Structural Funds from the operation of the Barnett Formula.
That is an important point, as about 5 per cent. of the moneys coming to Wales do so under the Barnett formula. That 5 per cent. would be imposed on the total structural block moneys coming to the United Kingdom and, as a result, Wales would, in effect, be sold short.
The hon. Member for Clwyd, South said that about 65 per cent. of the population of Wales reside in the area now given objective 1 status. The funding is therefore more important to Wales, pro rata, than any other part of the UK.
The Committee also urged the Government to respond swiftly to the report. Over the past few years, we have been disappointed in the content of the responses from Governments to reports, and in the fact that there have been delays of nine, 10 or 12 months before such responses have been made available. Those delays have been something of a scandal. On more than one occasion, the Committee has had to write a firm letter to the Wales Office asking for an urgent response. Those request have been totally ignored for another three or four months.
That is not good government. It is an affront to the Select Committee on Welsh Affairs, and to the parliamentary process. However, the Committee urged the Government to respond swiftly to the report by making a clear public commitment that they will
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provide Wales with public expenditure cover for the anticipated European grants, and with additional funding to meet the full costs of the public sector match funding requirement.
Swift response there was, in this particular case—indeed, it came the same day as the report was published. In a press release, the Secretary of State stated that
it is my view that the report is incorrect in its conclusion.
Somehow, the Secretary of State had prejudged the report's conclusions, or had received a leaked copy of the report. Clearly, he knew the contents of the report, and the Wales Office press release was issued on the morning of the press conference held by the Select Committee.
The press release continued:
In these circumstances I believe it would be entirely wrong to separate one aspect of funding of the Welsh block grant from all the others. We cannot afford to prejudge decisions about funding of Welsh schools and hospitals by considering one aspect of the Welsh budget in isolation.
The Parliamentary Under-Secretary of State for Wales (Mr. David Hanson): The hon. Gentleman has made the very serious allegation that the report was leaked to my right hon. Friend the Secretary of State. I hope that he will clarify that in his contribution, as it is a serious allegation against my right hon. Friend and members of the Committee.
Mr. Llwyd: In return, will the Minister explain how the press release came to be issued at the time of the Committee's press conference?
Mr. Hanson: My right hon. Friend the Secretary of State expressed a view about the report's conclusions.
Mr. Llwyd: Without seeing the report?
Mr. Hanson: He had certainly seen the report's conclusions at the time of the press conference.
Mr. Llwyd: I dispute that, as the press release was issued at the same time as the press conference was being held. That is a matter of record. However it happened, the Secretary of State gave an urgent response—that much is true.
Mr. Martyn Jones: I think that I can clear this up. Press copies of reports are sent out under embargo, 24 hours before their official publication. The Secretary of State would therefore have had 24 hours notice of the report's conclusions.
Mr. Llwyd: The hon. Gentleman confirms that the Secretary of State would have had prior sight of the report, in which case it is good that he gave his response within 24 hours of receiving it.

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However, the content of the Secretary of State's response is far from good, as he made it clear that he believed that the report was "incorrect in its conclusion".
Mr. Hanson: Will the hon. Gentleman withdraw what he said?
Mr. Llwyd: I will not.
Mr. Deputy Speaker (Mr. Frank Cook): Order. I remind hon. Members that there is a Chair here. It is occupied, and must be recognised.
Mr. Llwyd: I am obliged, Mr. Deputy Speaker.
There was a swift response to the report, saying "Wait for the CSR," and that the Committee's conclusions were incorrect—even though the report was consensual and its conclusions had been agreed by members of all parties involved.
Last week, it emerged that the English regions qualifying for objective 1 status—Cornwall, South Yorkshire and Merseyside—had been assured that they would receive match funding from the Government. The Minister for Local Government and the Regions has struck a deal with other Government Departments. Those Departments' budgets will be treated with more flexibility, so that cash can be freed up to match funds from the EU.
As we have heard, the issue of match funding for Wales is still to be resolved. We must have assurances that we will receive the necessary amount of match funding, over and above the Barnett block, to enable organisations in Wales to draw down money from the European structural funds.
Mr. Chris Ruane: Does the hon. Gentleman agree that it is easier for the three English regions with objective 1 status to get money as they represent only 6 per cent. of the English population? They can go to the Government and say, "We represent only 6 per cent. of the population. Can you spare us just a few extra pounds"—or millions of pounds. It is harder to do that in Wales, where 76 per cent. of the population live in objective 1 or objective 2 regions.
Mr. Llwyd: I hear what the hon. Gentleman says and I dismiss it utterly.
We must ensure that the First Secretary and the Secretary of State for Wales do all that they can to put pressure on the Treasury to deliver on this crucial issue. Without adequate funding it will be impossible to draw down funds from Europe, rendering objective 1 status worthless and a Pyrrhic victory.
Why are Welsh Ministers failing when those representing the English regions have been able to do deals with the Department of the Environment, Transport and the Regions, the Department for Education and Employment, the Department of Trade and Industry, the Ministry of Agriculture, Fisheries and Food and so on and are able to give cast-iron assurances?
Mr. Richard Livsey: I am interested in what the hon. Gentleman is saying, as I
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understand that the English regions have clearance for expenditure from 1 January 2000, which gives them a significant advantage. Does that not also highlight the fact that the Barnett formula has a stranglehold on the issues of public expenditure cover and match funding?
Mr. Llwyd: I agree entirely. The hon. Gentleman, as a member of the Select Committee, is fully aware of the problems that we face.
Mr. Evans: Does the hon. Gentleman also accept the fact that, because so much of Wales is covered by objective 1 and 2 status, there is a greater need for the Government to take an urgent decision instead of hiding behind the smokescreen of the comprehensive spending review?
Mr. Llwyd: I agree entirely. The hon. Member for Vale of Clwyd (Mr. Ruane) said that objective 1 regions in England represented 6 per cent. of the population, whereas in Wales they represent 65 per cent. according to my figures, and 76 per cent. according to his. Obviously, the decision is urgent and in any event it represents more people pro rata.
It is not just my party that is making this point; so are the hon. Members for Ribble Valley (Mr. Evans) and for Brecon and Radnorshire (Mr. Livsey). We are all ad idem on this and we need to get it clear. We have been asking for a decision for months now. This situation led to the downfall of the First Secretary in Cardiff and we are still no nearer a decision. I wonder when we will know what is happening.
Many projects are on hold and will not wait for much longer unless some assurances are given. People who are prepared to make inward investment are not prepared to wait for ever for assurances to be given. For all I know, some projects will switch to the English regions, once again denuding the Welsh economy of much-needed inward investment.
Mr. Ruane: Match funding is a key issue. It is not just the three Opposition parties that want an assurance on that; the Labour party does, too. There are rules, however, and announcements will be made in July. Does the hon. Gentleman accept that going on exclusively about match funding is scaring investors away from Wales? We are talking Wales down and people are afraid of getting involved because the only issue that they hear about is match funding. We need to talk up projects in Wales.
Mr. Llwyd: With respect, we can talk up projects in Wales till the cows come home. If we are unable to persuade inward investors that the economic conditions are right and the money is there, we can talk up Wales from now till kingdom come without any benefit to anyone.
The Government have failed the people of Wales in this matter. I understand that the final strategy and programming document will be with the Commission on 4 July and that the shadow monitoring committee will meet on 16 and 29 June and 21 July. The fast-track procedure will operate for two weeks in July with the possibility for every local partnership/regional package to submit applications.

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There is great concern that only large-scale projects involving bodies such as the Welsh Development Agency will be considered as part of the procedure. Small voluntary and community organisations are concerned that they will be left out. Further, there are serious concerns that only one project per application can be considered, since many local partnerships already have 50 to 100 projects lined up. All other project applications will have to wait until the end of September to be submitted and, in reality, will not start until November or December when the money starts to come through. That means that nearly a year has been lost since west Wales and the valleys have been eligible to receive objective 1 funding.
There are fears that only a small number of projects will be able to get into the fast-track procedure in July and that only a few will be able to claim under that process. Retrospective funding is the term for claiming back money that has been spent after a project has been approved. That, too, is in danger. The leader of Gwynedd county council told me yesterday that he has been informed that there will be no retrospective approvals and payments in respect of some projects already undertaken. I specifically ask the Minister to give us an answer on that when he replies to the debate. It does not have to wait for the comprehensive spending review.
My party and others represented in this Chamber have the best interests of Wales at heart. Objective 1 funding has been designated simply because the GDP of Wales is below that of the rest of the United Kingdom and below the European Union average. That is not a matter of pride. We are all concerned about that, but we are equally concerned that this is our last chance to draw down the funds. Six years from now there will be further integration into the European Union, probably involving eastern European states, and objective 1 funding will no longer be available, so we need to make as much as we possibly can of the current opportunity.
As I have said, it is undeniable that we have lost 12 months already and crucial issues still need to be resolved, such as the relationship between what can be delivered through regional and local packages and actions plans. Will there be a lead body or accountable body responsible for projects under such packages? Who will have financial control over those projects?
Many organisations and partnerships complain that they are being held back by the lack of guidance from the Assembly on such issues. Lack of guidance from the Government of Wales is doing enormous damage to preparations for the launch of such projects in all objective 1 regions. I believe that that was intentional on the part of the Government as they have allocated only £25 million for such projects during the first financial year.
We have been saying for the past six to nine months that we have been let down by the Government of Wales. The achievement of objective 1 status may well turn out to be a Pyrrhic victory if we are unable to maximise the structural funds that we can obtain. The Government have handled the matter in a deplorable way and we will get nothing like the benefit that we could have achieved.
Mr. Martin Caton: We have heard on many occasions in the past few months that the Government
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are letting Wales down. Can the hon. Gentleman give us a figure that he would expect from the comprehensive spending review that would not result in a statement the following day from Plaid Cymru to the effect that the Government had let Wales down again? How much does the hon. Gentleman expect from the comprehensive spending review?
Mr. Llwyd: I am no more privy to the comprehensive spending review than the hon. Gentleman is. It is one of the problems to which the Minister will refer in a moment. I do not know what is in the comprehensive spending review. I say simply that we should have additional funding and match funding sufficient to allow us to use all the allocated structural funds that have been designated for the poorer parts of Wales.
11.29 am
Mr. Chris Ruane: I am concerned about the contribution of the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd), which contrasted greatly with his more collegiate, co-operative approach in the Select Committee on Welsh Affairs yesterday. Perhaps someone has had a word with him—he is usually an amiable character, yet he said that the Government's record on objective 1 was deplorable.
Was it deplorable when the former Under-Secretary of State for Wales, my hon. Friend the Member for Neath (Mr. Hain), accepted the hon. Gentleman's county and my county into the Welsh Office bid at the last hour? If he had not, 7,000 people in the hon. Gentleman's constituency would not have benefited. Was it deplorable when the former Secretary of State for Wales, my right hon. Friend the Member for Caerphilly (Mr. Davies), argued in Cabinet—quite often with Cabinet members from other regions with objective 1 interests—that Wales should be accepted, and that it should be the largest region in the United Kingdom to be accepted? Was it deplorable when the Prime Minister went to Berlin, argued through the night for the UK bid to be accepted and then flew back to Hawarden airport to announce that to the Labour party conference?
Labour has delivered on these three key points, yet the Welsh nationalists have used objective 1 as a political football—a political cosh with which to bang Labour over the head time and time again. They have neglected the true interests of the people of Wales; they have sought party political gain at every opportunity—at the local elections last year, at the European elections and at the Assembly elections. They sacked the First Secretary, conniving with the Opposition parties in Wales to achieve that narrow political goal. They were after a political scalp, not objective 1 or match funding. They have used the subject of structural funding time and again for their own narrow political ends.
Match funding is a critical issue, and no one in Wales has tried harder than I have to ensure that objective 1—
Mr. Evans: Does the hon. Gentleman not accept that if the Government had come forward with the match funding, Plaid Cymru, the Conservatives and the Liberal Democrats would not have united in the interests of the people of Wales and removed the First Secretary?
Mr. Ruane: I am not accepting a criticism like that from the hon. Gentleman. When the previous

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Government came to power in 1979, of the 13 regions in the UK, Wales was mid-table as far as gross domestic product was concerned. When they left office in 1997, Wales came bottom of the league table. It is thanks to the previous Government that Wales achieved objective 1 status—they took us from the middle of the table to the bottom. They sacked the miners, they sacked the steelworkers, they put nothing in their place and they did not get the structural funds for objective 1. So I will have no truck with the hon. Gentleman when it comes to objective 1 funding. The Conservatives did nothing, and they continue to carp and do nothing.
As I was saying, match funding is a key issue. The way to achieve it is not along narrow party political lines, but through a collegiate approach. We should forget our political objectives and work together to put a cohesive, cogent case to the Chancellor of the Exchequer for match funding. That is what the Welsh Affairs Committee report does. It is critical, and it has all-party support. We want match funding.
I should have liked the Chancellor of the Exchequer to announce last year, or even in December, in the middle of the comprehensive spending review, that Wales was a special case and that the Government would stop the comprehensive spending review and guarantee the people of Wales objective 1 funding.
Mr. Llwyd: Can the hon. Gentleman confirm that Treasury Ministers were invited to give evidence to the Select Committee but declined?
Mr. Ruane: I am disappointed that they did. I should have preferred them to give evidence. I should have preferred the Chancellor of the Exchequer to announce in the middle of the comprehensive spending review that money for Wales—for the objective 1 regions in the UK—had been guaranteed. The report says that, and I support that view. However, we live in a political world, and if my right hon. Friend had guaranteed Wales that money for objective 1 funding, every other Department in Whitehall would have demanded the same. So that is what I wanted, but it was not to be. It will happen in July.
You have threatened us with all sorts. You have sacked the First Secretary.
Mr. Deputy Speaker: Order. I have threatened no one.
Mr. Ruane: I am sorry, Mr. Deputy Speaker.
Mr. Llwyd: Is the hon. Gentleman aware of the last Budget speech made by the Chancellor in which he departed from the purdah on the comprehensive spending review in no fewer than three instances, saying that extra expenditure would be forthcoming? If he can do it in those cases, why can he not do it for Wales?
Mr. Ruane: The Budget, as the hon. Gentleman knows, is fine tuning for the economy. The comprehensive spending review sets spending patterns for a three-year period. The objective 1 spending pattern
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is over a nine-year period. We do not need fine tuning; we need a strategic approach for the next nine years. That is why the funding has not been announced.
Mr. Robert Walter: Will the hon. Gentleman give way?
Mr. Ruane: This is the last time I shall give way—unless it is to one of my hon. Friends, of course.
Mr. Walter: I thank the hon. Gentleman for giving way. I am a little concerned by what he says. Is he suggesting that when we do get the announcement of the comprehensive spending review, the Prime Minister's commitment not to let Wales down may not be fulfilled, and that the money that is necessary for the first three or four years of objective 1 will not be provided?
Mr. Ruane: I take the Prime Minister at his word; I take the Chancellor of the Exchequer at his word. If the money is not delivered, I will be the first to criticise. On the flip side of the coin, I hope that if—or, rather, when—the money is delivered in the comprehensive spending review in July, the Opposition parties will apologise for sacking the First Secretary and for using objective 1 as a political cosh. I will criticise, and I hope that they will apologise, when we have the result in July.
I have concerns about the objective 1 plans for Wales. I have concerns that information has not percolated through to our communities over the past two or three years. Like the hon. Member for Meirionnydd Nant Conwy, I am concerned that the agencies that have paid employees on £25,000 and £30,000 a year will cut the cake before the community projects can get up and running.
In Cornwall, a 27-page full-colour brochure was sent out to all 450,000 households.
Mr. Livsey: Because of the Liberal Democrat council.
Mr. Ruane: The hon. Gentleman's party political point is well taken. However, such action has not been taken in Wales; it has certainly not been taken in Denbighshire and Conwy, which entered the bid late. We have had 40 meetings in Denbighshire on objective 1—people know about it, but there is more to be done.
I am also concerned about something else that the hon. Member for Meirionnydd Nant Conwy said. The procedure for applying for objective 1 bids is not clear to the communities, especially for community projects. What do the application forms look like? We need a general outline—if they are not ready yet, let us look at the sort of things that should be included. What is the line of command? Where is the local responsibility? Will it be too complicated? I believe that there are 32 strands, including strands for the development of tourism, small and medium-sized enterprises, agriculture, and so on.
I am also concerned at the slow pace this year. I hope that, once the comprehensive spending review is announced, and match funding is in place, there will be rapid action. I have been evangelising and enthusing about this in my communities; I have organised numerous events giving information in my constituency. My constituents are expectant—they want results. I want results, and I hope that we will see them soon.

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The Committee's report is an excellent document—it is critical, comprehensive and readable. It has strong conclusions. I hope that the Ministers who read it will take the feedback from the Committee and the people of Wales right to the top so that it will influence the Chancellor of the Exchequer when he makes his announcements on the comprehensive spending review in July.
11.39 am
Mr. Martin Caton: I want to focus first on the Select Committee's recommendation, in paragraph 12, that
the Government and the Assembly, jointly publish a simple but authoritative guide to public expenditure in Wales, setting out in simple terms how both UK and European funding operate in Wales.
When I reconsidered the evidence taken by the inquiry, I was reminded what a difficult and painful process it is to get one's head around the whole subject of European structural funds.
Most of that pain and aggravation is unnecessary, however. Yes, the issue is complex; to get on top of it, one has to become familiar with terms such as departmental expenditure limits, PES—public expenditure survey—cover, match funding, additionality, single programme documents and so on, as well as the organisational structures and grant criteria applied under a particular programme. However, one cannot help but wonder whether some smoke and mirrors have not been chucked in to make life even more complicated.
Last October, Jane Hough, of the House of Commons Library, attended an informal briefing of the Committee to try to lighten our path through the structural fund jungle. She provided us with an extremely useful background paper, although she acknowledged that it was not definitive. She pointed out:
There is an absence of any substantive explanation of the process either from the Treasury or the territorial departments. I have, however, discussed this matter with an official at the Treasury. While he was unable to add to the notes below, he confirmed that my understanding of the subject was "as accurate as it could be for someone outside the Treasury".
I do not know about you, Mr. Deputy Speaker, but those words sound to me like those of the high priest of an obscure cult, protecting the mysteries of the inner sanctum from the common worshipper. That is not good enough. Structural funds are an instrument of public policy and should be open to public scrutiny and democratic influence at every level. It is not merely a matter of producing helpful brochures and booklets to enable individuals or organisations to submit grant applications—although, of course, that is vitally important. Information about how the funds are designed and how they work should be available to anybody who is prepared to undertake a little study. At present, that is not the case. I hope that soon the Assembly and the Government will work together to produce a guide, as we have requested them to do.
The inquiry was the Committee's first attempt to fulfil a liaison and communication function between the National Assembly in Wales and the Government in Whitehall. There are clear responsibilities for both forms of government. Early on, ways were established
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for the Executives in Whitehall and Cardiff Bay to communicate and to reach decisions. Joined-up government can work between different tiers and in different geographical locations. Many members of the Select Committee hope that we can help to achieve joined-up scrutiny and joined-up accountability by working with the National Assembly on such issues.
We have not yet completed a mechanism to achieve that, but our inquiry did not make too bad a start. We took evidence from the First Secretary and the Chair of the Economic Development Committee in Cardiff, as well as from the Secretary of State.
The focus this morning has understandably been on match funding and public expenditure cover. However, the report made other significant recommendations—on the possibility of advance payments in certain circumstances; on shifting administration of the social fund from the Department for Education and Employment to the National Assembly for Wales; on operating aids—a matter which needs further exploration; and on urging extra funding from the UK Government if it was shown that there were a higher number of claims than were predicted when the allocation was made. The recommendations were all important; they have in part informed the consideration of structural funds at both tiers of government.
There has been a lot of huffing and puffing on spending cover and match funding this morning. That comes over as rather unconvincing theatre. As my hon. Friend the Member for Vale of Clwyd (Mr. Ruane) said, our report made a bid for a commitment to match funding. I certainly support that, although we did so more in hope than in expectation—aware that, in all likelihood, the Welsh block would have to be considered together and as part of the comprehensive spending review.
Mr. Walter: From talking to Commission officials in Brussels, my perception is that, if the money is not additional to the Welsh block, it will not fulfil the requirements of the objective 1 programme. Is the hon. Gentleman aware of that?
Mr. Caton: I do not know what the hon. Gentleman heard in Brussels, but I certainly agree with the spirit of what was said. We need the money to be additional. If the rules permit us to receive it only in that way, I have no problem with that. The money should be additional to the block grant.
We are within weeks of learning what the comprehensive spending review will reveal about Wales. My view of the matter has become firmer over the months; we shall hear a good-news story for Wales. However, the problem is how will the Opposition parties assess whether it is a good-news story? That is why I put my question to the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd). One cannot help but feel that, whatever is announced in the CSR, the day after, we shall hear that the Labour Government have let Wales down again. If Opposition parties do not have a figure in

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mind—how much they expect in order to provide match funding—when we are within weeks of that announcement, it is most disturbing.
Mr. Livsey: The answer to the hon. Gentleman's question is simple. We know that we need £885 million for match funding from public expenditure. We shall judge—
Mr. Deputy Speaker: Order. I should be much obliged if hon. Members would address the Chair rather than the wallpaper.
Mr. Livsey: Mr. Chairman, I shall never do that again—
Mr. Deputy Speaker: Order. Perhaps I should remind hon. Members that when the House took the decision to adopt this modified form of debate, it also decided that those who regularly occupy the Chair in Westminster Hall were to be addressed as Deputy Speaker. Those to be addressed as Mr. Chairman—or Miss for that matter—would be those who were reserves. I am not a reserve.
Mr. Livsey: I take your comments on board, Mr. Deputy Speaker.
The judgment that has to be made is about whether the Government come up with the amount of match funding required to meet that provided by the EU—as we know that is £885 million. That is surely how the matter should be judged.
Mr. Caton: It is interesting that the hon. Gentleman has not mentioned the fact that match funding for our existing structural fund money has not taken into account the current DFEE payments through the social fund. I am sure that he will enlarge on how he arrived at that figure when he makes his speech.
Mr. Evans: Will the hon. Gentleman tell the Chamber what figure he expects in the announcement, so that we can judge whether the Government were successful or inadequate in their provision?
Mr. Caton: My assessment will be based on the type of formula that I had begun to outline in response to the hon. Member for Brecon and Radnorshire (Mr. Livsey). After taking into account the existing match funding for our present structural funds, and after taking out the money currently controlled by the DFEE—which should eventually be controlled by Wales—the amount should match the remainder. It is as simple as that. I hope the amount will be better than that, and that we shall hear a good announcement about the block grant.
To conclude, Mr. Deputy Speaker—I apologise for my failure to address you correctly earlier—I am sure that there will be a good-news story. When we receive that announcement, we need to get on with the job of exploiting objective 1 in west Wales and the valleys to the benefit of constituencies such as mine, which desperately need it.
11.49 am
Mrs. Betty Williams: I had hoped that we would have had a constructive debate about European structural funds. However, I am sorry to say that, having listened to the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) in particular, it sounds as though the nationalists' campaign continues as it has for the past eight to 10 months. I would like us to work together constructively to put a strong, sound case forward, so that, in a few weeks time, my right hon. Friend the Chancellor of the Exchequer will make a favourable announcement for all the people of Wales and not just one section of society.
My hon. Friend the Member for Vale of Clwyd (Mr. Ruane) referred to the comprehensive spending review. However, we do not receive answers from the nationalists' representatives when we try to pin them down on how much funding they seek. They have mounted a long campaign, but I do not accept that we should expect any Chancellor, Minister or Prime Minister to sign an open-ended cheque to any organisation without knowing exactly what sum we are talking about.
The comprehensive spending review will tell us the Government's plans for the next three years. That must be separated from any Budget announcement, because that is the whole point behind having a comprehensive spending review.
Mr. Llwyd: Did the hon. Lady hear me earlier refer to the fact that the Government departed from that general rule in no fewer than three instances in the latest Budget statement? Furthermore, did she not listen when I said that the Minister for Local Government and the Regions has already given cast-iron assurances via the Treasury to the three English regions now getting objective 1 status?
Mrs. Williams: I am not a Minister, but I am sure that my hon. Friend the Under-Secretary of State for Wales will address that point when he winds up. However, my hon. Friend the Member for Vale of Clwyd attempted to give the hon. Gentleman an answer on that point.
At the height of the nationalist campaign to talk Wales down, prospective applicants raised certain questions. However, Labour Members and the Government were able to persuade those applicants to put packages together. I, as the Member for Conwy, was asked by members of the Federation of Small Businesses, voluntary organisations and local authorities whether it was worth their while to put packages together if they would be disregarded at the end of the day. They had accepted the nationalists' view that the money would not be available. I am confident that, in a few weeks time, we will hear a favourable announcement from my right hon. Friends the Chancellor of the Exchequer and the Prime Minister and that they will not let Wales down. It is wrong for any politician to consider this issue only in a political sense when the rest of us sincerely feel that the whole nation should be considered when we make our case to Government for match funding and for additional resources for Wales.
My hon. Friend the Member for Gower (Mr. Caton) referred to paragraph 12. The absence of a simple guide has left the door wide open for opposition parties to

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make use of the fact that people are unclear as to what additionality and match funding actually means. The opposition parties have grasped that opportunity and made the most of it in their 10-month campaign.
We must now persuade Government that the need for the funding exists. I refer to a meeting that we had at the Welsh Office some time ago at which the hon. Member for Meirionnydd Nant Conwy was present. We tried to persuade Government that Conwy and Denbighshire should be included on the map for objective 1 status. We succeeded in doing that, and the Prime Minister then succeeded in his attempt when he spoke on behalf of the United Kingdom later that year.
We need to work together on this at the last minute before the announcement is made. We need to persuade the Prime Minister, the Cabinet and the Chancellor that Wales deserves additional resources so that we can consider closely all the packages and projects that have been prepared in the past few months. I am confident that my right hon. Friends the Prime Minister and the Chancellor will not let Wales down and that we shall have a favourable announcement shortly.
11.54 am
Mr. Richard Livsey: The Welsh Affairs Committee has produced an important report. It is important because it is an all-party report and it was well received, not least by Members of the National Assembly, as an effective contribution to the debate and to ensuring that Wales receives a fair deal.
The report primarily deals with objective 1 funding and, in particular, with the raising of public expenditure for match funding. It highlights the importance of advance payments and it asks for a clear and early commitment for full public sector funding. We identified the amount of match funding that is required, and I referred to that figure earlier. We also asked for the exemption of structural funds from the operation of the Barnett formula and for funds for European social fund payments to be transferred from the Department for Education and Employment to the National Assembly. That is an important issue. We also want to ensure that private sector match funding is adequate.
We also asked what new structures for overseeing and monitoring plans after the wind-up of the Welsh Office task force will apply. I am sure that hon. Members will remember that we were critical of the way in which the task force was wound up, because that caused a significant delay to objective 2 plans which cover 9 per cent. of the population of Wales.
We also asked for a renegotiation of the objective 2 map, but that has not occurred. The answer that we received in the Government's response about additional public expenditure survey cover was to wait for the comprehensive spending review. That is a case of jam tomorrow and I believe that it is strongly connected with the next general election campaign. It demonstrates the iron grip by an iron Chancellor on such information. However, as has already been pointed out, he was prepared to make three exceptions only the other day.
I wish to deal in particular with the problems confronting objective 2, because much has already been said about objective 1. First, I congratulate the East Wales Partnership, which produced a single programming document that has already received
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approval from the European Commission. Although it still has to go over several internal hurdles, it has been approved in principle as a result of much hard work by civil servants in the National Assembly and by councils within the partnership, driven, not least, by my county council in Powys.
What worries us in particular is that there appear to be inadequate numbers of staff in the National Assembly to deal with the programming document. I understand that every expectation was given that the document would be in place and ready to go by November or December of this year. However, we found out only yesterday that the process has been delayed to March or April of 2001. The right hon. Member for Wokingham (Mr. Redwood) slashed the number of staff in the then Welsh Office and that has contributed to the delay. None the less, why cannot consultants or competent members of county councils be drafted in to speed up the process? The delay has slowed everything down. When I was in America with the Welsh Affairs Committee last week, I saw a fast-food restaurant called Mr. D. De-lay!, but the only problem was that it had been shut down and looked decrepit. That is what could happen to objective 2. The problem is serious.
The English regions have already had approval for objective 2 and that will be effective from 1 January. As of yesterday, we understand that objective 2 will not be effective in Wales until a starting date of 26 May and we must remember that the money is disbursed by the "M plus 2" rule. In other words, the money must be spent within two years. The position is therefore very unsatisfactory.
To achieve objective 2 status, we need £80 million of match funding against a contribution of £50 million from the European Union. The programme is extremely important. In my own area of Powys, the gross domestic product in 1995 was 76 per cent., of the average, which is only 1 per cent. over the 75 per cent. qualifying threshold for objective 1. It is now well below that threshold, even though we are receiving objective 2 funding, which concentrates on 60 per cent. of business development, entrepreneurship initiatives, help for small and medium enterprises and growing indigenous businesses, all of which are vital to our local economy.
I draw the Chamber's attention to a report produced last week by the Alliance for Regional Aid which addresses the problem of additionality that we discussed this morning. The report highlights the fact that additionality does not apply so much in England because of the Barnett formula. It says that the Treasury does not allow public expenditure to rise in Wales, but should do so. That is a huge issue. Indeed, the report proposes a matching finance fund. It states that there are two problems, the first of which
concerns the additionality of EU grants. This is about the public expenditure cover for the grants themselves. At the present time additionality is primarily a problem in Wales—
in the context of a comparison with what is happening in England—
where the fixed public expenditure total has not been adjusted to reflect the extra money coming as a result of Objective 1 status. The net effect is therefore that extra EU grants in Wales threaten to displace an equivalent amount of other Welsh public expenditure—on schools, hospitals, social services etc.

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That point cannot be made often enough. The report goes on to recommend a way of ensuring additionality and states:
One way of averting the immediate problem of non-additionality in Wales would be for the Treasury to allow Welsh public expenditure to rise by the value of the additional grants coming from the EU. That way, the extra grants would no longer displace other Welsh public expenditure.
The disadvantage of this one-off solution is that it is likely to provoke a reaction from other areas. A better way forward is to provide Wales with the extra spending it needs but within a framework that treats all EU grants equally and provides fairness for all parts of the UK. There are two simple ways in which this could be done.
The first way is to
take all EU regional grants right out of departmental spending totals.
The second way is to
give automatic extra spending consents, equal to the value of the grants to bodies in receipt of EU funding.
That is common sense and should be done. We expect it to be included in the comprehensive spending review; indeed, we should have had this information far sooner.
12.3 pm
Mr. Nigel Evans: First, I welcome the fact that we are having this debate. I have read the report and I congratulate the Welsh Affairs Committee on its comprehensive work.
The subject of objective 1 status is vital to the vast majority of Wales. As the map shows, whole swathes of Wales will now be covered by objective 1 status. We recognise that there are pockets of deprivation, even in those parts of Wales that are not covered by objective 1 status. It is therefore important that we do what we can to get this money through to the most deprived and disadvantaged areas of Wales as quickly as possible.
We have already given money in connection with these European funds. We are net contributors to the European Union and, as we are getting back our own money, the matter is doubly urgent. I agree with much, if not all, of what the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) said.
Mr. Evans: It is just as well that the hon. Gentleman is not running for his party leadership, as that might have been a critical blow to his campaign.
Mr. Llwyd: It would have been fatal.
Mr. Evans: What the hon. Gentleman said was important. Criticism of the Government is useful when their actions are wrong. There is nothing improper about such criticism. Indeed, in the first five years of my being a Member of Parliament, I was critical, both publicly and privately, of my Government when they did things that were wrong.
Mr. Ruane: Name the issues.
Mr. Deputy Speaker (Mr. Nicholas Winterton): Order.
Mr. Evans: There is nothing wrong in being critical when things are going wrong. Indeed, it is a strength to
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be critical of one's own Government. Similarly, we are not talking Wales down when we discuss deprived and disadvantaged areas, but are recognising problems that need to be recognised.
We have already heard a little about the fast-tracking of some bids that have come through in the first year. I was led to believe that any local authority that came forward with such projects would be match funded within the first year. We heard that £25 million would be made available, but were then told that the authorities could look at only one project in each area. Caerphilly has 90 projects; Blaenau Gwent has 40; Swansea has 20; Carmarthenshire has 10, and Gwynedd has seven. However, those areas will now have to reduce their projects to one each. If objective 1 is to be important for such areas, surely all the projects that have come forward should be examined. One should not just say that £25 million will be sufficient in the first year, as clearly it is not. I accept that the First Secretary is busy, as he is also a Member of Parliament and, I understand, has four jobs. The problem may be that he cannot give the necessary time and attention to objective 1 funding. Perhaps that should be re-examined.
I sat on the Standing Committee that considered the Bill that became the National Lottery etc. Act 1993. The Committee was told that lottery funding would all be additional funding, and we have heard the term "additionality" being used. However, it seems that some of that money will go into funds that the Government would normally provide. Again, we learn that we must wait for the comprehensive spending review. Is that a smokescreen? Going back to the subject of the lottery, it seems that the dome can ask for as much money as it likes. Cheques are written there and then as it needs the money straight away. Yet, whenever Wales asks for money, it has to wait for the comprehensive spending review. It seems that if Wales is now playing second fiddle to a failing theme park in Greenwich.
Mr. Ruane: Is the hon. Gentleman seriously suggesting that match funding should come from the lottery?
Mr. Evans: As I understand it, the Government have said that they are seriously considering using lottery funding, which will be part of the match funding to win funds from Europe. If the hon. Gentleman is critical of that and wants to intervene again, it would be breath of fresh air to hear him criticise his Government on anything. The lottery and lottery funding will be vital in gaining funds from the European Union.
Time and again, the Government use the comprehensive spending review as a barrier to prevent those funds getting through. Yet the dome can use lottery funds and goes back, cap in hand, time and again, and there does not seem to be any problem with that. The funding of £1.2 billion will be critical to parts of Wales and may be the last of its kind. As has already been said, several eastern European countries want to join the European Union and some of them are very poor indeed. I do not doubt that they will seek large cohesion funds from the EU to assist them with their problems.
Mr. Ruane: As a representative of the Conservative party, does the hon. Gentleman take credit for taking

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Wales from mid-table to the bottom of the league? We got objective 1 funding because we were at the bottom of the league for the whole of Europe.
Mr. Evans: That is a typical tactic by the hon. Gentleman, who is not prepared to address the problems of whether the Government will guarantee match funding, which we are here today to discuss. He just looks back at the past, and he must recognise that the Conservative Government did a great deal for Wales over 18 years, but, in 1997, despite the fact that more than 300,000 people in Wales voted for us, we paid a price. We are listening, and it is about time that the hon. Gentleman started listening to what people in his heartlands in Wales are saying. He should look at the results in the European, local government and Assembly elections, because the people in Wales are shouting, and he is refusing to listen.
Mr. Ruane: I am listening.
Mr. Deputy Speaker: Order. I enjoy and encourage interventions, but they should be interventions to which the hon. Member has given way. I deplore sedentary interventions that interrupt the flow of the debate.
Mr. Evans: As ever, Mr. Deputy Speaker, I am grateful for your protection.
The £1.2 billion will be vital to Wales, but what has been achieved so far? We are six months into the programme, and not a single project has got off the ground. All that we have had is the scalp of the First Secretary for Wales, and I will not let Plaid Cymru take all the credit for that because the support of all the opposition parties in the Assembly was necessary.
Mr. Llwyd: May I assist the hon. Gentleman by pointing out that half of the Labour Members of the Assembly wanted to get rid of the First Secretary as well?
Mr. Evans: I am looking forward to reading autobiographies as they emerge. Perhaps we will then get the full story of exactly what happened on that day; it could not have been only the Prime Minister who did not know what was going on.
I am concerned that projects could be lost. We do not know whether any have been lost to date. We know that a firm in Ceredigion in west Wales said that it was looking for objective 1 funding so that it could expand. We have to accept that inward investment into Wales might now go somewhere else. It has been suggested that the investment might go to England, but, with the European Union single market, it could go to Germany, France, Spain or Portugal. I cannot imagine Germany, France or Ireland—which has done very well out of the EU—hiding behind their comprehensive spending review and failing to get EU money.
The single programming document was sent to Brussels and criticised roundly by the European Union, and by businesses and by local authorities, because of the lack of guidelines that the hon. Member for Gower (Mr. Caton) has mentioned. In January, it emerged that the European Commission had been critical of the way in which Wales had handled its bid for objective 1
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funding. It stated that the bid was flawed in several ways, including a lack of vision and innovation, a weak sense of ownership of the programme by some of the partners, and the barrier caused by match funding.
The Commission said that the weaknesses of the submission were more comprehensive than the strengths. It concluded that
the Commission needs to be satisfied that future financial resources will be available to provide public funding for the whole programme and cannot be satisfied that this will simply be reviewed in the forthcoming CSR.
The Commission has made the same criticism as we have.
Mr. Livsey: By contrast, will the hon. Gentleman congratulate the East Wales partnership, which was not criticised? Its single programming document was accepted, but it is subject to even greater delay. We wonder whether some of the match funding due to go to objective 2 areas may, as a result, find its way into objective 1 areas, and that may be a reason for the delay.
Mr. Evans: Of course I accept that, but we are all keen to make sure that the funding comes through as soon as possible for all the regions of Wales, so it must be tackled as a matter of urgency. The Prime Minister said that he would not let Wales down. He said, "Trust me, I'm Tony," but we are still waiting. We have to ask why Wales is being let down. The Government state that this summer they will publish a clear, simple guide to the funding policy, and we look forward to that.
As many hon. Members know, I have a business in Swansea which I am expanding at the moment. When I borrowed funds for that, I was told, "And here is £500 from the European investment bank." I did not ask for that and it was not critical to my investment, but of course I am grateful for it. There are many areas in which such funds are available, and in many cases they may be critical to investment by a business. It would be extremely useful if the Government produced guidelines in simple language so that people knew exactly what funds were available and what projects they might be able to develop to get EU funding.
Mr. Caton: Do I take it from what the hon. Gentleman is saying that a Labour Government are good news for the economy of Townhill?
Mr. Evans: No, but I can tell the hon. Gentleman that the Evans family are good news for the economy of Townhill.
Perhaps the Minister will tell the Chamber when those guidelines will be published.
We know that the Chancellor of the Exchequer has a war chest, and we are all wondering what he is going to do with it and when he is going to spend it, but some areas of Wales are deprived now and they are asking for that money. The Chancellor is getting £22 billion for mobile phone licences, and people in Wales are wondering why they have to wait for the comprehensive spending review.
The Select Committee report is critical of the involvement of small businesses. The Federation of Small Businesses made several comments to the

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Committee. Will the Government re-examine that involvement, because it is the small businesses in Wales that will create new jobs, as they did in the 1980s?
The report says that the Committee will continue to monitor the situation of objective 1 funding, and I welcome that and wish it well. I hope that lessons will be learned for the future. Although it will be several years before we find out how much of the £1.2 billion will be taken up, will the Minister tell the Chamber exactly what percentage he believes will be taken up?
Paragraph 20 of the report says that the "trust us" approach is not enough, and I agree. The Government are all spin and no delivery, and style and no substance. They have gimmicks galore, but the people of Wales will not be fooled and will not forgive them if they do not stop the spin and deliver where Wales needs it most, in its deprived and disadvantaged areas.
12.17 pm
The Parliamentary Under-Secretary of State for Wales (Mr. David Hanson): Anyone who had arrived from the planet Zog and listened to this debate would think that objective 1 was a bad news story for Wales. I state categorically that it is a good news story for Wales, whatever criticisms have been made this morning about a range of issues, in the report and by hon. Members. Wales will benefit from objective 1 and, with the Government, will maximise that benefit. I shall try to respond to all the points that have been made, but I hope that hon. Members accept that the Government are acting in good faith on objective 1.
This is the first time that a Welsh Affairs Committee report has been debated in Westminster Hall, and I welcome the contributions that have been made and the partnership approach that the Committee has taken in discussions with the National Assembly. I welcome also the work of the staff in producing the report, which is comprehensive. We have had an enjoyable and interesting debate, which has strayed into party political issues.
Mr. Llwyd: How strange.
Mr. Hanson: Well, the report was consensual, and the debate has strayed into party political points to which I shall respond accordingly.
It is important to say at the outset that Europe matters to Britain and to Wales. Over 50 per cent. of our trade in goods and services is with the European Community; one seventh of all UK income and production and millions of jobs depend on sales to EU countries, and Wales is home to many mainland European businesses. The EU's 380 million consumers make it one of the largest and richest markets in the world.
The Government are pro-Europe, but it is not all about the market or working with our colleagues in Europe—there is also a common social objective. It is through the European social partnership and structural funds that we can make progress on achieving our common aim of reforming and modernising Wales. The voluntary and private sectors have an important role to play in Wales to make sure that we can look outwards to the UK, European and global economies.
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The hon. Member for Ribble Valley (Mr. Evans) is slightly out of tune with the shadow Chief Secretary, the right hon. Member for Wells (Mr. Heathcoat-Amory), who does not believe that structural funds are of value. However, the Government believe that European structural funds provide a real and tangible benefit to the people of Wales and to our membership of the EU. They are of particular significance to Wales.
As my hon. Friend the Member for Vale of Clwyd (Mr. Ruane) said, my right hon. Friends the Prime Minister and the Chancellor negotiated through the night at Berlin to reach agreement on the eligibility rules across the EU for objective 1, so that Wales can benefit from objective 1 status. That is why west Wales and the valleys have been designated as an objective 1 area and allocated 1.85 billion euro in the seven years 2000–06. The Government are committed to the receipt of structural funds and taking the issue forward.
As hon. Members have said, objective 1 covers areas that have less than 75 per cent. of average EU per capita gross domestic product and is intended to stimulate proper economic growth, enabling Wales to catch up. Given the political nature of the discussion, I have to say that the hon. Member for Ribble Valley has a bit of a brass neck to say that objective 1 is an important issue when the Government have been able to secure objective 1 partly because we have had to return to the EU and raise the Conservative Government's failures; they increased deprivation and the disparity between wealth and prosperity in Wales.
It is vital that such a huge injection of money is spent wisely and that the priorities correspond to the real needs of all the different sectors of the Welsh population. The EU resources must go where the real need lies, not just to established projects, partners and bidders for money. The widest possible partnership is needed, involving all sectors with an interest, from the National Assembly to the United Kingdom Government and the organisations on the ground. The rejuvenation of the economy of west Wales and the valleys is a vast and worthy task, and we must show that we are up to the job.
My hon. Friends the Members for Gower (Mr. Caton) and for Conwy (Mrs. Williams) and the hon. Member for Ribble Valley asked whether the Government would produce, with the Assembly, a report and authoritative guide on the European process. We shall produce an updated version of the statement for funding policy that was first published in March 1999. It will be published in the summer, shortly after the comprehensive spending review reports. I hope that it will help to clarify precisely the roles and responsibilities of the National Assembly and the Government.
The Welsh Affairs Committee report on European structural funds clearly shows the seriousness that it attaches to the matter, which I welcome. Objective 1 is immensely important to Wales and, as hon. Members have said, represents a once-in-a-lifetime opportunity. As the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) has said, the enlargement of the EU before the next structural funds round means that this will almost certainly be the last chance for Wales to receive the economic boost that objective 1 funding will bring.

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That is why the Government are committed to grasping this opportunity firmly and ensuring that it makes a real and lasting difference to Wales.
The report was thorough, comprehensive and raised several serious and important matters. My right hon. Friend the Secretary of State and I particularly welcome the recommendation on the importance of making the objective 1 programme a success in Wales. As my hon. Friend the Member for Vale of Clwyd clearly said, it is imperative that we move the debate on from funding and consider how to use the money. Hon. Members understand where we are coming from; we have explained the position many times. We have a commitment from Brussels, and the Government are committed to examining the issue in the comprehensive spending review. My right hon. Friend the Prime Minister has clearly and publicly said in Wales and in Parliament that he will not let down Wales. It is important hon. Members take that commitment in the good faith that my right hon. Friend gave it and in which I repeat it today. We await the outcome of the comprehensive spending review shortly so that we can consider how to use the money and resources to transform the Welsh economy.
Mr. Walter: Before the Minister moves on, several questions have been asked about funding, but I am not sure that we have heard any answers. Why is it necessary to negotiate something to which the Government have allegedly agreed? Will those funds be in addition to the Welsh block grant?
Mr. Hanson: As the hon. Gentleman will know, the Welsh block grant, objective 1 funding, additionality and other issues will be considered in the comprehensive spending review. It is important to take the Government in good faith and to await that announcement in due course. Hon. Members have understood that to be the position for many months and have continued to ask those questions—it is their legitimate right to do so.
Mr. Llwyd: If it is clear that, following the CSR, the Chancellor will commit £60 million in additional funding to Wales, together with £190 million direct from Brussels without taking any money away, that good faith will have been well invested.
Mr. Hanson: I take the hon. Gentleman's point. The CSR is due shortly. The Government's decision to include objective 1 funding in the current spending review does not put programmes at risk in any way. The hon. Member for Ribble Valley said that programmes and projects are threatened, and other hon. Members have made similar points, but projects cannot be brought forward in Wales until the Commission has approved the plans. The plans will not be approved until next week at the earliest, so no project has been approved or can be supported.
The hon. Member for Meirionnydd Nant Conwy, among others, mentioned retrospective payments. It is difficult—in fact, nigh impossible—to approve payments that have been made already on potential projects, because the Commission has not approved the plans. Some hon. Members have spoken about projects not being brought forward or allowed, but that is tosh
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because, to date, the document has not been approved and, therefore, the Government are as yet unable to consider it.
Mr. Livsey: Will the Minister give way?
Mr. Hanson: Time is pressing.
Mr. Livsey: What about objective 2?
Mr. Hanson: I must deal with the points that have been made.
As hon. Members will know, the spending review is a thorough, on-going examination of all Government spending plans. In those circumstances, it is wrong to try to separate one aspect of Welsh funding from the others. European structural funding is not new to the United Kingdom; it is well known. The comprehensive spending review constitutes the normal procedure for reviewing the spending needs of Wales and all Departments, including those for structural funds. My right hon. Friend the Chief Secretary to the Treasury has recognised that objective 1 is new to Wales and that that has to be considered in the current spending round.
When the objective 1 plan has been approved in Brussels, which is imminent, we will have a strategic framework in place. At that point, the Assembly will be able to draw down the payment on account and then submit claims to the Commission to reimburse payments that have made on account. That money will go straight to the Assembly, without delay. Britain would be in breach of the Commission's regulations if that did not happen. From then on, the success of objective 1 will be driven by the excellence of the projects and packages proposed for funding. The vision and local ownership of proposals produced by the Welsh partnership, tailored to meet Welsh needs, will be fundamental elements.
I give a clear commitment that the outcome of the spending review will be announced before the end of next month. It will include overall spending limits for Departments and the Assembly, as well as the other devolved administrations. I cannot pre-empt that announcement—as hon. Members would expect, negotiations are still continuing—but spending limits will be set from April 2001.
It is time to look ahead. We must consider what we must achieve for Wales—promoting community regeneration, employment and developing a competitive environment for business, a learning society and the sustainable use of natural resources. That involves a step change for Wales, and we shall use objective 1 funding to help to make that step change. We need to get on with that job.
The Welsh Affairs Committee report is welcome. Considerable allegations have been made and concerns have been expressed today, but I hope that the Government's intentions will be taken in good faith. The Labour Government have negotiated and achieved objective 1, and we shall deliver it for Wales when the time comes.
Mr. Deputy Speaker: I congratulate the Minister on responding in the time available. We now come to the next debate.

Marine Pollution
12.30 pm
Mr. David Chaytor: The annual meeting of the commission of the Ospar convention on marine pollution in the north-east Atlantic does not usually attract a great deal of advance publicity. Nevertheless, during this brief debate I want to highlight proposals that will be put to the annual meeting next week in Copenhagen, which could have significant implications for the United Kingdom and to which the Government have to give a clear response.
The Ospar convention, as it is commonly known, originates from two previous conventions relating to marine pollution: the 1972 Oslo convention on marine pollution caused by dumping, and the 1974 Paris convention on marine pollution from land-based sources. In 1992 those were merged; hence the name Ospar. The 15 member countries and the European Union form the 16 contracting parties to the convention, which meets annually. Every five years there is a ministerial convention.
The first Ospar ministerial convention at Sintra in Portugal two years ago agreed to establish strategies to eliminate hazardous substances and eutrophication from the north-east Atlantic, to provide protection of ecosystems and biodiversity and to agree a policy on the disposal of offshore installations. It was also agreed to end the British and French opt-out on radioactive dumping at sea. However, the most wide-ranging proposal was the elimination of radioactive discharges to close to zero by 2020. The intention to achieve that was reiterated at the 1999 annual meeting in Hull. My hon. Friend the Member for Mansfield (Mr. Meale), the then Minister, responded to that meeting by saying:
On the strategy for radioactive substances, the Contracting Parties agreed to intensify their efforts to implement it by focusing on the principal sources of discharges, emissions and losses, including the reprocessing of nuclear fuel and some other nuclear and non-nuclear activities; where action by the operators of nuclear installations is required, the Contracting Parties agreed to ensure that this is taken without delay.—[Official Report, 5 July 1999; Vol. 334, c. 377W.]
The consequence of that is this year's convention in Copenhagen. There will be proposals on the table from Ireland and Denmark, supported by other countries, which would require the participating countries to end their discharges simply by ending nuclear reprocessing; the reprocessing industries in the United Kingdom and France contribute the largest proportion of all discharges. It is well known that the Nordic countries and Ireland, in particular, are long-standing opponents of the reprocessing industry because of the effect on their fishing industries. Radioactive isotopes have been found in lobsters and other fish in the Irish sea—that is a matter of enormous concern in Ireland—and the isotope technetium-99 has been found as far north as the fishing grounds of Norway and Iceland. Indeed, traces have been found in the Arctic circle.
The consequence for the United Kingdom, where nuclear reprocessing has been a major and lucrative industry for many years, could be significant. I shall dwell on three aspects. The first is the implications for the thermal oxide reprocessing plant at Sellafield and the international trade in plutonium, which British Nuclear Fuels has developed in recent years. I do not want to
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rehearse the history of THORP, which has been contentious from the concept's origins in the 1970s, through a delay in the 1980s, to its final commissioning in the early 1990s. It is now well understood that the original rationale for the reprocessing industry and for THORP no longer apply.
It was assumed that there would be a gradual expansion of nuclear power as each year went by. That has clearly not been the case. It was assumed that the rising price of uranium fuel would mean that the reprocessing option was cheaper. In recent years, uranium itself has become cheaper. It was assumed that plutonium would have an enormous value, largely for nuclear weapons, but for other purposes as well, in the manufacture of further nuclear fuel. The end of the cold war and the reduction in the weapons programmes of the major nuclear weapons states have led the value of plutonium to become highly questionable. Last year, a House of Lords Science and Technology Committee report concluded that much of Britain's plutonium stockpiles, which are currently about 60 tonnes and, it is estimated, will reach more than 100 tonnes by 2010, should be declared to be waste.
It was assumed that the fast-breeder reactor programme would become successful and that endless supplies of plutonium would be needed for that. Fast-breeder reactor research has been stopped in Britain and France, and continues only in Japan. It was assumed that the alternatives to recycling nuclear fuel were not feasible. In recent years, the alternative—the dry storage option—has become much more feasible, and is quite practical and far cheaper than the reprocessing option.
The question mark over THORP has been intensified by the recent decision of the German Government—one of BNFL's biggest customers—to phase out its nuclear power programme within 20 years. The effect of the falsification of data scandal related to mixed oxide fuel exported to Japan, along with the nuclear accident at the Tokaimura plant there last September, has contributed to a rapidly changing climate of opinion in Japan. That country has also been one of BNFL's greatest customers. The issue is whether we can assume that reprocessing at THORP will continue much beyond the period of the base-load contracts, which end in 2004.
The second aspect of the proposals that will be put to the Ospar conference next week relates to the other reprocessing plant at Sellafield—the B205 plant, which reprocesses fuel from Magnox reactors. I and many others welcomed BNFL's announcement some weeks ago that all but two of its Magnox stations would be closed before 2010—thus, arguably, allowing the B205 reprocessing plant to close by 2012. However, there are major concerns as to whether that an be achieved, largely because of the total volume of spent fuel that still needs to be reprocessed, but also because of the time scale between deciding to close or switch off a reactor and decommission the plant, and the possibility of starting to reprocess the spent fuel. I shall give an example.
Currently, we have about 7,200 tonnes of spent reactor fuel from Magnox reactors either in reactors or in storage ponds. Only 465 tonnes were reprocessed in 1998–99. Therefore, on current throughput it will be at least 2015 before the existing fuel is reprocessed, regardless of any spent fuel generated by Magnox reactors between now and when most of them will close.

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The possibility of meeting the Ospar target to reduce radioactive discharges to close to zero by 2020 is becoming increasingly remote.
The third aspect that concerns me is the role of the Environment Agency in the consideration of the reprocessing industry. I note that the important report by the Select Committee on Trade and Industry on the future of BNFL, published last month, contained some comment about the relationships between the Environment Agency and BNFL not being of the highest order. However, my concern is that the agency has insufficiently challenged the assumptions put forward by BNFL—and accepted by the previous Government and, to some extent, by the present Government—about the inevitability of reprocessing and the feasibility of the alternatives. The significant point is that the 1994 Sellafield discharge authorisation required the Environment Agency to review the whole question of discharges and alternatives to reprocessing. That should have been done by 1997, but it is only starting to be done this year.
The scope and methodology for the review appear to rule out any consideration of dry storage options as a way to manage spent fuel. Although the agency accepts that Magnox could be reprocessed at THORP, thus allowing the closure of the B205, it still insists that dry storage is not an option. That is unusual, because at the power station at Wylfa about 100 tonnes of Magnox fuel have been kept in dry storage for the best part of 20 years. The whole question of the technology involved in the dry storage—rather than reprocessing—of Magnox fuel was confirmed as viable by the former Central Electricity Generating Board in its evidence to the Select Committee on the Environment in 1986, and by a more recent statement by the Radioactive Waste Management Advisory Committee in 1990. There is now a solid body of scientific evidence that maintains that it is feasible to deal with the potential corrosive problem of Magnox spent fuel through dry storage.
Several issues arise from the facts that I have laid out. The Ospar negotiations, although not widely understood by the public, are crucial for the future of one of Britain's major industries. The Trade and Industry Committee commented in its report that it was remarkable, both in this Parliament and in the previous Parliament, how few debates had been held about the nuclear industry. If we compare that industry, and its strategic importance to Britain, with the car, coal or textile industries, it is obvious that Parliament has scrutinised those industries much more than it has the nuclear power industry. The fact that the nuclear power industry has operated with that degree of secrecy, and that lack of accountability and scrutiny, has perhaps contributed to some of the difficulties that it has recently experienced.
The Government cannot ignore the feelings of other European countries or the scientific evidence of the radioactive pollution in the north-east Atlantic. Nor can they ignore our treaty obligations under Ospar. We are firmly committed to seeking discharges close to zero by 2020—and under our current policy, that cannot be achieved. A change of policy will therefore be necessary.
It is indisputable that reprocessing is the main cause of radioactive pollution in the Irish and North seas. If we are serious about our environmental commitments and our broader environmental policy, we must be
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prepared to act. I do not argue that the Government should immediately declare that reprocessing should end and Sellafield must close, because the issue is complicated, and Sellafield is important to the economy of west Cumbria, with many jobs at stake. However, the Government should now prepare for the inevitability of the closure of the reprocessing plant at Sellafield, which is likely to happen sooner rather than later, given the way in which nuclear power policy is changing, especially among key customers in Germany and Japan, and also given the requirements of the Ospar convention.
We should take careful note of the fact that the new chief executive of BNFL said to the Trade and Industry Committee that the time had now come for BNFL to think the unthinkable and withdraw from reprocessing as a key part of its business strategy. We should also take careful note of the comments by the chief executive of British Energy, who said recently that reprocessing was economic nonsense and should stop immediately. It is also in the long-term economic interests of the UK, and of BNFL, to grasp the nettle of preparing to withdraw from reprocessing and concentrate on dry storage and decommissioning, which has huge potential for the expansion of global business. That would be good for British business and for the environment. It is also an enormous opportunity for the Government to take the lead on a crucial environmental issue, by making a statement to that effect in Copenhagen next week.
I have several questions for my hon. Friend the Minister. I appreciate that he may not be able to answer all of them, but I would be grateful for an answer in writing in due course. First, what action has the UK taken since the ministerial Ospar meeting in 1998, which agreed the policy of reducing emissions close to zero? Secondly, what assessment have the Government made of last week's announcement by the German Government that they have now reached an agreement to phase out nuclear energy in Germany within 20 years? What will be the impact of that on the future of reprocessing in the UK? Thirdly, what consideration has my hon. Friend given to the statements by the chief executives of BNFL and British Energy on the likely future of reprocessing?
Fourthly, will my hon. Friend actively support the renegotiation of reprocessing contracts, both between BNFL and British Energy and between BNFL and foreign customers, into dry storage contracts? That issue is also flagged up in the Trade and Industry Committee's report. Fifthly, in view of the current backlog of spent nuclear fuel from Magnox reactors, does he believe that the timetable given by BNFL for an end to Magnox reprocessing by 2012 can be achieved?
Sixthly, does my hon. Friend agree that the Environment Agency has to get a serious grip on the issue? Why does its current review of discharges contain no consideration of the dry storage option? I may be mistaken on that point, but if it is true, will he challenge the Environment Agency and ensure that it gives equal consideration to dry storage of spent fuel and to reprocessing? Finally, I would be grateful for a concise statement of the British negotiating position at next week's meeting, and of the proposals by the Irish and Danish Governments.
12.48 pm
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Chris Mullin): I shall do my best to provide answers to the questions that my hon. Friend the Member for Bury, North (Mr. Chaytor) has asked. However, as he said, some of them may have to be pursued through correspondence, partly because I have only 12 minutes left in which to reply to the debate. I am pleased to have this opportunity to set out our thoughts on the annual meeting of the Ospar commission, which will be held next week in Copenhagen.
The Ospar process is one to which the Government continue to attach great importance. My right hon. Friends the Deputy Prime Minister and the Minister for the Environment both participated in the original meeting in Sintra in 1998 and fully supported the agreements reached there. The main work of next week's meeting will be to consider progress on the work agreed in Sintra. In particular, as my hon. Friend has said, the meeting will consider the strategy on radioactive substances, but it will also discuss progress with the implementation of the hazardous substances strategy and the overall assessment of the state of the marine environment of the north-east Atlantic, as well as a number of other issues.
My hon. Friend referred to issues relating to radioactivity. He also mentioned the two draft decisions put forward by the Governments of Ireland and Denmark, which will be considered in Copenhagen next week.
It may be helpful if I remind hon. Members of some of the background to Ospar's consideration of radioactive discharges. As my hon. Friend explained, the Oslo and Paris commission was set up to protect the marine environment of the north-east Atlantic; it came into force in 1998. The UK is a contracting party and supports the commission's aim of reducing discharges of radioactivity. In 1998 at the meeting in Sintra, all the contracting parties, including the UK, agreed to a radioactive discharges strategy covering the period to 2020. The strategy provides that the commission—which means all the member countries—should reduce radioactive discharges, so that, by 2020, concentrations of radioactivity in the marine environment in excess of historic levels as a result of such discharges are close to zero.
I should make two points about the agreement. First, all the contracting parties accept that it does not state that discharges of radioactivity should be reduced to zero. The Sintra agreement does not mean that contracting parties are in any way obliged to close their nuclear industries, or any part of them, to meet their commitments. My hon. Friend asked about the Government's attitude to the announcement by Germany that it would phase out nuclear power generation. That is entirely a matter for the German Government. I can confirm that the UK Government have no plans to make a similar announcement.
Secondly, it has to be recognised that the terms "historic levels" and "close to zero" have not been defined. In technical level meetings since 1998, there has been some discussion of those terms, but considerably more work needs to be done before agreed definitions are available. The UK has pressed strongly to engage
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with our Ospar partners on that subject, but has not met with much enthusiasm from other countries for grappling with the definitions. However, it is clear that progress must be made, so that reductions in radioactive discharges can be properly monitored.
To demonstrate our commitment to reducing radioactive discharges, the UK is publishing a 20-year radioactive discharges strategy: it is being published in draft today and copies will be placed in the Library. The purpose of publishing the strategy in draft form is to enable us to consult other Ospar members and interested parties both at home and abroad about our proposals. After taking account of their comments, the Government intend to publish the final version of the strategy towards the end of this year. The UK is the only Ospar contracting party to have announced that it is preparing for publication a strategy charting how discharges are expected to decrease over the next 20 years. I am sure that hon. Members will acknowledge the seriousness with which the Government take their Sintra commitments.
The Government will shortly publish a second consultation document—a draft of guidance that we propose to issue to the Environment Agency on radioactive discharge authorisations. The purpose of the second document is to ensure that the agency's decisions on individual applications to discharge radioactive substances are consistent with the overall strategy.
My hon. Friend talked about radioactive discharges arising from the reprocessing of spent nuclear fuel. It is true that discharges from reprocessing operations are higher than those from other parts of the nuclear industry; However, hon. Members will recall that, last month, BNFL announced a closure programme for the Magnox nuclear power stations. The closures will contribute substantially to the reduction of radioactive discharges, but, more importantly, they will enable the reprocessing of Magnox fuel to be brought to an end. It is currently estimated that that will be achieved by about 2012, so an important step in reducing discharges will be accomplished well before 2020. Discharges from the only other reprocessing plant in this country—the THORP plant at Sellafield—are very much lower in radiological terms than those from the Magnox reprocessing plant. The Government are satisfied that the continued operation of the THORP plant will not in any way jeopardise our meeting our Sintra commitments by 2020.
My hon. Friend asked about the Government's view on reprocessing in the light of the recommendation by the Trade and Industry Committee that we should clarify our position. My right hon. Friend the Secretary of State for Trade and Industry is considering the report and will reply in due course.
It is important to bear in mind the fact that, as a result of strict regulatory action in this country, discharges of radioactivity are kept well below internationally agreed limits. The Environment Agency is carrying out a review of all radioactive discharges from Sellafield, and consultation on any proposed new limits is expected to start in spring next year. The agency is also carrying out a review of discharges of technetium-99 on a faster track, and the outcome of that part of the review will be known in the autumn. The Government have made it clear that we support the aim of bringing the limit for

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technetium-99 down to 10 terabequerels a year. The strategy being published today will reaffirm this commitment, but we cannot, of course, pre-empt the outcome of the agency's review.
My hon. Friend asked why the Environment Agency was not considering the dry storage alternative. My understanding is that the design of Wylfa is different from that of the other Magnox stations, and that important safety considerations that prevent dry storage apply to the remainder of the stations. The Environment Agency has explained its reasons for not considering alternatives in its current review: they relate to a change in European law and to proposals that the issue of justification should pass to the appropriate Secretary of State. Any more detail on that point will have to be provided in correspondence.
The Environment Agency has published a document setting out the scope and methodology that it proposes to follow in carrying out the review. The Health and Safety Executive has already consulted on a proposal that, following the coming into force of the new Euratom basic safety standards directive, reviews of the justification of practices will be a matter for the appropriate Secretary of State. A further announcement will be made in due course.
It may be helpful to set current discharges from Sellafield in context. Discharges are already only 20 per cent. of what would be considered acceptable under internationally agreed dose limits. Our strategy indicates that we are on target to achieve a 90 per cent. improvement in that already low figure by 2020. The draft strategy published this week will give detailed information about how that is to be achieved. I should add that those dose figures relate to people who live close to Sellafield and whose eating habits expose them to higher than normal effects, and that those most exposed people are already well within internationally agreed dose limits. Anyone living further afield, especially people living in other countries, have nothing to fear from discharges from Sellafield.
The Governments of Ireland and Denmark have submitted for discussion at next week's Ospar meeting in Copenhagen draft decisions that call for a cessation of reprocessing. As I have already said, the reprocessing of fuel that gives rise to the highest discharges will cease by about 2012. The UK can meet its Sintra obligations without shutting the THORP plant, so we do not think that it would be appropriate for the Ospar meeting next week to agree a decision in the terms of the drafts submitted by Ireland or Denmark.
All Ospar contracting parties will, I am sure, study the draft strategy that we are publishing today. I hope that it will persuade them that the UK is committed to achieving reductions in radioactive discharges that are fully in line with the 1998 Sintra agreement. At the Copenhagen meeting we shall seek agreement on a decision that renews our commitment in a form acceptable to all contracting parties.

Government Websites
1 pm
Mr. Robert Maclennan: I sought this debate—I am grateful for the opportunity to hear the Minister's reply—because I am concerned that use by the Government of websites to communicate with the public is ineffectively regulated.
The Public Accounts Committee reported last week on managerial and technical issues arising from the Government's use of websites. Although it was a damning report, to which the Government will no doubt respond in due course—I am not attempting to preempt that formal response—the focus of my concerns is different. My concern is with the threat to the integrity and propriety of Government information flowing from what I perceive to be weak accountability, which is leading to inadequate control of advertising and sponsorship on Government websites. I am also concerned about the absence of effective guidelines and policing to prevent the Government's abuse of their valuable access to the public by the dissemination of politically controversial and tendentious assertions as public information on the net.
The Minister will be aware, I have no doubt, that I have tabled a substantial number of written questions to different Departments on the cost of the Government's websites and on sponsorship and advertising on those sites. I have been dismayed by the responses that I have received. Some questions have still not been answered; some have been answered misleadingly, and some inaccurately; other answers are incomplete. In sum, I take this opportunity to ask the Cabinet Office to recognise that it needs to take a grip of the situation and require conformity with rules that are open and properly adhered to.
I remind the Minister—I am grateful for his presence—of the recommendations of the sixth report of the Neill committee, particularly recommendation 35, to which the Government have not yet formally responded, although they are expected to do so quite soon, which states:
There should be disclosure in departmental annual reports, and to the public on request, of the details, including the value received, of sponsorship of government activities by the private and voluntary sectors.
I am afraid that it is clear that that is not happening. No such indications are given in departmental annual reports and it has proved extraordinarily difficult to elicit information, even by means of parliamentary questioning.
The lack of candour, I am sorry to say, starts in the Cabinet Office. So it is perhaps unsurprising that it is not exercising the control that one might look to it to exercise over other Departments. In replying to the debate, the Minister might make plain his view of the role of the Cabinet Office in ensuring the integrity and propriety of Government information on websites.
I should like to draw attention to certain advertisements that the Cabinet Office is hosting on the Government's principal site, www.open.gov.uk, such as by Lycos, which is a search engine, and IBM. I also draw attention to advertisements of what are called "Government Opportunities", owned by private limited

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company Business Information Publications Ltd. That is to be found at another site used by the Cabinet Office, www.bipcontracts.com, which is described as
the only officially sponsored UK source through which government service contracts are advertised.
That site has logos of companies that provide technical services—Ultraseek Server and Cable & Wireless Communications Ltd.
The Ministry of Defence began by denying that it carried advertisements or sponsorship-acknowledging advertisements that generate revenue and that such advertisements appeared on its principal websites. However, it includes on its website the Peregrine Trophy, which is named after Peregrine Associates. The Ministry explains, however, that sponsorship of major service events or, for example, the Royal Navy submarine museum, which recognises British Aerospace Systems and Equipment Ltd., may lead to advertising with company logos.
The Department of Health claims that there is no advertising on departmental, agency or non-departmental body websites. However, there is a live link on the NHS Confederation website to the American pharmaceuticals firm, Merck Sharp Dolme, which is a large supplier of the NHS. The NHS Confederation comprises 95 per cent. of NHS hospitals and health authorities. Although a charity, it is directly funded by NHS hospitals and health authority members and therefore clearly receives departmental money. To deny that that is an agency over which Government rules ought to apply must make one highly critical of the extent of coverage of the rules.
The Foreign and Commonwealth Office has come closer, but not all the way, to an admitting the facts. It states that two companies—Eagle Star and Glaxo Wellcome plc—have contributed £35,000 and £6,000 respectively to the Planet Britain website, www.planet.britain.org, on which the companies' logos appear. That site is linked to many groups that provided information for the site, including I D Magazine, Rough Guides and Millennium Products. Cable & Wireless is also there, presumably for technical services rendered.
The most remarkable case that I found was that of the Treasury. It appears that, although the Treasury claims not to have accepted advertising or sponsorship for its websites, that disclaimer does not cover the Treasury's private finance initiative taskforce, which is accessible through the Government's main portal, www.open.gov.uk. The taskforce was set up by the Government to oversee negotiations on PFI deals, in which hospitals, schools, roads and other projects attract private money. The taskforce's website is www.treasury.treasury-project-taskforce.gov.uk. It is sponsored by none other than Berwin Leighton, the City solicitors who specialise in private finance initiative projects. The site, which has the firm's own logo, is linked live to its website, which discloses that it is involved in 16 PFI deals with the Department of Health alone—those deals are valued in total at more than £473 million.
According to the taskforce website:
The taskforce has become the focal point of all PFI activity.
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Therefore, it follows that that firm of solicitors has been allowed to sponsor the website of a taskforce that directly impacts on the company's commercial interests as it has handled the legal side of dozens of PFI deals with the Government. Will the Minister say whether what has happened in that case, which received a little publicity earlier this week in The Observer, reveals—as I believe it does—that the rules, if they exist, are not biting sufficiently tightly?
Government websites have developed to such an extent that the Government have effectively become a broadcaster. The appearance of sponsors and advertisers on those sites makes that a commercial activity. I searched in vain to find any adequate guidelines from the Government on how that activity should be regulated. One can find general guidance about matters of propriety, but nothing is targeted on websites. The "Government Information and Communication Handbook" contains a section entitled, "Toolkit". Although there is also a section on sponsorship propriety, the only section on websites—that headed "Building Websites"—includes nothing on the propriety of the content. Nor is there any reference to the propriety of the content in the "Framework, policy and guidelines for Government websites", which is to be found on a such a website. The document "Guidance on the work of the Government Information Service" does not deal with sponsorship or advertising on websites.
The underlying failure of the Government appears to be their complete unwillingness to acknowledge that sponsorship involves mutual endorsement—endorsement of the Government by the company and vice versa. As the Neill committee report pointed out, one of the aims of sponsorship is to achieve credibility. It is worth asking where that credibility would come from if not from implicit endorsement by the recipient of the sponsorship. The Cabinet Office general guidelines lack the understanding that endorsement is intrinsic to the nature of sponsorship.
The need for a rethink by the Government on the issue is demonstrated by the flawed statement by the Department of the Environment, Transport and the Regions in reply to my question, which concluded:
Above all, acknowledgement of any sponsorship—
on websites—
would not imply any endorsement of the sponsor's goods or services, nor be open to misinterpretation as influencing policy making.—[Official Report, 19 April 2000; Vol. 348, c. 489W.]
I submit to the Minister that that statement from that important Department demonstrates a complete failure to grasp the nature of sponsorship and the risks to the perception of objectivity.
From the parliamentary answers that I have received, it is clear that the average annual costs of Government websites are expected to run at more than £4.5 million. I have not yet received answers on the matter from several significant Departments, including the Treasury.
Some Departments are recording the number of hits. The Department of Trade and Industry received 67 million hits in the year to May, averaging 1.3 million per week. The Treasury website receives around 20 million hits per annum. I am advised that it is commercially calculated that 1,000 hits are considered by the industry to be worth £25. It appears—however difficult it may be

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to quantify—that the value of the advertising space of the Government's webs must run well into millions. What is not clear is how the Government are seeking to evaluate that and what they are giving in return for sponsorship and advertising facilities on the websites.
My conclusion is that since the rules, in so far as they exist, seem incapable of ensuring openness and preventing abuse—never mind delivering value for money to the taxpayer—it would be appropriate for the Government to end advertising and sponsorship on their websites.
Finally, on a different aspect of guidelines for the use of the websites, the Mountfield report made the general recommendation on political propriety that the aim of the Government Information and Communication Service should be
to retain a politically impartial service and sustain the trusted values of the service embodied in its rules of guidance.
That was stated by the service to be merely a restatement of essential principles in its third annual report. Unfortunately, none of the handbooks or existing codes are working to ensure that those principles are sustained on Government websites.
I shall give one broad example from the No. 10 site where, under "facts" the site purports to track the progress of all 177 manifesto commitments of the Labour party. The information there imparted is certainly not regarded as incontrovertibly factual and, indeed, would be contradicted by much information that has been obtained from the Government, the House of Commons Library and other objective sources. The information is highly tendentious and certainly does not accord with statistical information from the sources that I mentioned. Worse perhaps, are the press releases, which are often placed on websites and are highly partisan and undoubtedly breach the guideline on objectivity.
The guidelines indicate that information should always be directed at informing the public. I shall cite a few examples that fall short. The Financial Secretary to the Treasury issued a press release headed,
A good way to explain what the Government is trying to do is that we want to build a new Britain that will be modern and decent.
I question whether that could be regarded as providing either information or objective information.
In a press release of 30 March, the Home Office announced:
Straw announces an "increase" in the funding of police authorities to reflect the enlarged size.
In fact, that was a transfer of funding from the authorities with decreased areas of responsibility. It was a highly misleading statement, and certainly not objective. It is a rule of Government publicity that it should be objective.
Finally, let me cite an example from the Department for Education and Employment. One of its press releases was headed "World Class Guides for Employers launched—Hodge". No objective justification is given for the use of the phrase "world class" in that press release.
The problem is far wider than I can hope to tackle in the ambit of a short debate, but I hope that I have at least opened the subject. I look forward with great
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interest to the Minister's remarks. We are at a formative stage in dealing with websites, and it is extremely important that the independence and objectivity of Government information on sites are secure; that advantages are not improperly given to sponsors; and that the public's right to be informed is protected.
1.20 pm
The Minister of State, Cabinet Office (Mr. Ian McCartney): I thank the right hon. Member for Caithness, Sutherland and Easter Ross (Mr. Maclennan) for providing us with the opportunity to discuss websites and for the intellectual case that he made in respect of some of the relevant issues.
In the 10 minutes available to me, I cannot deal with all the issues that the right hon. Gentleman raised, but I give him an assurance that I will write to him and place my reply in the Library, so that other hon. Members who take an interest in the matter can link that to the debate. I will consider the right hon. Gentleman's comments in the same way as the Government are considering the issues around the reports that he mentioned, to which we shall respond.
I am clear that my role is to ensure the best possible access for the citizen to Government services, and to ensure that we have in place appropriate guidelines and working arrangements and that the system is transparent and cannot be abused by Departments, individuals or, for that matter, politicians. It is crucial that the information provided by Government websites is trusted.
The right hon. Gentleman made a general complaint about the cost of development of Government websites. It has always been the task of Governments to provide information to citizens—information about taxes and benefits and employment regulations; personal information about insurance records or tax details; records of change of address or change of circumstances; information about payments to Government by the citizen, such as vehicle licensing, general taxation or council tax payments; and information about payments by Government to the citizen, such as benefits and student grants.
By using new technology, we are opening up access to every citizen far more effectively. That means that the right hon. Gentleman's constituents in Caithness and Sutherland can access information and services from the Government as readily and as quickly as someone who lives in central London. It is vital that communities in the highlands and islands, in the mountains and in large tracts of rural England have the same opportunity to do business with the Government or to seek information from the Government. Information technology provides such an opportunity.
In the process of establishing websites or service delivery modules, it is important that we listen to customers. As the Government introduce a new service or a new link-up to a portal, it is essential that we continue to consult our customer base, and that we produce guidelines on the basis of consultation. Guidelines must be regularly updated, so that they incorporate the improvements in practice for which the right hon. Gentleman called. We will soon be going out to further consultation on the revision of our website guidelines, as I promised a few months ago.

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The right hon. Gentleman implied that he was worried that the Government's new knowledge network would be used as a party political tool. That is not the case. Strict safeguards and rules have been put in place to ensure that it is not misused for party political purposes. New types of information exchange have been used within Government for years. The only difference is that large amounts of information which were previously accessible only to the Government will now be available to everyone—Members of Parliament and the citizen. It is crucial that access to Government information is opened up. That is the purpose of the knowledge network.
A website without links is a poor website. The Treasury website does not endorse the firm that the right hon. Gentleman mentioned—in fact, it contains a disclaimer. The Cabinet Office website points to other websites, in the same way as other Government websites point to The Guardian for jobs, for example. Do The Guardian or The Observer complain about that? It seems a reasonable approach.
Websites should give people additional information that they can use if they wish to do so. The Government websites merely signpost the way to further information and services, some provided by Government and some not. It is nonsense to suggest that because we provide signposts and access to the citizen, that is a corruption of Government websites. It ensures that the websites maximise the potential for the citizen to obtain information.
Sponsorship on websites is not special. New guidelines to take account of the Neill committee's recommendations are in their final draft. As soon as they are ready, I shall make them available to the right hon. Gentleman for his comments.
Links are what make websites work. For example, the BBC has links on its news pages, but that does not compromise its editorial integrity. For those who use the sites, links provide further opportunity to seek out information or services, and the same is true of Government websites. That is a sensible and reasonable approach.
No Government Departments have advertising on their websites. The Central Computer and Telecommunications Agency—CCTA—is an executive agency and has a banner advertisement clearly distinct from any Government messages. The recommendation of the Neill Committee in January 2000 was:
There should be no ban on sponsorship of Government activities subject to our other recommendations.
The right hon. Gentleman mentioned www.planet.britain.org. I hate having to read out such things—in fact, this is the first time that I have done it. In the past, I have always avoided doing so, but the right
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hon. Gentleman has me in a corner. He referred to it specifically, so I have to read it out for the record. That website is sponsored throughout by various organisations, including the provision of editorial content. It is supported by the Foreign and Commonwealth Office but has no Government content. It is not a Government site.
The Treasury taskforce website is an old one, with links to Brown Leighton, but there is a statement specifically disclaiming any endorsement. In any event, the website is due to be replaced. When that has been resolved, I shall send the details to the right hon. Gentleman.
Guidelines are needed, and they exist. Branding should not detract from a Department's own branding. Advertising should not imply endorsement and should not contradict Government messages. Standard sizes of banners are recommended.
The Committee on Standards in Public Life and the Cabinet Office also publish guidelines on sponsorship. Sponsorship must not appear to place a Department under any obligation, and must not be able to be read as an endorsement by a Department. It must not come from firms that are currently engaged in negotiation with the Department. Sponsors must be suitable and must not appear to contradict Government messages. Sponsorship must not be for the activities of a particular Minister. Other similar companies must have been offered sponsorship opportunities. In accordance with a recent revision, any sponsorship worth more than £5,000 must be listed in the Department's annual report. Clearly, the Government are moving to ensure probity in these matters.
The right hon. Gentleman complained about costs of Government websites and delay in responses to his parliamentary questions. For every avenue of communication used by the Government, there is a cost. The question is whether that represents value for money. The Department of Trade and Industry had 5.6 million hits last month on its website. How much would that cost in postage, telephone calls and other communications with those 5.6 million people? Some of them will have hit the website more than once, of course, so I should speak of 5.6 million communications, rather than people. Traditional methods of responding to those inquiries would have been far more expensive.
The Department of Social Security has 2.5 million hits per month, and the Cabinet Office and The Stationery Office have 1.8 million hits. We are communicating with far more people and providing them with far more detailed information about their rights as citizens.
I take on board the right hon. Gentleman's comments and the spirit in which they were made. I assure him that the Government will ensure that our guidelines operate effectively and that they are drawn up on the basis of consultation.

Peel Hall, Warrington
1.30 pm
Ms Helen Jones: I am most grateful to be given the opportunity to debate the future of the last large open space in the north of my constituency. It is a green space that is important for the well-being of the residents in the area. Development proposals raise serious questions about future planning policies.
Warrington has always accepted the need for development, and the complexity of development issues is well known to us, especially that of balancing the need for housing with the need to protect the environment. Following the development of the new town, large parts of my constituency have been built on what were once green fields, so we are not nimbys. However, as time has passed, we have become increasingly conscious of the need to protect the quality of life of our residents, both old and new. We are all too well aware that building houses without the necessary infrastructure, transport links and regard for people's quality of life is not enough.
That is why there has been local outrage at proposals to build on the Peel Hall site. Indeed, we collected a petition bearing 14,500 signatures, and there was a march to present it to the then mayor. The reason for that is simple. Peel Hall is one of the last remaining areas of open grassland, trees and pond in the north of my constituency. The Warrington nature conservation audit, which was carried out in 1995, placed high value on the variety of habitats found on the site, the wide species diversity and the sheer size of the area. It is one of the few remaining uncompromised wildlife areas that we still have.
The Warrington nature conservation forum has identified at least 67 species of birds, 78 of moths and butterflies, three of amphibians, 10 of mammals and two of bats on the site. Seven of these are red-list species and seven are on the amber list. I am assured that there is the presence of the short-eared owl, which is found on only two other sites in the area. The area comprises also a large area of wet grassland where species such as the marsh orchid and the purple loosestrife are to be found. All these would be wiped out by development.
In addition, an archaeological assessment of the site has suggested that it has some of the most convincing evidence of long-term occupation in Cheshire. It is the site of a mediaeval manor house and moat. It is suggested also that there may be other archaeological remains on the site.
My hon. Friend the Minister will be well aware that as things stand it is difficult to protect local sites such as Peel Hall. Part of it has been designated as a site of importance for nature conservation. However, local councils have limited powers in relation to such sites. I know from an answer given by my right hon. Friend the Minister for the Environment that the Government have a local sites review group that considers how sites can be protected.
It is important that we protect local sites better. It is relatively easy to protect areas of outstanding natural beauty or a site of special scientific interest. It is also
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relatively easy to protect well-known historical sites. However, it is equally important to protect green spaces such as the Peel Hall site, and to protect local history before it is wiped out. That is especially important in areas where there has been intensive development, and where a site may be one of the few that remain.
The need for protection was clear from the inspector's report on the Warrington local plan. The plan had to be abandoned for technical reasons, and a new one is being drawn up. However, we can learn important lessons from what the inspector said. He dismissed the possibilities of the area and talked about it being used for—I think I quote him correctly—
low-level informal recreational activities.
I think that he meant walking. I hope that he did. He said also that the site had no nature conservation value. Bearing in mind the evidence, that is nonsense, and the thrust of the report indicated that the inspector felt that only areas of outstanding beauty were worth preserving. I do not agree with his argument that a wildlife area can be equated to a park. It is important that we maintain proper wild areas. Not everyone wants to see nature tamed and confined. The ability to walk along footpaths in such an area, to watch birds and to enable children to play is especially important to my constituents because they have so few opportunities for these experiences.
The strength of feeling of the residents in the area has already been tested on many occasions when there have been development proposals. Originally, when the plans for the new town were being unveiled, people in what was then the small village of Orford Green were assured that the area between the M62 down into Orford would be preserved as a linear park. Eventually, the development corporation abandoned plans to build on the site generally. It considered it unsuitable because of problems associated with mining subsidence.
There have been many battles since then, which the residents thought that they had won. However, they clearly reckoned without the company called Satnam Investments, which bought the site in the mid-1980s as agricultural land. Satnam operates through a number of subsidiaries. After some local publicity, one of the subsidiaries put in six outline development applications in September 1999, which would have resulted in the building of more than 1,000 houses on the site, with presumably a substantial profit for the company. Residents were outraged and they did all that they could to oppose the applications.
A public meeting was called, at which I was present. I understand from a letter that I have seen subsequently that a representative of Satnam was at the meeting, but that was not known to the residents at the time. That would not be surprising to anyone who attended the meeting. I received a letter afterwards that said that many of the arguments advanced were misleading. I would argue that the most misleading has been done by the company. It has shown itself to be acting as a predatory developer.
From 14 August 1999, people in the area were awoken by the noise of bulldozers and a JCB moving on to the area. They saw shrubs, trees and willows being ripped up. When council officials arrived on the site, having been called by the residents, they were told that the land was being cleared on the order of the owners. The solicitor acting on behalf of the company assured local

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people that the site would be fenced and prepared for planting so that the owners could get some return on their investment. He suggested that a crop of potatoes might be planted. There were reports of a flying pig the same day. Not surprisingly, the potatoes never appeared. Instead, the vegetation that was ripped up was placed in huge mounds alongside the M62, and there was a report that it would be disposed of by burning.
On hearing that, I contacted both the environmental health department and the Cheshire fire brigade. I did so because of worries about the health of people in the area and the potential lethal consequences of black smoke drifting across the M62. It says much about the attitude of the company that it could even contemplate such action.
It seems to be a clear sign of an attempt to discourage people from using the site. Barbed wire has been placed alongside some of the footpaths that cross the site, and they have been blocked in some areas. I know that that has happened because I have walked them myself with someone who lives in the area.
That is a clear attempt to destroy the site's wildlife and nature conservation value and to discourage people from using it. At the moment, there are no sanctions that can be used against would-be developers who behave in such a way and try to pre-empt the planning process by destroying some of the value of a site, and I hope that my hon. Friend the Minister will touch on that point in her reply.
This is a firm which is out to make a large profit at the expense of the health and well-being of my constituents, and that is a real issue here. The traffic in this area of Warrington is already extremely heavy, and, at times, it comes to a standstill. Recently, an air quality survey was undertaken under the Environment Act 1995. I have not yet seen all the figures from that survey, but what would usually be called a reliable source tells me that it shows that the air quality in the neighbouring Poplars ward is extremely poor. That will come as no surprise to anyone as it is bounded by the M62 and A49. It clearly cannot take the increase in traffic that such a development would generate.
People's health is a real issue because two of the wards bordering the site, Poplars and Hulme, are among the most health-deprived wards in north Cheshire. People badly need green space in which to walk and watch wildlife. I hope that they will benefit from the health improvement programmes that the Government are initiating, but such programmes are no use if, at the same time, the quality of people's environment is deteriorating. Our health and planning policies must be much more closely integrated if we are to achieve our objectives.
The development is not in accord with the Government's policy planning guidance note 3, which makes it clear that brownfield sites should be used before greenfield sites, and that local authorities should attempt to reuse existing land and buildings in a process of sustainable development. According to the agreed structure plan, Warrington has 5.7 years' supply of land, and, measured against the draft regional planning guidance rate of development, it has 7.9 years' supply of land.
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Therefore, we do not want or need a development on Peel Hall. Residents, local councillors and I, who also live in the constituency, oppose it. But if we are to implement the Government's planning policy, local authorities need the powers to ensure that that planning policy becomes a reality on the ground. It is nonsense that we should still be talking about building on greenfield sites when property stands derelict in Greater Manchester and Liverpool and inner-city sites need regeneration.
We in Warrington agree with the Government's planning policy, and we support the draft regional planning guidance, which has a regeneration-led agenda. But the Government must ensure that local authorities have the power to make that a reality on the ground, that they can protect local open spaces better, that they can take into account the health of their residents, and that they have some powers to prevent developers from destroying the value of sites before planning applications are determined.
I hope fervently that when the application comes before the local planning committee, it will reject it, and I hope that if it ever reaches my right hon. Friend the Secretary of State, he, too, will reject it. But, most importantly, I hope that we learn the lessons from what has gone on here for our future planning policy, so that communities are not put in such a situation again, and we ensure that we protect our local open spaces and our local wildlife for future generations as well as for ourselves.
1.44 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 Warrington, North (Helen Jones) on securing the debate and raising this important issue. My hon. Friend is an assiduous user of Adjournment debates to raise important local issues, and it is right that she should do so. She is performing a proper service as a Member of Parliament for her constituents.
As my hon. Friend has explained, five planning applications have been submitted by Satnam (Millennium) Ltd. for outline planning permission for residential development, access roads and retail and community facilities at Peel Hall. Taken together, the applications relate to a site of around of 55 hectares, lying to the north of the built-up area of Warrington and to the south of the M62.
As my hon. Friend acknowledged, the consideration of the planning applications is, in the first instance, a matter for Warrington borough council, as the local planning authority for the area, and at this stage, it is not clear whether the council will be minded subsequently to grant planning permission. If it decides to refuse planning permission, it will be open to the applicant to exercise his right of appeal, and the matter could, therefore, come before my right hon. Friend the Secretary of State for determination.
If, on the other hand, the council is minded to grant planning permission, I understand that it first intends to refer the applications to the Secretary of State because, on the face of it, the proposals do not accord with the development plan for the area and because they involve residential development on a large greenfield site, as my

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hon. Friend clearly explained. That would allow my right hon. Friend to decide whether to use his reserve powers to call in the applications for his own determination.
I have explained that fully so that it is clear. My hon. Friend will appreciate that I am unable to comment on the merits of the proposals because my right hon. Friend may well have to use his call-in power and I cannot fetter his decision in any way. However, there are some comments that I can make which I hope will be helpful.
The Secretary of State's general approach is not to interfere with the jurisdiction of local planning authorities unless it is necessary to do so. Many hon. Members argue for that principle of local determination. Parliament has entrusted local authorities with responsibility for day-to-day planning control in their areas, so it is right, in general, that they should be able to carry out their duties responsibly, with the minimum of interference.
The Secretary of State's policy is to be selective about calling in planning applications. He will do that only if a case conflicts with national policy on important matters, such as transport, sustainability or regional or greenfield issues; could have significant effects on the locality; give rise to substantial regional or national controversy; raise significant urban design issues; or involve issues of national security or foreign government. Each case will be considered on it merits, so I can assure my hon. Friend that, if the applications are referred to my right hon. Friend, in either of the two ways that I have identified, he will give the most careful consideration to all the issues raised before deciding to exercise his call-in power.
My hon. Friend painted a clear picture of the site and its value to local people in terms of its wildlife, open space and plantlife. She will know that the original applications were submitted last September, but, as they proposed the development of a large greenfield site, the council formally requested the applicant to submit an environmental statement under the Town and Country Planning (Environmental Impact Assessment) (England and Wales) Regulations 1999.
The main aim of that procedure is to ensure that the authority that gives primary consent for a project makes its decision in the full knowledge of any likely significant effects on the environment. That helps to ensure that the public and the local planning authority understand the importance of those effects and the scope for reducing them.
In the case we are considering, I understand that the council has received the completed environmental statement very recently and has undertaken to give it wide publicity. It will therefore be in the public domain. That will give the public an opportunity to present their views about the project and the detailed contents of the statement. The council is required to take account of the statement and the comments and representations on it when deciding whether it would be appropriate to grant planning permission for the development. Doubtless the information will be copied to us in due course; it must be if the council decides to grant permission.
The procedure that I have outlined is one means of considering all the environmental issues, including those that my hon. Friend raised, that pertain to the characteristics of the site and its value to the local community.
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My hon. Friend said that the developer had felled several trees and removed some of the hedgerows on the site, and that questions have been asked about the current route of the public right of way. I understand my hon. Friend's anxiety and that of her constituents about what they perceive as the cavalier actions of the developer towards the wildlife and plant life on the site. At this stage, those are matters for Warrington borough council as the local planning authority. However, I asked my officials to make inquiries on my behalf, and I understand that the council has investigated the matter.
The council's current view on the hedgerows is that no consent was required for their removal and that, after discussions with the developer and the council, the correct route of the public right of way has been reinstated. I take account of my hon. Friend's comments about the need to ensure that councils have the wherewithal to protect sites from such action.
Relevant Government policy is mainly PPG3, which my hon. Friend mentioned, but also policies on development plans. PPG3 is the guidance note that relates to housing. When considering planning applications, the council is required to have regard to national planning policy guidance as stated in PPG3. It sets out the key elements of Government policy, which encourages greater choice for different sizes of household, greater affordability and more mixed development. It specifically encourages less profligate use of land—there has been profligate use of land in some very modern housing developments—and, of course, the use of brownfield sites before greenfield sites.
The national target for the use of brownfield sites is 60 per cent., with some local and regional variations. That is a demanding target because, in previous decades, a rate of between 40 and 50 per cent. has been achieved. The policy also demands the adoption of a sequential approach to identifying suitable sites for applications. Brownfield sites must be identified in preference to greenfield sites.
Local authorities should try to exploit opportunities to locate larger housing developments around major nodes along good quality transport corridors, and to ensure that all housing developments are accessible by a range of transport other than the private car. Public transport should be used positively to shape the pattern of development. New housing development should be used to make public transport services more viable.
We also firmly believe that new housing development, whatever its scale, should not be viewed in isolation. My hon. Friend stressed that point. Design and layout must be informed by the wider context, having regard not only to immediate neighbourhood buildings but to the townscape and the landscape of the wider locality. PPG3 is therefore of great relevance to the application to which my hon. Friend refers. I am sure that the council wants to apply that policy assiduously.
Policy on development plans is also relevant. As my hon. Friend said, Warrington borough council had been in the process of preparing a local plan when it became a unitary authority on 1 April 1998. As a result of its change of status, the council decided in June 1999, after discussion with its lawyers, to discontinue further procedures on the local plan—it had by then been subject to inquiry, on which the council had received the inspector's report—and move immediately towards the

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preparation of a unitary development plan. As a new unitary authority, Warrington is charged with the preparation of a UDP, which includes policies on strategic matters as well as local plan and site-specific matters.
Warrington council is currently consulting widely on the UDP strategic issues and strategy options document, as the first stage in the process of moving towards a UDP. It is unlikely that the UDP will be adopted before 2004. As the UDP moves towards adoption, decision makers will be entitled to attach increasing weight to its content.
Officials tell me that the position in Warrington is unique because there is currently no strategic framework for site-specific preferences for development. That means that there is nothing in council strategic policy to identify suitable or preferred uses for the sites that we are considering. There is therefore no local policy framework to inform decision making on the site. Although the framework does not exist, there are two process whereby my hon. Friend and
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local residents can make their views known about the applications in particular and the future of the site in general.
First, there is a process of development control whereby the council considers the applications. It will apply PPG3 and other relevant national policies to its decision making. Clearly, local residents can make their views known through that process. Secondly, there is the development of the UDP. In that process, the council will have to consider the future use of the site and identify its preferences. Through that process, my hon. Friend and her constituents can express their views strongly.
I apologise for not being able to comment on my hon. Friend's remarks about the merits of the application—I know that she understands the reasons for that. I hope that I have given her some assurances about the policies that we want to be applied in the decision making. I also want to assure her that if the applications are considered by the Secretary of State, we will ensure that the policies that we are robustly pursuing on housing development and greenfield sites are applied, and that the best judgments are made.
Question put and agreed to.
Adjourned accordingly at two minutes to Two o'clock.

TRADE AND INDUSTRY

  Corruption and Bribery
  Mr. Austin
  To ask the Secretary of State for Trade and Industry which British companies involved in the Ilisu Dam project are involved in the trial concerning bribery and corruption in Lesotho; and if he will make a statement. [127079]

  Mr. Caborn
  [holding answer 20 June 2000]As has already been reported in the press, Balfour Beatty, one of the companies involved in a bribery trial in Lesotho, is bidding for work on the proposed Ilisu Dam project in Turkey.

  It would be inappropriate to comment on specific allegations against British firms, which are a matter for the appropriate courts.

  Mr. Austin
  To ask the Secretary of State for Trade and Industry what formal procedures are in place in the event of companies in receipt of ECGD support(a) being charged with corruption and (b) having allegations of corruption made against them. [127082]

  Mr. Caborn
  [holding answer 20 June 2000]ECGD's audit services would normally investigate any case, in either category, where there are grounds for believing that the Exchequer's interest might be prejudiced as a result of alleged corrupt practices.

  ECGD will shortly be introducing new procedures to the OECD Bribery Convention aimed at further deterring corrupt practices.

  Mr. Austin
  To ask the Secretary of State for Trade and Industry what action he has taken concerning recent allegations of bribery and corruption on the part of British companies in Lesotho. [127080]

  Mr. Caborn
  [holding answer 20 June 2000]The Government share international concern at all allegations of corruption. It would, however, be inappropriate to comment on specific allegations against UK firms which are a matter, in this instance, for the Lesotho courts. The Government will, if asked, co-operate fully in any way that it can.

  Mr. Austin
  To ask the Secretary of State for Trade and Industry if he will list the directors of UK companies banned from World bank contracts who are directors of companies in receipt of ECGD support; and if he will list the relevant companies. [127085]

  Mr. Caborn
  [holding answer 20 June 2000]The World bank last updated their list of ineligible firms on 29 February 2000. ECGD has no record of having provided support to any of the firms on that list.
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  Mr. Austin
  To ask the Secretary of State for Trade and Industry what staff he has in post to check for corruption relating to ECGD- backed projects. [127083]

  Mr. Caborn
  [holding answer 20 June 2000]ECGD policy makes it clear that all staff have a part to play in minimising the risks of corruption and malpractice by remaining alert to such possibilities and by developing and maintaining effective controls to reduce these risks. Additionally there is an Internal Audit Department of seven who have responsibility for investigating any suspected cases of corruption relating to ECGD backed projects.

  Mr. Austin
  To ask the Secretary of State for Trade and Industry if guidelines to prevent corruption will be included in the forthcoming recommendations for the ECGD's Mission and Status. [127084]

  Mr. Caborn
  [holding answer 20 June 2000]The review of ECGD's Mission and Status is ongoing and I cannot comment on the outcome of the review until it is complete. It is looking at what ECGD's future role should be and, as I stressed when I announced the review last July, will consider carefully how ECGD can better help the Government to meet their wider objectives. I expect Ministers to determine necessary changes to ECGD's Mission in the next month or so. A report of the review will be published.

  Post Offices (Benefits Agency Business)
  Mr. Alasdair Morgan
  To ask the Secretary of State for Trade and Industry what payments were made to post offices in each of the last five years for undertaking Benefits Agency business in(a) Scotland, (b) Dumfries and Galloway and (c) Galloway and Upper Nithsdale parliamentary constituency. [124713]

  Mr. Alan Johnson
  I understand from the Post Office that details of payments made to post offices in respect of business undertaken for the Benefits Agency are contractual matters and as such commercially confidential.

  Trade Partners UK
  Mr. Prior
  To ask the Secretary of State for Trade and Industry if he will make a statement on the recent performance of British Trade International; and what are its(a) performance criteria and (b) annual budget. [126751]

  Mr. Caborn
  British Trade International's services for trade development and promotion are now delivered under the single brand name of Trade Partners UK. As I announced last month, British Trade International is also the umbrella body for the Invest in Britain Bureau which will work alongside Trade Partners UK.

  Trade Partners UK was launched nationally on 31 May 2000, and replaces the various promotional brands that have been used in the past. The services available to firms will be easier to access and more effective. A new electronic gateway provides internet access to all basic information on international markets and business sectors, and an electronic inquiry service. Trade Partners UK will continue to work in partnership with other Government Departments, devolved administrations and regional bodies.
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  Trade Partners UK's aim is to enhance the competitiveness of Britain's companies through overseas sales and investments. Trade development and promotion objectives have been published in both the Foreign Office's Departmental Report and the Department of Trade and Industry's Government Expenditure Plans.

  In the period 1999–2000, these objectives were achieved with, for example, a customer satisfaction rate of 89 per cent. and more businesses (especially SMEs) being encouraged to take an active and professional approach to exporting as a result of assistance provided.

  Detailed performance criteria for Trade Partners UK's future activities are in development. These will be in place by April 2001.

  British Trade International's annual budget for its Trade Partners UK activities consists of three elements. In round figures these are:
  about £67 million for programme expenditure;
  about £90 million (net of certain overheads) currently devoted to running costs (staff) in overseas posts;
  about £30 million currently devoted to running costs in the UK (the headquarters in London and the English regional operations). About £28 million of the funding is provided by DTI, the balance by the FCO.
  These figures exclude funding for the Invest in Britain Bureau.

  Mr. Prior
  To ask the Secretary of State for Trade and Industry what will be the cost of establishing Trade Partners UK. [126753]

  Mr. Caborn
  It cost £250,000 to develop the Trade Partners UK brand. Further costs of promoting and developing customer awareness of the new brand and the services we offer are being met by redirecting marketing effort that would in any case have been spent on promoting our services.

  A3XX
  Mr. Peter Robinson
  To ask the Secretary of State for Trade and Industry what level of launch aid has been provided by his Department for the Airbus A3XX; to how many sets of components the launch aid applies; and how many jobs he estimates will be created as a result of the launch aid. [127158]

  Mr. Alan Johnson
  My right hon. Friend the Secretary of State for Trade and Industry announced on 13 March 2000,Official Report, column 9W, that the Government would provide £530 million of launch investment to BAE Systems to help them develop the wings for the A3XX. We estimate this project will create 22,000 new jobs (8,000 in BAE Systems and supply companies, and 14,000 new induced employment) and safeguard a further 62,000 jobs (20,000 on current Airbus programmes and 42,000 in induced employment).

  Employment Relations Act 1999
  Dr. Desmond Turner
  To ask the Secretary of State for Trade and Industry if he will use section 23 of the Employment Relations Act 1999 to give ministers of religion the same employment rights as other employees. [126879]
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  Mr. Alan Johnson
  The Government are committed to carrying out full public consultation before exercising the power in section 23, which allows the Secretary of State to confer existing employment rights on categories of individuals who currently fall outside their coverage. The issue of rights for ministers of religion is one of those on which we intend to seek views in the consultation document.

  Foreign-based Commercial Staff
  Mr. Baldry
  To ask the Secretary of State for Trade and Industry how many commercial staff and at what grades his Department employs in(a) Kazakhstan, (b) Uzbekistan, (c) Turkmenistan, (d) Tajikistan and (e) Kyrgystan. [R] [126433]

  Mr. Battle
  I have been asked to reply.

  Commercial staff overseas are employed by the Foreign and Commonwealth Office as part of the unified FCO/DTI British Trade International operation. Staff in British Trade International's UK operation are primarily employed by the Department of Trade and Industry. We have no representation in Tajikistan or Kyrgystan. Details of commercial staffing in the other countries are (a) Kazakhstan—the equivalent of 2.68 staff (including a DTI officer on loan), (b) Uzbekistan—the equivalent of 2.65 staff and (c) Turkmenistan—the equivalent of 1.95 staff. The staff involved in commercial work vary in grades. These totals are a reflection of the total time spent by both UK based and locally engaged staff over a year. They reflect the combined efforts of several staff at each post on commercial work.

AGRICULTURE, FISHERIES AND FOOD

  Food Imports
  Mr. Flynn
  To ask the Minister of Agriculture, Fisheries and Food what proportion of(a) organic foods, (b) bottled drinking water, (c) parsnips and (d) yoghurt consumed in the UK are imported. [126323]

  Ms Quin
  [holding answer 19 June 2000]It is estimated that about(a) 70 per cent. of organic foods, (b) 35 per cent. of mineral water, and (d) 15 per cent. of yoghurt consumed in the UK are imported. Statistics on imports of parsnips are not separately available.

  Animal By-products
  Mr. Robertson
  To ask the Minister of Agriculture, Fisheries and Food what plans he has to minimise skip lorry movements of animal products for final disposal between farms. [125167]

  Ms Quin
  [holding answer 8 June 2000]None. The transport and disposal of animal by-products are already controlled by the Animal By-Products Order 1999. The Order is enforced by local authorities.

  Confectionery Manufacturing
  Mr. Chaytor
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement on the impact on British confectionery manufacturing of the
  187W
  European Commission's decision to suspend the payment of refunds payable on the export of non-Annex 1 products. [124769]

  Ms Quin
  [holding answer 14 June 2000]From 8 May this year the European Commission temporarily suspended the issue of further refund certificates, required for refund payments on the export of non-Annex 1 products. Special provision has been made for small traders to ensure that they are unaffected by the suspension. This suspension reflects the Commission's concern about the value of claims made so far in the current year compared to budgetary limits.

  For the British confectionery manufacturing industry this could result in a shortfall in the current budget year of some £4.7 million from the previous year's export refund receipt of £18.5 million, if certificates remain suspended until the end of the budget year in October. The UK confectionery industry exports products worth some £300 million per year to non-EU destinations, and it is these exports that will be affected by suspension.

  Discussions with the Commission are continuing at official and at ministerial level to secure a solution that will minimise the impact for all exporting industries affected by the suspension.

  Milk
  Mr. Gareth Thomas
  To ask the Minister of Agriculture, Fisheries and Food what steps he is taking to promote the consumption of fresh milk in schools. [125790]

  Ms Quin
  The Government have already taken action via the Intervention Board to draw the attention of schools and local education authorities to the existence of the EU School Milk Subsidy Scheme and to simplify its operations. The Intervention Board has also recently issued a questionnaire to all claimant organisations in England and Wales seeking further suggestions for improvements to the administration of the scheme.

  Mr. Gareth Thomas
  To ask the Minister of Agriculture, Fisheries and Food what steps he is taking to assist the promotion of the sale of fresh milk. [125791]

  Ms Quin
  In response to calls from representatives of dairy farmers the Government widened the remit of the Milk Development Council (MDC) to allow it to engage in the generic promotion of milk. The MDC's first marketing campaign for fresh milk, funded jointly by producers and processors, commenced on 19 June.

  Mr. Todd
  To ask the Minister of Agriculture, Fisheries and Food what is the basis and source of data of the Intervention Board calculations of milk production; and what representations he has received as to their accuracy. [125775]

  Ms Quin
  The monthly, wholesale, butterfat-adjusted, milk production figures calculated by the Intervention Board are based on monthly returns submitted to the Intervention Board by all approved milk purchasers, as required by regulation 28(2) of the Dairy Produce Quotas Regulations 1997, as amended.
  188W
  The Intervention Board has received a number of representations over time about the accuracy of the milk production figures and, in response to such inquiries, has explained that the figures are subject to amendment and should not be regarded as definitive. It is made clear in the accompanying notes that the figures are issued only as a guide to trends in milk production and for comparison against a calculated milk quota profile. Those using the figures, particularly in reaching commercial decisions relating to milk quota or milk production, are advised to take account of the limitations, which are set out in some detail.

  Farm Diversification
  Mr. Robertson
  To ask the Minister of Agriculture, Fisheries and Food what(a) advice and (b) financial assistance is available to farmers to help them diversify their work; and if he will make a statement. [125949]

  Mr. Morley
  We will launch a new Rural Enterprise Scheme which will include grant aid for farm diversification once we receive approval from the European Commission for the England Rural Development Plan.

  Under the Action Plan for Farming we will also produce a new booklet on farm diversification and intend to provide free advice on planning to successful applicants to the Rural Enterprise Scheme.

  Farm Animal Welfare
  Mr. Coaker
  To ask the Minister of Agriculture, Fisheries and Food what steps he is taking to persuade his European Union partners to give a high priority during negotiations to revise WTO rules ensuring that the EU can maintain and improve its standards of farm animal welfare; and if he will make a statement. [126514]

  Ms Quin
  The conclusions of the EU Agriculture Council on 27 September 1999 and the General Affairs Council on 25 October 1999 committed the EU to taking forward the issue of farm animal welfare in the WTO negotiations. The UK has been a strong support of this commitment, which was reinforced by the Prime Minister in his Action Plan for Farming, published on 30 March 2000, and we will be seeking to take it forward in the negotiations on agriculture which have now started.

  Fisheries Council
  Mr. Casale
  To ask the Minister of Agriculture, Fisheries and Food what the outcome was of the Fisheries Council held in Luxembourg on 16 June; and if he will make a statement. [127182]

  Mr. Morley
  The Fisheries Council met in Luxembourg on 16 June. I led the UK delegation, accompanied by John Home Robertson, Deputy Minister for Rural Affairs in the Scottish Executive.

  The Commission presented its mid-term review of the Multi Annual Guidance Programme (MAGP) IV, which will now go for further study. I made clear that I could not accept the cuts in the UK fleet suggested by the Commission. In particular, effort control must be retained. However, the need to bring capacity into better balance with available stocks remained, and I welcome the Commission's plans for a public consultation this autumn

  189W
  on successor arrangements to MAGP IV. Stricter MAGP limits should be applied in member states offering construction grants for new vessels.

  The Council adopted a report on the integration of environmental concerns into the Common Fisheries Policy for submission to the European Council and agreed on new arrangements for the collection of biological and economic data on the industry. I, together with German and Belgian colleagues, succeeded in insisting that these should not be unnecessarily burdensome. We raised the issue of unregulated international fishing for haddock off Rockall and with support from a number of member states pressed the Commission to seek early action through the North East Atlantic Fisheries Commission.

  I welcomed a statement from Commissioner Fischler on the need for member states to take action to reduce cetacean bycatches in EU waters. I also welcomed the Commission's report on the pilot stage of Regional Workshops, which helpfully bring together fishermen, scientists and administrators to consider improvements in the management of particular fisheries.

  Commissioner Fischler reported on the latest state of play on negotiations on a new EU-Morocco Agreement. The Council had an initial discussion on responsibility for the enforcement of Regional Fisheries Organisation responsibilities. A revised Total Allowable Catch for anchovies was agreed.

PRESIDENT OF THE COUNCIL

  Free Votes
  Mr. Wigley
  To ask the President of the Council if she will make it the Government's policy that in each instance where the majority of the House is in favour of legislation and where the Government are neutral on the issue in question, it will put forward appropriate legislation, provide time for debate and permit a free vote on specific issues. [126084]

  Mrs. Beckett
  Governments are elected on the basis of their Manifestos, which will always contain a number of commitments requiring legislation. It is right that Manifesto commitments should have priority. Other legislative needs are identified by Government and examined on a case-by-case basis. Although parliamentary time is limited, there have always been occasions when the Government has found time for matters on which it is itself neutral.

  Appointments Commission
  Mr. Gordon Prentice
  To ask the President of the Council if the Appointments Commission will make it its policy to give unsuccessful applicants for membership of the House of Lords reasons why their applications failed. [126832]

  Mrs. Beckett
  This is a matter for the Appointments Commission.

  Mr. Gordon Prentice
  To ask the President of the Council who provides the secretariat supporting the Appointments Commission; and how many persons are employed in it. [126835]
  190W
  Mrs. Beckett
  The Appointments Commission is supported by a Secretariat who are either members of, or on loan to, the Cabinet Office. The Commission has yet to determine its final requirement for staff.

  The same staffing arrangement applies to other independent bodies such as the Commissioner for Public Appointments and the Committee on Standards in Public Life.

  Mr. Gordon Prentice
  To ask the President of the Council if applicants for membership of the House of Lords are to receive a specification from the Appointments Commission setting out the qualities and abilities expected in successful applicants. [126836]

  Mrs. Beckett
  I understand that it is the Commission's intention to be exceedingly open in its procedures. The issue of a person specification would be consistent with that approach.

  Mr. Gordon Prentice
  To ask the President of the Council if she will list the scheduled dates of meetings of the Appointments Commission in 2000. [126834]

  Mrs. Beckett
  This is a matter for the Commission.

  I understand, however, that the schedule of meetings has not yet been finalised.

DEFENCE

  Boeing C17
  Mr. Hancock
  To ask the Secretary of State for Defence what the total cost is over the whole life of the contract for the lease of the four Boeing C17 aircraft; and if it includes maintenance for the aircraft. [125437]

  Mr. Hoon
  This is a matter for the Chief Executive of the Defence Procurement Agency. I have asked the Chief Executive to write to the hon. Member.

  Letter from Robert Walmsley to Mr. Mike Hancock, dated 21 June 2000:
  I am replying to your question to the Secretary of State for Defence in which you asked what the total cost is over the whole life of the contract for the lease for the four C17 aircraft; and if it includes maintenance for the aircraft. This matter falls within my area of responsibility as Chief of Defence Procurement and Chief Executive of the Defence Procurement Agency.
  The exact contract price is commercially confidential. In broad terms, however, we expect the overall cost to be in the order of £500M, which costs include maintenance of the aircraft.

  Permanent Secretary (Official Visits)
  Mr. Matthew Taylor
  To ask the Secretary of State for Defence if he will list the visits outside the UK 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. [127135]

  Dr. Moonie
  The MOD's Permanent Secretary has made the following visits outside the UK on official business since 1 January 1999.
  191W

  Date

  Venue

  Purpose

  1999

  5–7 February

  Munich, Germany

  Wehrkunde security conference

  25–26 February

  Bonn, Germany

  Talks on european defence and bilateral issues

  24 March-2 April

  Pakistan and India

  UK/Pakistan Defence Cooperation Forum

  UK/Indian Defence Consultative Group

  12–13 May

  Ploce, Macedonia

  Visiting UK forces, and bilateral discussions

  3 June

  Brussels, Belgium

  Discussions at NATO Headquarters

  7–8 June

  Ankara, Turkey

  Talks on European defence and bilateral issues

  20 July

  Paris, France

  Talks on European defence and bilateral issues

  2–3 August

  Bosnia and Croatia

  Visiting UK forces

  1–2 September

  Copenhagen, Denmark

  Conference of Northern Defence Permanent Secretaries

  18–19 October

  Rome, Italy

  Talks on European defence and bilateral issues

  1–2 November

  Helsinki, Finland

  Talks on European defence and bilateral issues

  8–9 November

  Germany

  Visiting UK forces

  2000

  24–25 January

  Cyprus

  Visiting UK forces

  4–5 February

  Munich, Germany

  Wehrkunde security seminar

  15–16 March

  Berlin, Germany

  Chairing UK/German seminar

  11–12 March

  Oslo, Norway

  Talks on European defence and bilateral issues

  11–12 March

  Pristina, Kosovo

  Visiting UK forces, and other discussions

  MOD Buildings, Whitehall
  Mrs. Ewing
  To ask the Secretary of State for Defence if he will make a statement on his proposals for refurbishing the MOD building in Whitehall, including the total cost of the refurbishment. [126677]

  Dr. Moonie
  I refer the hon. Member to the answer I gave my hon. Friend the Member for St. Albans (Mr. Pollard) on 17 May 2000,Official Report, columns 162–63W.

  Kosovo (Depleted Uranium)
  Mr. Dalyell
  To ask the Secretary of State for Defence what reports he has evaluated of health problems among service men deployed in Kosovo attributable to contact with depleted uranium. [125934]

  Mr. Spellar
  I have not received any reports evaluating or suggesting health problems among service personnel deployed in Kosovo attributable to contact with depleted uranium.

  Senegal (Chinooks)
  Mr. Keetch
  To ask the Secretary of State for Defence when the decision was taken to send Chinooks to Senegal in order to assist the deployment of troops; when the Chinooks left the United Kingdom; when they arrived in Senegal; and if he will make a statement. [126998]

  Mr. Hoon
  The decision to deploy Chinooks to Dakar in Senegal, which was designated as the Forward Mounting Base for the evacuation operation, was taken on Saturday 6 May. The Chinooks left the UK that day and flew to Dakar over the course of that weekend, arriving in the early morning of 8 May.

INTERNATIONAL DEVELOPMENT

  Hospitals
  Dr. Tonge
  To ask the Secretary of State for International Development what plans she has to monitor cleanliness of hospital wards and operating theatres. [126918]
  192W
  Clare Short
  Our health programmes in developing countries work to improve the overall quality of health care provided, particularly for the poorest. Good hygiene practice and sterile operating conditions are important indicators of quality in service delivery.

  China Western Poverty Reduction Project
  Dr. Tonge
  To ask the Secretary of State for International Development what plans she has to support the Qinghai component of the China Western Poverty Reduction Project. [126919]

  Clare Short
  The report by the Independent Inspection Panel into the China Western Poverty Reduction Project, and World Bank management's response to it, will be discussed at a World Bank Board meeting in early July 2000. We will be looking very carefully at the conclusions of the Inspection Panel Report, and management's response to it, in preparing our position for that board meeting.

ENVIRONMENT, TRANSPORT AND THE REGIONS

  Flaxmill, Shrewsbury
  Mr. Paul Marsden
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the extent of repairs required to the Flaxmill in Shrewsbury. [125943]

  Ms Beverley Hughes
  I understand the building has been empty since 1987 and has a status of Grade A awarded by English Heritage. The repairs have been estimated to cost some £12.2 million.

  Bus Lanes
  Mr. Bob Russell
  To ask the Secretary of State for the Environment, Transport and the Regions if he will amend the road traffic regulations to enable Class 3 vehicles to use bus lanes; and if he will make a statement. [126187]

  Mr. Hill
  I have no plans to amend regulations to permit Class 3 vehicles to access bus lanes.
  193W
  The use of bus lanes by those vehicles, which are limited by Regulation to a maximum speed of 12.8 kph, would impede the flow of buses. That would clearly undermine the purpose of bus lanes which is to afford buses greater priority over other vehicles.

  There is also the question of safety. We would be extremely concerned about the safety of Class 3 users travelling in small, slow moving vehicles immediately in front of or behind some of the largest vehicles on our roads.

  Where Class 3 users consider that the road conditions are unsuitable for them to travel on the carriageway we would strongly recommend that they continue the journey on the footway where they can legally travel at up to 6.4 kph. We believe that is more appropriate than providing them with access to bus lanes.

  Rail Service (London-Liverpool)
  Mr. Ben Chapman
  To ask the Secretary of State for the Environment, Transport and the Regions what discussions he has had with the Rail Regulator about the delays in boarding Liverpool trains at Euston Station. [126421]

  Mr. Hill
  The Franchising Director, not the Rail Regulator, is responsible for monitoring delays in the boarding of trains. The Secretary of State has had no discussions with the Franchising Director about delays in boarding Liverpool trains at Euston station.

  Mr. Ben Chapman
  To ask the Secretary of State for the Environment, Transport and the Regions what representations he has received on the timekeeping of West Coast Main Line trains between Liverpool and Euston. [126422]

  Mr. Hill
  The Secretary of State has not received any representations about the timekeeping of West Coast Main Line trains between Liverpool and Euston. All trains on the West Coast Main Line have been subject to some delays due to the West Coast Main Line upgrade, but consequential amendments have been to the timetable and timekeeping has remained constant. The Franchising Director's publication 'On Track' (copies of which are available in the House Libraries) shows that 80.6 per cent. of West Coast Main Line trains arrived at their destination within 10 minutes of the advertised time in the year to 31 March 2000. This was an improvement on the 72.8 per cent. achieved in the previous year.

  Mr. Ben Chapman
  To ask the Secretary of State for the Environment, Transport and the Regions what discussions he has had with the Rail Regulator on the timekeeping of West Coast Main Line services between Liverpool Lime Street and Euston. [126420]

  Mr. Hill
  The Franchising Director not the Rail Regulator is responsible for monitoring the timekeeping of trains. The Secretary of State has had no discussions with the Franchising Director about the timekeeping of West Coast Main Line services between Liverpool and Euston.

  Mr. Ben Chapman
  To ask the Secretary of State for the Environment, Transport and the Regions what representations he has received about delays in boarding Liverpool trains at Euston station. [126511]
  194W
  Mr. Hill
  The Secretary of State has received no representations relating specifically to delays in boarding trains to Liverpool at Euston station. Development work in connection with the West Coast Main Line upgrade has resulted in a number of platforms at Euston being closed between May and September of this year. The consequential shortage of platforms has meant that upon arrival trains unload passengers and are then cleaned and stored out of the immediate station area, returning to the departure platform shortly before departure time. This has resulted in reduced intervals between trains being available for loading and departure times but this is common to all services from Euston.

  Mr. Ben Chapman
  To ask the Secretary of State for the Environment, Transport and the Regions what discussions took place at the Rail Summit about the timekeeping of West Coast Main Line services between Liverpool Lime Street and Euston. [126782]

  Mr. Hill
  Timekeeping of West Coast Main Line services between Liverpool Lime Street and Euston was not discussed at the Rail Summit.

  Mr. Ben Chapman
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make it a condition when re-awarding the franchise for the West Coast Main Line that the level of on-board services between Liverpool Lime Street and Euston Station is improved. [126781]

  Mr. Hill
  The present franchise for the West Coast Main Line is not due to be replaced until 9 March 2012. The franchise, in common with all the other passenger rail franchises, does not contain any provisions stipulating what on-board services must be provided. It is not envisaged that there will be any such provisions in any of the replacement franchises.

  Sewage Works
  Mr. Gorrie
  To ask the Secretary of State for the Environment, Transport and the Regions what monitoring system is in place to ensure that the precautions required by law when parties of school pupils or organised parties of adults visit water treatment or sewage works are taken. [126282]

  Mr. Meacher
  Employers in the water supply and sewage treatment industry have general duties placed upon them by the Health and Safety at Work etc Act 1974 to ensure that, so far as is reasonably practicable, visitors are not exposed to risks to their health and safety.

  The Management of Health and Safety at Work Regulations require employers to carry out a suitable and sufficient assessment of the risks arising from their undertaking to the health and safety of persons not in their employment. This includes members of the public.

  Risks to health, including biological risks, are also covered by the more specific requirements of the Control of Substances Hazardous to Health Regulations 1999. They require the employer to carry out a risk assessment and where necessary to implement suitable measures to reduce the risk. This duty would extend to groups visiting the site.
  195W
  The Health and Safety Executive is responsible for the inspection of water treatment works and sewage works. Inspections of water treatment companies would include an assessment of their ability to manage and control risks, including, where appropriate, risks to the public.

  Mr. Gorrie
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of whether washing screens in the screen houses of sewage works with untreated effluent produces a local atmosphere containing biological agents of a hazardous nature. [126269]

  Mr. Meacher
  HSE has undertaken at least one local intervention to monitor levels of aerosols in a screen house and at visits to water treatment companies over the years has looked into the biological risks arising from the process and the way they are controlled.

  There are potentially hazardous micro-organisms in all sewage and a range of reasonably practicable precautions should be taken to control the risk.

  HSE made a number of recommendations including improved washing facilities, disposable overalls, respiratory protective equipment and improved ventilation. Although they had initially recommended the use of clean mains water or its equivalent for screen washing, they accepted that this was not reasonably practicable given the very large volumes used and the fact that a new secondary treatment works is being built and that biologically treated effluent will be available for screen washing from September 2000, with the plant being fully commissioned by the end of 2000.

  At a national level HSE works with the water industry's national trade body, Water UK, to help identify and resolve health and safety problems in the industry. Work has been carried out at national level on the microbiological risks from sewage, including those encountered at sewage treatment works. HSE produced guidance for employers and workers in 1995.

  Screens are usually washed with water which has been through the treatment process ("final effluent") which, while not of drinking-water quality, has fairly low levels of micro-organisms. However, where the treatment facilities are limited, as at Seafield, the water used will have higher levels of micro-organisms. The main risk is from ingestion/swallowing and from splashes on the skin and in the eyes. Aerosols containing micro-organisms are likely to be produced in screen houses from the general flow of sewage and also from the washing down of the screens. These aerosols can pose a risk to health from inhalation, depending on droplet size and the type and amount of micro-organisms present.

  Cycles
  Mr. Mitchell
  To ask the Secretary of State for the Environment, Transport and the Regions how many of his Department's buildings display notices prohibiting the chaining of cycles to railings. [126410]

  Mr. Hill
  Only the Queen Elizabeth II Conference Centre, London, displays such signs. This reflects the high security needs of the centre.

  Light and Noise Pollution
  Mr. Gordon Prentice
  To ask the Secretary of State for the Environment, Transport and the Regions if he will publish maps showing tranquil areas in respect of light and noise pollution. [126413]

  Mr. Hill
  In respect of noise, Birmingham City Council has recently produced an innovative noise map of the City with support from this Department. This has been published as a DETR report ("A report on the production of noise maps of the City of Birmingham"—ISBN 1–85112359–8). Copies are available in the House Library and on the DETR website (www.environment.detr.gov.uk/noisemaps/birmingham/report/index.htm).

  The question of extending this technique throughout the country both in urban areas and relatively quiet areas in the open country is actively being considered by the Government and in European fora. My hon. Friend may wish to be aware that the Council for the Protection of Rural England together with the Countryside Commission has published a "Tranquillity Map", identifying areas of England which are far enough away from visual or noise intrusion to be considered unspoilt by urban influences.

  There are no plans at this time to introduce mapping for light pollution.

  Dioxin
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer to the hon. Member for East Worthing and Shoreham (Mr. Loughton) of 24 May 2000,Official Report, column 539W, on dioxin, if he will make a statement about the operation of his Department's Hazardous Air Pollutants Programme in East Sussex. [126258]

  Mr. Meacher
  [holding answer 19 June 2000]The Hazardous Air Pollutants Programme has no measuring station in East Sussex.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to the answer to the hon. Member for East Worthing and Shoreham (Mr. Loughton) of 24 May 2000,Official Report, column 539W, on dioxin, what assessment his Department has made of the geographical comprehensiveness of his Department's Hazardous Air Pollutants Programme; and if he will make a statement. [126257]

  Mr. Meacher
  [holding answer 19 June 2000]The Hazardous Air Pollutants Programme has made measurements of polyaromatic hydrocarbons (PAH), dioxins, furans and polychlorinated biphenyls in Cardiff, Manchester, London, Stevenage, Hazelrigg in Lancashire, High Muffles in the North Yorkshire Moors and Stoke Ferry in East Anglia in various years since 1991. It is making further measurements of PAH at Ashington, Bolsover, Glasgow, Holyhead, Kinlochleven, Lisburn, Newport (Gwent), Port Talbot and Scunthorpe. The first list of sites gives a good indication of levels of hazardous air pollutants across the UK as a whole, while the second list represents sites where levels might be expected to be higher than average.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer to the hon. Member for East Worthing and Shoreham (Mr. Loughton) of 24 May 2000,Official Report,

  197W
  column 539W, on dioxin, what steps he has taken to publicise the website displaying the results of programmes which monitor dioxin levels; how many hits that website has received for each of the last 12 months for which figures are available; and what is the web address. [126259]

  Mr. Meacher
  [holding answer 19 June 2000]The Department's website that contains the results of all the Department's air quality measuring programmes is widely publicised in a variety of media. The number of hits on the pages containing the dioxin measurements were 2,445 in the period 1 June 1999 to 31 May 2000, representing approximately 1,150 users. The website address is http://www.environment.detr.gov.uk/airq/aqinfo.htm, then click on National Air Quality Information Archive and then Monitoring Networks. The dioxin data are collected in the Toxic Organic Micropollutants section.

  The Food Standards Agency data are on the website http://www.foodstandards.gov.uk. This site has experienced 612 hits since 3 April 2000 on the pages giving information about dioxins in food.

  Houses in Multiple Occupation
  Ms Buck
  To ask the Secretary of State for the Environment, Transport and the Regions which local authorities operate registration schemes for houses in multiple occupation; how many properties are on the list; and what proportion are estimated to be high risk. [127007]

  Mr. Mullin
  The latest information my Department has on such schemes, based on local authority returns made in July 1999, indicated that 81 authorities, as listed, had schemes, and had registered approximately 10,000 houses in multiple occupation in the private rented sector. A number of these schemes, notably in London boroughs, are ward-based, although the majority are authority-wide:Darlington, Gateshead, Middlesbrough, Newcastle-upon-Tyne, Stockton-on-Tees, North Tyneside, Barnsley, Calderdale, East Riding of Yorkshire, Harrogate, North East Lincolnshire, North Lincolnshire, Rotherham, Scarborough, York, Derby, Kettering, Mansfield, Newark and Sherwood, South Kesteven, Basildon, Cambridge, Colchester, Kings Lynn and West Norfolk, Luton, Mid Bedfordshire, North Norfolk, Peterborough, South Norfolk, St. Albans, Tendring, Watford, Waveney, Barking and Dagenham, Bromley, Brent, Camden, Croydon, Ealing, Greenwich, Hackney, Hammersmith and Fulham, Haringey, Hillingdon, Kingston-upon-Thames, Lewisham, Newham, Islington, Hounslow, Sutton, Tower Hamlets, Westminster, Chiltern, Dover, Gravesham, Canterbury, Guildford, Portsmouth, Rushmoor, Southampton, Thanet, Bournemouth, Bristol, Cheltenham, Mid Devon, North Somerset, Torbay, West Devon, Weymouth and Portland, Birmingham, Coventry, Redditch, Wyre Forest, Blackpool, Bury, Carlisle, Chester, Lancaster, Preston, Warrington, West Lancashire, Wirral.

  Authorities are not required to notify new schemes to my Department, but we are aware of several in the past year, including:
  Kingston-upon-Hull, Sheffield, Bexley, Harrow, Lambeth, Southwark, Eastbourne, North Warwickshire, Brighton and Hove, Doncaster, Oxford, Herefordshire.

  All the schemes are based upon my Department's 1997 model, which exempts certain lower-risk categories in the private rented sector, including houses occupied by: persons who form only two households; no more than four persons who form more than two households; no more than three persons in addition to the responsible person and any other member of their household.

  Speed Cameras
  Ms Drown
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the results of the schemes that are exploring alternative mechanisms of funding speed cameras. [126966]

  Mr. Hill
  The camera funding pilots that started in April this year in eight police force areas in England, Wales and Scotland will run for two years to assess the effectiveness of new funding arrangements. It is too soon after the start for any results to be available yet, and we expect some preliminary results after the first year.

  Abandoned Vehicles
  Mr. Patrick Hall
  To ask the Secretary of State for the Environment, Transport and the Regions if he will review the Refuse Disposal Act 1978 with regard to the seven day notice period applicable to vehicles abandoned on the public highway before they can be removed by local authorities. [126568]

  Mr. Hill
  The existing regulations are intended to provide owners with safeguards against a local authority prematurely assuming a vehicle is abandoned and having it towed away for scrap. They also ensure that local authorities do not have to go to the unnecessary expense of removing and storing vehicles that may not, in the event, have been abandoned.

  We believe that the current legislation provides a good balance between the powers of local authorities to deal with abandoned vehicles and the rights of vehicle owners.

  Mr. Patrick Hall
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make it his policy to maintain an official record of the number of motor vehicles abandoned every year in England and Wales. [126566]

  Mr. Hill
  There are no plans at present to maintain an official record of such cases.

  Mr. Patrick Hall
  To ask the Secretary of State for the Environment, Transport and the Regions if he will introduce legislation to amend the Data Protection Act 1998 to allow details of last registered owners of abandoned motor vehicles to be passed to local authorities on request. [126565]

  Mr. Hill
  The Data Protection Act exempts certain data from its non-disclosure provisions. The Driver and Vehicle Licensing Agency already has powers to release vehicle keeper details to local authorities to help them deal with abandoned vehicles. The Agency provides the information on request. It is also developing electronic links with authorities to speed up the process.

  Mr. Patrick Hall
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to review the(a) legal and (b) financial framework for dealing with abandoned motor vehicles. [126567]

  Mr. Hill
  We will review the existing arrangements as we develop proposals for implementing the proposed European End-of-Life Vehicles Directive in the UK.

  Ministerial Travel
  Mr. Loughton
  To ask the Secretary of State for the Environment, Transport and the Regions if he will list the overseas trips on official business he has made since 1 January; and how many days he has spent overseas since 1 January. [126546]

  Mr. Prescott
  [holding answer 19 June 2000]Since 1 January 2000 I have made the following overseas visits on official business:Sunday 12 to Friday 17 March:
  Brazil and United States. Meetings with President Cardoso and other Brazilian Ministers. Trade Promotion. Meetings with Carnival and Cunard shipping companies and discussions on aviation with US Secretary of Transportation.
  Friday 7 to Tuesday 11 April:
  Japan. Attend G8 Environment Ministers Conference. Meetings with Prime Minister Mori and other Japanese Ministers and with Honorary Chairman of Toyota.
  Tuesday 25 to Thursday 27 April:
  United States. Meetings with Vice President Gore and other members of US Administration. Discussions with Senators on climate change. Attend United Nations Commission on Sustainable Development.
  Sunday 4 June:
  France. Represent UK Government at 60th Anniversary Dunkirk.
  Sunday 11 to Thursday 15 June:
  Nigeria and Sierra Leone. Meeting with President Obasanjo and other Nigerian Ministers. Trade promotion. Meeting with President Kabbah and visit to UK troops in Sierra Leone.

  All travel has been undertaken in accordance with the Ministerial Code.

  Mr. Redwood
  To ask the Secretary of State for the Environment, Transport and the Regions how many times(a) he, (b) the Minister for the Environment, (c) the Minister for Local Government and the Regions and (d) the Minister for Housing and Planning have come to their office in the last month (i) all or part of the way by official car and (ii) by other means. [126796]

  Ms Beverley Hughes
  [holding answer 19 June 2000]Ministers travel by car and by public transport on a regular basis on official visits and on journeys to their offices.

  Ministers are required under the Ministerial Code always to make efficient and cost-effective travel arrangements.

  Housing
  Mr. Loughton
  To ask the Secretary of State for the Environment, Transport and the Regions what estimate he has made of the number of below tolerable standard houses in England and Scotland; and on what criteria this is based. [126544]

  Mr. Mullin
  [holding answer 19 June 2000]The tolerable standard is a measure of minimum standard housing in Scotland and is the responsibility of my right hon. Friend the Secretary of State for Scotland. It does not apply in England. Therefore there is no comparable information.

  Environment Policy
  Ms Walley
  To ask the Secretary of State for the Environment, Transport and the Regions if he will issue his Policy Appraisal and the Environmental Policy Guidance, "Sustainable Development: What it is and What You Can Do", to newly-appointed Ministers and civil servants involved in policy development. [126851]

  Ms Beverley Hughes
  My Department's document, "Policy Appraisal and the Environment: Policy Guidance", has been made widely available to other Departments since it was published in 1998. It is also now included on the Cabinet Office's website as part of the "Policy Makers Checklist" and all Departments will be adding that checklist to their own intranet sites. A number, including mine, already have. Electronic availability of this guidance is more efficient than the distribution of large numbers of paper copies.

  The guide "Sustainable Development: What it is and What You Can Do" is one of four guidance notes issued by the Green Ministers Committee. Again my Department has a stock of paper copies which other Departments can draw from while the guide is also available to them through our website or by addition to their intranets.

  Green Ministers regularly consider the procedures by which sustainable development and the environment are integrated into policy-making and act as the focal point for those procedures among their ministerial colleagues in their own Departments.

  Ms Walley
  To ask the Secretary of State for the Environment, Transport and the Regions what further plans he has concerning the development of the targets and policies contained in the sustainable development frameworks produced in each English region; and if he will make a statement. [126850]

  Ms Beverley Hughes
  The first regional sustainable development framework was launched in the West Midlands in February and the second is due to be launched in the North-West in July; both are promising documents. We expect all the regions to have completed their frameworks by the end of 2000. Frameworks are not Government documents nor are they statutory and they will set their own targets. For frameworks to have a real impact it is vital that their production, including setting priorities and establishing systems for monitoring progress, involves all stakeholders and has support across the region. That is why we have said they should be agreed by the regional chambers. Once published we expect regional decision-makers to "buy in" to the visions set out in frameworks and to act in ways that are consistent with them.

  O'Byrne Lawsuit
  Mr. Waterson
  To ask the Secretary of State for the Environment, Transport and the Regions what steps he plans to take following the decision in Rv. Secretary of State for the Environment, Transport and Regional Affairs, ex parte O'Byrne. [126801]

  Ms Beverley Hughes
  None.

  St. Helens Council
  Mr. Watts
  To ask the Secretary of State for the Environment, Transport and the Regions if he will set out
  201W
  the cash and percentage increase in the St Helens Metropolitan Council (a) revenue support grant, (b) HRA subsidy, (c) capital grants and (d) partnership grants for (i) 1997–98, (ii) 1998–99 and (iii) 1999–2000. [126638]

  Ms Beverley Hughes
  The following tables set out the cash and percentage changes in the amounts of grants made by my Department to St. Helens Metropolitan Council in each of the last three financial years.

  Cash change on previous year

  £ million

  Grant

  1997–98

  1998–99

  1999–2000

  Revenue support grant1

  -3.757

  6.602

  3.274

  Housing revenue account subsidy2

  -1.497

  -1.062

  -0.313

  Capital grants3

  -1.326

  1.052

  0.612

  Partnership grants4

  2.450

  -0.234

  1.103

  1Data for 1999–2000 takes into account amending report figure of £4,900, adjustment in respect of 1997–98 data.

  21999–2000 Housing Revenue Subsidy is subject to change once final audited figure is received.

  3Data do not include capital grants paid to Passenger Transport Executives (PTEs) in support of rail service in Merseyside.

  4Partnership grants comprise Single Regeneration Budget grant paid to the authority as the accountable body for the partnership projects, which include Southern Corridor, Parr Partnership, Newton 21 and Count Me In, and are grants to the partnerships and not specifically to the authority.

  Percentage change on previous year

  Grant

  1997–98

  1998–99

  1999–2000

  Revenue support grant

  -5.41

  10.05

  4.53

  Housing revenue account subsidy

  -7.26

  -5.55

  -1.73

  Capital grants

  -50.86

  82.12

  26.23

  Partnership grants

  96.88

  -4.70

  23.25

  UK/US Air Services
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions what recent discussions he has had with US authorities regarding fifth freedoms and cabotage rights in US airspace for UK commercial carriers. [126302]

  Mr. Mullin
  [holding answer 20 June 2000]UK/US air services talks took place between 13–15 June in London. These talks, which covered a wide range of issues, including traffic rights, will continue in Washington on 5 July.

  Rents
  Ms Glenda Jackson
  To ask the Secretary of State for the Environment, Transport and the Regions if he will introduce measures to restrict rent officers raising annual rents above those applied for by landlords. [126670]

  Mr. Mullin
  [holding answer 20 June 2000]Rent officers are required to set fair rents based on market rents less any element resulting from scarcity in accordance with the Rent Act 1977 and case law. We do not intend to require rent officers to take into account the rent applied for by the landlord. However, the House of Lords has granted the Government provisional leave to appeal the decision of the Court of Appeal to quash the Rent Acts (Maximum Fair Rent) Order which we introduced in February 1999 to cap excessive increases in fair rents.

  Incineration
  Mr. Pickthall
  To ask the Secretary of State for the Environment, Transport and the Regions what recent epidemiological research the Government have undertaken near incinerators; and what research they intend to undertake in the future. [126333]

  Mr. Mullin
  [holding answer 20 June 2000]The Small Area Health Statistics Unit (SAHSU) has carried out two Government-funded studies on cancer incidence around the older generation of more polluting incinerators ("Elliott P et al (1996). Cancer incidence near municipal solid waste incinerators in Great Britain. British Journal of Cancer, volume 73, pp 702–710", and "Elliott P et al (2000). Cancer incidence near municipal solid waste incinerators in Great Britain. Part 2: Histopathological and Case-Notes Review of Primary Liver Cancer Cases. British Journal of Cancer, volume 82, pp 1103–6.") These found a small excess of primary liver cancer in people living near to incinerators between 1974 and 1987. The Government have sought advice on these studies from the Committee on the Carcinogenicity of Chemicals in Food, Consumer Products and the Environment (COC).

  The COC has advised that it is not possible to conclude that this small increase in primary liver cancer is due to emissions of pollutants from incinerators, as it is not possible to rule out completely that it may be related to socio-economic factors. It has also advised that any potential risk of cancer due to living near municipal incinerators (for periods in excess of 10 years) was exceedingly low and probably not measurable by the most modern epidemiological techniques. The COC has recommended that, at the present time, there is no need for any further epidemiological investigations of this subject. The COC's statement can be found on the Department of Health's website at www.doh.gov.uk/munipwst.htm.

  Mr. Pickthall
  To ask the Secretary of State for the Environment, Transport and the Regions what the Government's estimate is of the cost per year of continuous emissions monitoring at incinerators. [126805]

  Mr. Hill
  [holding answer 20 June 2000]It is not possible to estimate with precision the cost of continuous emissions monitoring for incinerators, as this will be site-specific, varying according to the nature and circumstances of the plant, and with the manufacturer and supplier of equipment used. The Environment Agency has estimated, however, that the installed cost for continuous monitoring equipment to meet the requirements of the forthcoming waste incineration Directive would be £50–60k per plant. Annual operating costs, including calibration, are estimated to be in the range £12–18k per plant.

  Mr. Pickthall
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment the Government have made of continuous emissions monitoring at incinerators in Belgium. [126806]

  Mr. Hill
  [holding answer 20 June 2000]The Government have made no assessment of continuous monitoring at incinerators in Belgium.

  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer to the hon. Member for Ashford (Mr. Green), of 13 June 2000,Official Report, column 543W, on

  203W
  consultees, for what reason (a) Friends of the Earth and (b) Greenpeace were not consulted over the EU waste incineration Directive. [127000]

  Mr. Hill
  Friends of the Earth were included among those to whom copies of the draft Directive and copies of our consultant's cost-benefit analyses were sent for comment. Comments on the proposal were also invited from the National Society for Clean Air and Environmental Protection. Greenpeace were not known to have such an active interest in incineration and related issues (for example, Greenpeace did not respond to the consultation on our waste strategy consultation document A Way With Waste, nor to the earlier consultation on Less Waste More Value).

  Mr. Tony Lloyd
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the implications of the Government's waste strategy on the need for additional waste incinerators. [126812]

  Mr. Mullin
  The Government's waste strategy is principally directed at reducing waste and, where waste is produced, at increasing recycling and composting in order to maximise the value recovered from waste and to meet the requirements of the landfill Directive.

  The need for additional incinerators will depend on the success of the strategy in achieving waste reduction, and increasing recycling and composting.

  Modelling of possible mixes of waste management options is included in the Regulatory Impact Assessment in the Waste Strategy 2000 (Part Two). The mix of facilities will be a matter for local authorities.

  Mr. Tony Lloyd
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has concerning the location of future incinerators. [126813]

  Mr. Mullin
  The location of facilities is a matter for local authorities. Suitable sites for new incineration plant will be determined by local planning authorities, in line with the decisions of regional planning bodies. Planning policy guidance on waste management in England is set out in "Planning Policy Guidance Note 10: Planning and waste management".

  Jubilee Line
  Mr. Baker
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer of 14 June 2000,Official Report, column 635W, for what reasons the section of the Jubilee line between Charing Cross and Green Park was not retained as a separate branch. [126999]

  Mr. Hill
  LUL consider that while it is sensible to retain the Green Park—Charing Cross spur for occasional special purposes (e.g. reversing empty trains), it would not be feasible to use it for passenger services. Up to 24 trains per hour serve the Jubilee Line. Dividing these to serve both the extension to Stratford and the spur to Charing Cross would result in an unacceptably sparse service for both routes, significantly reducing the attractiveness of operations on the extended line while providing only a limited service to Charing Cross. In addition, running services in this way would be more complex operationally and could have an adverse impact on reliability.

  Diabetic Drivers
  Mr. Pickthall
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the progress of the review of the driving licensing regime for insulin users. [126582]

  Mr. Hill
  The following progress has been made:

  (i) The Honorary Medical Advisory Panel on Driving and Diabetes has been asked to reconsider their view on what constitutes "very exceptional cases". They have also been asked to compile relevant research data.

  (ii) Inquiries have been made with other EU member states about arrangements for the licensing of insulin treated diabetics.

  (iii) Preliminary inquiries have been made with the European Commission about the interpretation of Directive 91/439/EEC. Follow up arrangements are in hand.

  (iv) Work has begun on developing the specification for two research projects to be initiated in this financial year. Tendering is expected to take place in early Autumn.

  Radioactive Discharges
  Mr. Burgon
  To ask the Secretary of State for the Environment, Transport and the Regions when he expects to publish a draft of the UK strategy for radioactive discharges. [127623]

  Mr. Meacher
  A draft of the strategy is being published for consultation today and copies are being placed in the Library.

  The strategy demonstrates how the UK is going to achieve substantial and progressive reductions in radioactive discharges in the period to 2020, in order to fulfil the obligation entered into at the 1998 meeting of the OSPAR Commission.

  Comments on the draft are invited. After taking accounts of the comments we receive, the Government intend to publish a final version of the strategy towards the end of the year. The Government will shortly publish a draft of guidance they intend to issue to the Environment Agency on the setting of radioactive discharge authorisations. The intention is that the guidance, when it is formally issued with the final version of the strategy, will ensure that discharge authorisations are consistent with the strategy.

  The Government are determined to continue the downward pressure of radioactive discharges. This draft strategy marks a further step towards meeting our OSPAR commitments. We owe it to the future generations to get it right.

WALES

  Aerospace Industry
  Mr. Barry Jones
  To ask the Secretary of State for Wales if he will make a statement on the prospects for the aerospace industry in Wales. [126280]

  Mr. Paul Murphy
  I acknowledge the significant contribution that a strong aerospace industry has made to the economic life of Wales in recent years, particularly the British Aerospace Systems Airbus facility at Broughton. I hope the Government's announcement of £530 million for the A3XX project will consolidate and enhance this position.

  Industrial Development
  Mr. Barry Jones
  To ask the Secretary of State for Wales what discussions he has had with the First Secretary concerning requirements in Deeside for land for industrial development; and if he will make a statement. [126520]

  Mr. Paul Murphy
  I have regular discussions with the First Secretary about a range of topics including the availability of land for industrial development.

  Through its strategic sites programme, the Welsh Development Agency seeks to identify and bring forward sites for development across the whole of Wales. The Agency has reviewed the need for additional land in North Wales, jointly with the North Wales Economic Forum, and concluded that new strategic sites are required to allow for future industrial development.

EDUCATION AND EMPLOYMENT

  New Deal
  Mr. Allan
  To ask the Secretary of State for Education and Employment what statistics about the New Deal he collects on the participation of, and outcomes for,(a) ethnic minorities, (b) men, (c) women and (d) the disabled by (i) unit of delivery and (ii) parliamentary constituency. [126811]

  Ms Jowell
  Information is collected separately for men and women, people with disabilities and those from ethnic minority groups, on their participation through the New Deal and outcomes from the programme. However, some of the outcome information is limited by what participants are prepared to tell us.

  Unit of Delivery tables are placed monthly in the House of Commons Library and give key information by the client's characteristics. Parliamentary constituency tables are placed in the House of Commons Library quarterly. These are intended as summary documents and information is not shown separately by the client's characteristics.

  School Repairs
  Mr. Allan
  To ask the Secretary of State for Education and Employment if he will list by local education authority, for the latest date for which figures are available, the total value of the estimates that schools have made of the sums needed for the repair of school buildings. [126847]

  Jacqui Smith
  The Department does not have these data. However, local education authorities are currently preparing Asset Management Plans covering all the maintained schools in their areas.

  ICT Access
  Mr. Jim Cunningham
  To ask the Secretary of State for Education and Employment what steps his Department is taking to increase access to ICT in deprived communities. [126114]

  Mr. Wills
  [holding answer 20 June 2000]We are taking forward a range of measures so that everyone can benefit from the advantages of new technologies. We are providing £252 million to fund the ICT Learning Centres 206W
  initiative which will give people living in disadvantaged communities in England the opportunity to access the internet and ICT facilities. There will be around 700 Learning Centres which are targeted within the 2,000 most deprived local authority wards and rural areas with significant transport and deprivation problems. They will support disadvantaged client groups with low or no ICT skills.

  We are also introducing a £10 million pilot project which will "wire-up" deprived communities around England. The project will provide a window into the future, assessing how home access to the internet and e-mail can transform lives in the most disadvantaged communities.

  In addition, the Government are making £15 million available for a pilot scheme—"Computers Within Reach"—to enable those who cannot afford new computers to acquire reconditioned computers for use in the home for the purpose of improving their employment prospects, for lifelong learning, or for their children's homework.

  The recently published report of Policy Action Team 15 looked specifically at issues relating to the role of ICT in community renewal. We will continue to work with partners and the private sector to address the issue of closing the digital divide.

  Dyslexia
  Mr. Paice
  To ask the Secretary of State for Education and Employment how many people suffering from dyslexia are currently receiving(a) full-time and (b) part-time support worker time under the Access to Work Scheme. [126579]

  Ms Jowell
  [holding answer 20 June 2000]Responsibility for the subject of the question has been delegated to the Employment Service agency under its Chief Executive. I have asked him to arrange for a reply to be given.

  Letter from Leigh Lewis to Mr. James Paice, dated 21 June 2000:
  As the Employment Service is an Executive Agency, the Secretary of State has asked me to reply to your question regarding how many people with dyslexia are currently receiving (a) full time or (b) part time support worker time under the Access to Work programme. This is something which falls within the responsibilities delegated to me as Chief Executive of the Agency.
  I am afraid we do not collect the specific information you have asked for. However, we do collect information on the total number of disabled people needing the help of a support worker, and the total amount spent in providing this support. In 1999–2000 Access to Work helped 4,133 disabled people needing support workers in their jobs at a cost of £5.6 million. Independent research conducted for the ES and published in 1998 indicated that around 3% of people receiving Access to Work help had a specific learning disability, a category which includes people with dyslexia.
  I am sorry that I cannot be more helpful.

  School Exclusions (Coventry)
  Mr. Jim Cunningham
  To ask the Secretary of State for Education and Employment how many pupils were excluded from schools in Coventry in the years 1995 to 2000; and what alternatives to exclusion his Department is developing. [126113]
  207W
  Jacqui Smith
  [holding answer 20 June 2000]The available information on exclusions in maintained schools in Coventry local education authority area is shown in the table.

  Exclusions data were collected in the January 2000 Annual Schools Census for the 1998–99 academic year and were published in the Department's Statistical First Release SFR20/2000 "Permanent Exclusions from Schools and Exclusion Appeals, England 1998–99 (provisional)" on 10 May 2000.

  We are providing more than £500 million over three years, backed up by new guidance on 'Social Inclusion: Pupil Support', to help tackle behaviour problems in classrooms. This includes increasing the number of on-site Learning Support Units to more than 1,000 within two years to help schools better manage disruptive pupils. The 'Social Inclusion: Pupil Support' (Circular 10–99) also recommended multi-agency Pastoral Support Programmes (PSPs) for pupils at serious risk of permanent exclusion. The Department has provided funding for PSPs.

  We announced at the NASUWT Conference (27 April) that there would be a new £2 million innovation fund with the voluntary sector and employers to provide innovative programmes for excluded pupils and those at risk of exclusion. In addition, there would be a new £9 million pupil allowance scheme for secondary schools in Excellence in Cities areas which accept difficult pupils outside the normal admissions round.

  Number of pupils who were permanently excluded from maintained primary and secondary schools and special schools1 in Coventry local education authority area and England for academic years 1994–95 to 1998–992

  1998–992

  1997–98

  1996–97

  1995–96

  1994–953

  Coventry LEA

  Primary

  5

  20

  9

  16

  4—

  Secondary

  105

  101

  94

  69

  4—

  Special

  4

  1

  4

  1

  4—

  Total

  114

  122

  107

  86

  4—

  England

  Primary

  1,343

  1,5391

  1,573

  1,608

  1,365

  Secondary

  8,622

  10,187

  10,463

  10,344

  9,197

  Special

  439

  572

  632

  524

  522

  Total

  10,404

  12,298

  12,668

  12,476

  11,084

  1Includes maintained and non-maintained Special schools.

  2Provisional

  3The number of permanent exclusions was estimated to take account of a small number of schools that did not provide any information on their permanent exclusions.

  4Not available

  Postgraduate Teacher Training
  Mr. Clappison
  To ask the Secretary of State for Education and Employment how many applications were received for courses of postgraduate initial teacher training commencing in September; and how many had been received at the same stage last year, broken down into those applying for secondary teaching in(a) maths, (b) foreign languages, (c) science and (d) technology. [126317]

  Ms Estelle Morris
  Latest available figures for applications for postgraduate initial teacher training courses in England and Wales for secondary teaching in 208W
  maths, modern foreign languages, science and technology, together with comparative figures for the previous year are given in the table.

  3 June 2000

  5 June 1999

  Mathematics

  950

  1,085

  Science

  2,167

  2,324

  Modem Languages

  1,757

  1,673

  Technology

  871

  928

  Note:

  The figures are for applications as entered on the GTTR computer system.

  Source:

  Graduate Teacher Training Register (GTTR)

  The Government announced on 30 March that training salaries would be introduced for postgraduate trainees starting initial teacher training courses from September 2000. Since that date, latest available figures show 1,119 (32 per cent.) more applications have been input onto the Graduate Teacher Training Registry computer system than for the equivalent period last year.

  The number of trainees recruited onto mathematics postgraduate initial teacher training courses declined between 1994–95 and 1998–99. There was a similar decline in the number of trainees recruited onto science postgraduate initial teacher training courses between 1996–97 and 1998–99. Last year, with the introduction of "golden hellos", recruitment to mathematics and science was up on the previous year.

  In recognition of the fierce competition for good graduates in mathematics, science, modern foreign languages, information technology and design and technology, as well as £6,000 training salaries, new style "golden hello" incentives of £4,000 were announced for postgraduate trainees in these subjects who pass their induction year and go on to take up a relevant teaching post. Since the announcement, available figures for all these subjects together show an increase of 379 or 22 per cent.

  Class Sizes (East Sussex)
  Mr. Caplin
  To ask the Secretary of State for Education and Employment what the average primary school class size in East Sussex was for each year since 1979. [126640]

  Ms Estelle Morris
  The requested information is shown in the table.

  In East Sussex, the number of pupils in key stage 1 classes of 31 or more pupils taught by one teacher was 1,240 compared with 6,439 a year earlier, which represented an 80 per cent. reduction in the number of such pupils. The Government are well on target to deliver their pledge to limit the size of infant classes to 30 pupils. During the same time period, the average size of classes in maintained primary schools for the unitary authorities of East Sussex and Brighton also fell. This was the first year for some time that average primary class sizes in either the new or old authorities of East Sussex had fallen, after class sizes had shown a steady increase since 1987.

  East Sussex local education authority area has been allocated £4 million of funding so far to support their efforts in reducing infant class sizes. This funding comprises some £1.1 million of capital funding and £2.8 million of revenue funding.
  209W

  Size of classes taught by one teacher in maintained primary schools in the local education authority areas of East Sussex and Brighton 1979 to 2000

  Position as at January

  Key stage 1

  Key stage 2

  Overall primary1

  Average class size

  Pupils in classes of more than 30 pupils

  Average class size

  Average class size

  East Sussex2

  Brighton2

  East Sussex3

  East Sussex2

  Brighton2

  East Sussex3

  East Sussex2

  Brighton2

  East Sussex3

  East Sussex2

  Brighton2

  East Sussex3

  20004

  26.1

  27.3

  —5

  1,240

  2,262

  —5

  30.2

  29.3

  —5

  28.2

  28.2

  —5

  1999

  27.5

  28.0

  —5

  6,439

  2,811

  —5

  29.9

  29.2

  —5

  28.7

  28.5

  —5

  1998

  27.3

  28.5

  —5

  6,433

  3,422

  —5

  29.4

  28.9

  —5

  28.3

  28.6

  —5

  1997

  —5

  —5

  27.9

  —5

  —5

  10,130

  —5

  —5

  28.9

  —5

  —5

  28.2

  1996

  —5

  —5

  27.4

  —5

  —5

  8,927

  —5

  —5

  28.2

  —5

  —5

  27.7

  1995

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  27.5

  1994

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  27.4

  1993

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  27.1

  1992

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  26.9

  1991

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  26.6

  1990

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  26.0

  1989

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  25.9

  1988

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  25.8

  1987

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  25.5

  1986

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  26.3

  1985

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  25.8

  1984

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  24.6

  1983

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  24.5

  1982

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  24.9

  1981

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  25.3

  1980

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  25.2

  1979

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  —6

  —5

  —5

  25.9

  1Includes nursery classes and mixed key stage classes

  2After local government reorganisation

  3Before local government reorganisation

  4Provisional

  5Not applicable

  6Not available (information not collected by specific key stages)

  Special Educational Needs
  Mr. Ben Chapman
  To ask the Secretary of State for Education and Employment when the special educational needs and disability in education Bill will be introduced in Parliament. [127380]

  Mr. Blunkett
  We are totally committed to taking forward the education recommendations of the Disability Rights Task Force (DRTF) and will legislate when parliamentary time allows, alongside our proposals to change the special educational needs framework. Our commitment to legislate on SEN was made in the Queen' Speech and remains in place. However, it has now become clear that it will not be possible to introduce a Bill this parliamentary Session.

  The DRTF recommendations—crucial to our plans—were not available until December and required full consultation. Our consultation exercise on how to take forward the education recommendations of the report has revealed strong support for the broad thrust of our proposals, but there are some detailed issues which have required further consultation.

  In view of the inevitable delay, and, without the option of carryover, we have decided to publish a draft Bill in this parliamentary Session, giving the opportunity for comment and feedback before introduction of the Bill.

SOCIAL SECURITY

  Incomes
  Mr. Welsh
  To ask the Secretary of State for Social Security what was the average income in(a) cash, (b) real terms and (c) as a percentage of average earnings in (i) 1979, (ii) 1984, (iii) 1989, (iv) 1994 and (v) each year from 1994 to 2000 for (A) the UK and (B) Scotland of (1) pensioners, (2) pensioners aged over 75 years, (3) students, (4) single parents, (5) the bottom decile, (6) the top decile and (7) the disabled; and if he will make a statement. [126770]

  Mr. Bayley
  The information requested could be obtained only at disproportionate cost.

  Information on average (mean and median) income of pensioner couples, single pensioners and single parents, and median incomes of the top and bottom deciles are published in the annual publication Households Below Average Income. The latest published edition, which relates to 1997–98, also contained analyses showing the position in the income distribution of pensioners by age, and students. Copies of this volume are in the Library.

  Benefit Recipients
  Mr. Ashdown
  To ask the Secretary of State for Social Security how many people in(a) Yeovil constituency and (b) South Somerset have been in receipt of (i) Income

  211W
  Support, (ii) Disability Living Allowance, (iii) Incapacity Benefit, (iv) Unemployment Benefit, and (v) Housing Benefit in each of the last 10 years; and if he will make a statement. [126580]

  Mr. Bayley
  The administration of benefits is a matter for Alexis Cleveland, the Chief Executive of the Benefits Agency. She will write to the right hon. Member.

  Letter from Alexis Cleveland to Mr. Paddy Ashdown, dated 20 June 2000:
  The Secretary of State for Social Security has asked me to respond to your recent Parliamentary Question asking how many people in (a) Yeovil constituency and (b) South Somerset have been in receipt of (i) income support, (ii) disability living allowance, (iii) incapacity benefit, (iv) unemployment benefit, and (v) housing benefit in each of the last 10 years; and if he will make a statement.
  The data is not available in the requested format, however the information that is available is supplied in the attached tables.
  I hope this is helpful.

  (i) Income Support

  Year

  Yeovil PC

  South Somerset LA

  August 1998

  5,000

  —

  August 1999

  5,000

  —

  February 2000

  4,900

  —

  February 1993

  —

  9,9000

  February 1994

  —

  10,200

  February 1995

  —

  10,000

  February 1996

  —

  9,800

  February 1997

  —

  6,900

  February 1998

  —

  6,700

  February 1999

  —

  6,700

  February 2000

  —

  6,900

  Notes:

  1. Claimant figures have been rounded to the nearest hundred.

  2. Sample size 5 per cent., therefore subject to sampling error.

  3.Figures for parliamentary constituency are not available prior to August 1998.

  4. Figures for South Somerset are not readily available prior to February 1993.

  Source:

  Income Support Statistics Quarterly Enquiry, February 1994 to February 2000.

  (ii) Disability Living Allowance—recipients of Disability Living Allowance

  Year

  Yeovil PC

  South Somerset LA

  May 1993

  1,600

  1,900

  May 1994

  1,700

  2,200

  May 1995

  1,700

  2,300

  May 1996

  2,000

  2,700

  May 1997

  2,200

  3,000

  May 1998

  2,313

  3,311

  May 1999

  2,447

  3,494

  Notes:

  1. Figures relate to 31 May.

  2. Figures based on a 5 per cent. data for years up to 1997 and on 100 per cent. data for years 1998 and 1999.

  2. Figures prior to 1993 not available. Disability Living Allowance was introduced in April 1992.

  Source:

  DSS Information Centre
  212W

  (iii) Incapacity Benefit—Incapacity Benefit recipients in the South Somerset area for May 1996, 1997, 1998 and 1999

  South Somerset

  31 May 1996

  2,600

  31 May 1997

  2,700

  31 May 1998

  2,600

  31 May 1999

  2,500

  30 November 1999

  2,700

  Notes:

  1. These figures are taken from a 5 per cent. sample of the benefit computer system, and exclude a small number of cases held clerically. All the May figures for South Somerset are subject to a rating factor to account for missing postcodes. The figures are rounded to the nearest hundred.

  2. Figures for parliamentary constituency are not available. Figures for South Somerset are not readily available prior to May 1996.

  3. Incapacity Benefit replaced Sickness Benefit and Invalidity Benefit in April 1995.

  Unemployment Benefit

  No figures are available for Unemployment Benefit by either Parliamentary Constituency or Local Authority however figures for Jobseekers Allowance are provided in the table below.

  Unemployment benefit ceased on 6th October 1996 and Jobseekers Allowance began from 7th October 1996

  (iv)Jobseeker's Allowance

  Year

  Yeovil PC

  South Somerset LA

  August 1998

  1,300

  —

  August 1999

  1,000

  —

  August 2000

  1,000

  —

  August 1997

  —

  2,100

  February 1998

  —

  1,600

  February 1999

  —

  1,600

  February 2000

  —

  1,500

  Notes:

  1. Claimant figures have been rounded to the nearest hundred. Sample size 5 per cent., therefore subject to sampling error.

  2. Jobseeker's Allowance replaced Income Support for the unemployed in October 1996.

  3. Figures are for all claimants including those with nil benefit.

  Source:

  Jobseeker's Allowance Statistics Quarterly Enquiry, August 1997 to February 2000

  (v) Housing Benefit-Housing Benefit recipients in South Somerset: May 1990 to May 1997

  Number of people in receipt of Housing Benefit

  May 1990

  8,470

  May 1991

  9,380

  May 1992

  8,770

  May 1993

  8,400

  May 1994

  7,810

  May 1995

  8,940

  May 1996

  9,030

  May 1997

  8,930

  May 1998

  8,530

  May 1999

  8,170

  Notes:

  1. Information refers to the number of benefit units.

  2. The figures are rounded to the nearest ten.

  The number of people in receipt of Housing Benefit for the years from 1990 to 1999 in the Yeovil constituency is unavailable, as the data are not collected at this level.

  Source:

  Housing Benefit Management Information System, quarterly 100 per cent. case load stock-counts, taken on the last working day in May 1990 to May 1997 and on the second Thursday of May 1998 and May 1999.

  Pension Schemes
  Mr. Gordon Prentice
  To ask the Secretary of State for Social Security how many people lost pension entitlements because their company pension schemes were underfunded and were wound up in each year since 1990. [126412]

  Mr. Rooker
  The Pension Schemes Registry indicates that since April 1997, the first date at which reliable information is available, a total of about 22,500 occupational pension schemes have been recorded as having wound up. However, no information is available as to how many of these schemes are salary-related schemes that were underfunded on wind-up.

  Home Responsibility Protection
  Mr. Rooney
  To ask the Secretary of State for Social Security if time spent as a foster parent qualifies for state retirement pension under the rules of home responsibility protection. [126913]

  Mr. Rooker
  Foster parents do not receive Child Benefit in respect of foster children who are deemed to be in the care of the local authority. Consequently, foster parents are not currently eligible for Home Responsibilities Protection in respect of their foster caring role.

  Parliamentary Questions
  Mr. Maclennan
  To ask the Secretary of State for Social Security on how many occasions he deposited papers in the Library in response to parliamentary questions tabled to his Department between 19 October 1999 and 20 April 2000. [127101]

  Mr. Rooker
  We have answered 1,815 parliamentary questions between 19 October 1999 and 20 April 2000. Papers were deposited in the Library in response to 40 parliamentary questions.

TREASURY

  Council Tax Exemptions
  Mr. Chaytor
  To ask the Chancellor of the Exchequer if he will issue guidelines to universities and local authorities on the issuing of exemption certificates for council tax eligibility for intercalating students; and if he will make a statement. [124696]

  Ms Beverley Hughes
  [holding answer 15 June 2000]I have been asked to reply.

  Those undertaking a period of intercalation, who remain enrolled at the educational establishment, may continue to qualify as students for council tax purposes. Guidance was issued to this effect to all local authorities on 29 April 1996. We have no evidence to suggest there is a need to issue further guidance at this time. However, we continue to keep the operation of council tax under review and will issue further guidance should the need arise.

  Parliamentary Questions
  Mr. Maclennan
  To ask the Chancellor of the Exchequer on how many occasions he deposited papers 214W
  in the Library in response to parliamentary questions tabled to his Department between 19 October 1999 and 20 April 2000. [127104]

  Mr. Timms
  The information is not held in the form requested and could be provided only at disproportionate cost. However, in replying to parliamentary questions Treasury Ministers often place documents in the Library of the House for the information of Members.

  Vocational Training
  Mr. Willis
  To ask the Chancellor of the Exchequer what plans he has to specify the vocational training courses that will qualify for tax relief. [126809]

  Mr. Timms
  I assume the hon. Member is referring to the new Individual Learning Account framework being introduced shortly by my right hon. Friend the Secretary of State for Education and Employment and in Scotland by the Scottish Ministers. Clause 57 of the Finance Bill provides that employees will not be taxable on any financial contribution which their employers may make towards the cost of an eligible learning course for which a Government grant may be payable. The range of training which can qualify will be a matter for the Department for Education and Employment and devolved administrations, but I can confirm that it will be a very wide range.

  Mr. Willis
  To ask the Chancellor of the Exchequer what estimate he has made of the saving to the Exchequer that will result from the removal of tax relief for vocational training costs from students. [126808]

  Mr. Timms
  As the Chancellor made clear in his 1999 Budget statement, the savings from the removal of Vocational Training Relief (VTR), as set out in Table A2.1 of the FSBR 2000—will help pay for the Government grants and discounts that can be claimed under the coming Individual Learning Account scheme. The Government are making available £150 million in grants and discounts up to April 2002. In addition we are introducing in the Finance Bill a tax exemption for employees on employer contributions towards these learning accounts; the estimated Exchequer cost of this exemption is £10 million in a full year.

  Working Families Tax Credit
  Jane Griffiths
  To ask the Chancellor of the Exchequer what steps the Government are taking to publicise the working families tax credit in Northern Ireland. [125496]

  Dawn Primarolo
  I refer my hon. Friend to the answer I gave my hon. Friend the Member for Elmet (Mr. Burgon) on 9 February 2000,Official Report, column 215W.

  Mr. Alexander
  To ask the Chancellor of the Exchequer how many lone parents are benefiting from the working families tax credit. [126866]

  Dawn Primarolo
  The number of families in receipt of working families tax credit at the end of April 2000 is provisionally estimated at 1,053,000. Of these, it is estimated that 542,000 were headed by lone parents.
  215W
  Mr. Davidson
  To ask the Chancellor of the Exchequer how much is spent annually on the working families tax credit; and how much would be spent if the national minimum wage were raised to five pounds per hour. [125111]

  Dawn Primarolo
  Table C12 in the March 2000 Financial Statement and Budget Report shows estimated and projected expenditure on the working families tax credit (WFTC) and the disabled person's tax credit (DPTC).

  It is not possible to estimate accurately the potential impact of raising the minimum wage on the labour market. No reliable estimate of its effect on WFTC expenditure can therefore be provided.

  Single Market
  Mr. Redwood
  To ask the Chancellor of the Exchequer what tax measures are needed to complete the EU single market. [126404]

  Dawn Primarolo
  The Government assess all EU tax proposals on their merits, including whether they assist the effective functioning of the single market.

  Customs and Excise (Liverpool)
  Mrs. Ellman
  To ask the Chancellor of the Exchequer what changes are proposed in the location and operation of Her Majesty's Customs and Excise in Liverpool. [126437]

  Dawn Primarolo
  It is for the Chairman and the Management Committee of Her Majesty's Customs and Excise to determine where best to place Customs operations in order to discharge its various responsibilities. I understand that there are no major changes currently planned in the location of Customs and Excise in Liverpool, but changing demands and work patterns mean that the management would be failing in its responsibilities if it did not keep the position constantly under review.

  Sea Tax Rebates
  Mr. Wigley
  To ask the Chancellor of the Exchequer if he will make a statement on sea tax rebates. [124198]

  Dawn Primarolo
  I assume that the right hon. Member is referring to the Tonnage Tax. The Government's proposals on tonnage tax are set out in schedule 22 of this year's Finance Bill.

  Pesticides Tax
  Mr. Alan Simpson
  To ask the Chancellor of the Exchequer what(a) representations the Treasury has received and (b) meetings he has held on the proposed pesticides tax with (i) the British Agrochemicals Association, (ii) UKASTA, (iii) NOAH, (iv) the National Farmers' Union, (v) the Country Landowners' Association and (vi) agrochemical companies, giving the name of each company, including the dates and duration of the meetings. [126900]

  Mr. Timms
  Ministers and officials have had numerous meetings with representatives of the agrochemicals industry, agriculture and environmental non-Government organisations, and received a number of representations on 216W
  a possible pesticides tax and on a voluntary package of measures to reduce the environmental impact of pesticides use.

  The Government are currently consulting on a formal set of voluntary proposals which have been published by the British Agrochemicals Association. The Government welcome the views of all interested parties on these proposals and their effectiveness in tackling the environmental impacts of pesticide use.

HOME DEPARTMENT

  Wormwood Scrubs Prison
  Mr. Darvill
  To ask the Secretary of State for the Home Department when Her Majesty's Chief Inspector of Prisons will publish his report into his follow-up inspection of Her Majesty's Prison Wormwood Scrubs of 7 to 17 February. [127381]

  Mr. Straw
  Her Majesty's Chief Inspector of Prisons' report of his unannounced inspection is being published today. Copies have been made available in the Library and the Vote Office.

  I made a statement to the House on 28 June 1999, Official Report, columns 21–33, on the report of an unannounced full inspection of Wormwood Scrubs prison that had taken place in March 1999. That report made deeply disturbing reading. Sir David's inspection had taken place against the background of criminal investigations into allegations that a number of members of staff at Wormwood Scrubs had assaulted prisoners. Sir David and his team of inspectors had found the overall treatment of prisoners was profoundly unsatisfactory.

  In my statement last year, I said that I had made it absolutely clear to the Director General of the Prison Service that change must be delivered at Wormwood Scrubs. I expected a robust action plan to be put in place quickly, and I expected the majority of Sir David's recommendations to be accepted and implemented. I reported that I had asked Sir David Ramsbotham to carry out a further inspection in six months' time and that I would report the result to the House.

  The Chief Inspector returned to Wormwood Scrubs between 7 and 17 February this year, and his report of that inspection is published today. He found Wormwood Scrubs much improved from his previous visit. Change had taken place, and life for prisoners had improved. Prisoners felt safer, and their relationships with staff were better. Health care was radically improved, education had been expanded and, together with employment, could attract most prisoners into purposeful activity.

  The extent of the changes required, including substantial cultural change, inevitably takes time. Nevertheless, the chief inspector found that a promising start had been made and real improvements had already been delivered. The report makes 99 recommendations for further improvement, but encouragingly identifies 12 examples of good practice.

  I should like to pay tribute to all those who have contributed to this change. Senior managers at Prison Service headquarters have given the establishment both leadership and support. The Governor and his management

  217W
  team have tackled the problems at Wormwood Scrubs with determination and commitment, and their legitimate authority has been restored. It also gives me great pleasure to commend the staff of Wormwood Scrubs for what has been achieved. This time last year, there were serious concerns as to whether or not the Prison Officers' Association would co-operate fully with what needed to be done. Sir David notes the determination of the vast majority of staff in the prison to see Wormwood Scrubs restored to a place of excellence, known for the high quality of the treatment of and conditions for its prisoners.

  Staff at Wormwood Scrubs still face a difficult time. A number of staff are still suspended from duty in connection with the investigations into the allegations of assault. I understand that the first criminal trials are likely to start in the next few weeks, and this will bring further unwelcome attention on everyone connected with the establishment. Nevertheless, today's report shows how much has already been achieved in the face of these sorts of difficulties, and with Sir David Ramsbotham I am optimistic that the programme of improvement will be continued and completed at Wormwood Scrubs. I am still keeping the option of market-testing open, but believe that this report shows the kind of rapid progress I had hoped for.

  Correspondence
  Dr. Godman
  To ask the Secretary of State for the Home Department when the hon. Member for Greenock and Inverclyde will receive a substantive answer to his letter of 17 May concerning the visit of Mr. Mike Tyson. [126306]

  Mr. Straw
  The Minister of State, my hon. Friend the Member for Hornsey and Wood Green (Mrs. Roche) wrote on 16 June in response to my hon. Friend's letter.

  Asylum Seekers
  Dr. Harris
  To ask the Secretary of State for the Home Department to what extent Her Majesty's Government's policy on removals to Zimbabwe of failed asylum seekers has changed in response to the civil unrest and political repression in that country. [125125]

  Mrs. Roche
  We see no reason at present to change our arrangements for the removal of failed asylum seekers to Zimbabwe. No one has been or will be removed to Zimbabwe unless we are satisfied that they can return without risk. Each case is considered on its individual merits and circumstances. Developments in Zimbabwe are being carefully monitored.

  Prison Service Expenditure
  Mr. Simon Hughes
  To ask the Secretary of State for the Home Department what the change was in planned expenditure on(a) the Prison Service, (b) policing and (c) probation (i) in total and (ii) in real terms in each of the last 10 years; and if he will make a statement. [126556]

  Mr. Straw
  [holding answer 19 June 2000]The following tables set out the total expenditure (revenue and capital) on the prison service, policing and probation for the 10 financial years 1991–92 to 2000–01. The figures for the financial years 1991–92 to 1998–99 represent expenditure outturn. The figures for 1999–2000 are estimated outturn while the figures for 2000–01 reflect 218W
  expenditure plans. The tables also show the change in expenditure from one financial year to the next in both cash and real terms.

  Prison Service

  Total net expenditure

  Percentage change over previous financial year

  Financial year

  (£ million)

  Cash terms

  Real terms

  1991–92

  1,462

  —

  —

  1992–93

  1,470

  0.56

  –2.67

  1993–94

  1,509

  2.62

  0.00

  1994–95

  1,598

  5.91

  4.41

  1995–96

  1,667

  4.32

  1.39

  1996–971

  1,609

  –3.50

  –6.49

  1997–98

  1,734

  8.10

  4.85

  1998–99

  1,812

  4.18

  1.17

  1999–2000 (estimated)

  1,846

  1.88

  –0.61

  2000–01 (plans)2

  1,780

  –3.58

  –5.72

  1Expenditure on capital reduced following completion of major capital works programmes in 1995–96

  2Reduction in planned expenditure reflects transfer of provision of £118.2 million (from the Prison Service to the Youth Justice Board) in respect of the secure juvenile estate

  Police

  Total net expenditure1

  Percentage change over previous financial year

  Financial year

  (£ million)

  Cash terms

  Real terms

  1991–92

  5,405

  —

  —

  1992–93

  5,897

  9.10

  5.61

  1993–94

  6,225

  5.56

  2.82

  1994–95

  6,490

  4.26

  2.79

  1995–96

  6,735

  3.78

  0.87

  1996–971

  6,986

  3.73

  0.49

  1997–98

  7,243

  3.68

  0.86

  1998–99

  7,450

  2.86

  –0.41

  1999–2000 (estimated)

  7,859

  5.49

  2.92

  2000–01 (plans)2

  8,100

  3.07

  0.80

  1Total expenditure includes revenue and capital expenditure by police authorities and expenditure on policing incurred directly by the Home Office

  2Excludes Capital Modernisation Fund moneys announced in the Budget as this is in respect of a range of projects and the funding can and will be spread over an number of years. The detailed profile of this expenditure is still being established

  Probation

  Total net expenditure1

  Percentage change over previous financial year

  Financial year

  (£ million)

  Cash terms

  Real terms

  1991–92

  335

  —

  —

  1992–93

  365

  9.00

  5.46

  1993–94

  393

  7.67

  4.89

  1994–95

  406

  3.31

  1.85

  1995–96

  416

  2.46

  –0.41

  1996–97

  468

  12.50

  8.99

  1997–98

  481

  2.78

  –0.01

  1998–99

  475

  –1.25

  –4.39

  1999–2000 (estimated)

  491

  3.37

  0.85

  2000–01 (plans)

  524

  6.68

  4.37

  1Total expenditure figures do not include capital expenditure on probation/bail hostels nor direct Home Office central expenditure

  WWII Unexploded Bombs
  Mr. Bob Russell
  To ask the Secretary of State for the Home Department if he will establish a national register of unexploded bombs from the Second World War, available for public inspection; and if he will make a statement. [126952]
  219W
  Mr. Mike O'Brien
  During the Second World War local authorities were responsible for maintaining records of the locations of unexploded ordnance. Although some local authorities destroyed the details they held, some information is still available through the Public Record Office.

  In 1997 the Home Office collated details of information from a variety of sources including emergency services, local authorities and the military. It had been intended to publish the information, but this was not pursued when it became evident that there were unexplained contradictions in the data and it could not be relied upon as either accurate or comprehensive. Because of this it would not be sensible to establish a national register as proposed.

  We do, however, search the information if asked by individuals, local authorities or building contractors.

NORTHERN IRELAND

  Security Situation
  Mr. Walker
  To ask the Secretary of State for Northern Ireland if he will make a statement on the security situation in Belfast, North. [125483]

  Mr. Ingram
  During the period 1 January to 13 June this year one death, 36 shootings and two bombings were recorded by the Royal Ulster Constabulary's D Division which takes in North Belfast and includes Antrim and Carrickfergus. There were 54 casualties (31 shootings and 23 assaults) as a result of paramilitary style attacks.

  Mr. Ben Chapman
  To ask the Secretary of State for Northern Ireland what recent progress has been made on creating a more normal security environment. [125490]

  Mr. Ingram
  I refer my hon. Friend to the answer I gave earlier today to my hon. Friend the Member for Hemel Hempstead (Mr. McWalter),Official Report, column 329.

  Decommissioning
  Miss McIntosh
  To ask the Secretary of State for Northern Ireland what recent representations he has received on decommissioning in Northern Ireland; and if he will make a statement. [125484]

  Mr. Ingram
  The Government continue to meet representatives of all the political parties to discuss all aspects of the Good Friday Agreement. The Decommissioning Commission continues its discussions with representatives of the various groups. All sides must honour all the commitments they have made.

  Mr. Nicholas Winterton
  To ask the Secretary of State for Northern Ireland what assessment he has made of when the decommissioning section of the Belfast agreement will be implemented. [125485]

  Mr. Ingram
  It is more important to get the process under way than to set a deadline for its end. We now have a firm commitment from the IRA to put arms beyond use, and a process of confidence-building measures with independent verification.
  220W
  This is only the start. But it is better to start than to worry so much about when it will finish, lest you never start.

  Mr. William Ross
  To ask the Secretary of State for Northern Ireland what progress has been made towards the surrender and destruction of terrorist weapons in Northern Ireland. [125491]

  Mr. Brady
  To ask the Secretary of State for Northern Ireland if he will make a statement on progress towards decommissioning of terrorist weapons. [125501]

  Mr. Ingram
  Now for the first time, the IRA have put in place a commitment to put their arms completely and verifiably beyond use, and have volunteered a confidence-building measure, to demonstrate that their arms remain silent and secure. We expect Mr. Ramaphosa

  and

  Mr. Ahtisaari to begin their work soon.

  Mr. Ian Bruce
  To ask the Secretary of State for Northern Ireland how many illegally held weapons have been inspected. [125498]

  Mr. Ingram
  The inspection of illegally-held weaponry is a matter for the independent inspectors and IICD.

  Police Ombudsman
  Mr. Dismore
  To ask the Secretary of State for Northern Ireland when he last met the police ombudsman to discuss complaints. [125486]

  Mr. Ingram
  The ombudsman has not met directly with the Secretary of State to discuss complaints.

  Paramilitary Violence
  Mr. Evans
  To ask the Secretary of State for Northern Ireland what recent discussions he has had with the IRA and Sinn Fein concerning the use of violence against Northern Ireland citizens. [125487]

  Mr. Ingram
  Ministers meet regularly with representatives of all the political parties in Northern Ireland where a range of issues including paramilitary assaults are discussed. We have consistently called upon those with influence over the paramilitary groups to call a complete cessation to these barbaric acts.

  Mr. Robathan
  To ask the Secretary of State for Northern Ireland what assessment he has made of the extent of(a) punishment beatings and (b) other terrorist activities by Republican paramilitaries since 22 May. [125488]

  Mr. Ingram
  From 22 May to 11 June this year there were two deaths, two bombings and 12 shooting incidents. In addition there were seven casualties as a result of paramilitary style attacks (three by Loyalists and four by Republicans).

  Mr. Swayne
  To ask the Secretary of State for Northern Ireland how many punishment beatings have taken place in the last month. [125500]

  Mr. Ingram
  During the month of May the number of casualties as a result of paramilitary style attacks were 14 shootings (nine by Loyalists and five by Republicans) and 14 assaults (six by Loyalists and eight by Republicans).

  Job Creation
  Mr. Savidge
  To ask the Secretary of State for Northern Ireland how many jobs have been created in the last six months in Northern Ireland. [125489]

  Mr. Michael J. Foster
  To ask the Secretary of State for Northern Ireland how many jobs have been created in the last six months in Northern Ireland. [125502]

  Mr. Mandelson
  Responsibility for this subject has been devolved to the Northern Ireland Assembly and is therefore no longer a matter for the Secretary of State for Northern Ireland.

  Civic Forum
  Mr. Pound
  To ask the Secretary of State for Northern Ireland when a civic forum is to be established in Northern Ireland. [125492]

  Mr. Mandelson
  Responsibility for this subject has been devolved to the Northern Ireland Assembly and is therefore no longer a matter for the Secretary of State for Northern Ireland.

  Military Structures and Installations
  Dr. Godman
  To ask the Secretary of State for Northern Ireland what recent representations he has received concerning the dismantling of military and related structures and installations. [125493]

  Mr. Ingram
  The Government have received one recent written representation concerning the dismantling of military structures, which are the operational responsibility of the Chief Constable. All decisions with regard to normalisation of security are taken by the Chief Constable in the light of the current threat level.

  Young Offenders
  Mr. Hoyle
  To ask the Secretary of State for Northern Ireland if he will make a statement on the range of schemes available to deal with young offenders. [125494]

  Mr. Ingram
  The Criminal Justice Children (Northern Ireland) Order 1998 was introduced in January 1999 and brought in a new juvenile justice centre order of between six months and two years, half of which is spent in custody and half under close supervision in the community. The community element of the sentence is delivered by the Probation Board for Northern Ireland.

  A range of programmes for young people, both in custody and in the community have been developed. Programmes such as cognitive behaviour training to tackle offending and the associated causes and problems such as drugs and alcohol misuse, car crime, aggressive behaviour and sex offending, have been developed on a multi-agency basis.

  Peace Process
  Mr. Bercow
  To ask the Secretary of State for Northern Ireland if he will make a statement on the peace process. [125495]

  Mr. Mandelson
  The last few weeks have seen significant progress in the peace progress. On 27 May I signed an order restoring devolution to Northern Ireland with effect from midnight on 29 May. Northern Ireland 222W
  now has a second opportunity for locally accountable government to take responsibility for building stability and prosperity for all the people of Northern Ireland.

  Election Fraud and Malpractice
  Mr. Thompson
  To ask the Secretary of State for Northern Ireland what steps he is taking, with what time scale, to prevent fraud and malpractice in elections in Northern Ireland; and if he will make a statement. [125497]

  Mr. George Howarth
  The Government have already introduced legislation to extend the time available to the Chief Electoral Officer to scrutinise absent vote applications, one of the main areas where it is thought that abuse of the system takes place. The provisions of the Representation of the People Act 2000 which makes provision for rolling registration will also be extended to Northern Ireland and hence will make the electoral register more accurate. The staffing and other resources of the Chief Electoral Officer are also kept under constant review to ensure they meet changing needs and circumstances. In addition, the Government intend to bring forward other measures which will require legislation by Bill. As already confirmed elsewhere, we hope to find parliamentary time for this before the General Election but the timing will of course depend on the timing of that election.

  Police Service
  Mr. Woodward
  To ask the Secretary of State for Northern Ireland if he will make a statement on the future of the police service in Northern Ireland. [125503]

  Mr. Ingram
  The Police (Northern Ireland) Bill lays the foundations for a new beginning for policing in Northern Ireland including a widely acceptable, effective and representative police service.

  British-Irish Council
  Mr. McFall
  To ask the Secretary of State for Northern Ireland if he will make a statement on the progress being made on the British-Irish Council. [125504]

  Mr. George Howarth
  I refer my hon. Friend to the reply I gave earlier today to my hon. Friends the Members for Glasgow, Maryhill (Mrs. Fyfe) and for Leeds, Central (Mr. Benn),Official Report, column 327.

  Criminal Justice
  Mr. McDonnell
  To ask the Secretary of State for Northern Ireland if he will make a statement on the progress that has been made with the consultation phase of the review of the criminal justice system. [125505]

  Mr. Ingram
  We have received 60 written responses to the report of the review of the Criminal Justice System in Northern Ireland from members of the public. A number of seminars have been organised by the Government Department to facilitate consultation and we are aware that a number of other organisations plan to hold conferences to consider the report's recommendations before the consultation period ends on 29 September 2000.

  Downpatrick Police Station
  Mr. McGrady
  To ask the Secretary of State for Northern Ireland what progress has been made on the removal of the security fortifications at the Police Station in Downpatrick; and if he will make a statement. [125499]

  Mr. Ingram
  The security levels which exist at Downpatrick Royal Ulster Constabulary station are currently under review and any action recommended will be taken after this review is completed.

CABINET OFFICE

  Pesticides Tax
  Mr. Alan Simpson
  To ask the Minister for the Cabinet Office what(a) representations her office has received and (b) meetings she has held on the topic of the proposed pesticides tax with (i) the British Agrochemicals Association, (ii) UKASTA, (iii) NOAH, (iv) the National Farmers' Union, (v) the Country Landowners' Association and (vi) agrochemical companies, giving the name of each company, including the dates and duration of the meetings. [126899]

  Mr. Timms
  I have been asked to reply.

  Ministers and officials have had numerous meetings with representatives of the agrochemicals industry, agriculture and environmental non-governmental organisations, and received a number of representations on a possible pesticides tax and on a voluntary package of measures to reduce the environmental impact of pesticides use.

  The Government are currently consulting on a formal set of voluntary proposals which have been published by the British Agrochemicals Association. The Government welcome the views of all interested parties on these proposals and their effectiveness in tackling the environmental impacts of pesticide use.

  1997–98

  1998–99

  1999–2000

  AIDS Support Grant

  800,000

  770,000

  810,000

  Drugs and Alcohol Specific Grant

  61,744

  27,421

  0

  Drugs and Alcohol Special Grant1

  —

  —

  0

  Guardians Ad Litem and Reporting Officer Services2

  28,784

  —

  —

  Mental Health Grant

  942,203

  927,401

  1,159,163

  Training Support Programme

  215,091

  198,259

  196,791

  Secure Accommodation (Capital)

  0

  0

  0

  Community Care Special Transitional Grant3

  2,304,652

  2,170,586

  —

  Asylum-Seekers' Accommodation Grant4

  3,846,920

  75,306,235

  —

  Persons from Abroad Children's Grant4

  2,835,433

  3,753,040

  —

  Unaccompanied Asylum-Seeking Children's Grant

  41,163

  879,200

  2,769,000

  Promoting Independence: Partnership Grant5

  ‑

  —

  1,754,966

  Promoting Independence: Prevention Grant5

  —

  —

  146,487

  Promoting Independence: Carers' Grant5

  —

  —

  137,108

  Children's Social Services Grant6

  —

  32,500

  755,373

  1This grant was available in 1999–2000 only

  2This grant ended in March 1998

  3This grant ended in March 1999

  4These grants were transferred to the Home Office from 1999–2000

  5These grants began in 1999–2000

  6This grant began in 1998–99

  7This is the total actually paid. However, auditors have certified that £5,074,621 was the correct amount due. The Department is recovering £231,614.

HEALTH

  Mead Webber Plant
  Mr. Paterson
  To ask the Secretary of State for Health for what reason a Regulation 10 (Prohibition) Notice was served ordering Mead Webber immediately to cease slaughter operations. [122065]

  Ms Stuart
  [holding answer 15 May 2000]I am advised by the Food Standards Agency that the Fresh Meat (Hygiene and Inspection) Regulations 1995 (as amended) oblige the Meat Hygiene Service (MHS) to appoint one or more official veterinary surgeons (OVSs) at every licensed fresh meat slaughterhouse in Great Britain to be responsible for the ante-mortem and post-mortem inspection and other health inspection duties.

  Following an alleged assault on an OVS by a member of Mead Webber plant management and ejection of the OVS from the premises on 21 April 2000, a notice was served on the plant occupier under regulation 10 of the regulations at 7.44pm the same day. Regulation 10(1)(b) of the regulations empowers the OVS to serve a notice on the occupier when it appears to the OVS that adequate health inspection in accordance with the regulations is being hampered. The notice was served to prevent operation of the plant in the absence of the OVS until such time as unobstructed access to the plant by the OVS was permitted by the occupier.

  Council Grants
  Ms Buck
  To ask the Secretary of State for Health if he will list the specific grants made by his Department, and the amounts allocated through each grant to(a) Westminster and (b) Kensington and Chelsea boroughs for each year since 1997–98. [125422]

  Mr. Hutton
  The table lists the specific and special grants available to councils since 1997-98 and the amount of grant paid to the London Borough of Westminster.
  225W

  The table lists the specific and special grants available to Councils since 1997–98 and the amount of grant paid to the London Borough of Kensington and Chelsea.

  £

  1997–98

  1998–99

  1999–2000

  AIDS Support Grant

  890,000

  760,000

  780,000

  Drugs and Alcohol Specific Grant

  68,378

  53,222

  690,0007

  Drugs and Alcohol Special Grant1

  —

  —

  60,0007

  Guardians Ad Litem and Reporting Officer Services2

  20,520

  —

  —

  Mental Health Grant

  730,177

  813,609

  937,814

  Training Support Programme

  162,939

  160,877

  171,851

  Secure Accommodation (Capital)

  0

  0

  0

  Community Care Special Transitional Grant3

  1,509,005

  1,413,818

  —

  Asylum-Seekers' Accommodation Grant4

  2,326,374

  4,603,767

  —

  Persons from Abroad Children's Grant4

  1,276,670

  1,549,540

  —

  Unaccompanied Asylum-Seeking Children's Grant

  151,731

  646,924

  1,496,800

  Promoting Independence: Partnership Grant5

  —

  —

  1,161,961

  Promoting Independence: Prevention Grant5

  —

  —

  103,047

  Promoting Independence: Carers Grant5

  —

  —

  95,156

  Children's Social Services Grant6

  —

  32,500

  560,122

  1This grant was available in 1999–2000 only

  2This grant ended in March 1998

  3This grant ended in March 1999

  4These grants were transferred to the Home Office from 1999–2000

  5These grants began in 1999–2000

  6This grant began in 1998–99

  7This grant was paid to Kensington and Chelsea to spend on the provision of Pan London services

  Meat Inspection
  Mr. Gill
  To ask the Secretary of State for Health which EU countries charge for meat inspection on a headage basis. [R] [126197]

  Ms Stuart
  According to information collected by British Embassies in other member states at the end of 1998, and by the Meat and Livestock Commission in May 1999, it is understood that the following countries charge for meat inspections either partly or wholly on a headage basis:

  Austria

  Belgium

  Denmark

  France

  Germany

  Italy

  Luxembourg

  Portugal

  Republic or Ireland

  Spain

  Sweden.

  Patient Rights
  Mr. Patrick Hall
  To ask the Secretary of State for Health (1) what work his Department is undertaking to examine the role of patient advocates, with particular regard to supporting complainants through the NHS complaints procedure; and what plans he has to consult community health councils about their role in assisting complainants; [126244]

  (2) when he will respond to the report, "A New Life for Health", prepared by the Commission on Representing the Public Interest in the Health Service; [126245]

  (3) what plans he has to consult on a new NHS Charter. [126246]

  226W
  Ms Stuart
  The Patient Care (Empowerment) Modernisation Action Team is considering the future roles for patient advocates and community health councils in assisting complainants, together with the format and content of a new National Health Service Charter.

  Following publication of the national plan in July, the Department will begin work on implementing the recommendations of the modernisation action teams.

  NHS Patients
  Mr. Swayne
  To ask the Secretary of State for Health, pursuant to his answer of 13 June 2000,Official Report, column 586W, on NHS patients, if he will list by clinical specialism the number of patients treated and the amounts spent by the NHS on health care in the independent sector in each of the last three years. [126994]

  Ms Stuart
  [holding answer 20 June 2000]A breakdown by clinical specialty is not collected centrally. A breakdown of expenditure and activity by type has been placed in the Library in response to the hon. Member's question of 13 June 2000,Official Report, column 586W.

  Dentists (Reciprocal Arrangements)
  Mr. Colman
  To ask the Secretary of State for Health what reciprocal arrangements exist to enable dentists trained in the UK to practise in India and dentists trained in India to practise in the UK. [126912]

  Mr. Hutton
  There are no reciprocal arrangements. Dentists registered in the United Kingdom who wish to practise in India have to satisfy the statutory authority that their qualifications, training and experience meet its requirements. Like other dentists from abroad, Indian dentists wishing to practise here may apply to the General Dental Council (GDC) to take its statutory examination. Those dentists who wish to undertake postgraduate training in the United Kingdom in a hospital post may
  227W
  apply to the GDC for temporary registration on the basis of evidence of acceptance for employment in that post. Temporary registration is granted for periods not exceeding 12 months up to an aggregate of four years.

  Parliamentary Questions
  Mr. Maclennan
  To ask the Secretary of State for Health how many written parliamentary questions tabled to his Department between 19 October 1999 and 20 April 2000 have not received substantive answers on the grounds of(a) commercial and (b) other confidentiality. [127100]

  Ms Stuart
  There have been two Parliamentary Questions that have not been fully answered on the grounds of commercial confidentiality within the dates specified.

FOREIGN AND COMMONWEALTH AFFAIRS

  Parliamentary Questions
  Mr. Cohen
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he will make a substantive reply to the question from the hon. Member for Leyton and Wanstead tabled on 18 April relating to Zimbabwe (ref 120086). [125671]

  Mr. Hain
  The question was answered by my right hon. Friend the Secretary of State for International Development on 19 June 2000,Official Report, columns 20–21W.

  International Investment Disputes
  Mr. Blunt
  To ask the Secretary of State for Foreign and Commonwealth Affairs if it is the policy of Her Majesty's Government to assist British companies to enforce judgments made against other Governments by the International Centre for the Settlement of Investment Disputes. [125037]

  Mr. Hain
  [holding answer 12 June 2000]We cannot comment on cases which are the subject of legal proceedings at the International Centre for the Settlement of Investment Disputes (ICSID). Her Majesty's Government expects any State with whom we have a Investment Promotion and Protection Agreement to take seriously its treaty obligations and, where such a State is involved in a dispute covered by that treaty, to co-operate fully with any international arbitration procedures and rulings.

  Mitrovica
  Mr. Maude
  To ask the Secretary of State for Foreign and Commonwealth Affairs (1) what assessment he has made of the progress made in re-establishing a joint city administration in Mitrovica; [126644]

  (2) what representations he has made to UNMIK regarding (a) establishment of local power-sharing arrangements for the Serbs in Mitrovica; and (b) reestablishing blocked trade ties between the southern and the northern parts of Mitrovica; [126645]

  (3) what recent representations he has received from Mitrovica's regional administrator regarding additional human, financial and security resources for this town; [126643]

  228W
  (4) what estimate he made of progress made by the Joint Interim Administrative Council for Mitrovica. [126646]

  Mr. Vaz
  [holding answer 19 June 2000]Measures to improve public order and to counter extremist activities in Mitrovica have continued to be a key focus of both UNMIK and KFOR. Working with the Joint Interim Administration Council (JIAC) they have implemented a strategy to stabilise the situation and to build confidence between the communities. UNMIK police and KFOR are taking steps to enhance joint security operations. The zone of confidence in central Mitrovica has been implemented.

  Additional KFOR and UNMIK police and personnel have been deployed. Village employment and rehabilitation projects, funded by the EU, are being implemented around Mitrovica. New protected train and bus services have started allowing Serbs to commute to Mitrovica.

  Bosnia-Herzegovina
  Mr. Maude
  To ask the Secretary of State for Foreign and Commonwealth Affairs what percentage of the funds budgeted by the EU for 1999 has been spent on reconstruction in Bosnia-Herzegovina. [126642]

  Mr. Vaz
  [holding answer 19 June 2000]In 1999, the EU allocated 93.17 million euros to Bosnia and Herzegovina through its Obnova Programme, which is the main mechanism for reconstruction assistance in the Western Balkans. In 1999 the total Obnova budget was 284.39 million euros and Bosnia and Herzegovina received 32.8 per cent. of the total. The Obnova Programme is funded through the Community Budget.

  Kosovo
  Mr. Maude
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the progress made in establishing the criminal justice system in Kosovo. [126603]

  Mr. Vaz
  [holding answer 19 June 2000]Establishment of an impartial and effective judicial and penal system is a priority for the UN Mission in Kosovo (UNMIK). 400 judges, prosecutors and lay judges have been appointed and the capacity of the court system has been increased. However, as the UN Secretary-General's latest report noted, ethnic bias and the risk of intimidation continue to hamper the administration of justice. In order to strengthen the effectiveness and integrity of the justice system, the UN is recruiting international judges and prosecutors to work with their local counterparts, in particular to try war and ethnically related crimes. The UK has provided UNMIK with over 40 candidates for international prosecutors and UNMIK staff interviewed candidates in London last week. We also hope soon to be able to provide candidates for international judges and judicial support staff.

  Mr. Maude
  To ask the Secretary of State for Foreign and Commonwealth Affairs what assessment he has made of the progress made in establishing provisional institutions for democratic self-Government in Kosovo. [126604]

  Mr. Vaz
  [holding answer 19 June 2000]UNSCR 1244, which established the international presences in Kosovo, gave the international civil presence responsibility for development of provisional institutions for democratic and
  229W
  autonomous self-government. The UN Mission in Kosovo (UNMIK) is preparing a draft Regulation on establishment of municipal authorities in Kosovo, for discussion in the Joint Interim Administrative Structures (JIAS). UNMIK intends to hold elections for these authorities later this year.

  The Contact Group is currently developing guidance for UNMIK on the possible structure and content of Kosovo-wide institutions for provisional self-government, taking into account the Rambouillet Accords. UNMIK's proposals for such institutions would also be for discussion in the JIAS. This is unlikely to start in earnest until after the municipal elections.

  Mr. Maude
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has received from the US Government regarding the form that the provisional self-Government in Kosovo will take and its relationship to UNMIK and KFOR. [126605]

  Mr. Vaz
  [holding answer 19 June 2000]The US Government is working closely with the UK and our partners in the Contact Group in developing guidance for the UN Mission in Kosovo (UNMIK) on the possible form and content of provisional institutions for self-government in Kosovo. As required by UNSCR 1244, the development of these institutions will take account of the Rambouillet Accords, of which US officials were the principal architects. Under any proposals for provisional institutions UNMIK and KFOR would retain their overall responsibilities as set out in UNSCR 1244.

  Generation Europe
  Mr. Maude
  To ask the Secretary of State for Foreign and Commonwealth Affairs how much funding the Generation Europe organisation has received from the(a) British Government and (b) European Union. [126596]

  Mr. Vaz
  [holding answer 19 June 2000]The Foreign and Commonwealth Office gave Generation Europe a one-time support of £10,000 to help fund the publication in 1999 of the Generation Europe student diary, 1999–2000. Generation Europe also received funding from the Community budget in 1999–2000 totalling 217,000 euro (£137,000).

  Mr. Maude
  To ask the Secretary of State for Foreign and Commonwealth Affairs for how long the Generation Europe organisation has received funding from his Department. [126595]

  Mr. Vaz
  [holding answer 19 June 2000]The Foreign and Commonwealth Office has made only one allocation of funds to Generation Europe. The Foreign and Commonwealth Office gave Generation Europe a one-time support of £10,000 to help fund the publication in 1999 of the Generation Europe student diary, 1999–2000.

  Small Businesses (EU Legislation)
  Mr. Rammell
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list the examples he provided, in response to the request from the right hon. Member for Horsham (Mr. Maude) on 15 June 2000,Official Report, column 1208, of improvements in legislation made to assist small businesses as a result of the Lisbon Special European Council. [127199]
  230W
  Mr. Vaz
  The right hon. Member for Horsham challenged me at 6.50pm on 15 June, to identify three improvements that the Lisbon Special European Council had introduced for business. I responded immediately that I would supply a list of 25 examples before 10 o'clock. I provided a list of no fewer than 35 examples, as follows, and it was faxed to the right hon. Member's office by 9.45 pm.

  As my right hon. Friend the Prime Minister told the House of Commons in his statement on 27 March 2000, Official Report, columns 21–23, Lisbon marked a sea change in European economic thinking. It pointed Europe in a new direction, towards a new approach based on enterprise, innovation and competition. A work programme is now in hand across the entire breadth of EU economic and social policy, to deliver the improvements that Lisbon called for. The list sets out examples of how much is being done, and the Feira European Council will mark a further step in the delivery of this agenda.

  Economic Benefits for Enterprise from Lisbon

  1. Charter for small firms already agreed, to be confirmed at Feira.

  2. Clear set of principles to ensure small enterprise promoted as main driver for innovation, employment and social integration.

  3. Concrete follow-up action e.g. national bankruptcy laws to be assessed, new regulations screened to assess impact on small business.

  4. Progress to be monitored annually.

  5. Work on structural indicators in hand to promote economic reform in order to benefit enterprise and SMEs, to be endorsed at Nice.

  6. Agreement on improvements to the Broad Economic Policy Guidelines, in line with the Lisbon conclusions, to be endorsed at Feira.

  7. Adoption of EU legal framework for electronic commerce reached in April 2000.

  8. E-Europe action plan agreed, to be endorsed at Feira.

  9. Focus on cheaper internet access, accelerating e-commerce and bolstering ICT skills.

  10. Generalised electronic access to main basic public services by 2003.

  11. All schools to have access to the Internet by 2001.

  12. Teachers skilled in use of Internet and multimedia resources by 2002.

  13. European diploma for basic IT skills.

  14. Fully integrated and liberalised telecommunications markets by the end of 2001.

  15. Competition in local loop to reduce substantial costs of using the Internet for business and consumers alike.

  16. Single market strategy agreed (May).

  17. Faster liberalisation of energy and transport. New targets will be established next year following a report from the Commission. Bodes well for forthcoming Gas Directive.

  18. State aids to be reduced further.

  19. EU strategy to remove barriers to services in hand, to be agreed at Nice.

  20. New EU integrated regulation and simplification initiative in hand, to be agreed by June 2001.

  21. Resolution on European Research Area agreed in June 2000. Boost to links between firms and research centres.

  22. Increased mobility of researchers.

  231W

  23. Proposal for regulation on community wide patent (June), to be agreed by 2001. To make patent protection in the EU as simple, inexpensive and comprehensive in scope as the protection granted by key competitors.

  24. Interim review of Employment Guidelines—to include recognition that policies like welfare to work and lifelong learning have a key part to play to fight social exclusion and to ensure that the benefits of the knowledge-based economy will be for all.

  25. Europe-wide database on jobs and learning opportunities, based on a UK idea.

  26. Schools and training centres to be turned into multipurpose local learning centres accessible to all.

  27. European award for firms committed to developing staff potential—a European "Investors in People".

  28. Lisbon agreed to raise employment rate from average of 61 per cent. today to as close as possible to 70 per cent. by 2010.

  29. Target to halve by 2010 the numbers of 18 to 24 year olds with only lower-secondary level education without further education and training.

  30. High Level Group on social protection which was called for by Lisbon is now established. Working to modernise and re-orient EU social policy, away from a narrow focus on employee rights towards: active welfare state, not passive dependency; new focus on employability and life long learning; ensuring that work pays and that welfare systems are sustainable. Agreement to increase investment in human resources.

  31. Political agreement on directive to counter racial discrimination.

  To promote integrated European capital market.

  32. EU action now in hand to lead to common international accounting standards.

  33. Financial Services Action Plan in hand to be implemented in full by 2005.

  34. EIB to make another billion euro available for venture capital for SMEs over the next three years. Tax policies, venture capital and EIB support for private research investments, R&D partnerships and hi-tech start-ups.

  35. Work in hand on rapid adoption of new streamlined rules in the public procurement legislative package for June 2001. Procurement on line by 2003; procurement rules modernised and simplified by 2002. The system will be more accessible to SMEs.

  Sierra Leone
  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs what discussions he has had with the Belgian Government on the regulation of the diamond industry in connection with Sierra Leone; and if he will make a statement. [126679]

  Mr. Hain
  My right hon. Friend the Foreign Secretary and I have each raised the issue of conflict diamonds with the Belgian Foreign Minister, stressing the need for early international action to prevent revenue from illicit diamond trading fuelling conflict. Officials met with representatives of the Belgian Government and the Diamond High Council of Antwerp this month to discuss a draft United Nations Security Council resolution, proposed by the UK, which would ban trade in diamonds from Sierra Leone which were not certified as legitimate by the Government of Sierra Leone.

  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement about the strength and composition of the United Nations peacekeeping forces in Sierra Leone. [126681]
  232W
  Mr. Hain
  The strength of the United Nations Mission in Sierra Leone (UNAMSIL) now exceeds 12,500. Principal troop contributors currently include Bangladesh, Ghana, Guinea, India, Jordan, Kenya, Nigeria and Zambia. Her Majesty's Government continue to provide direct headquarters, intelligence and logistic support to UNAMSIL.

  Mr. Worthington
  To ask the Secretary of State for Foreign and Commonwealth Affairs what estimate he has made of the number of paramilitary activists in Sierra Leone who have voluntarily disarmed and entered into rehabilitation programmes. [126680]

  Mr. Hain
  Of the estimated total of 45,000 combatants in Sierra Leone, by the end of April, some 24,000 had entered the Disarmament, Demobilisation and Reintegration programme under the Lomé Peace Agreement.

  One of the key priorities now is to establish a revised programme for those combatants willing genuinely to disarm.

CULTURE, MEDIA AND SPORT

  Millennium Dome
  Mr. Peter Ainsworth
  To ask the Secretary of State for Culture, Media and Sport, pursuant to his answer of 5 June 2000,Official Report, column 93W, on the Dome sale, in what proportions the proceeds of the sale of the Dome will be split between the New Millennium Experience Company and English Partnerships. [125449]

  Mr. Chris Smith
  [holding answer 12 June 2000]The proportion of the proceeds that will be split between the New Millennium Experience Company and English Partnerships is still under consideration. Any such decision depends, among other issues, on the precise content of any winning bid for the Dome's legacy.

  Mr. Peter Ainsworth
  To ask the Secretary of State for Culture, Media and Sport what legal technical and practical impediments exist to selling the Dome prior to 31 December. [125448]

  Mr. Chris Smith
  [holding answer 12 June 2000]The handover of the Dome to the preferred bidder will take place on 1 January 2001. There are no plans to bring forward the competition timetable. While there are no legal reasons why the Dome could not be sold prior to 1 January, time constraints and issues surrounding planning permission could make handover prior to 1 January difficult for either of the two final shortlisted bidders.

  Dr. Gibson
  To ask the Secretary of State for Culture, Media and Sport what bids he has received to site biotechnology industry in the Dome following its sale. [126044]

  Mr. Chris Smith
  No bids to site biotechnology industry in the Dome have been received by the Competition team. However, the final shortlisted bid by Legacy plc, which proposes a high technology industrial campus, could be capable of accommodating biotechnology industry occupiers.
  233W
  Mr. Baker
  To ask the Secretary of State for Culture, Media and Sport (1) by what criteria the performance of Pierre-Yves Gerbeau will be judged for the purpose of bonus payment calculations; [125932]

  (2) pursuant to the answer of 9 June 2000, Official Report, column 397W, regarding the Millennium Dome, if the target for visitor numbers which will be one of a range of measures used in any decision to award a bonus payment to the Chief Executive of the New Millennium Experience Company will be the stated target when P-Y. Gerbeau was appointed; and if he will make a statement. [126290]

  Mr. Chris Smith
  [holding answer 19 June 2000]I refer the hon. Member to the answer given to him on 4 February 2000,Official Report, column 771W, by my hon. Friend the Minister for Tourism, Film and Broadcasting.

  Mr. Baker
  To ask the Secretary of State for Culture, Media and Sport by what criteria the success of the Millennium Dome will be judged. [125933]

  Mr. Chris Smith
  [holding answer 19 June 2000]The 2.7 million people that have visited the Millennium Dome have already judged the project to be a success. More than 85 per cent. of visitors come away from the Dome satisfied with their day and almost 80 per cent. say they will recommend a visit to family and friends. This is a higher satisfaction rating than for any other pay-to-visit attraction in Europe.

  Lottery Grants
  Mr. Ben Chapman
  To ask the Secretary of State for Culture, Media and Sport, pursuant to his answer to the hon. Member for Blyth Valley (Mr. Campbell) of 15 May 2000,Official Report, column 580W, on Lottery grants, what steps are proposed to increase the amount of Lottery money going to the constituency of Wirral South. [126955]

  Kate Hoey
  Following the publication on 5 June of a report on the impact of the National Lottery on coalfield and other areas of low take-up, my right hon. Friend the Secretary of State has set up an action team, involving representatives of both Government and Lottery distributors. The team will look into ways of ensuring that areas of low take-up such as Wirral South receive greater benefit from National Lottery money. Measures to be developed by the team include actively encouraging applications, reducing partnership funding requirements, making decision-making more transparent and a scheme where successful bidders teach other would-be applicants how to apply.

  New Millennium Experience Company
  Mr. Peter Ainsworth
  To ask the Secretary of State for Culture, Media and Sport (1) if he will publish, on a case by case basis, the amounts disbursed to date by the New Millennium Experience Company in relation to litigation; [126464]

  (2) what contingency exists in the budget of the New Millennium Experience Company to meet the cost of litigation; [126462]

  (3) what assessment he made of the value of the New Millennium Experience Company's current and contingent liabilities in relation to litigation. [126463]

  234W
  Mr. Chris Smith
  [holding answer 19 June 2000]The New Millennium Experience Company considers that publication of details of issues relating to litigation runs the risk of adversely impacting on its relationships with those organisations and companies it has entered into contract with and, therefore, on its ability to operate in an effective and commercial manner.

  Hawksworth Hall
  Mr. Peter Ainsworth
  To ask the Secretary of State for Culture, Media and Sport what representations he has received concerning Hawksworth Hall, near Leeds; and if he will make a statement. [126871]

  Mr. Chris Smith
  [holding answer 19 June 2000]One such representation has been received by my Department and has been transferred to the Government Office for Yorkshire and Humberside.

  I am aware that there are proposals to redevelop Hawksworth Hall. The issues currently being considered are a planning and listed building consent application. It would not be right therefore for me to comment on the case, since to do so could prejudice the position of my right hon. Friend the Secretary of State for the Environment, Transport and the Regions in the event of the case being called in by him or becoming the subject of an appeal. However, arrangements are in place for this Department to be consulted where appropriate.

PRIME MINISTER

  Special Advisers
  Mr. Baker
  To ask the Prime Minister what steps he takes to ensure that the work of special advisers does not compromise the political neutrality of civil servants. [127095]

  The Prime Minister
  The Ministerial Code and the Civil Service Code are clear that public resources must not be used for party political purposes and that the political impartiality of the Civil Service must be upheld.

  Mr. Baker
  To ask the Prime Minister if he will set a maximum limit of two special advisers per department. [127094]

  The Prime Minister
  Under the terms of the Ministerial Code, Cabinet Ministers may each appoint up to two special advisers. Where Ministers appoint two part-time special advisers this will normally be counted as one full-time equivalent. All appointments require my approval. Departures from the rule of two special advisers per Cabinet Minister are exceptional. These decisions are taken on the merits of the individual case.

  Engagements
  Sir Peter Tapsell
  To ask the Prime Minister if he will list his official engagements for Wednesday 21 June. [126581]

  The Prime Minister
  This morning I had meetings with ministerial colleagues and others. In addition to my duties in the House I will have further such meetings later today.

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Oxford.

Colombia
The Lord Bishop of Durham The Lord Bishop of Durham asked Her Majesty's Government:
How they intend to support Plan Colombia at its meeting with donor governments in Madrid on 6th and 7th July.
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Scotland of Asthal): My Lords, we are keen to support the Colombian Government's efforts to bring peace to Colombia. In preparation for the Madrid conference in July, the Foreign and Commonwealth Office hosted a meeting of senior officials on Monday 19th June to examine ways in which the international community can help. Neither we nor our EU partners has made any decision about what aid we could give to Colombia. We are determined, however, that any aid will support human rights, long-term economic and social development and an end to violence in Colombia.
The Lord Bishop of Durham: My Lords, I am grateful for the Minister's Answer. Can the noble Baroness elaborate on the kinds of conditions that might be attached to any aid, especially with regard to military activity in Colombia and consultation with human rights organisations?
Baroness Scotland of Asthal: My Lords, I reassure the right reverend Prelate that, as I said in my original Answer, the aid to be given by Her Majesty's Government will be directed towards the maintenance and support of human rights and long-term economic and social development. We are at the discussion stage in this matter and a good deal of consultation will be needed. We are pleased that on 19th June the NGOs participated and were able to make a special presentation. We very much value their contribution.
Lord Avebury: My Lords, can the Minister confirm that the plan contains a 600 million dollar military component, including massive armaments such as Black Hawk helicopters, and that serious reservations have been voiced about it by some of our partners in Europe, including the Belgians, the Dutch, the French and the Germans? How will the Government and EU ensure that the views of non-governmental organisations are fed into the July consultation? In particular, has the noble Baroness noted the opposition to the plan by the Regional Association for
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the Defence of Human Rights and the National Organisation of Indigenous of Colombia? How will the Minister ensure that their voices are heard?
Baroness Scotland of Asthal: My Lords, there are no set figures relating to the aid that the Government intend to give. I hear what the noble Lord says about the military component of any such aid. Since we have not yet fashioned precisely how the aid is to be given, and its quantum, I am unable to confirm anything that the noble Lord says. However, as we have already demonstrated, I reassure the noble Lord that we shall continue to listen to, and seek to engage, non-governmental organisations as appropriate.
Baroness Rawlings: My Lords, I hope that the Minister will acknowledge the very important role that the Royal Navy West Indies guard ship has played in countering drug operations from Latin America and the Caribbean. Therefore, do Her Majesty's Government now regret their decision to cut the amount of time that the guard ship spends in the region, and why was that done?
Baroness Scotland of Asthal: My Lords, I am unable to answer the precise question put by the noble Baroness. However, with respect, that has precious little to do with this Question.
Lord Wallace of Saltaire: My Lords, does the Minister accept that in the past the American attitude to problems of social unrest, economic under-development and the attendant drugs problems in Latin America has been very much a military and policing response and not sufficiently a political and economic response? As a general part of this question, will Her Majesty's Government ensure that a broader response than merely a military one is an important part of Plan Colombia?
Baroness Scotland of Asthal: My Lords, in this situation EU and American aid needs to be co-ordinated in such a way that it responds appropriately to the perceived difficulties that Colombia faces. We hope that in the work that we do together we shall be able to fashion a holistic approach that better addresses the needs of Colombia.
Lord Mackay of Ardbrecknish: My Lords, I wonder whether the noble Baroness wants to review her response to my noble friend Lady Rawlings. The Plan Colombia with which the Question is concerned is about trafficking in narcotics, is it not? Is not one of the roles of the guard ship in the West Indies to try to stop drug trafficking? Surely, my noble friend deserved a better answer than the Minister gave.
Baroness Scotland of Asthal: My Lords, I assure the House that the patrols of the West Indies guard ship to control drug trafficking continue, and we are satisfied that it is able to do its job.

Artificial Limbs: Audit Commission Report
2.41 p.m.
Lord Campbell Lord Campbell of Croy asked Her Majesty's Government:
What action they are taking as a result of the Audit Commission's report, published in March, on the quality of artificial limbs, surgical appliances and disability equipment services in the United Kingdom.
The Parliamentary Under-Secretary of State, Department of Health (Lord Hunt of Kings Heath): My Lords, we welcome the report and are already taking action to improve standards. We are also considering currently all of the recommendations and hope to make further announcements soon.
Lord Campbell of Croy: My Lords, I am grateful to the noble Lord for his reply. Does it mean that he agrees with the report that urgent reorganisation is required in the supply of orthotic equipment such as callipers and surgical appliances because the quality of what has been described as fragmented services is, in many places, unacceptable?
Lord Hunt of Kings Heath: My Lords, alongside many of the other recommendations, the Government are considering with careful interest the suggestion to which the noble Lord refers, in particular that units should be large enough and throughput sufficient enough to make for quality and cost effectiveness. Part of the process of improving the quality of services at local level is to remind health authorities and local authorities of their responsibilities in that area. Where changes need to be made to improve the organisation, I am sure that that will occur.
Lord Ashley of Stoke: My Lords, is the Minister aware that his constructive response to a recent debate on the subject was warmly appreciated? The urgent requirement now is a clear timetable. In the debate, the Minister was not enthusiastic about that need. However, without specific targets, dates and outputs we shall get nowhere. Will my noble friend think again?
Lord Hunt of Kings Heath: My Lords, I am not in a position today to give an explicit timetable. I assure my noble friend that my honourable friend Mr John Hutton is considering urgently the recommendations in the Audit Commission's report and what the Government's response should be. The Government have taken action. They are promoting the value of integrated community services providing a single point of access for service users. The sum of £14 million is being provided recurrently for wheelchair developments. As my noble friend well knows, £4 million is being invested this year to modernise the NHS
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hearing aid service. We agree that the deficiencies identified by the Audit Commission need to be addressed.
Lord Addington: My Lords, notwithstanding his previous answer, does the Minister agree that the report raises some points which could be dealt with easily? Recommendation 15 states:
"Service managers should review and eliminate the potential conflicts of interest that arise when commercial suppliers discharge the services of both clinician and salesman".
That relates to the supply of orthotics and wheelchairs. Will the Minister draw his department's attention to this matter? Such a straightforward conflict of interest can surely be quickly dealt with.
Lord Hunt of Kings Heath: My Lords, the noble Lord raises the issue of whether the role of the orthotist as both clinician and salesman creates a conflict of interest. I understand that the matter has been addressed in Department of Health guidelines on orthotic services. Ultimately it is a matter for local management. We must ensure that the lessons of the Audit Commission report are fully considered at local level by health authorities and, where appropriate, local authorities. In order to have effective performance management of health authorities and performance assessment of local authorities the Government must ensure that account is taken of current guidelines and any future guidelines.
Baroness Masham of Ilton: My Lords, does the Minister agree that some materials used are heavy and old fashioned whereas others are light and more attractive? Will he consider how important it is for a young girl, for example, who has lost limbs through meningitis to have equipment which is usable and attractive?
Lord Hunt of Kings Heath: My Lords, I very much understand the noble Baroness's point. A working group has been set up to consider the introduction of silicone cosmeses coverings in artificial limb services. In addition, the NHS Purchasing and Supply Agency has set up a strategic commissioning group which brings together commissioners, providers, the industry and user representatives to inform future specification for artificial limb contracts. I hope that, as part of that process, we can take account of the point the noble Baroness raises.
Lord McColl of Dulwich: My Lords, is the Minister aware that the supply of artificial limbs in many places in developing countries in Africa is better and quicker than in this country? It is an urgent issue. What will the Government do?
Lord Hunt of Kings Heath: My Lords, I pay tribute to the noble Lord for his work over many years on this issue, in particular in relation to the artificial limb and appliance centres. We need to be careful not to suggest that everything is poor about current services. There are many examples of excellent services around the

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country. The problem is that high standards are not universal. The Government are seized of the need to ensure that best practice is adopted throughout the country. In addition, through its local inspectors, the Audit Commission will monitor what will happen at local level. Although we should always consider the experience of other countries, we can also look to our own country for experience of best practice.
Lord Clement-Jones: My Lords, the Minister is aware of the problem when medical staff, in particular occupational therapists, are faced with widely differing standards from social services departments and health authorities about the equipment which can be provided for patients on discharge from hospital. The position as regards charges made and the type of equipment provided needs urgent consideration. Can the Minister say something on that?
Lord Hunt of Kings Heath: My Lords, I do not disagree with that point. We need to bear in mind that effective investment in appropriate equipment in the long term will ensure that many people make fewer demands on the services in the future. We need to bring home to the health service and local government the message that the more effective services they can develop in this area the better the spin- off for users of the services and the services themselves.
As regards community equipment services, the Government are keen to encourage health and local authorities to work together. As regards charges, the noble Lord will know that we intend to table amendments to ensure that we can issue statutory guidance.
Lord Campbell of Croy: My Lords, will the Minister recognise that, owing to our ageing population, demand for surgical appliances is increasing but that new materials and technologies, as referred to by the noble Baroness, Lady Masham, which are becoming available, could alleviate the situation?
Lord Hunt of Kings Heath: Yes, my Lords. Part of the effective delivery of high quality services in future is the need to ensure that those in NHS health services and local authorities who commission services relating to community equipment are keeping up to date with developments and ensuring that its quality and acceptability are of the highest order. We want to encourage that.

Medical Students
2.51 p.m.
Lord Roberts of Conwy Lord Roberts of Conwy asked Her Majesty's Government:
What progress has been made towards increasing the number of medical students in the United Kingdom.
Lord Hunt of Kings Heath: My Lords, in July 1998, the Government announced that the annual intake of
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medical students in the United Kingdom would be increased by about 1,000 places per annum by 2005. In England, the Higher Education Funding Council for England has announced the allocation of a total of 1,126 additional places. The Government are now considering a further increase in medical school intake in England. The information relating to Scotland, Wales and Northern Ireland is a matter for the devolved administrations.
Lord Roberts of Conwy: My Lords. I declare an interest as president of the University of Wales College of Medicine. I appreciate the increase of about 1,000 in the number of medical students. However, are the Government convinced that the number is adequate to meet the needs of the United Kingdom? Bearing in mind that during the past five years only 42 per cent of doctors registering each year for service in the United Kingdom have been trained here, is it not time that the Government changed their target?
Lord Hunt of Kings Heath: My Lords, an additional 1,126 places is a considerable achievement. However, I assure noble Lords that as part of our further developments within the NHS we are looking at the number of places over and above the 1,126 which we shall need. As regards the statistics which the noble Lord gave, I understand that 76 per cent of the medical workforce is UK trained. The advice given by the Medical Workforce Standing Advisory Committee in 1997, on which much of the development in medical school places is based, suggested that we needed to stabilise that proportion. I believe that the additional places we have announced will help us to do that, as will any future expansion.
Lord Cledwyn of Penrhos: My Lords, my noble friend has given us important information, but is he aware that we could do with many more trained doctors throughout Wales—in the villages, outside Cardiff and Swansea, where they are badly needed?
Lord Hunt of Kings Heath: My Lords, I am in danger of trespassing on another country's arena. I pay tribute to the high quality of medical education in Wales, of which I have experience. The new training places allow us to develop links outside traditional medical school centres, both in terms of the new medical schools—for instance, in Norwich at the University of East Anglia and at the Peninsular Medical School in the West Country—and in places where medical schools have been expanded—for instance, in Birmingham through links with other parts of the Black Country. There is no doubt that in ensuring that we have high quality doctors we have to ensure a broad-based education for medical students which enables them to experience all facets of life in the health service.
Lord Clement-Jones: My Lords, although the Government's announcement is welcome, the Minister will be aware of comments made by his honourable friend Frank Field pointing out that the number of

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doctors per head of population in France is 75 per cent greater than in this country; two and a half times greater in Spain than in this country; and three times greater in Germany. Are the Minister and his department examining the question of additional medical students in a sufficiently fundamental way?
Lord Hunt of Kings Heath: My Lords, international comparisons can often be misleading. In terms of doctors per 1,000 of population, the UK is comparable with Finland, Norway, the Netherlands and the US. But we accept that we need to do better. We need to expand the NHS workforce as a whole and doctors will be an important component of that. Furthermore, we must break down some of the working barriers between the different professions. By the sensible reordering of responsibilities we can take some of the load from doctors, nurses and other professionals in order to allow them to focus on the most important and serious elements of their work.
Baroness Young: My Lords, does the Minister recognise that we need a considerable increase in the number of doctors? Do the figures he has given mean an absolute increase over and above those who retire every year? Is what we read in the newspapers about the two new medical schools at East Anglia and Exeter true; that they will take in students with lower qualifications who will therefore require a longer training period? Can we be satisfied that they will achieve the correct standard?
Lord Hunt of Kings Heath: My Lords, medical workforce planning has proved to be a difficult art. The noble Baroness is right that a considerable number of doctors are coming up to retirement. That statistic needs to be factored into the further development of training places.
It is right that we should consider everything we can to widen access to medical education. I point to King's College, London, whose medical school is working with local schools and colleges in south London to identify potential medical students at a young age, and where alternative tests will be applied to demonstrate a suitability and general aptitude for medicine. However, I do not believe that that or other initiatives will in any way impact on the high quality of medical students and doctors in this country. I believe that the number of applications for places is at a healthy level, enabling us to ensure that high quality students enter our medical schools.
Lord McColl of Dulwich: My Lords, is the Minister aware that according to OECD figures, Britain's number of practising doctors per head of population is one of the lowest compared with the majority of OECD countries? Only Turkey, Korea and Mexico have a lower number. At the other end of the scale, will he comment on unemployment among fully trained obstetricians and on last year's cut of 33 per cent in the number of new consultants as opposed to an annual increase under the previous government of 4 per cent?
Lord Hunt of Kings Heath: My Lords, so far as concerns obstetrics and gynaecology, the noble Lord will know that the Government have been in discussion with the president of the Royal College of Obstetricians and Gynaecologists. We are looking closely at a range of proposals to address that issue and the way forward. So far as concerns the OECD report, my understanding is that that information was based on 1996 statistics and therefore, I believe, comes under the responsibility of the party of the noble Lord.

Pension Increase: Basis of Calculation
2.59 p.m.
Lord Brabazon of Tara Lord Brabazon of Tara asked Her Majesty's Government:
For what reason the Treasury uses different bases for calculating inflation for increasing petrol prices and pensions.
Lord McIntosh of Haringey: My Lords, the increase in prices in the year to September is used as the basis for the inflation increase in both excise duties and pensions. Exactly the same methodology has been used this year as in previous years. Next year we shall index pensions by the out-turn for September 2000 RPI, which we forecast at 3.4 per cent.
Lord Brabazon of Tara: My Lords, I am grateful to the Minister for that reply. However, in his Budget Statement the Chancellor said that he was raising both pensions and petrol tax in line with inflation. Why did he not go on to say that he was using two completely different measures of inflation; that is, petrol at 3.3 per cent and pensions at 1.1 per cent? How can he possibly justify using two completely different measures in one Budget Statement? Is that not a scam of epic proportions, even for this Chancellor? Is the Minister aware that, had pensions been increased by the same rate as petrol, they would now by rising by £2.25 per week instead of a measly 75 pence per week?
Lord McIntosh of Haringey: My Lords, pensions have always been raised on the basis of the out-turn in September figures. Excise duties were raised in the July 1997 Budget, which we had to introduce when we came into office, on the basis of the forecast. In order not to count the same year twice, we continued with the forecast base, which explains the difference. However, the noble Lord refers to this year's figures. He should recognise that these matters balance out. Last year, the excise duties were indexed by 1.3 per cent and personal allowances by 3.2 per cent. Next year, we shall index pensions by the out-turn for the September 2000 RPI, which we forecast at 3.4 per cent. On the whole, over the years the Treasury loses out and pensioners gain.
Lord Mackay of Ardbrecknish: My Lords, has the Minister told the Bank of England that inflation will rise by well over 3 per cent? According to the rules laid down in the Act of Parliament which set up the Monetary Policy Committee, I should have thought

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that that would put the jobs of its members at risk. However, leaving aside that interesting answer from the Minister, does he believe that it is a good defence to say that when the Chancellor suggested using the same rate of inflation, he then went on to use two rates? Is that not a case of double standards? Those are not my words. It was the Daily Record, the determinedly Labour paper in Scotland, read by all the Chancellor's constituents in Dunfermline, which accused the Chancellor of double standards. Is the Daily Record right or wrong?
Lord McIntosh of Haringey: My Lords, when the noble Lord asks me a question and then proposes to leave it on one side, I am not sure whether or not he wishes me to answer. I shall answer, because I always answer his questions when they are serious. As he very well knows, the figure of 3.4 per cent which appears in the Red Book was announced at the time of the Budget. The answer to the second question is that I am not responsible for the Daily Record. I have explained exactly and precisely on what basis the September figures are calculated for each of the two purposes.
Lord Goodhart: My Lords, is it not the case that perhaps the main reason why the pension increase last year came out at such an appallingly, ridiculously low figure was that the index on which the increase was based included mortgage interest? Given that very few pensioners have mortgages and that, on the other hand, cuts in interest rates harm pensioners because the income from their savings is reduced, would it not be desirable, once pensioners have had a chance to catch up from the effects of last year, to base pension increases on an index which does not include mortgage interest?
Lord McIntosh of Haringey: My Lords, there are several different bases for calculating inflation. Some of them are unfair to some people and some are unfair to others. The RPIX version is used widely for a variety of purposes.
Baroness Hogg: My Lords, in the light of that answer, can the Minister explain why the Government have refused to subject their calculations of inflation to the independent scrutiny of the new statistics commission?
Lord McIntosh of Haringey: My Lords, I am not aware that that is the case. The new statistics commission is barely in existence. When it is, it will no doubt ask for the figures that it wants.
Lord Davies of Oldham: My Lords, does my noble friend recall whether, when they introduced the fuel escalator, the last Conservative government believed that pensions should be accelerated by the same amount?
Lord McIntosh of Haringey: My Lords, my noble friend points to the fact that it was the previous government who withdrew the earnings link and
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replaced it with a prices link for pensions. My noble friend is also aware that the full benefit of the provisions that have, and are being, made for pensioners in this Parliament amount to £6.5 billion whereas restoration of the earnings link would cost only £4.5 billion.
Lord Clark of Kempston: My Lords, surely the Minister agrees that the public, pensioners and motorists were misled by the Statement of the Chancellor of the Exchequer. It was a shabby trick to play on pensioners and motorists. Does the Minister agree that it is high time that Statements from whichever government department should be unassailably true?
Lord McIntosh of Haringey: My Lords, unless the noble Lord is saying that something that I have said this afternoon is not unassailably true, I believe that he should be careful about the words he uses.

Business
Lord Carter: My Lords, at a convenient moment after 3.30 p.m. my noble friend the Leader of the House will, with the leave of the House, repeat a Statement which is being made in another place on the European Council at Feira.

House of Lords' Offices: Select Committee Report
3.6 p.m.
The Chairman of Committees (Lord Boston of Faversham): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the Fifth Report from the Select Committee be agreed to (HL Paper 70).—(The Chairman of Committees.)
Following is the report referred to:
The Committee have met and been attended by the Clerk of the Parliaments and the Gentleman Usher of the Black Rod.
1. Fast stream pay proposals
The Committee agreed to new arrangements, developed in conjunction with the House of Commons, for paying fast-stream Clerks and Library Clerks.
2. Salaries of the Chairman and Principal Deputy Chairman of Committees
The Committee approved revised salaries with effect from 1 April 2000.
3. Lords' reimbursement allowances
The Committee was informed that from 1 April 2000 the motor mileage allowance had been up-rated in line with the retail prices index to 52.5 pence per mile for the first 20,000 miles and 24.2 pence per mile thereafter; and that the bicycle allowance had been up-rated to 6.7 pence per mile.
4. Appointment of a management consultant
The Committee approved the appointment of a management consultant, Mr Michael Braithwaite, to undertake a review of the management structure and the structure, including the Committee structure, for taking decisions about the services of the House and

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other domestic matters, which were introduced in the House of Lords in 1991–92 following the Ibbs reforms in the House of Commons.
5. Commercial activities
The Committee agreed that the House of Lords should not be used by Members as a business address nor the name used for the promotion of any commercial activity.
Lord Barnett: My Lords, I believe that the House is being asked to approve a Motion which, frankly, is ridiculous. Perhaps I may trouble the House with a few questions that I wish to ask the Chairman of Committees. First, item 1 of the report states that:
"The Committee agreed to new arrangements"
it does not tell us what the new arrangements are—
"for paying fast-stream Clerks",
but it does not tell us who fast-stream Clerks are.
Item 2 tells us that the committee "approved revised salaries" for the Chairman and Principal Deputy Chairman. It does not tell us what those revised salaries are and by what amount they have been increased.
Item 3, regarding Lords' reimbursement allowances, tells us that the Committee was informed that from 1st April 2000 (in other words, backdated) the motor mileage allowance has been uprated in line with the retail prices index—not the RPIX but the retail prices index. There will also be an increase in the bicycle allowance, which has been uprated to 6.7p per mile. However, no reference is made to noble Lords' other allowances, which I should have thought were much more important than those two items.
What of the committee? I gather that it is composed of the usual channels, and of course we know who they are. They are part of the House authorities. We read that the Clerk of the Parliaments and the Gentleman Usher of the Black Rod were also in attendance at that meeting.
The worst item that we are asked to approve is item 4, which concerns the appointment of a management consultant. We are told that he is a certain gentleman called Michael Braithwaite, who will,
"undertake a review of the management structure and the structure, including the Committee structure, for taking decisions about the services of the House".
We are not told what salary that gentleman will receive, or why we need a management consultant when a small committee of your Lordships' House could, at no cost at all, do a job that we understand.
I am sorry to trouble the House with those four items, but it is nonsense and does a disservice to the House to ask us to approve a document when we have been given so little information. I should be obliged if the Chairman of Committees could answer some of my questions.
Lord Cocks of Hartcliffe: My Lords, perhaps I can help my noble friend. I understand that Mr Braithwaite is picking up £70,000 for the job.
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I wish to concentrate on this item selected by my noble friend, because this Michael Braithwaite investigation follows a similar exercise in the House of Commons. His report on the Commons was debated there on 20th January. Introducing the report on behalf of the House of Commons Commission, Mr Archy Kirkwood gave enormous detail about Mr Braithwaite's work, for which he received £77,000 on that occasion. To assist the process, 105 people were interviewed, many on two or more occasions, and information was gathered from 14 overseas countries. Mr Kirkwood did not say whether there were fact-finding missions, but an enormous amount of work was done.
Imagine my surprise when I read through the debate and found a contribution from the honourable Member for Newcastle-under-Lyme, who said:
"the thing that concerns me about the report is its lack of clarity on what is happening to ordinary staff here".—[Official Report, Commons, 20/1/00; col. 1083.]
I must stress that point, because conflicts could arise. With a lot of young, zealous Members in the other place and a changing situation in your Lordships' House, there is a growing demand for resources for Members in either place. An Early Day Motion in the other place calling for an extra £20,000 on the office costs allowance has already attracted 124 signatures.
I am afraid that the constant pressure for more resources for Members of both Houses may lead to a temptation to find savings in the ordinary staff who service us here. I do not regard them as ordinary—I am using the phrase of my honourable friend from Newcastle-under-Lyme. They are very faithful, very experienced and very reliable. More than anything, when we have security problems, we can trust them. Anything that could set us against them must be thought about very carefully. I have heard rumours that there are attempts to cut the overtime rate of the catering staff in the other place. A big operation is going on among the security staff, with young people being recruited to replace old, experienced staff. We may be getting into a situation of penny wise, pound foolish.
The Committee should have had a word with the House formally before undertaking such a massive operation. Following my noble friend's remarks, I wonder whether it is too late to allow the House to discuss the matter, or whether we are faced with a fait accompli.
Lord Boardman: My Lords, the motor allowances increases in paragraph 3 are said to be in line with the retail prices index. What index was used for their calculation—the figure applied by the Government for pensions or the one used for petrol prices?
Lord Monson: My Lords, consultants never come cheap. How many days will Mr Braithwaite be working in return for his £70,000?
3.15 p.m.
Viscount Cranborne: My Lords, I endorse the remarks of the noble Lord, Lord Barnett, who, not for the first time, has rendered great service to your Lordships' House by drawing our attention to the shortcomings in the report. I associate myself with every word that he said.
In particular, I should like to ask the Chairman of Committees a little more about paragraph 4 of the report, which relates to Mr Braithwaite and the management consultancy. I must pick my words with some care, as I am all too well aware that the leader of my party was once a management consultant, I yield to no one in my admiration for the leader of my party.
Why was Mr Braithwaite appointed and at whose suggestion? What ills endemic in your Lordships' House are his attentions designed to put right? What are his riding instructions? How much is he going to be paid? Why is it so important that we should spend the large sums of money that I assume are involved in getting his views? Is it true that the suggestion of appointing a management consultant came from another place? If so, why have the authorities of this House undertaken to follow that suggestion without further consultation with your Lordships' House?
I am concerned about management consultants. I remember my American employer in California many years ago telling me that there were only two reasons that enterprises consulted management consultants: one was because the management did not know what to do and the second was because there was an argument that the managing director—or president, in American terms—wished to resolve without an internal quarrel. Do either of those conditions apply in your Lordships' House?
The Chairman of Committees: My Lords, I shall deal first with the points raised by the noble Lord, Lord Barnett. In doing so, I shall refer to other noble Lords who have spoken. If it is the wish of your Lordships that more information should be given, I am certainly prepared to view that request with sympathy. On the whole, I attempt to put forward less written material rather than more because, as I have said on previous occasions, I do not wish to overburden your Lordships. However, if your Lordships want more, you are entitled to have more. I also remind your Lordships that the minutes of Committees are available in the Library and can be consulted there.
I can ensure that the noble Lord, Lord Barnett, is provided with fuller details on the first item without burdening your Lordships now. We always intend to recruit the high quality staff from whom your Lordships' House has traditionally benefited. But recently there have not always been as many high quality applicants as on previous occasions and it was felt that this means of accelerating recruitment in certain instances would add to the incentive for those who might be available to be appointed to your Lordships' House.
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The increases in the reimbursement allowances follow the lines of previous years. The usual formula has been used. I readily concede, particularly this week, when we have heard something about bicycling, that the rewards in the bicycling allowances are not excessive. In fact, your Lordships may be interested to have a little more information on that point than is in the report; that is, the amount has gone up by 0.2p per mile from 6.5p to 6.7p per mile. That is a rise of approximately 3 per cent which is slightly more than the petrol allowance. I know that this week a number of your Lordships have joined in the cycle ride from the office of the noble Lord, Lord Macdonald of Tradeston, at the Department of Transport in Victoria Street to your Lordships' House. So there is something of a reward there.
As regards the allowances not mentioned in the report, as the noble Lord, Lord Barnett, will remember, those go up in August and are effective from that time. So that matter will be dealt with again in accordance with the normal procedure which is followed.
The noble Lord, Lord Cocks of Hartcliffe, and the noble Viscount, Lord Cranborne, raised the question of the proposed appointment of the management consultant, Mr Michael Braithwaite. Perhaps I may make a few remarks about that appointment. In the first place, your Lordships' committees, particularly the Offices Committee and its two sub-committees, were persuaded that there was a need to examine various options by which the House could make decisions on domestic matters. That has not been looked into since the reforms following the inquiry carried out by Sir Robin Ibbs in 1991–92.
I make this point—and your Lordships' Offices Committee was persuaded of this too—that sometimes there is advantage in having a qualified person from outside look at our management structures. That was done by Sir Robin Ibbs at the beginning of the last decade. As many of your Lordships will know, he was a highly qualified person. As a result of his inquiry, reforms were not only introduced in another place but were also introduced in your Lordships' House in relation to the financial management of your Lordships' affairs.
It is true to say that it was felt generally at that time that there had been advantage in having an independent mind to look at that matter.
Lord Ampthill: My Lords, I succeeded soon after the Ibbs report on the House of Commons. I have a belief that I was appointed Chairman of Committees for the sole reason that we did not think that we needed an Ibbs report but that we could manage to find somebody, and it happened to fall upon me—for goodness knows what reason—to take on the job which the noble Lord now fulfils. We did not need Ibbs here. Our affairs were in far better shape than the affairs of the House of Commons. I merely make the point that there surely is enough talent sitting on the Benches in this House, not to mention sitting at the Table and among all the other learned Clerks who look

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after us so well, for it to be totally unnecessary to bring in somebody who will not have a clue about how well we conduct our affairs compared with the other place.
The Chairman of Committees: My Lords, it is indeed the case that there is a great deal of talent in your Lordships' House already. I wholly agree with the noble Lord, Lord Ampthill, about that. Also, I pay tribute to him on the way in which he carried out his duties as Chairman of Committees when he occupied that post.
However, I remind the noble Lord that, in relation to the Ibbs inquiry, Deborah Williams was, at that time, appointed by your Lordships' House to assist with advising on the financial management of your Lordships' House. So that assistance was here at that time.
Of course, there is ample talent in your Lordships' House. If I can say so without too much immodesty, even I am not bereft of the occasional idea to put forward to your Lordships. There is no doubt about the range of talent and that we know a great deal about our own affairs, sufficient to put forward many ideas.
But I emphasise—and I feel this quite strongly—that from time to time there is advantage in drawing upon the experience, knowledge and inquiring mind of somebody from outside. This will be the first time in some 10 years that we have done that.
Lord Hooson: My Lords, I am grateful to the noble Lord for giving way and I am sorry to interrupt him. It would be extremely helpful if he could tell us what experience Mr Braithwaite has of management problems in legislative assemblies.
The Chairman of Committees: My Lords, he is a former senior partner of Deloitte & Touche. He has considerable experience of management matters. He carried out the inquiry for the other place.
In saying that, perhaps I may answer one of the specific points which was raised by the noble Viscount, Lord Cranborne. The suggestion to have management consultancy in this House did not come from another place. The further point on that is that there has been the suggestion that your Lordships' House should have considered these matters from the outset. It is always the practice of your Lordships' House that preliminary decisions and any recommendations are considered first in your Lordships' committees. That is the way in which we operate. That is the way in which proposals come before your Lordships' House. I suggest that it would be wasting the time of your Lordships' House if we did not follow that procedure.
There is a further fundamental point about that. Whatever recommendations the management consultant may make, in the first place, it is for your Lordships' appropriate committees to consider any such recommendations and then, if thought fit, to make recommendations to your Lordships. It is, always has been and, as far as I am concerned, always
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will be for your Lordships to make the ultimate decisions on any such recommendations. That will not be departed from.
Baroness Knight of Collingtree: My Lords, before the Chairman of Committees sits down, although he has generously and freely offered a great deal of information which has been sought, for which I am sure the House is grateful, I am not clear whether he proposes that the House should agree to that which many of us are worried about and on which we should prefer to have a rather fuller debate. Will he agree to that?
Lord Strathclyde: My Lords, before the Chairman of Committees responds to that point and, indeed, to any other points that are made—and I can see that a number of noble Lords wish to play a part—perhaps I may make a few remarks not just as Leader of the Opposition but also as a member of the Offices Committee. Apart from the Chairman of Committees, I believe that I am the only person so far who has spoken as a member of that committee.
I want to make two points: one a general one and one a more specific one. On the general point, the noble Lord, Lord Barnett, quite rightly raised the question of the report which we are debating. He said that it is rather thin. Having read it again, I agree entirely with that.
I know and suspect that that follows a format which has been well laid down by precedent, but perhaps the time has come, given the greater interest that there is in the House on such matters, for the way in which the reports are laid out to be reviewed and for more information to be provided. That may, in part, allow Peers who have an interest in those matters to raise questions informally with the Chairman of Committees or the authorities of the House before raising them in the House in this manner. I hope that that is a valuable suggestion which the Chairman of Committees may bring forward.
The second matter concerns the appointment of the management consultant. I should like to assure the House that this was agreed to in committee only after a great deal of discussion, debate and advice coming from the Chairman of Committees and others about the role of Mr Braithwaite.
The two points that were made were, first, that although Members of the House may be suitable to undertake this role, the Clerks were tied up in doing a great deal of other business servicing this House, so that they did not have the time to carry out this work themselves. The second point was made by the Chairman of Committees about having somebody from outside examining our structures. I, for one, agree with that. I hope that the noble Lord, Lord Barnett, and others will agree to accept this report. If it should come to a Division—I hope that it will not—I shall support the conclusions of the Offices Committee.
Lord. Peston: My Lords, I must say I was very disturbed by the intervention of the Leader of the Opposition just now. I had intended to rise earlier, but the Chairman of Committees got to his feet before I was able to join in. I am particularly concerned about how we operate. We are told that, of course, when we get this document we are free to spend as much time as we like debating it, except that if we debate for too long everybody gets irritated, so de facto, we are not.
We are also told that, of course, we can divide on such a Motion, but in practice we do not, because we are all so sensitive to the feelings of those who serve on this committee that we would not care to offend them. I agree very much with my noble friend Lord Barnett, except that as always in his restrained manner he talked in rather delicate language. I regard this report as ridiculous and if there were an opportunity to vote against it, I say categorically that I would vote against it on this occasion.
I am concerned not merely with the lack of a factual basis but, like the noble Viscount, Lord Cranborne, having had at least a minimum of experience of what management consultants do, I know that you end up doing all the work for them. All this is is a way of bringing somebody in at £70K so that some of us can then do the job. In my judgment, my noble friend Lord Barnett. is quite right: in which case why do we not save the £70K, organise a dinner for ourselves and still do the job? The serious point is that we will end up doing the job even if we spend that £70K. Therefore, I personally would not like to spend it.
It seems to me this is an example of what is going wrong with your Lordships' House. I do not say this to the noble Lord in any personal way—he is doing this in his role as a member of the Procedure Committee—but to put forward the argument that the Clerks have not got the facilities for doing the job themselves simply confirms what we have all been saying for some time: it is about time that we dealt with the resources problem and did not go in for this minimal incrementalism of doing a little bit here and a little hit there but never facing up to the realities of what needs to be done in your Lordships' House. Therefore, I particularly reject the argument that we have to follow this course because the Clerks are too busy. I have no idea what my noble friend Lord Barnett will propose in a moment, but were he for once, instead of being conciliatory, to adopt a rather revolutionary approach to this matter, he would have at least one noble friend supporting him.
Lord Campbell of Alloway: My Lords, before the noble Lord sits down, may I ask—
Noble Lords: Lord Barnett!
Lord Barnett: My Lords, first, I welcome the intervention of the noble Lord, Lord Strathclyde. I thought it was very helpful. If I may say so, I have found quite incredible some of the replies from the Chairman of Committees. He told us that he did not want to overburden us with information. Well, he certainly did not do that. He said that he would send
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me the details. I do not want him to send me the details; I want your Lordships to have the details. We were told that the procedure of this House is that such information is sent to committees and that committees examine it, and that that is the normal way that we do these things. Of course, we also have another normal course of action: we do not have to agree with committees when they put a report before us. I do not suggest to the Chairman of Committees that we should vote against this report today. I hope that he will withdraw it—
Noble Lords: Hear, hear!
Lord Barnett: My Lords, it would be, frankly, outrageous to ask us to agree to a report which suggests, for example, spending thousands of pounds on a consultant without telling us the answer to all the other points that we need to know, some of which have not yet come forward. Therefore, I hope that the Chairman of Committees will tell us that he does not propose to put this Motion to the House. If he does, I ask your Lordships to oppose it.
Lord Campbell of Alloway: My Lords, the only point I wanted to make has been made by the noble Lord, Lord Barnett, with greater force than I would have been able to make it. I sincerely ask the noble Lord the Chairman of Committees if he will withdraw this Motion now and for it not to be debated today.
Lord Berkeley: My Lords, as a former member of the Administration and Works Sub-Committee, perhaps I may say that my noble friend Lord Peston is actually wrong. We did divide the House over the matter of carparking at the front of your Lordships' House, so there is a precedent. I, too, hope that the Chairman of Committees will withdraw this Motion, but if he decides not to do so, I shall certainly vote against it.
Could the Chairman of Committees let the House know whether Mr Braithwaite has been chosen as a result of a competitive tendering procedure? There are many thousands of management consultants in this country and I would like to hear that he has been appointed because of his excellence rather than because he is somebody's friend, but I am sure that is not the case.
The Chairman of Committees: My Lords, perhaps I may provide one or two additional pieces of information before I respond to the suggestions which have been most recently made. I am very grateful indeed to the noble Lord, Lord Strathclyde, the Leader of the Opposition, and to the noble Baroness, Lady Knight of Collingtree, for raising the points that they did. If I may say so, the noble Lord, Lord Strathclyde, made a very helpful point as a member of your Lordships' committee which considered these matters in some detail.

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It is proposed that Mr Michael Braithwaite will be helped by two Officers of your Lordships' House. They are the Yeoman Usher, Brigadier Hedley Duncan and the Establishment Officer, Dr R Walters. It has been suggested that Mr Michael Braithwaite will not be in a position, because of lack of knowledge, to assist your Lordships. I would suggest that is far from the case. He has already become very familiar indeed with the workings of Parliament through the examination which he made in another place. It is for that reason that if he undertakes this work it will be less costly than it otherwise would have been, and indeed he will not have to spend a great deal of time in finding out about the basic workings of the House.
In answer to the point made by the noble Lord, Lord Monson, no set number of days has been set aside: that has been left open depending upon how the work proceeds. Although I have attempted to indicate that some more detailed information is already available in the normal way to your Lordships through the Library, I am persuaded that it might be helpful for your Lordships to be presented with a further report, which will contain more information of the kind requested by your Lordships this afternoon.
In the circumstances, I shall not press this Motion this afternoon but return to your Lordships with a more detailed report which, so far as its basic elements are concerned, will be similar to this one but contain the additional information which your Lordships, quite understandably, require.
Lord Denham: My Lords, before the noble Lord sits down, he has said that he will produce further information. Does he mean that he will refer the matter back to the committee—I think that is what the House wants—rather than just produce more information? I think that we want this to be referred back to the committee before we reach a decision on it.
The Chairman of Committees: My Lords, my immediate answer to the point raised by the noble Lord, Lord Denham, which I well understand, is that I should like to consider that. Another meeting of the Administration and Works Sub-Committee is scheduled for early July. If I may reflect upon it, that may be the appropriate point at which to ask that sub-committee to take another look at this. I do not want now, on the spot, to commit myself to referring the matter back in that way. What I shall certainly do, as I have indicated, is come back with a new report which contains more information. If the noble Lord will allow me to reflect upon that I will do so and if, on reflection, it does seem to be a better way of proceeding I will of course do that.
I suspect that I have not, on this occasion, been able to satisfy many of your Lordships with this report. However, I hope that your Lordships feel that it is appropriate for me to take the course of action I have suggested. That being the case, I beg leave to withdraw the Motion.
Motion, by leave, withdrawn.

European Council, Feira
3.40 p.m.
The Lord Privy Seal (Baroness Jay of Paddington): My Lords, with the leave of the House, I should like to repeat a Statement on the Feira European Council which is being made in another place by my right honourable friend the Prime Minister. The Statement is as follows:
"Together with my right honourable friends the Chancellor of the Exchequer and the Foreign Secretary, I attended a meeting of the European Council in Santa Maria da Feira, Portugal, on 19th and 20th June. A copy of the Council's conclusions is available in the Library of the House. I had a series of meetings in the margins with the Prime Minister of Belgium, Mr Verhofstadt, on illegal trafficking in people and football hooliganism; with the Prime Minister of Greece, Mr Simitis, in the wake of the appalling killing of Brigadier Saunders; with the Spanish Prime Minister, Mr Aznar, on economic reform; and with the French Prime Minister, Mr Jospin, on French plans for their presidency.
"As regards savings tax, the most contentious issue at the Council itself was the question of how best to tackle the problem of cross-border tax evasion within the EU. For many years the Commission and, indeed, most member states, have argued that the best way to deal with this issue is through tax harmonisation by requiring all countries to introduce a withholding tax on savings income paid out to non-residents. We, for our part, have argued consistently that a EU-wide withholding tax would not only be seriously damaging for the City of London; it would also be completely ineffective in tackling tax evasion. But we have also made it clear through these long and complex negotiations that we do fully agree with the objective of fighting international tax abuse caused by banking secrecy.
"The outcome my right honourable friend the Chancellor and I achieved at Feira was fully in line with the principles and objectives we set out. It was, as I said yesterday, a personal triumph for the Chancellor. This is a comprehensive agreement which fully protects the competitiveness of the City. All 15 countries have now agreed to accept exchange of information, not a withholding tax, as the way forward for the EU. Implementation of the European Union regime will depend on the progress made in agreeing similar measures with third countries and dependent territories. Even in the transitional period, only two of the 15 countries have said that they will definitely retain a withholding tax.
"This is an excellent agreement for Britain and for Europe. It shows once again how the Government's strategy of positive engagement in Europe both protects and indeed enhances the country's national economic interest.
"As regards economic reform, that was also demonstrated at the last European Council at Lisbon where we agreed a radical 10-year

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programme of economic reform for Europe. Since Lisbon we have made progress in taking this agenda forward, including directives on e-commerce and e-money, agreement in respect of copyright and new proposals on public procurement. At Feira we agreed a charter for small enterprises, a new strategy on scientific and technological research and a hugely ambitious action plan on e-Europe, which will underpin efforts to create a dynamic knowledge economy in Europe. At the same time we invited the Commission to accelerate work on the single market in financial services, energy liberalisation and aviation.
"Heads of Government discussed the proposed charter of rights. I made clear my view that the charter should pull together in a single document the rights European citizens enjoy, that it should be political in nature, not legally binding, and that it should not impose new legal obligations on the member states. The House will welcome the fact that there was a good deal of support for this approach from other Heads of Government. The charter will he one of the main issues for discussion at the Biarritz European Council in October.
"On enlargement, we agreed on the need to keep up the momentum in the negotiations with the candidate countries.
"On the European Union's own preparations in the inter-governmental conference, we heard a progress report from the Portuguese presidency setting out the options for re-weighting votes in the Council of Ministers in favour of the larger member states like the UK, for reforming the size and structure of the Commission and for looking again at what issues should be decided by qualified majority voting.
"We also discussed the arrangements agreed at Amsterdam to allow closer co-operation among a group of member states. Such arrangements already exist, for example in Schengen. And we will need more such flexible co-operation in an enlarged EU. But in this context, the Council reaffirmed in its conclusions the need for coherence and solidarity in an enlarged European Union.
"We made further progress on European defence. Close working links between the European Union and NATO are being put in place, together with special consultation arrangements with those European allies who are not in the EU. The priority now is on how Europe will deliver on the headline goal we set ourselves at Helsinki, and this will be the focus of work in the next six months. We also adopted targets for the civilian aspects of crisis management, such as the provision of police officers.
"Finally, we discussed a range of international issues: Russia, the Balkans, the Middle East peace process, and Africa on which President Mbeki of South Africa addressed the Council.
"This was, again, a successful summit for Europe and the United Kingdom. I have no doubt at all that it is vital for British ideas, British industry and
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British influence that we continue with the policy of constructive partnership with the EU and under this Government that is what we shall do."
My Lords, that concludes the Statement.
3.45 p.m.
Lord Strathclyde: My Lords, I am grateful to the noble Baroness for repeating the Statement. I understand that she has taken time off from the "Body Image Summit" being held by the Prime Minister at No. 10. I thank her for putting the interests of the House first.
In the past I have often been accused of being churlish in response to EU summits in this House. Perhaps I may say at once that I welcome the commitment to the completion of the internal market, the overdue emphasis placed on small businesses and the action plan on drugs. I also welcome the success achieved in resisting the threat of a withholding tax which would have done much damage to the City of London. Let us hear no more about unfair tax competition. Does the noble Baroness agree that that owes much to the Chancellor of the Exchequer, Mr Brown? Can she confirm the Treasury briefing to today's Financial Times that Downing Street urged Mr Brown to give way on this issue at the Helsinki summit but that the Chancellor refused to do so? Did the Chancellor, not for the first time, show better judgment than the Prime Minister? Can she confirm, however, that this agreement will not be put into effect unless the European Union can achieve exactly the same agreement of the Swiss and the US authorities to exchange information on savings? I wonder how the Government assess that particular prospect.
Can the noble Baroness assure the House that the Government will not try to prove its euro credentials by harassing the authorities in the Isle of Man or the Channel Islands in pursuit of an agreement that may never come into force if the Swiss Government will not lift their secrecy laws?
I wonder whether the noble Baroness has had the opportunity to see the comment of the Swiss Finance Minister, Kaspar Villiger, in today's Corriere della Sera that Swiss banking secrecy is "non-negotiable"? Is that very same newspaper not right in saying that the English may be speaking of a very important result but that the Feira agreement has already received a cold shower in the shape of a "No" from the Swiss?
We, on this side of the House, do not favour EU intervention in pursuit of tax harmonisation. The Chancellor may have held a threat at bay, but is it not a threat that should never have been made in the first place? Does not this episode show once again the utter futility of the schoolboy boycott of the democratically elected government of Austria? Is not the noble Baroness ashamed of the admission by her noble friend Lady Scotland that Austria is the only member of the United Nations with whom we have a policy of refusing bilateral ministerial talks?
What do we do if an Austrian Minister comes up to a member of this Government at one of these summits? Do we shuffle away, muttering, "Not today, thank you

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very much?" Is it not high time that this farcical and offensive policy was brought to an end? Can the noble Baroness take that message with her when she meets with the rest of the Cabinet tomorrow morning?
At least the Chancellor could say that he was at centre stage in Feira. The Prime Minister can say no such thing. During the summit the Prime Minister hovered on the fringe, unable to say with which of his Minister's views on the euro he agreed; he was left in the wings while Herr Schroeder and President Chirac set out their plans for what they called "reinforced co-operation". If any of the Prime Minister's diminishing legion of spin doctors had bothered to mention that in yesterday's briefing, the translation into English is a "two-speed Europe".
That "two-speed Europe" will now officially be on the agenda in Nice. So too will the charter of fundamental rights. Can the noble Baroness tell the House this afternoon whether the Government are in favour of "reinforced co-operation" or against it? Are they ready to agree to a charter of fundamental rights, or will they oppose that concept? There are clear choices to be made. Parliament needs to be told and so too do the British public.
Is not the brutal truth that the Prime Minister was an increasingly forlorn figure as he boasted of his euro leadership, but then had to listen to the blunt words of the German chancellor that,
"A two-speed Europe already exists. You should know because you are not a member of the euro"?
Does the noble Baroness agree with the noble Lords, Lord Owen and Lord Healey, that any further major concessions of power should be made only after they have been endorsed by the British people in a referendum? Was there any discussion of the United Kingdom's entry into the euro at the summit, given that the entry of the Greek drachma was endorsed? Did the summit agree with the words of Mr Duisenberg that there was a "psycho-political" problem in the United Kingdom Government as to the euro? I do not know who inside the Government is a psycho, but it is a serious point.
Everyone in this country and across Europe knows from whispers and spin that the Prime Minister wants to enter the euro soon, and that he does not believe that there are any constitutional implications of this matter at all. We differ with him on that. But is not the stark truth that he could carry more respect at these summits if he came out for what he believed instead of dithering and simpering on the fringe?
That is the "psycho-political" problem accurately identified by Mr Duisenberg. It goes right to the top of this increasingly incoherent and indecisive Government. On the biggest issues facing the EU in Nice and after, the Prime Minister is not offering the leadership that the country expects. As President Chirac bluntly put it, in Europe,
"there will be leaders and followers".
Increasingly we can see that, in today's Europe, the Prime Minister is not one of its leaders.
3.54 p.m.
Lord Rodgers of Quarry Bank: My Lords, on behalf of these Benches, I too thank the Leader of the House for repeating today the Statement made by the Prime Minister elsewhere.
I too welcome the outcome on what we call "tax evasion". I agree that it is an excellent agreement both for the United Kingdom and for the European Union. I find no embarrassment on this occasion in congratulating the Chancellor on his achievement. Unlike the noble Lord, Lord Strathclyde, I am not too bothered about trivial newspaper stories, whether or not they are accurate. I feel that they are irrelevant to the outcome, which was a good one. It shows what can be done in the European Union through persuasion, given a good case. For that reason it is strengthening both of the Union, as well as of those who believe that Britain's full membership, in every respect, at all times, is to the United Kingdom's advantage.
I ask the noble Baroness only one question in that regard. The Statement refers to the need to make progress with the agreement after negotiations with third countries and dependent territories. Can she say how those negotiations will be started? Will they be carried out by the Europe Union or through bilateral exchanges? Is there any timetable by which implementation of that important agreement will take place?
Compared with the outcome on tax evasion, other matters were, perhaps not subsidiary, but less striking. I should like to ask questions on two or three of those topics. A reference was made to something which is not unfamiliar to us; that is, closer co-operation among groups of member states. It may be my shortcoming, but I do not fully understand what that means. That is an area in which there could be a danger of two-tier membership or of unravelling. I am sure that that is not the intention and it should be possible to welcome the progress that has been made. However, could the House be told a little more as to precisely what that involves?
A vague statement was made on European defence, with no indication of exactly what has been agreed. Perhaps the noble Baroness could tell us explicitly what was new on the whole question of the emergency unit being able to take express action. Also, we know that there has been a real problem—Kosovo among others—of obtaining the target of police officers which had been set. Can the Minister say what the new target is and what is the likelihood of it being achieved?
I referred earlier to rapid response. I am afraid I was tumbling over my words. I was asking explicitly what progress had been made on rapid response.
As often happens, the Statement began with reference to other meetings that the Prime Minister had on the margins of the Council, including the meeting with the French Prime Minister, Mr Jospin. In that respect, can the Minister say a word or two about the agendas for Nice and, before that, Biarritz? She referred to progress on the charter in Biarritz. It would be helpful to have an indication, not necessarily of the agenda, which presumably will be for the French

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presidency to arrange, but of the United Kingdom's objectives, both at Biarritz and the Nice Council meeting in December.
It is clear that there was no substantive discussion of the euro at the summit meeting, and no explicit statement of the United Kingdom's intentions. In that respect the Chancellor likes to make extramural statements of one kind or another. I should like to believe that his success with the withholding tax has given him some confidence and courage to think rather differently about the whole question of entering the eurozone. I agree with Mr Duisenberg that it is not only a matter of convergence; it is not only a matter of five conditions, of which three have probably already been met; it is a political decision. I am not expecting the noble Baroness to give us a great deal of hope today, but perhaps he can confirm that that political decision will be made sooner rather than later and that the Chancellor is in high spirits and open to persuasion.
3.58 p.m.
Baroness Jay of Paddington: My Lords, as always I am grateful to the noble Lords, Lord Strathclyde and Lord Rodgers, for their overall welcome of this report on the summit and, indeed, as the noble Lord, Lord Strathclyde, said, for his enthusiasm for certain parts of it.
As the noble Lord, Lord Strathclyde, is concerned about the issue of interpretation of various events as he has read them in what one might call secondary sources, I can assure him—I should not like this to go unchallenged or unassailed—that the Prime Minister was certainly not involved in the "Body Image Summit"; that that summit was not held at No. 10 Downing Street; and that it finished at 10.15 this morning. There was therefore no challenge to my responsibilities towards your Lordships' House in that regard.
I refer the noble Lord, Lord Strathclyde, to those matters which are on record in relation to this conference to assist him in obtaining the correct position of Her Majesty's Government. For example, I refer him to the press conference which my right honourable friends the Prime Minister, the Chancellor of the Exchequer and the Foreign Secretary gave yesterday and, on the issue of the convergence criteria and whether or not convergence is closer or further away, to the speech made by my right honourable friend the Chancellor of the Exchequer at the Mansion House last week. Those may be more instructive and more authoritative than some of the second-hand sources on which he commented this afternoon.
With regard to the general point made by the noble Lord, Lord Strathclyde, about the sense in which Britain was lagging behind the leaders at this conference, a reading of the conclusions of the presidency will again lead him from the primary sources to a rather different view from that which he took this afternoon.
If we leave aside the welcome that he rightly gave to the points made by my right honourable friend the Chancellor of the Exchequer as regards the
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withholding tax, of which he was able to convince the rest of his colleagues, he will see that, in relation to the charter of rights, the question of the post-Lisbon agreements, the economic agreements which were set out at that previous summit on, for example, a more subsidiary but, none the less, very important issue of the drugs trade, not to mention the question of trafficking in people, the British Government took a very important leading position in the discussion and, as is often the case, those positions which we espoused were ones which resulted in considerable agreement from our colleagues.
The noble Lord raised the question of what he described as the "two-speed Europe", and thought that somehow the Prime Minister had been disadvantaged by the fact that some of the issues which could fall into this category would be put on the agenda at the Nice summit. Again, I refer to the Prime Minister's reported statements in the past 24 hours on this matter. He said very clearly that he realised that these issues would be on the agenda of the Nice summit; that this was not something into which we were suddenly being bounced by the French government; and that, as was referred to in the Statement which I repeated, on certain issues—for example, the question of Schengen—there were different kinds of co-operation at different periods and in different ways between different countries.
I refer again to the terms of the conclusion. If I can find the exact words for your Lordships, I will quote them precisely. The conclusion was that, where it was thought possible to look at enhanced co-operation, it would be—and I quote directly from the conclusion—
"in the context of cohesion and solidarity within the European Union".
That could not be much clearer.
The noble Lord, Lord Rodgers, raised whether there were specific issues which might fall into this basket of concerns which might be discussed during the IGC. The Government's position is that they are willing to consider those issues, in the spirit in which they are seen in the context of cohesion and solidarity. However, at present the Government are not convinced that the existing treaty provisions are sufficient in terms of making allowance for those different forms of progress in the specific areas of which I have given examples.
With regard to the question of the development of the very important and successful agreement that we achieved in relation to the exchange of information, as opposed to the withholding tax, I remind the House—and in this respect I concur with the point made by the noble Lord, Lord Rodgers, that, given a good case, this is an example of achieving much through persuasion—that six months ago the UK Government were in a position of 1:14 on this particular issue. We have now resolved it in the way in which the Government and particularly the City of London were concerned to resolve it. We have done that through persuasion, on the basis of a good argument, and entirely accept that description by the noble Lord, Lord Rodgers.

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With regard to the question of how we go forward, particularly on the attitude of the Swiss and indeed the relationship and negotiations which will need to take place with the dependent territories and others, I am sure that noble Lords are aware that the question of the OECD discussions has already thrown up a more optimistic overall view of what the position may be vis-à-vis the Swiss government and specifically the United States government than was perhaps indicated from, yet again, the second-hand source of the noble Lord, Lord Strathclyde, in quoting a particular Minister today.
On the negotiations with the independent territories, we shall be working with our own independent territories on a bilateral basis, as I understand it, to fulfil our commitment set out in the conclusions. However, on the question of Switzerland—and this relates to the general point made by the noble Lord, Lord Strathclyde—this is precisely the reason that the UK has retained its right to veto the directive on the entire package, if these kind of agreements are not met within two years. I hope that that meets the point made by the noble Lord, Lord Rodgers. I cannot today give him a precise indication of exactly how discussions will proceed between the EU and other governments with which we are not as involved in terms of our bilateral arrangements as we obviously are with dependent territories. If I have further information, I shall, of course, write to the noble Lord.
I think I have covered most of the major points that were raised, except for the specific one which was raised by the noble Lord, Lord Rodgers, in relation to what practical progress has been achieved on the defence and security agreement. The wording of the presidency conclusions, which allows a very positive engagement between non-European NATO countries and other NATO countries, underlies what one might describe as the spirit of this development. The specific points are that the permanent political and military structures should be put in place in early 2001, and that the practical ways forward will be those which have previously been outlined. The proposals are a development of the mechanisms which have previously been agreed at other summits, and various benchmarks have been agreed. If the noble Lord requests it, I shall be happy to write to him with the precise details.
With regard to the European police force, I can reassure the noble Lord, Lord Rodgers, that the target for civilian police capabilities is to be met by voluntary contributions from the national police forces of member states. These contributions will be available for operations carried out by any international organisation, including, for example, the UN or the OSCE.
I believe that I have covered most of the main points made by noble Lords. In conclusion, I say to the noble Lord, Lord Strathclyde, that, although he perceives the British Government to be on the margins of the summit, if he looks at the conclusions and at the agreements which have been made on the basic
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principles, as well as the practical development of some of the earlier summits, he will discover that much was achieved on the basis of our leadership. I again commend to him the phrase of the noble Lord, Lord Rodgers—that much is achieved through persuasion, given a good case.
4.7 p.m.
Lord Renton: My Lords, I welcome the agreement that the proposed charter will not be legally enforceable. Perhaps I can ask the noble Baroness whether she is aware that that would be a very useful precedent for future agreements. That arises because the Treaty of Rome and its enactments have, to a great extent, not been legally enforceable. The economies, constitutions and climates of the European countries differ so greatly that it is difficult to expect them to be legally enforceable. Will the Government do all that they can to ensure, especially if the Community is to be enlarged, that future agreements will not be legally enforceable, but merely good aims?
Baroness Jay of Paddington: My Lords, I would be reluctant and foolish to give from the Dispatch Box this afternoon that overriding assurance to the noble Lord, Lord Renton. However, I was very interested to read the extremely authoritative debate on the charter of fundamental rights which was held in your Lordships' House last Friday, when regrettably I could not be present. The way in which those issues were covered lends great credit to those who took part in the debate, and notably the people who were actually involved in the discussion on the convention. Many of the points made this afternoon by the noble Lord, Lord Renton, were thoroughly examined and very positively aired.
I reinforce the point that I made in answer to the noble Lord, Lord Strathclyde, that the Prime Minister led off the discussion on the charter at the Feira summit, saying that it should be declaratory and limited to existing rights. As I emphasised in my earlier reply, this position was supported by several partners. I also reinforce the point made by my noble friend Lady Scotland in her reply to the debate last week, that it is the Government's position that the charter should not extend competence or disturb member states' legal relations with their citizens within areas of national competence. To that extent, the declaratory point, which the noble Lord, Lord Renton, made as his primary, opening contribution, is one which we very strongly feel should be supported. It should not be an aspiration or a legal requirement.
Lord Shore of Stepney: My Lords, I congratulate my noble friend on the Statement. It is one of unusual importance. She has covered a vast menu of subjects. Looking ahead to Nice, one has to pick up, as it were—this Council is only a stepping stone towards that—what will be the big issue. The big issue is undoubtedly closer co-operation, which the French and Germans have placed on the agenda of the IGC. However, we would be only too happy if it was not there.

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Let us be clear about the matter. I ask my noble friend to confirm my next point. This is almost the breaking point. "Closer co-operation" is code for "full steam ahead" to that European state and ever-closer union upon which the founding six set their sights from the beginning. We should not be dragged along behind, unwillingly, at this moment when a great enlargement is bound to influence and offer opportunities for change in the whole European Union relationship. This is a great opportunity for us—if we have only the wit and the will to take it—to change our own relationship with the European Union into an honest one. We do not intend to become part of a federal union state. We need to have an honest relationship with the European Union and at the same time do great service to the rest of Europe, particularly to a number of the applicant countries which will lose their own freedoms in being subjected to the 31-odd chapters of the acquis communautaire which they are supposed to swallow at the point of entry.
I should be grateful if my noble friend would at least indicate that she realises that the big issue is now with us and that the Foreign Office and the Government are thinking carefully about where we go from now.
Baroness Jay of Paddington: My Lords, I am grateful for my noble friend's comments. I hope that it is self-evident that the Government are thinking about the issues. However, the question remains as to whether or not they are thinking about them from the same perspective as that of my noble friend. I am not sure whether my noble friend was present in the Chamber when I said in response to an earlier question that the Government have recognised for some time—the Prime Minister stated this explicitly at the news conference that he gave yesterday afternoon in Portugal—that these issues would be on the agenda for the Nice summit. As I said, this is not something into which we have suddenly found ourselves "bounced".
We have always accepted that in a more diverse Europe some flexibility will be needed. However, on the other hand—I emphasise this point—we do not accept that closer co-operation automatically leads to the creation of an inner core of member states, nor indeed, in the fashionable phrase, to a "two-tier Europe". As I said earlier, this is made explicit in the Presidency conclusions in terms of seeing this whole process within the solidarity and cohesion of the wider Europe.
My noble friend Lord Shore challenges the Government to demonstrate wit and will in this area. I emphasise again what I said in my first reply; namely, that what has been demonstrated above all at the Feira summit—given the strong leadership that exists on the specific issues which I mentioned, and which are included in the Statement—is that the Government have a good record of achieving change through persuasion and of achieving leadership on those issues in which they wish to play a prominent role.
Lord Wallace of Saltaire: My Lords, I am surprised at the passing reference to EU enlargement in the Statement as many of us consider that this is the main
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strategic project for the European Union for the next five years. Will the Government give us an assurance that one of their objectives for the Nice European Council is to achieve an agreed target date for EU enlargement? As the noble Baroness the Leader of the House is aware, the current timetable is slipping badly. The date has informally been agreed to be January 2003. I understand that the other week the German Chancellor said informally to the conference of Baltic states that they should not expect to join before January 2005 because serious negotiations are unlikely to begin until after the next German and French elections.
Many within the applicant states consider that the British Government are not giving great priority to enlargement. The Foreign Secretary has just cancelled his visit to Warsaw which was due to take place this coming weekend. This follows two cancelled visits of the Prime Minister to Warsaw during the past year. There is a queue of Prime Ministers and Foreign Ministers from the applicant states asking to visit London and waiting for acceptance. The image is therefore not given that the British Government attach great priority to that matter. Will the noble Baroness give us some assurance that in preparing for the Nice Summit the British Government will attempt to achieve an early target date?
Baroness Jay of Paddington: My Lords, as regards the target date, it was decided at Feira—this may not have been set out in the conclusions as precisely as the noble Lord wished—that all remaining chapters with the best prepared Helsinki 6 countries would he opened as early as possible in 2001. The noble Lord will be aware that the EU is committed to be ready to welcome new members by the end of 2002 and has set aside funding for new member states to join the EU from 2002 to 2006. However, as the noble Lord will appreciate, the date of accession depends on each applicant's readiness. It would be foolish to make artificial predictions about that this afternoon.
On the broader point about the Government's commitment to the enlargement process, there is no moving away from the position that that remains our greatest opportunity and a great challenge to the European Union. Clearly, the Government are aware that achieving successful enlargement enhances not only the security and the stability, but also the prosperity, of Europe. This is therefore a matter on which we have certainly not slowed down. However, the fact that it was not given the prominence in the conclusions that the noble Lord expected was simply because other issues, such as the withholding tax, took greater priority in this particular two-day meeting.
Lord Monson: My Lords, I hope that I may put one short and one slightly longer question to the noble Baroness the Leader of the House. First, has she seen the report in yesterday's Times which reveals that support in Poland for EU entry has dropped from 80 per cent to 50 per cent and is still falling, and gives the reason why that has occurred? I hope that the noble Baroness will comment on that report, if she has read it.

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Secondly, although, as the noble Baroness pointed out, the agreement to drop the withholding tax seems to have been welcomed by many other EU countries, nevertheless the United Kingdom is obviously the main beneficiary by virtue of the importance of the City of London. Can the noble Baroness guarantee that the Government have not privately indicated to the other countries that, as a quid pro quo for the dropping of the withholding tax, the United Kingdom will be prepared to accept certain integrationist measures that may be desired by the more federalist members of the Community?
Baroness Jay of Paddington: My Lords, I am afraid that I cannot be as helpful as I normally like to be to the noble Lord, Lord Monson, as regards both his questions. First, I regret that I have not read the article in The Times to which he referred. I am sure that he will know as well as I that in general the perspective of the populations of individual countries on such matters tends to vary enormously. The views expressed in, for example, Denmark and the United Kingdom in relation to the Maastricht Treaty showed variations in public opinion at different stages of the process.
As regards the withholding tax, I understand that no measures of the kind that the noble Lord mentioned were agreed in the margins or at any stage of the summit. However, as I was not present I cannot make a categorical statement about whispers in corridors, although I do not think that is what the noble Lord seeks. As regards the positions that were agreed, I can state categorically that there was no undertaking of the kind that the noble Lord mentioned.
Lord Grenfell: My Lords, does my noble friend the Leader of the House agree that perhaps my noble friend Lord Shore would be able to avoid some of his nightmares about a United States of Europe if he were to remove Mr Joschka Fischer's speech from his bedside reading and not read too much into it, particularly when most of the 15 member states do not seek a "United States of Europe" but a "united Europe of states"? That makes a great deal more sense.
Having said that, I congratulate my noble friend on the highly significant and successful result obtained on the withholding tax. It is a major step forward after, as she rightly pointed out, the United Kingdom had been in a very isolated position.
I am pleased that the European Council has recognised the problem that Austria will have with the amendment of its constitution in order to remove banking secrecy. Does my noble friend welcome the fact that a seven-year period of grace has been accorded to both Austria and Luxembourg in which to change their banking secrecy laws.
Finally, is my noble friend aware that there is talk of a Portuguese presidency initiative which includes proposals for monitoring the policies and actions of the Austrian Government in place of sanctions? If that is so, can she assure the House that Her Majesty's Government would welcome this? In my view, it is
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exactly what should have happened when Austria formed its new government. If we had agreed to monitor their actions at that time, there would have been no need to impose these sanctions, which I find absolutely unnecessary and damaging to the European Union.
Baroness Jay of Paddington: My Lords, I am grateful to my noble friend Lord Grenfell for raising the point of the Portuguese initiative. I apologise to the noble Lord, Lord Strathclyde, who specifically raised that issue in his initial comments. He asked whether there had been any further action in relation to Austria after the Feira summit, and I am afraid that I simply forgot that in responding to him.
My noble friend Lord Grenfell is right. Although there was no substantive discussion on this issue at Feira, it was understood from the presidency that Prime Minister Guterres would be in contact with the Austrian Government—we hope by the end of this month—in order to raise some of the issues mentioned by my noble friend. As I say, because there was no substantive discussion of this issue at the Feira conference, it would be premature to say what the hypothetical outcome of that kind of communication or contact with the Austrian Government will be and, therefore, whether the British Government would welcome the outcome. As to the mechanics, it is true, and obviously welcome, that Prime Minister Guterres is taking this initiative.
As to my noble friend's other point, he is right to raise the question of the difficulties surrounding the speech to which he referred. I was present in the House on an earlier occasion when my noble friend Lady Scotland referred to that speech and emphasised to the House its unofficial and personal nature. I know that that did not necessarily reassure some Members of the House on that occasion—it probably will not again today—but I underline once more what both my noble friends Lady Scotland and Lord Grenfell have said on many occasions—that a "united Europe of states" is the worthwhile objective, not a "United States of Europe".
Lord Pearson of Rannoch: My Lords, does the noble Baroness accept that it is a measure of how deeply we have become involved in this whole perilous European venture that we should regard the kicking into the long grass of the entirely destructive and senseless proposal of the withholding tax with such relief? In that respect, can the noble Baroness assure the House that the rest of tax harmonisation—which, as she knows, is "Eurospeak" for British taxes being increased by some 20 per cent—is now firmly off the agenda, both at Nice and in the related initiatives which are running parallel to Nice?
Does the noble Baroness also agree that even if the charter of fundamental rights is to be only declaratory—we shall have to wait and see—that

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would still allow the court to take the charter into account in its future pursuit of the ever-closer union of the peoples of Europe?
Baroness Jay of Paddington: My Lords, as your Lordships are well aware, the noble Lord, Lord Pearson, takes a particular constitutional stance on this country's position vis-à-vis the European Union. Indeed, I think it is true that he has introduced legislation in his name to try to effect that. Am I right? The noble Lord looks sceptical. I give way.
Lord Pearson of Rannoch: My Lords, in 1997 your Lordships' House was good enough to give a Second Reading—by two votes in a record vote on a Friday afternoon—to that effect. But the Bill which is passing through your Lordships' House at the moment has the entirely reasonable purpose of requiring a committee of inquiry to consider what life may be like outside the European Union.
Baroness Jay of Paddington: My Lords, in that case the noble Lord, Lord Pearson, deals in hypotheticals to some extent on this issue. In practical reality, of course, the directive has been agreed around some of the issues on the exchange of information rather than the withholding tax. The noble Lord feels that that is an indication of the mire in which we find ourselves, but he was kind enough to say that we had at least extricated ourselves from this particular mire with some degree of dexterity.
I am sure that the noble Lord is aware that this directive is not about with tax harmonisation; it reaffirms that it is for member states to decide how their residents' income should be taxed. So the issue of tax harmonisation—although it was a potential answer to this particular issue—does not arise, either hypothetically or in practice, in this instance. The noble Lord, of course, will be aware that the British Government have always taken a very firm position on tax harmonisation, which the Chancellor of the Exchequer reinforced at this conference. His leadership skills in achieving this agreement on the withholding tax have demonstrated his authority in this particular field.
As to the other point raised by the noble Lord, I refer him to the detailed discussions which took place in your Lordships' House last Friday—I know he took part in the debate—on the potential implications of a declaratory charter. A number of notable jurists, including those who are members of the convention on the charter, also took part, and no clear apprehension was shown by the people most directly involved about the kind of scenario suggested by the noble Lord. Some of them are distinguished jurists, and I would rest on their opinion.
Lord Bruce of Donington: My Lords, can my noble friend—
Lord Harrison: My Lords, does my noble friend the Leader of the House recognise that the Feira Council—
Lord Bruce of Donington: My Lords, can my noble friend give some indication of the official legal status
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of a presidential declaration as distinct from an agreed communiqué? It may not have much significance today, but it may have some significance in the future.
Baroness Jay of Paddington: My Lords, I cannot help my noble friend on that technical point, but I shall, of course, write to him on it.

Utilities Bill
4.27 p.m.
Lord McIntosh of Haringey: My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Lord McIntosh of Haringey.)
On Question, Motion agreed to.
House in Committee accordingly.
[The DEPUTY CHAIRMAN OF COMMITTEES (Baroness Lockwood) in the Chair.]
Clause 24 [Provision of information to the Council]:
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 132:
Page 21, line 30, leave out from beginning to ("under") in line 39 and insert ("(1) The Council may direct—

(a) the Authority; or

(b) the holder of a gas licence or an electricity licence,

to supply to it, in such form as it may reasonably specify, such information specified or described in the direction as it may require for the purpose of exercising its functions.

(2) A person to whom a direction under this section is given shall comply with it as soon as is reasonably practicable.

(3) Before giving a direction").

The noble Lord said: This amendment was spoken to with Amendment No. 104. I beg to move.
On Question, amendment agreed to.
[Amendment No. 133 not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 134:
Page 21, line 43, leave out subsections (6) to (11) and insert—
("(6) If the Authority fails to comply with a direction under this section it shall, if so required by the Council, give notice to the Council of the reasons for its failure.").
The noble Lord said: This amendment was spoken to with Amendment No. 104. I beg to move.
On Question, amendment agreed to.
Lord Kingsland Lord Kingsland moved Amendment No. 135:
Page 22, line 19, at end insert—
("(12) Neither the Authority nor any licence holder shall be required by virtue of this section or any regulations made under it to supply any information which the Authority or that licence holder could not be compelled to give in evidence in civil proceedings in the High Court or, in Scotland, the Court of Session.").
The noble Lord said: In moving Amendment No. 135, I shall speak also to Amendment Nos. 202, 203, 261 and 262. These amendments concern information which is legally privileged. I think I am

281
right in saying that legal privilege protection appears in only two clauses of the Bill—Clauses 69(9) and 98(9). I also believe that I am right—although I am not absolutely sure about this—that these provisions were added to the Bill during the course of the Committee stage in another place. At any rate, it is the view of the Opposition that legal privilege protection should be given in those other parts of the Bill to which Amendment No. 135 and the other amendments to which I have spoken relate. I beg to move.
Lord McIntosh of Haringey: These amendments are designed to exclude legally privileged information from that which the authority or the Secretary of State may require to be disclosed under Clauses 92, 93 and 97, and from that which the council may require under Clause 24.
In relation to Amendment No. 135, the amendment which relates to Clause 24, there is a slight chance—I stress that it is very slight—that the council might seek information to which legal privilege attaches under Clause 24. But our consultation document on which information licensees and the authority should be entitled to withhold from the council included legally privileged information. For that reason, this amendment is unnecessary.
The noble Lord, Lord Kingsland, referred to the even slighter possibility of a dispute about information which is legally privileged in relation to a court case to which the authority is a party. On the face of it, that could give rise to a concern that the authority will see information it could not see in court when it determines whether the licensee may withhold the information from the council. However, the situation will not be fundamentally different from that which now exists under the licences. Condition 16(3) of the Standard Conditions of Public Gas Transporters' Licences excludes legally privileged information from the director-general's right to information under condition 16(1).
In both cases the issue would proceed by a submission of arguments, but not the allegedly privileged documents, by the licensee to the regulator. If the regulator rejected the licensee's arguments and ordered him to produce the documents, the licensee could still secure that the compellability of the documents is decided by a judge in court, by contesting the regulator's enforcement order.
As regards the other amendments in the group—those relating to Clauses 92, 93 and 97—it is inconceivable that the information provisions in the case of these clauses could require companies to disclose information of a legally privileged kind. Examples of the sorts of disclosure required would be the number of cases when companies failed to meet individual standards of performance and the amount of compensation they therefore paid to customers under Clause 92; statistics on standards of performance and levels achieved under Clause 93; and information relating to types of customers to enable the effective functioning of a scheme on fuel poverty
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under Clause 97. There is no prospect of requiring companies to disclose information such as legal advice, which is subject to legal privilege.
I have to say that I have dealt as fairly as I can with Amendment No. 135 which would have some point if the Government had not already dealt with it in the consultation document. The other amendments simply would not contribute anything to the Bill.
Lord Kingsland: I understand the Minister to be saying that he agrees with my amendments but that he does not accept them.
Lord McIntosh of Haringey: On the contrary, I am saying that none of these amendments is necessary. There are no circumstances in which any of these requirements could involve legal privilege.
Lord Kingsland: Can the Minister tell me why it would subtract from the Bill if these amendments were included? Clearly, the Minister agrees with the policy that lies behind the amendments.
Lord McIntosh of Haringey: The Bill already provides the protection which the noble Lord seeks. It would therefore be quite inappropriate to include his amendments.
Lord Kingsland: In light of the Minister's last remarks, I shall again look closely at the Bill and consider whether it will be necessary to pursue this matter at Report stage. In the mean time, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 24, as amended, agreed to.
Clause 25 [Publication of notice of reasons]:
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 136 and 137:
Page 22, line 21, leave out ("24(7) or (10)") and insert ("24(4)").
Page 22, line 23, leave out ("not be") and insert ("be excluded from any notice").
On Question, amendments agreed to.
[Amendment No. 138 not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 139:
Page 22, line 28, leave out ("disclosure") and insert ("publication").
On Question, amendment agreed to.
[Amendments Nos. 140 to 146 not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 147:
Page 22, line 44, leave out from first ("section") to end of line and insert ("(General restrictions on disclosure of information)".
On Question, amendment agreed to.
Clause 25, as amended, agreed to.
Clause 26 [Provision of information by the Council to the Authority]:
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 148 and 149:
Page 23, line 1, leave out subsections (1) and (2) and insert—
("(1) The Authority may direct the Council to supply to it, in such form as it may reasonably specify, such information specified or described in the direction as it may require for the purpose of exercising its functions.
(2) The Council shall comply with a direction under this section as soon as is reasonably practicable.").
Page 23, line 18, leave out subsection (5).
On Question, amendments agreed to.
Clause 26, as amended, agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 150:
After Clause 26, insert the following new clause—

Utilities Bill

  SECTIONS 24 TO 26: SUPPLEMENTARY
  (".—(1) The Secretary of State may make regulations prescribing—

  (a) descriptions of information which the Authority, a licence holder or the Council may refuse to supply under section 24 or 26; or

  (b) circumstances in which the Authority, a licence holder or the Council may refuse to comply with a direction under section 24 or 26.

  (2) The Council may, if no person is prescribed for the purpose under subsection (3), refer a failure by a licence holder to comply with a direction under section 24 to the Authority.
  (3) The Secretary of State may make regulations for the purpose of enabling a failure to comply with a direction under section 24 or 26 to be referred by the person who gave the direction to such person (other than the Authority) as may be prescribed by the regulations.
  (4) A person to whom such a failure is referred (whether under subsection (2) or regulations under subsection (3)) shall—

  (a) consider any representations made by either party;

  (b) determine whether the person failing to comply with the direction is entitled to refuse to do so and, if not, order him to comply with the direction; and

  (c) give notice of his determination and any order under subsection (4)(b), with reasons, to both parties.

  (5) A notice under subsection (4) may be published by either party to the reference; and subsections (2) to (5) of section 25 apply to the publication of such a notice as they apply to the publication of a notice under section 24(4).
  (6) Section 60 of the 1989 Act (powers to make regulations) applies to regulations under this section as if they were made under Part I of that Act.
  (7) The power of the Secretary of State to make regulations under this section is exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.").
  On Question, amendment agreed to.
  [Amendments Nos. 151 and 152 not moved.]
  Clause 27 agreed to.
  Clause 28 [Exemptions from electricity licensing]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 153:
  Page 24, line 3, leave out (", after consultation with the Authority,").
  The noble Lord said: In moving Amendment No. 153, I should like to speak also to Amendments Nos. 154, 155, 181, 182, 185, 187 and 323.
  Clause 28 of the Bill provides for exemptions from the requirement to hold a licence to carry out the activities otherwise prohibited by Section 4 of the Electricity Act; that is, the generation, supply, transmission and, for the future, distribution of electricity. Clause 85 is similarly concerned with exemptions from the requirement to hold a licence to carry out the activities otherwise prohibited by Section 5 of the Gas Act.
  Why do we have exemptions? Smaller generators, suppliers and the like are granted exemptions because, as they operate on a limited scale or for a particular purpose, it would be unduly onerous to subject them to the full regulatory burden associated with holding a licence. For example, owners of caravan sites who take a supply of electricity or gas from the system and redistribute it to the caravans would qualify for an exemption.
  Amendments Nos. 153, 154, 155 and 323 introduce a requirement for the Secretary of State to go out to consultation before granting an exemption under Clauses 28 or 85. They require him to produce a notice that sets out the exemption he proposes to make, together with the reasons why he proposes to do so.
  A copy of the notice should be served on the authority and the consumer council, and it should be published so as to bring it to the attention of those likely to be affected by the exemption. Those wishing to make representations are given a minimum of 28 days in which to do so.
  In the context of this new obligation to consult, Amendments Nos. 181, 182, 185 and 187 remove the granting of exemptions from the list of decisions that triggers the duty to give reasons under Clause 41 and 86. This change helps to avoid setting an unfortunate precedent, since exemptions are granted by statutory instrument and it is not usual practice to require the giving of reasons for the making of legislation. This can be distinguished, however, from the giving of reasons for a proposal to grant exemptions, as required by the new consultation procedure.
  Amendments Nos. 182 and 187 have two further effects. First, in the context of the general requirement introduced for the first time by Clauses 41 and 86 to publish reasons for key decisions, they clarify the matters which the authority or the Secretary of State should consider excluding when publishing those reasons. The amendments require that matters should relate,
  "to the affairs of a particular individual or body of persons",
  before the requirement to consider exclusion is triggered.
  Secondly, they ensure that the subsection (5) exception to the duty to give reasons—a decision subject to a disapplication direction by the Secretary of State—applies whether the decision itself was taken by the authority or the Secretary of State.
  I hope that the Committee can agree with me that, taken together, this package of amendments represents a strengthening of the provisions of the Bill. I beg to move.
  On Question, amendment agreed to.
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 154:
  Page 24, line 10, at end insert—
  ("(1A) Before making an order under subsection (1) the Secretary of State shall give notice—

  (a) stating that he proposes to make such an order and setting out the terms of the proposed order;

  (b) stating the reasons why he proposes to make the order in the terms proposed; and

  (c) specifying the time (not being less than 28 days from the date of publication of the notice) within which representations with respect to the proposals may be made,

  and shall consider any representations which are duly made in respect of the proposals and not withdrawn.
  (1B) The notice required by subsection (1A) shall be given—

  (a) by serving a copy of it on the Authority and the Council; and

  (b) by publishing it in such manner as the Secretary of State considers appropriate for bringing it to the attention of those likely to be affected by the proposed order.").

  The noble Lord said: I have just spoken to this amendment. I beg to move.
  On Question, amendment agreed to.
  Clause 28, as amended, agreed to.
  Clause 74 agreed to.
  Clause 85 [Exemptions from gas licensing]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 155:
  Page 83, line 4, at beginning insert—
  ("( ) In subsection (1) of section 6A of the 1986 Act (exemptions from prohibition) the words ", after consultation with the Director," shall be omitted.
  ( ) After subsection (1) of that section there is inserted—
  "(1A) Before making an order under subsection (1) the Secretary of State shall give notice—

  (a) stating that he proposes to make such an order and setting out the terms of the proposed order;

  (b) stating the reasons why he proposes to make the order in the terms proposed; and

  (c) specifying the time (not being less than 28 days from the date of publication of the notice) within which representations with respect to the proposals may be made,

  and shall consider any representations which are duly made in respect of the proposals and not withdrawn.
  (1B) The notice required by subsection (1A) shall be given—

  (a) by serving a copy of it on the Authority and the Council; and

  (b) by publishing it in such manner as the Secretary of State considers appropriate for bringing it to the attention of those likely to be affected by the proposed order."").

  The noble Lord said: I have spoken to this amendment. I beg to move.
  On Question, amendment agreed to.
  Clause 85, as amended, agreed to.
  Clauses 29 and 30 agreed to.
  4.45 p.m.
  Clause 31 [Electricity licence conditions]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 156:
  Page 29, line 9, at end insert—
  ("(4A) After subsection (3) there is inserted—
  "(3A) Conditions included in a transmission licence or a distribution licence by virtue of subsection (1)(a) may require the holder, in such circumstances as are specified in the licence—

  (a) so to increase his charges for the transmission or distribution of electricity as to raise such amounts as may be determined by or under the conditions; and

  (b) to pay the amounts so raised to such licence holders as may be so determined.").

  The noble Lord said: This amendment addresses a point raised by the noble Lord, Lord Currie, at Second Reading. He rightly noted (at cols. 1167–8) the absence from the Bill of measures relating to the provision of a supplier of last resort in electricity. This relates to the appointment of a supplier to take over the customers of another supplier whose licence has been revoked or suspended by the authority other than with his consent.
  As in gas, we propose that there should be two routes through which funds might be made available to finance the costs of the appointment of a supplier of last resort.
  First, each supplier will be required to post some form of approved bond with a person appointed by the authority. These bonds might take the form of, for example, insurances or parent company guarantees. In the event that a supplier's licence is revoked or suspended and one or more supplier of last resort is appointed, the bond of the failed supplier may be called to finance the additional costs of the appointee.
  Secondly, standard conditions in transmission and distribution licences will permit the authority to require licence holders to increase the charge they make for the transmission and distribution of electricity and to pay the moneys raised to licence holders as directed. It is intended that this levy route will be used only in the event that the moneys which could be raised by calling the failed supplier's bond were not sufficient to cover the additional costs of the supplier of last resort.
  The levy route is needed because the costs of a supplier of last resort are not readily calculable in advance and so it is not clear that there is a sensible level of bond cover which could be set which would cover every eventuality. The levy spreads the top-up costs across the whole of the supply industry.
  We want it to be clear on the face of the legislation that the power exists for the authority to raise such a levy. The present power in the Electricity Act (Section 7, as amended by Clause 31 of the Bill) to include conditions in a licence condition does not give that clarity. Parliament took a similar view in respect of the

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  Gas Act provisions when considering the Gas Act 1995. It used that Act to amend the Gas Act 1986 to make ex press provision of just this sort.
  So the levy power which this amendment creates is not new. It replicates in electricity the existing gas provision and so allows for electricity licence conditions—and hence the supplier of last resort arrangements—to be established to mirror those in gas. Indeed, the draft standard conditions of electricity licences already contain both the bond and levy conditions which I have described. I beg to move.
  Baroness Buscombe: We should like to express concern with regard to the amendment. As we read it, it would permit the imposition of additional charges for the transmission or distribution of electricity. It would allow licence conditions to be imposed on a transmission or distribution licence which require the licence holder to increase charges to raise an amount set in the condition, and then to pay that money to other licence holders as directed by the authority.
  The amendment refers, as indeed does the clause, to increased charges,
  "for the transmission or distribution of electricity as to raise such amounts as may be determined by or under the conditions; and … to pay the amounts so raised to such licence holders as may be so determined".
  We are concerned about this provision. What does it actually mean?
  Distributors are under a duty to operate the network in a manner that can demonstrate a level playing field. They are in effect under a duty to keep their charges down. But then along comes this stealth tax, in the form of what we consider to be a very vague power.
  Lord McIntosh of Haringey: I am disappointed to hear the reference to "stealth tax", which has not previously arisen in relation to the Bill.
  First, the provisions in the amendment are already contained in the Gas Act 1986, as amended by the Gas Act 1995. They exactly mirror the provisions in those Acts, which were passed by the previous administration. As I have said, there is nothing new in this provision; it is simply being extended to electricity.
  What the supplier of last resort who comes in to receive the money is doing is to provide continuity of supply when a supplier fails in whatever way. The provision must be left at large, even though it is intended to be used for this single, narrow purpose.
  In determining the standard conditions of electricity and gas licences under powers in Clauses 32 and 80, the Government intend that this power shall be used only for the purposes of supporting supplier of last resort arrangements. The purpose of the power is left at large because it may be useful in some unforeseeable way in the future, but there are safeguards against its being used in the way that the noble Baroness, Lady Buscombe, fears.
  If the authority decides that it wishes to use the power for other purposes, it will need to use the licence modification procedures set down in the Bill so as to
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  amend existing licence conditions or introduce further conditions providing for the use which may be made of any levy raised. As I said in introducing the amendment, provision is made for the amendment in the draft conditions which have already been published. The licence modification procedures require that the Secretary of State be consulted and provide him with a power to veto the authority's proposal. If that veto is not exercised, the authority must still gain sufficient support within the industry for its proposals. Failing that, a reference to the Competition Commission followed by an adverse public interest finding would be necessary before the new use for the power could be established in licence conditions.
  I hope that that convinces the noble Baroness not only that the powers, which have existed for a very long time in the gas industry, are not likely to be abused, but that the amendment and other provisions in the Bill make it certain that they cannot be used other than for the single and narrow purpose of ensuring continuity of supply of electricity to the customer.
  Lord Borrie: I should like briefly to welcome the amendment. Perhaps I may say on behalf of my noble friend Lord Currie of Marylebone, who expects to be here for most of the discussion in the Committee today, that I am sure that he too would welcome the amendment, because it fills the gap that my noble friend the Minister has explained: that gap between the position in the gas industry and the position in the electricity industry.
  The amendment is to deal with a very limited situation that one hopes will very rarely, if ever, arise. The noble Baroness, Lady Buscombe, will recognise that in a competitive situation—and we are all in favour of the increased competition that has already been brought about and will be developed further—there is bound to be at any rate the possibility of a supplier's failing and being unable to meet the needs of customers. The notion of the supplier of last resort is intended to fill that gap and ensure that whoever becomes the supplier of last resort and therefore ensures that customers are not without supply will be compensated.
  Given the qualifications, and the limited occasions when the provision would apply, this is a helpful equating of the existing position under the Gas Act 1986 with the position in electricity.
  Lord Jenkin of Roding: Like the noble Lord, Lord Borrie, I completely understand the purpose for which the amendment is required. It seems to me that it is very necessary in the new arrangements, as it was in relation to gas in the former arrangements. The problem is how it is to be quantified. In the end, the levy has to be of a sum of money. No doubt the supplier of last resort will provide the Government with his estimate of how much it will cost him to take over and re-establish the supply. Surely there must be some way of testing that: some way in which there can be, as it were, an arbitration between what he will ask

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  for and be paid and what the rest of the industry will have to find. It is not just a question of the principle; it is a question of the quantum.
  Lord McIntosh of Haringey: Of course, this is a last resort of last resort. First, it is a last resort in the sense that we do not really expect electricity companies to go to the wall and fail and be in a position in which they are unable to meet the needs of electricity customers.
  Lord Jenkin of Roding: I recall when I was Chief Secretary to the Treasury having to pick up the bits when Rolls-Royce went to the wall.
  Lord McIntosh of Haringey: That was the case.
  The noble Lord asked for quantum. I am saying that, first, we do not expect it to happen, because we expect the licence conditions to be sufficient to secure what is after all an objective of the authority under the Bill, which is that suppliers shall be in a financial position to meet their obligations.
  After that, the next option is that the supplier of last resort shall post some form of approved bond with a person approved by the authority. That could be insurances or parent company guarantees, as I made clear. We think that in the remote case of a supplier's failing, it is most likely that it would be possible to achieve continuity of supply through a bond. For example, a parent company is likely to wish to support a supplier of last resort.
  The last resort of last resort is that one has to go to a levy. We have had to provide a rather broader power, precisely because we do not know what the levy would be. Perhaps it is a good thing that I cannot give a very precise answer on this question. It is because there has been no practical experience in the gas industry, since the 1986 Act was passed, of having to appoint a supplier of last resort and having to cover that person's additional costs.
  The supplier of last resort conditions in gas supply specify what a supplier appointed by the director to be a supplier of last resort must do. He is required to use all reasonable endeavours to secure that a new meter reading is taken at the premises of each of his new customers within 14 days of his appointment and to send a notice to all his new customers explaining that their supplier has changed and setting out the terms on which they are now being supplied. Many of the customers transferred from the previous supplier probably would not grasp what was going on anyway. The supplier of last resort would be in a reasonable commercial situation.
  I know that that does not address the quantum question. All I can say about how large the levy would be is that it will be as small as possible and that for a levy to be proposed to the industry as a whole the authority would have to justify in the circumstances of
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  each case how much money was required. By definition there cannot be a general answer to the question that the noble Lord, Lord Jenkin, asks.
  Lord Jenkin of Roding: I am very grateful to the noble Lord for that very helpful description. In the last resort, is this a justiciable issue? Could it be tested in the courts?
  Lord McIntosh of Haringey: All the authority's decisions are in the end justiciable.
  In my response to the noble Baroness, Lady Buscombe, I set out the ways in which the power would have to be used. In particular, I referred to the licence modification procedures and the need to consult the Secretary of State and gain sufficient support within the industry, as well as the possibility of a reference to the Competition Commission.
  As to how far those matters apply to the issue of the size of the levy, which is the particular point raised by the noble Lord, I shall have to write to him. I suspect that we are dealing in last resorts of last resorts of last resorts.
  On Question, amendment agreed to.
  Clause 31, as amended, agreed to.
  Clause 73 [Gas licence conditions]:
  5 p.m.
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 157:
  Page 73, line 9, at end insert—
  ("( ) After subsection (2) there is inserted—
  "(2A) Where the Authority proposes to refuse the application, it shall give to the applicant a notice—

  (a) stating that it proposes to refuse the application;

  (b) stating the reasons why it proposes to refuse the application; and

  (c) specifying the time within which representations with respect to the proposed refusal may be made,

  and shall consider any representations which are duly made and not withdrawn."").
  The noble Lord said: I rise to move Amendment No. 157. I should like to speak also to Amendments Nos. 158 to 179, 288, 290, 291, 297, 298, 310, 311, 324 to 326, 330, 335, 336, 341 and 348. I acknowledge that this is a large group comprising 39 amendments, but I hope that the Committee takes comfort when I say that all of them are designed to do no more than tidy up the existing provisions of the Bill and the Gas and Electricity Acts. They stem from our desire to align the electricity and gas regulatory regimes as far as possible. This group of amendments covers a number of themes related to licences and licensing. We have organised the amendments within this group under those themes with the intention to help structure the debate. The themes are: gas licence conditions; standard conditions of licences; collective licence modifications; licence modification references to the Competition Commission; and a few minor miscellaneous amendments.
  I begin with gas licence conditions, which are dealt with in Clause 73. Two of these amendments are worth a quick mention. The remaining three, Amendments Nos. 158, 159 and 325, are minor tidying-up amendments. Amendment No. 157 provides that the authority shall give reasons to an applicant for a gas licence should it propose not to grant a licence. This brings gas into line with the provisions in Clause 29 in relation to electricity licences. Amendment No. 160 delegates to the authority the power to make regulations in relation to applications for gas licences. We have already made a similar provision for electricity in Clause 29. The Government consider it is appropriate that the authority, which will be solely responsible for granting all licences, should have the power to specify the information it requires in order properly to assess applications.
  The second group is concerned with standard conditions of licences (Clauses 32 and 80). There are five amendments in this group, four of which—Amendments Nos. 161, 169, 170 and 325—are related to the same point. They provide that the standard conditions to be included in electricity or gas licences granted after the establishment of the standard conditions by the Secretary of State should incorporate any changes which have been made to the standard conditions under powers elsewhere in the Electricity and Gas Acts respectively. The remaining amendment, Amendment No. 162, merely attempts to clarify the meaning of subsection (10)(b) of the new Section 11A inserted by Clause 32.
  There are five collective licence modification amendments in Clauses 34 and 81: Amendments Nos. 163, 171, 172, 173 and 298. Four are minor tidying-up amendments of no significance. Amendment No. 172 corrects a small but significant drafting error in Clause 81 which relates to the tests which the authority is to apply in order to determine whether the level of opposition to a proposed collective licence modification is sufficient to prevent it proceeding with the modification. Without this amendment, the statutory frameworks for gas and electricity collective licence modification would be markedly different one from the other. The intention is, of course, that they should be the same.
  The next group, comprising 10 amendments, deals with references to the Competition Commission in Clauses 35 to 39 and 82. All of these amendments are minor or consequential. Briefly, Amendments Nos. 164 and 291 are similar in nature and extend the definition of "relevant conditions" and "relevant licence" holder used elsewhere in the Electricity Act 1989 and the Gas Act 1986 to the Competition Commission's new power to veto licence modifications in Clauses 38 and 82.
  Amendments Nos. 165 and 175 serve to clarify that the Competition Commission may veto proposed electricity licence modifications which do not go far enough to remedy or prevent adverse effects identified in its report as well as those that go too far. Identical amendments, Amendments Nos. 166 and 176, clarify that where the Competition Commission exercises its veto it may in turn modify only relevant conditions of licences as defined in the Electricity Act and Gas Act
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  respectively. Identical amendments, Amendments Nos. 167 and 177, clarify that where the Competition Commission has vetoed collective gas or electricity licence modifications, the holders of such licences should be notified and receive notice of the Competition Commission's own proposed modifications. Amendments Nos. 168 and 178 provide for the consequential modifications to electricity and gas licences that might be necessary following modification by the Competition Commission of the standard conditions of a type of licence.
  There are 11 amendments in the miscellaneous group: Amendments Nos. 288, 290, 297, 310, 311, 326, 330, 335, 336, 241 and 348. These amendments are related to licences and licensing but do not share any common theme. They are minor and technical amendments of no real consequence. I beg to move Amendment No. 157.
  On Question, amendment agreed to.
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 158 to 160:
  Page 73, line 11. leave out from ("for") to second ("and") in line 12 and insert (-section 4 or 4A above" there is substituted "sections 4AA, 4AB and 4A").
  Page 73, line 28, after ("described") insert ("in the licence"").
  Page 73, line 29, at end insert—
  ("( ) After subsection (10) there is inserted—
  "(11) In this section "prescribed" means prescribed in regulations made by the Authority."").
  On Question, amendments agreed to.
  Clause 73, as amended, agreed to.
  Clause 32 [Standard conditions of electricity licences]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 161 and 162:
  Page 29, line 30, after ("shall") insert (", subject to such modifications of the conditions made under Part I of the 1989 Act after the determination under this subsection.").
  Page 30, line 47, at end insert ("being modified)").
  On Question, amendments agreed to.
  Clause 32, as amended, agreed to. Clause 33 agreed to.
  Clause 34 [Modification of standard conditions of licences]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 163:
  Page 33, line 29, leave out ("standard conditions") and insert ("anything done").
  On Question, amendment agreed to.
  Clause 34, as amended, agreed to.
  Clause 35 [Electricity licence modification references]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 164:
  Page 34, line 26. leave out ("and 14") and insert (", 14 and 14A").
  On Question, amendment agreed to.
  Clause 35, as amended, agreed to.
  Clauses 36 and 37 agreed to.
  Clause 38 [Competition Commission's power to veto modifications following report]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 165 to 168:
  Page 36, line 34, after ("be") insert ("the modifications which are").
  Page 36. line 43, after ("modifications") insert ("of the relevant conditions").
  Page 37, line 30, at end insert ("or, as the case may be, the relevant licence holders").
  Page 37, line 34, at end insert—
  ("(8A) Where, in consequence of a reference under section 12(1A), the Commission modifies under subsection (4)(b) the standard conditions of licences of any type, the Authority may make such incidental and consequential modifications as it considers necessary or expedient of any conditions of licences of that type granted before that time.
  (8B) Where the Commission modifies the standard conditions of licences of any type as mentioned in subsection (8A) the Authority—

  (a) shall make (as nearly as may be) the same modifications of those conditions for the purposes of their incorporation in licences of that type granted after that time; and

  (b) shall publish the modifications made for those purposes in such manner as it considers appropriate.

  (8C) The modification under this section of part of a standard condition of a particular licence in consequence of a reference under section 12(1) shall not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of this Part.").
  On Question, amendments agreed to.
  Clause 38, as amended, agreed to.
  Clause 39 agreed to.
  Clause 80 [Standard conditions of gas licences]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 169 and 170:
  Page 77, line 1, after ("shall") insert (", subject to such modifications of the conditions made under Part I of the 1986 Act after the determination under this subsection,").
  Page 77, line 6, after ("licences)") insert ("—

  (a) the words "and sections 23(2), 26(1A) and 27(2) below" shall be omitted; and

  (b)")

  On Question, amendments agreed to.
  Clause 80, as amended, agreed to.
  Clause 81 [Modification of standard conditions of gas licences]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 171 to 173:
  Page 77, line 13, at end insert ("; and
  (b) after "the holder of the licence" there is inserted "being modified".").
  Page 77. line 45, leave out ("or") and insert ("and").
  Page 78, line 2, at end insert ("or").
  On Question, amendments agreed to.
  Clause 81, as amended, agreed to.
  Clause 82 [Modification of licence conditions following Competition Commission report]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 174 to 179:
  Page 78, line 46, at end insert—
  ("( ) After subsection (5) of that section there is inserted—
  "(6) The modification under subsection (1) of part of a standard condition of a particular licence in consequence of a reference under section 24(1) shall not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of this Part."").
  Page 79, line 20, after ("be") insert ("the modifications which are").
  Page 79, line 29, after ("modifications") insert ("of the relevant conditions").
  Page 80, line 15, at end insert ("or, as the case may be, the relevant licence holders.").
  Page 80, line 19, at end insert—
  ("(8A) Where, in consequence of a reference under section 24(1A), the Commission modifies under subsection (4)(b) the standard conditions of licences of any type (that is to say, licences under section 7 or section 7A(l) or 7A(2)) the Authority may make such incidental and consequential modifications as it considers necessary or expedient of any conditions of licences of that type granted before that time.
  (8B) Where the Commission modifies the standard conditions of licences of any type as mentioned in subsection (8A) the Authority—

  (a) shall make (as nearly as may be) the same modifications of those conditions for the purposes of their incorporation in licences of that type granted after that time; and

  (b) shall publish the modifications made for those purposes in such manner as it considers appropriate.

  (8C) The modification under this section of part of a standard condition of a particular licence in consequence of a reference under section 24(1) shall not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of this Part."").
  Page 80, line 45, at end insert—
  ("( ) In section 27 of that Act (modification of licences by order under enactments other than the 1986 Act), after subsection (1) there is inserted—
  "(1A) The modification under subsection (1)(a) of part of a standard condition of a particular licence in consequence of a reference under section 24(1) shall not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of this Part."").
  On Question, amendments agreed to.
  Clause 82, as amended, agreed to.
  Clause 84 agreed to.
  5.15 p.m.
  The Deputy Chairman of Committees: There has been a wrong placing of Amendment No. 180. It will come after Amendment No. 181.
  Clause 40 agreed to.
  Clause 41 [Reasons for decisions under the 1989 Act]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 181:
  Page 40, leave out line 31
  On Question, amendment agreed to.
  Lord Kingsland Lord Kingsland moved Amendment No. 180:
  Page 41, line 6, at end insert—
  ("( ) A notice under subsection (2) shall, in particular, contain details of—

  (a) how the decision is proportionate; and

  (b) how it complies with the Human Rights Act 1998.").

  The noble Lord said: In moving the amendment I speak also to Amendments Nos. 183, 184, 186, 188 and 189.
  Amendment No. 180 has a twin amendment, Amendment No. 186. The issue is straightforward. Clause 41 of the Bill sets out the circumstances in which reasons for the decisions under the 1989 Act are given. The clause applies to seven decisions. Clause 41(2) states:
  "As soon as reasonably practicable after making such a decision the Authority or the Secretary of State shall publish a notice stating the reasons for the decision in such manner as it or he considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be interested".
  Amendments Nos. 180 and 186 simply wish to add an obligation to he contained in the notice requiring the authority or the Secretary of State to say how the decision is proportionate and how it complies with the Human Rights Act 1998.
  I do not see how the amendment could be objectionable to the Government. The Government introduced the Human Rights Bill into this Chamber in 1997. It became an Act the following year and is due to come into force in October 2000. I am in no doubt that those who are the subject of any decision taken under Clause 41 will scrutinise carefully the notice to see whether it conforms with the provisions of the European convention. In my submission it can only be in the interest of the Secretary of State or the authority to explain in exactly what way he or it believes that the decision has conformed with the terms of the convention.
  Clause 58, concerning electricity, and Clause 94, concerning gas, insert new provisions into Sections 27A to F of the Electricity Act and Sections 30A to F of the Gas Act. They give the authority power to impose penalties for contravention of relevant conditions or requirements or failure of performance standards. As I am sure the Committee is aware, relevant conditions or requirements are defined under the Acts and amplified by the Bill.
  The penalty has to be reasonable in all the circumstances but is otherwise wholly unconstrained. If the licence holder is aggrieved by inter alia the imposition or amount of the penalty, it may make an application to the court. If the court is satisfied that the imposition of the penalty was not within the power of the authority, it can quash or reduce it.
  The Opposition take the view that procedures introduced by the new provisions constitute the determination of a civil right or obligation under Article 6 of the European Convention on Human Rights and, therefore, should provide a fair and public hearing before an independent and impartial tribunal. The provisions before the Committee do not do so
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  because the authority is not independent of the executive. It is involved in the imposition of licence conditions, relevant requirements and setting performance standards; and there is no provision for an oral hearing.
  It is true that the Government have furnished us with a procedure that they describe as a right of appeal. However, that right of appeal is no more than a narrowly confined right of review—a sort of judicial review "minus". In our submission it cannot cure the deficiencies of these procedures.
  The amendments offer two alternative forms of appeal: the first based on the telecoms analogue contained in Statutory Instrument 1999 No. 3180; and the other based on the Competition Act model. Amendment No. 183, which refers to electricity, and Amendment No. 188, which refers to gas, insert new sections into Section 49B of the Electricity Act and Section 38B of the Gas Act, giving broader grounds of appeal from all relevant decisions of the authority including a decision to impose a penalty under the new Section 27A or 30A: that is, an appeal to the court on grounds of material error of fact, material procedural error, error of law or other forms of illegality including unreasonableness or lack of proportionality.
  Amendment No. 184, dealing with electricity legislation, and Amendment No. 189 dealing with gas legislation, insert, as an alternative, new sections into the Electricity and Gas Acts giving even broader grounds of appeal, again from all relevant decisions of the authority including a decision to impose a penalty under the new Section 27A or 30A. Thus, the Opposition have helpfully provided the Minister with two alternative approaches from which he has the luxury of choice.
  I want to comment, now, in more detail on the Government's so-called right of appeal. Under the new Section 27E, a licence holder can make an application to the court if it is aggrieved over the amount of the penalty. But there is no provision which would enable the court to find that the amount was unreasonable. In other words, the right of appeal is in reality a narrowly confined right of review rather than a proper right of appeal and does not even appear to offer similar grounds of review to those available on an application for judicial review.
  As a court would not normally substitute its own findings of fact, it is not clear how a court would exercise the power to substitute another penalty from that originally imposed by the authority, or the power to substitute a different payment date from that originally prescribed.
  Moreover, it is not clear whether the provisions in new Section 27E(3) are intended to take the place of any right on the part of a licence holder to bring an action for judicial review on the lawfulness of the actions and the authority in imposing the penalty. Are the provisions intended to provide the only right of redress for a licence holder?
  That view appears to be supported by new Section 27E(8), which provides that:
  "Except as provided by this section, the validity of a penalty shall not be questioned by any legal proceedings whatever".
  Here we have a fine example of a classic ouster clause. It would preclude a licence holder from taking any further form of action, or even to seek an appellate review of a decision of the court. On that basis, it would not appear to be open to an aggrieved licence holder to apply to the court for a determination as to whether the authority has acted lawfully, reasonably and fairly in imposing a penalty, or has made a material error of fact in imposing a penalty.
  In the Standing Committee debate in another place, the Opposition argued that the appeal procedure was extremely limited and contended that the first ground of appeal in Section 27E(4) was similar, though more restricted, to a provision for a judicial review and as such precluded an appeal on the fine itself or the actual facts, limiting it to a view on the basis of whether the authority acted in a quasi-judicial and fair manner, regardless of the decision made. The fine could therefore be unreasonable under an objective assessment but provided the authority regarded it as reasonable, and the authority had taken all steps to enable it to take that view, there could be no appeal.
  We also argued that the second ground of appeal in Section 27E(4) was confined to procedural matters and that the third ground of appeal in Section 27E(4) was restricted to the timing of payment of the fine but that there were no grounds for appeal on the quantum or reasonableness of the fine.
  We believe that as the authority will be the body responsible for establishing and enforcing obligations—for example, under the Electricity Act 1989—and for setting standards of performance, and for determining whether there has been a contravention of the Act or failure to achieve a standard of performance, and for imposing financial penalties, there should be a full right of appeal against the decisions of the authority. In this respect, the arrangements under the Bill are wholly inadequate. It should be possible to challenge a substantive decision of the authority in respect of any particular matter or to challenge that it has made a material error of fact or law.
  I have already said that the remedy provided is less than that provided by judicial review and does not provide a full and proper appeal to an independent tribunal. As such, there must be considerable doubt whether the arrangements will be consistent with the Human Rights Act.
  In the debate in Standing Committee in the other place (cols. 565 and 566), the Government maintained that no amendments were necessary and they referred to the explicit provision in new Section 27E(3) which allows the court, on an application from the licence holder concerned, to quash the penalty or substitute such lesser penalty as it considers appropriate in all the circumstances.
  The Government maintained that it would be odd to insert these provisions if they did not intend licence holders to have the right to challenge the authority's decisions. The Government also argued that there was an inherent power of the judiciary to ensure that the executive complied with the will of Parliament as expressed in statute; and that the Bill was explicit that the reasonableness criteria should apply and that this was a term recognised in the United Kingdom courts. However, they suggested that ministerial references to reliance on reasonableness could be invoked in support in court.
  It is likely that the provisions in Clause 58, in their present form, will be the subject of an application in due course to the court under the Human Rights Act 1998 on the ground that an aggrieved licence holder does not have unfettered access to an independent appeal tribunal which has power to examine all aspects of the contested decision involving a financial penalty.
  We have suggested two alternative approaches to resolve the problem. The Minister is aware that an appeals procedure can be found in the Telecommunications (Appeals) Regulations 1999, which came into effect on 20th December 1999. The regulations provide an appeals procedure for a range of decisions of national regulatory authorities in respect of telecommunications in accordance with Article 1(6) of Directive 97/51/EC and Articles 5(3), 9(4), 9(6) and 19 of Directive 97/13/EC, which require member states to ensure that suitable mechanisms exist at national level under which a party affected by a decision of the national regulatory authority has a right of appeal independent of the parties involved.
  Under the regulations, a new Section 46B is inserted into the Telecommunications Act 1984 which provides for an appeal against certain decisions of the Secretary of State and the Director-General of Telecommunications. An appeal can be made on one or more of the following grounds: namely, that a material error as to the facts had been made; that there was a material procedural error; that an error of law had been made; that there was some other material illegality, including unreasonableness or lack of proportionality. An appeal lies to the High Court or, for Scotland, to the Court of Session.
  We recognise that the regulations apply only to appeals against the decisions specified in the regulation and that the regulations were introduced to meet the requirements of EC directives and as such they have no direct effect on the issues being raised by the electricity and gas companies. However, the provisions for appeals under the regulations address the concerns of these industries and it is difficult to see why the Government are not prepared to consider an equivalent arrangement for appeals against decisions under Clause 58. Indeed, the arrangements in the regulations provide a model which could be of general application in providing a basis for appeal by an agreed body from the decision of a regulatory body. I beg to move.
  Lord Borrie: My Lords, the noble Lord, Lord Kingsland, has ranged widely in his closely argued

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  submission, and properly so, because he has addressed himself to a range of amendments which are grouped together and he has discussed all of them. I do not propose to do that. I simply want to raise an issue regarding what I believe was a fundamental theme running through his remarks.
  He said that the court, right of appeal to which is provided for in Clause 58, cannot review whether or not the amount of the penalty is reasonable. I believe that I quote correctly the noble Lord, Lord Kingsland, in saying that the court will have no right to say that the amount of the penalty is unreasonable. The noble Lord quoted from Clause 58.
  However, we should bear in mind that the clause states that the penalty imposed by the authority must be reasonable in all the circumstances of the case; that is, the authority has power only to impose a penalty which is reasonable in all the circumstances of the case. We should also bear in mind the other part of Clause 58 which states that a ground for appeal to the court exists if the imposition of the penalty was not within the power of the authority.
  In my submission, if the authority imposes a penalty which is not reasonable in all the circumstances of the case, it will have acted ultra vires (to use the English that we must all use nowadays in this regard) and the penalty will be beyond the powers of the authority. Therefore, the court may turn it down on that basis. I am referring to subsection (4) on page 58 of the Bill which states that:
  "The grounds falling within this subsection are—
  (a) that the imposition of the penalty was not within the power of the Authority under section 27A".
  That is a fundamental point in the noble Lord's argument and it does not seem to me that he is entirely right in that regard.
  5.30 p.m.
  Lord McIntosh of Haringey: I am grateful to the noble Lord, Lord Kingsland, for one thing: the concept of twinned amendments. I wish that I had thought of that. It makes it much easier to understand the proliferation of amendments, some of which relate to gas and some of which relate to electricity. Of course, I am familiar with the arguments that he adduced with regard to ECHR compliance. We debated that issue on a number of occasions during discussion on the Financial Services and Markets Act and I am glad that he has not lost his skill in presenting his case.
  The amendments deal broadly with the ECHR compatibility of decisions taken by the Secretary of State and/or the gas and electricity markets authority in relation to licences and the appropriateness or otherwise of provisions by which licence holders may challenge those decisions.
  Amendments Nos. 180 and 186 seek to ensure that any notice published under the new sections (inserted by Clauses 41 and 86 respectively) of the Electricity Act 1989 or the Gas Act 1986 which sets out the reasons for the key decisions listed in those new sections should contain details of how the Secretary of
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  State or the authority have ensured that the decision is proportionate and compliant with the Human Rights Act 1998 and, therefore, with the European convention.
  A key point with regard to the amendment is that it would not secure compliance. Under Section 6 of the Human Rights Act, it will be unlawful for any public authority to act in a way which is incompatible with the European convention. However, nothing in the Human Rights Act 1998 requires public authorities to explain how each decision that they take is compliant with the convention. Even if it did so require, an explanation would not ensure that the decisions were compliant. Whatever was asserted by such an authority, ultimately it would be for the courts to decide whether a decision was compliant. Therefore, the amendment does not add anything in that respect.
  By requiring the authority and the Secretary of State to give reasons for their key decisions—they are set out in Section 49A, inserted by Clause 41——the Bill helps interested parties to judge for themselves whether decisions are compliant with the European convention and to take appropriate action if they believe that they are not.
  Each amendment also requires the notice to contain details of how the decision is proportionate. It does not say what is meant by "proportionate" in this context. The concept of proportionality is, of course, one which applies under the European convention. If the word is used here in the sense that it is used in the human rights context, it is covered by the second limb of the amendment. If it means something else, I must ask what that is. It is hardly to be supposed that the authority or the Secretary of State will say that their decisions are not proportionate in the sense of "reasonable". Therefore, I am afraid that I cannot accept Amendments Nos. 180 or 186.
  Amendments Nos. 183, 184, 188 and 189 would make all the decisions taken by the authority and/or the Secretary of State in relation to licence holders—including, but not limited to, those for which reasons must be given under the Bill—appealable to the High Court or, in Scotland, the Court of Session; and/or an appeals tribunal of the Competition Commission. The grounds for appeal to the High Court include material error as to the facts, material procedural error, an error of law and some other material illegality, including unreasonableness or lack of proportionality.
  I believe that it is helpful to look at the issues raised by these amendments in order to distinguish the different kinds of decision which can be taken by the Secretary of State or by the authority. Some decisions fall into a category that, broadly speaking, sets the framework for regulation; that is, decisions such as the determination of specific licence conditions. In those cases, it is appropriate that the route of appeal should be to the reporting arm of the Corn petition Commission, which is well placed to take a view on this type of public interest decision.

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  Other decisions, such as those in relation to the granting or revocation of licences, or enforcement, have more to do with the application of the rules as they stand. In such cases, judicial review provides an appropriate right of challenge.
  A third category of decision may require grounds for challenge that go beyond that of judicial review; for example, in the case of financial penalties the Government have provided for companies to challenge both the imposition and the amount of a penalty in the courts. In examining whether the amount of a penalty was reasonable in all the circumstances of the case, which it must be if the authority is acting within its powers, we believe that a court would be bound to consider the facts underlying the case. Therefore, those grounds of appeal go beyond judicial review.
  The point that I make is that for each of the three types of decision the Government have provided a right of review that is appropriate to the case. By contrast, the amendments seek to impose a blanket provision for all decisions to be subject to exactly the same appeals procedures in the High Court and/or an appeals tribunal of the Competition Commission. We do not believe that that is the right way forward.
  The noble Lord, Lord Kingsland, set out in some detail the analogies that he sees between these provisions and those of, first, the Competition Act and, secondly, the telecommunications appeals regulations. We do not believe that those analogies are sound.
  I turn first to the Competition Act. In many cases, the nature of the decisions involved under the utilities Acts and under the Competition Act are quite different. Under the utilities statutes, decisions may fall into a range of categories of the kind that I have set out. A number of types of appeal may be appropriate, ranging from a route of appeal to the reporting arm of the Competition Commission, where a public interest-type decision is involved, through judicial review and into cases where something beyond judicial review is provided for, as in the case of financial penalties. The important point is that the right of appeal is appropriate to the type of decision.
  A decision under the Competition Act about whether or not one of the prohibitions on anticompetitive behaviour has been breached is a determination as to how the law, which is to be interpreted in accordance with existing jurisprudence, applies to the facts. The appeal is heard by the appeal tribunal of the Competition Commission which is headed by the president, who has status equivalent to that of a High Court judge. Again, the important point is that the right of appeal is appropriate to the decision.
  The noble Lord, Lord Kingsland, also referred to the Telecommunications Appeal Regulations 1999. As he rightly said, those were introduced in response to the requirements of the European Commission directives on telecom licensing and ONP, which, among other things, required member states to provide an appeals mechanism against certain
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  regulatory decisions in the telecommunications sector. I thought that I heard him recognising that that directive is telecoms-specific and does not apply to the gas and electricity sectors, although he is at liberty to argue that it should apply.
  The important point is that the rights of appeal against regulatory decisions in the gas and electricity sectors should be appropriate to those decisions. For example—I am repeating myself to some extent—the Government have provided for electricity companies to challenge the imposition of financial penalties on the following grounds: that the imposition of the penalty was not within the power of the authority under Section 27A; that any of the procedural requirements of subsections (2) to (4) or subsection (6) of Section 27A, which are concerned with the giving of notice, had not been complied with in relation to the imposition of the penalty, and that the interests of the operator had been substantially prejudiced by that non-compliance; or that it was unreasonable of the authority to require the penalty imposed, or any portion of it, to be paid by the date or dates by which it was required to be paid.
  The Government believe that the provisions on financial penalties go further than judicial review and allow for appeal on similar grounds to those provided under the Telecommunications (Appeals) Regulations 1999, which include material factual or procedural error, error of law or some other material illegality. A court considering whether the imposition of a penalty was within the authority's powers would have to consider whether the penalty was, as the noble Lord, Lord Borrie, quoted,
  "of such amount as is reasonable in all the circumstances of the case".
  The court would therefore have to consider the circumstances or facts of the case.
  It is important to stress that a company will be able to challenge the imposition and the amount of any penalty. New Section 27A of the Electricity Act 1989 and new Section 30A of the Gas Act 1986 give the authority the power to impose only such a penalty as is reasonable in all the circumstances of the case. If it is not reasonable in all the circumstances, its imposition will not be within the power of the authority under that section. Accordingly, if a company challenges the amount of a penalty on the grounds that its imposition was not within the authority's power under Section 27A of the Electricity Act or Section 30A of the Gas Act—which the Bill expressly makes a ground of challenge—the court will have to consider whether it was reasonable in all the circumstances. If it does not think so, it may quash or lower the penalty, as it thinks appropriate.
  In all those respects, the Bill conforms with the requirements of the European Convention on Human Rights, with the Human Rights Act 1998, and with the objective of ensuring justice in these matters—an objective that I think that the noble Lord, Lord Kingsland, shares.
  Lord Kingsland: I thank the Minister for his responses. Our reason for tabling the twinned

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  Amendments Nos. 180 and 186 was not that we thought that the Government were under an obligation under the convention to explain exactly how they have fulfilled the proportionality criteria.
  Lord McIntosh of Haringey: I think that the noble Lord means for the authority to do so in relation to each decision. That would be the effect of the amendments.
  Lord Kingsland: Or the Secretary of State. The intention is to avoid needless litigation by requiring the authority or the Secretary of State to provide sufficient information on the facts so that anybody who is concerned about a decision can be satisfied that the Government have arrived at it properly. In that respect, we are trying to be helpful to the Secretary of State and the authority. There can surely be no objection in principle to such a clause. If the Government are convinced that they have to comply with the principle of proportionality, I see no reason why they should not have to comply with the requirements of the principle in a particular set of circumstances.
  Lord McIntosh of Haringey: That is what Clause 41 does. New Section 49A to the 1989 Act gives a full list of the key decisions of the authority or the Secretary of State for which reasons have to be given.
  5.45 p.m.
  Lord Kingsland: The giving of reasons and satisfying the principle of proportionality are two entirely different things. Someone can give reasons for a decision that is disproportionate.
  Lord McIntosh of Haringey: The amendment would merely ask for a statement from the Secretary of State or the authority that the decisions are proportionate. Neither is likely to say, "These are my reasons. They are not proportionate".
  Lord Kingsland: The amendment would require the Secretary of State or the authority to say in what way the decision was proportionate. They would have to set out the facts to demonstrate that the decision was not excessively penal. We may well return to that point on Report.
  The Minister also talked about the range of decisions that the authority or the Secretary of State will have to make, the different circumstances in which each decision is made, and the inappropriateness of having a uniform appeals procedure for so many unpredictable events. If that is true for the appeals procedure that we propose, it must also be true for the procedure that the Government propose. With great respect to the Minister, I am not impressed by his argument. Perhaps he should have accepted that there should be a different appeals procedure to fit every decision procedure but that it should satisfy a minimum standard of review or appeal, which should reflect the fundamental principles in the European convention.
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  As the noble Lord, Lord Borrie, said—this point was endorsed by the Minister—the grounds under new Section 27E(4)(a), in Clause 58, for challenging the authority's decision under the new procedures introduced by the Bill include the submission that the imposition of the penalty was not within the power of the authority under new Section 27A.
  However, that does not empower the court to reopen the underlying facts of the case that gave rise to the authority's decision. Under Section 27A(1), the authority needs only to be satisfied that a contravention has occurred or is occurring. The Minister maintains that the court can look at the facts, because the authority has to impose a penalty that is reasonable in all the circumstances. In contrast, we say that that confuses two issues: the authority's power to impose a penalty and the amount of that penalty. The two alternative forms of appeal that we are putting forward would allow the court or the tribunal to review the underlying facts. In our submission, that option is not open in the procedure set out by the Government.
  The Minister rightly recognised that the telecoms model, which the Opposition have tabled as one alternative, is telecom specific because the Government were obliged to introduce the procedure as a result of the European Community directive. But I should like to leave the Minister with this thought. Why is something that is considered appropriate to telecommunications as a public utility not appropriate to electricity and gas as public utilities? Is there something about the nature of decision-making in the telecoms industry which requires the rights of-licensees in that industry to be so much greater than those for electricity and gas? I do not expect the Minister to respond to that now but he may wish to reflect on it.
  Lord McIntosh of Haringey: I have responded to it already. I went into some detail as to what is the important issue in what is being proposed by the Opposition; namely, the extension of rights under appeal under the telecommunications appeal regulations to gas and electricity. As I said, there are different kinds of decision, different from those relating to telecommunications. The right of appeal which is provided in the Bill is appropriate to those three types of conditions. There is no less protection in the Bill than there is in the telecommunications appeal regulations. It is just that the protection is more appropriate to gas and electricity.
  Lord Kingsland: I thank the noble Lord the Minister for generously providing me with that response. My thesis is that the Minister's last remark cannot be right on the face of the Bill. But we now have an extensive account of what has occurred in the debate on the amendments on the face of Hansard. In begging leave to withdraw my amendment, between now and Report stage I shall read that account and the Minister can be reasonably confident that we shall return to this matter at Report stage.
  Amendment, by leave, withdrawn.
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 182:
  Page 41, line 11, leave out from beginning to ("resulting") in line 18 and insert ("In preparing a notice under subsection (2) the Authority or the Secretary of State shall have regard to the need for excluding, so far as that is practicable, any matter which relates to the affairs of a particular individual or body of persons (corporate or unincorporate), where it or he considers that publication of that matter would or might seriously and prejudicially affect the interests of that individual or body.
  (5) This section does not apply to a decision").
  On Question, amendment agreed to.
  [Amendments Nos. 183 and 184 not moved.]
  Clause 41, as amended, agreed to.
  Clause 86 [Reasons for decisions under the 1986 Act]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 185:
  Page 84, leave out line 23.
  On Question, amendment agreed to.
  [Amendment No. 186 not moved.]
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 187:
  Page 85, line 1, leave out from beginning to ("resulting") in line 8 and insert ("In preparing a notice under subsection (2) the Authority or the Secretary of State shall have regard to the need for excluding, so far as that is practicable, any matter which relates to the affairs of a particular individual or body of persons (corporate or unincorporate), where it or he considers that publication of that matter would or might seriously and prejudicially affect the interests of that individual or body.
  (5) This section does not apply to a decision").
  On Question, amendment agreed to.
  [Amendments Nos. 188 and 189 not moved.]
  Clause 86, as amended, agreed to.
  Clause 42 agreed to.
  Clause 87 agreed to.
  Clauses 43 to 46 agreed to.
  Clause 47 [Additional terms of connection]:
  Baroness Buscombe Baroness Buscombe moved Amendment No. 190:
  Page 50, line 11, after ("negligence") insert ("or breach of contract").
  The noble Baroness said: In moving this amendment, I shall speak also to Amendment No. 191. These amendments concern the nature of the relationship between distributor and customer. Under the new arrangements for the supply of electricity, customers will have a direct contractual relationship with the supplier who sells them electricity but the customer's connection to the network will remain the responsibility of a distributor.
  Clause 43, which amends Sections 16 and 17 of the Electricity Act 1989, places a statutory duty on distributors to make and maintain a connection to premises if required to do so by the customer or a supplier acting on the customer's behalf.
  Clause 47, which amends Section 21 of the 1989 Act, permits distributors, as part of the arrangements for such a connection, to limit their liability to the customer for economic loss which arises from the distributor's negligence.
  There is one crucial issue which the DTI has, with respect, been unable to answer; namely, whether the distributor-customer relationship is entirely statutory or whether the initial statutory obligation then triggers a contractual relationship.
  Amendment No. 190 asks whether the relationship between the customer and the distributor is contractual by extending the limitation of liability to loss arising from breach of contract by the distributor.
  Clause 48, which substitutes a new section for Section 22 of the 1989 Act, permits customers to enter into a special agreement with a distributor under which the terms of the connection would be agreed between them outside of the statutory framework provided by Clause 43. However, unlike the present Section 22, no provision is made for the distributor to be able to compel a customer to do so.
  While a distributor may agree to connect a customer only subject to certain safeguards—for example, providing security for costs—we believe that there will be some instances when the nature of the connection will impose additional burdens on the distributor, who should have the ability in such cases to require the customer to agree the terms of connection contract outside of the statutory framework. Amendment No. 191 would enable the distributor to do so where it was reasonable in all the circumstances. I beg to move.
  Lord McIntosh of Haringey: Amendment No. 190 would mean that a person requiring a connection could be required by a distributor to accept terms which would limit the distributor's liability to that person in respect of economic loss resulting from a breach of contract.
  The Government are opposed to this amendment on legal and policy grounds. From the point of view of the law, we are not convinced that a court would conclude that terms agreed under Section 16A form a contract. Our reasons are as follows. Sections 16(1) to (3) place a duty on distributors to make a connection when required to do so. That duty encompasses not just the making of the connection but the subsequent maintenance of it for so long as the connection is required.
  The terms themselves which are mentioned in Section 16(3) and 16A form the basis of a statutory agreement which governs the performance of and adds a gloss to the statutory duties in Section 16(1) and (2). We would not expect any terms derived from these provisions to be regarded as terms of an ordinary and independent contract.
  As a result, the distributor is under an obligation to make and maintain a connection once terms are agreed. Such terms may be determined by a third party—that is, the authority—in the event that the parties cannot agree the terms between themselves.
  For that reason, we do not think that the amendment achieves what it sets out to achieve and in any case, we do not consider it appropriate to second guess what the courts may decide by making reference in the Bill to a contract.

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  I am aware that some parts of the distribution industry are concerned about how they might enforce the obligations of the other party if such an agreement is not a contract. In our view, where a term provides for connections to be satisfied by the customer before the making of a connection, failure to satisfy the conditions would absolve the distributor from the duty to connect on the basis of Section 17(1)(c).
  In the event of a continuing breach by a customer of an obligation of his, we are confident that a court would reach a sensible conclusion, imposing such a remedy as it considered appropriate, taking account of all the circumstances of the case. We do not think that the existence of statutory duties would necessarily preclude the award of damages in appropriate circumstances.
  However, as I said, we also have difficulties with this amendment on policy grounds. Our view is that it would not he proper to allow distributors as of right to include terms which limit their liability in respect of economic loss arising from any breach of any term agreed under Section 16A of the Electricity Act. We understand that the concerns which lie behind this amendment stem in the main from the rapid growth in the use of computers and other electronic equipment which use and store information of huge commercial value. Such equipment, and the information it stores, is especially vulnerable to any interruption in, or deterioration in the quality of, its supply of electricity. Anybody who tries to connect into the Palace of Westminster at the weekend will know about that! This is an issue which has increased greatly in importance since the present legislation was enacted in 1989.
  It is not difficult to see why distributors may be concerned about their exposure to economic loss as a result of this development, but it is important to bear in mind that customers who rely heavily on IT equipment face the prospect of severe—possibly fatal—business disruption in the event of some damaging change in their electricity supply. Clearly, both sides must take the necessary measures to protect themselves both physically and financially. In designing the legislative framework, it is necessary to strike the right balance between the interests of both parties. We believe that Amendment No. 190 would provide distributors with an inappropriate level of protection compared with the person requiring the connection; that is, the customer.
  I turn now to Amendment No. 191. The effect of this amendment would be to remove from an undefined group of persons the right to seek a connection under Section 16 and to require them instead to enter into a special connection agreement, provided for by Section 22. This amendment seems to be designed to allow distributors in effect to require customers with large loads or embedded generation to make a connection agreement under Section 22. For such customers, connection agreements are inevitably complex and wide ranging. This is because both the making of the connection and the subsequent behaviour of the
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  customers can have effects on the wider operation of a distribution system which can give rise to further, and possibly continuing, costs for the distributor.
  I think it might be helpful if I were to say a word or two about the distinct purpose for which special connection agreements under Section 22 have been designed. Sections 16 to 21 of the Act, as amended by this Bill, set out a statutory framework governing connections to electricity distribution systems. In discussing Amendment No. 190, I set out the Government's views on the status in law of the terms made under Section 16A. We have concluded that it is not certain that the courts would interpret such an agreement as a contract.
  For this reason, we are providing in Section 22 an alternative means for obtaining a connection. The intention is that there should be no doubt as to the status of the special connection agreement as a contract, since it is not governed by the provisions in the previous sections. The Bill says nothing about which of the routes made available by the Bill for the making of a connection agreement, whether it is Section 16A or Section 22, should be used for the purpose of agreeing the terms on which a connection is to be made. That is deliberate. The Government's policy is that everyone requiring a connection should be on the same legal footing.
  This is especially important in the case of embedded generation, which is one of the targets of this amendment. The Government have sought through various provisions in this Bill to make sure that embedded generators get fair access to distribution systems so that they can compete in the generation market on level terms with conventional large-scale generation. There are a number of reasons why we think this is important, but perhaps the key one is that we are conscious of the crucial role that embedded generation, in the form of renewables and CHP plant, will have to play in meeting the Government's climate change targets.
  The amendment, at a stroke, would undermine all of what I have just explained to your Lordships about the Government's intentions, and that is why we must oppose it. However, although I am opposing the amendment, I accept that we must be clear that the provisions in Sections 16 to 21 do in fact support the inclusion in Section 16A terms of the full range of matters which it is proper for distributors to wish to incorporate in large and complex cases.
  The Electricity Association has suggested to Department of Trade and Industry officials that this is not the case. Officials have promised to look further at this point and to let the association know in good time whether they think that anything needs to be done in order to address this concern. On this basis, I hope that the noble Baroness, Lady Buscombe, will not press either of these amendments.
  Baroness Buscombe: I thank the Minister for his response. First, in relation to Amendment No. 191. I am pleased to have his suggestion that the Department

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  of Trade and Industry will meet again with the Electricity Association to discuss this issue. It is one of considerable concern to the industry.
  Turning to Amendment No. 190, the noble Lord is also right in saying that this is of enormous interest to the industry. With great respect, we are not satisfied with the Minister's response, and I wish to test the opinion of the Committee.
  6.5 p.m.
  On Question, Whether the said amendment (No. 190) shall be agreed to?
  Their Lordships divided: Contents, 61; Not-Contents, 130.

  Division No. 1

  CONTENTS

  Anelay of St Johns, B.

  Jenkin of Roding, L.

  Astor of Hever, L. [Teller]

  Jopling, L.

  Attlee, E.

  Kingsland, L.

  Blatch, B.

  Knight of Collingtree, B.

  Brabazon of Tara, L.

  Laird, L.

  Brougham and Vaux, L.

  Luke, L.

  Buscombe, B.

  Lyell, L.

  Butterworth, L.

  McConnell, L.

  Campbell of Croy, L.

  Mackay of Ardbrecknish, L.

  Carnegy of Lour, B.

  Mancroft, L.

  Clark of Kempston, L.

  Marlesford, L.

  Coe, L.

  Montrose, D.

  Colwyn, L.

  Naseby, L.

  Craig of Radley, L.

  Northesk, E. [Teller]

  Crathorne, L.

  Oxfuird, V.

  Dean of Harptree, L.

  Palmer, L.

  Dixon-Smith, L.

  Park of Monmouth, B.

  Pearson of Rannoch, L.

  Feldman, L.

  Rawlings, B.

  Ferrers, E.

  Reay, L.

  Fookes, B.

  Rees, L.

  Fraser of Carmyllie, L.

  Renton, L.

  Freeman, L.

  Roberts of Conwy, L.

  Gardner of Parkes, B.

  Rogan, L.

  Geddes, L.

  Seccombe, B.

  Hanham, B.

  Selborne, E.

  Hayhoe, L.

  Skidelsky, L.

  Henley, L.

  Stodart of Leaston, L.

  Higgins, L.

  Taylor of Warwick, L.

  Hooper, B.

  Thomas of Gwydir, L.

  Howe, E.

  Tombs, L.

  NOT-CONTENTS

  Acton, L.

  Brooke of Alverthorpe, L.

  Addington, L.

  Burlison, L.

  Ahmed, L.

  Carter, L. [Teller]

  Alli, L.

  Christopher, L.

  Amos, B.

  Clarke of Hampstead, L.

  Andrews, B.

  Cledwyn of Penrhos, L.

  Archer of Sandwell, L.

  Clinton-Davis, L.

  Bach, L.

  Cocks of Hartcliffe, L.

  Barnett, L.

  Currie of Marylebone, L.

  Bassam of Brighton, L.

  David, B.

  Beaumont of Whitley, L.

  Davies of Oldham, L.

  Berkeley, L.

  Desai, L.

  Blackstone, B.

  Dholakia, L.

  Blease, L.

  Dixon, L.

  Borrie, L.

  Dormand of Easington, L.

  Bragg, L.

  Dubs, L.

  Brennan, L.

  Elder, L.

  Brett, L.

  Evans of Parkside, L.

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  Evans of Watford, L.

  Massey of Darwen, B.

  Ezra, L.

  Merlyn-Rees, L.

  Falconer of Thoroton, L.

  Methuen, L.

  Farrington of Ribbleton, B.

  Miller of Chilthorne Domer, B.

  Faulkner of Worcester, L.

  Mitchell, L.

  Filkin, L.

  Molloy, L.

  Fyfe of Fairfield, L.

  Morris of Castle Morris, L.

  Gale, B.

  Morris of Manchester, L.

  Geraint, L.

  Newby, L.

  Gibson of Market Rasen, B.

  Nicol, B.

  Gladwin of Clee, L.

  Patel of Blackburn, L.

  Goldsmith, L.

  Phillips of Sudbury, L.

  Goodhart, L.

  Pitkeathley, B.

  Goudie, B.

  Plant of Highfield, L.

  Graham of Edmonton, L.

  Ponsonby of Shulbrede, L.

  Greaves, L.

  Prys-Davies, L.

  Grenfell, L.

  Ramsay of Cartvale, B.

  Hardy of Wath, L.

  Razzall, L.

  Harris of Greenwich, L.

  Redesdale, L.

  Harris of Richmond, B.

  Rendell of Babergh, B.

  Harrison, L.

  Rodgers of Quarry Bank, L.

  Hayman, B.

  Russell, E.

  Hilton of Eggardon, B.

  Sawyer, L.

  Hollis of Heigham, B.

  Scotland of Asthal, B.

  Howells of St. Davids, B.

  Scott of Needham Market, B.

  Howie of Troon, L.

  Serota, B.

  Hoyle, L.

  Sharp of Guildford, B.

  Hughes of Woodside, L.

  Shore of Stepney, L.

  Hunt of Kings Heath, L.

  Shutt of Greetland, L.

  Irvine of Lairg, L. (Lord Chancellor)

  Simon, V.

  Stone of Blackheath, L.

  Janner of Braunstone, L.

  Symons of Vernham Dean, B.

  King of West Bromwich, L.

  Tomlinson, L.

  Kirkhill, L.

  Tordoff, L.

  Layard, L.

  Uddin, B.

  Lea of Crondall, L.

  Wallace of Saltaire, L.

  Lipsey, L.

  Walmsley, B.

  Lockwood, B.

  Warner, L.

  Lofthouse of Pontefract, L.

  Warwick of Undercliffe, B.

  Longford, E.

  Weatherill, L.

  Macdonald of Tradeston, L.

  Whitaker, B.

  McIntosh of Haringey, L. [Teller]

  Whitty, L.

  Wigoder, L.

  McIntosh of Hudnall, B.

  Wilkins, B.

  MacKenzie of Culkein, L.

  Williams of Mostyn, L.

  Mackenzie of Framwellgate, L.

  Williamson of Horton, L.

  Mar and Kellie, E.

  Woolmer of Leeds, L.

  Mason of Barnsley, L.

  Young of Old Scone, B.

  Resolved in the negative, and amendment disagreed to accordingly.
  6.15 p.m.
  Clause 47 agreed to.
  Clause 48 [Special agreements with respect to connection]:
  [Amendment No. 191 not moved.]
  Clause 48 agreed to.
  Clause 49 [General duties of electricity distributors]:
  Lord Ezra Lord Ezra moved Amendment No. 192:
  Page 50, line 36, at end insert—
  ("( ) to facilitate the development of embedded generation"").
  The noble Lord said: In moving Amendment No. 192, I shall speak also to Amendment No. 193. The purpose of these amendments is to add to the general duties of licensed electricity distributors. In the case of Amendment No. 192, it is to add the duty of

  311
  facilitating the development of embedded generation to which the Minister referred in commenting on the last amendment.
  Perhaps I may remind the Committee that embedded generation is small-scale generation, generally deriving from renewables or combined heat and power, which is too small to supply onto the national network and has to link up with local networks. It brings power and heat generation closer to communities and local industry. The successful development and growth of embedded generation helps to develop new environmentally-friendly technologies and services.
  According to the DTI, the amount of embedded generation is likely to increase by an extra 8,000 to 10,000 megawatts over the next decade. By then, more than 25 per cent of generating capacity could come from this source. This is one of the most significant developments in electricity generation and distribution since the development of the National Grid. It reflects major technological change. Bringing the source of generation close to consumers could lead to big savings. Less electricity would be lost through long-distance transmission. Embedded generation technology is more flexible and less polluting. It changes altogether the electricity scene we have been used to in the post-war period, with mammoth power stations distant from their customers. Here we have a situation in which more and more power will be generated in smaller amounts close to the customer.
  Embedded generation can usefully supplement the capacity of the grid in particular localities. The difficulty under the earlier system was that the capacity of the grid could be augmented only on a very large scale. Embedded generation introduces much greater flexibility, adding to capacity where it is needed.
  In the latest report of the Royal Commission on Environmental Pollution, which was issued on 15th June, specific reference is made to the importance of embedded generation. The report states that:
  "The relatively small size of renewable energy plants generating electricity and local CHP plants does not fit easily with an electricity distribution and transmission network based on massive generators and highly centralised control".
  That refers to the previous system. It goes on,
  "The national grid and the regional distribution systems need to become more favourable to small and very small environmentally friendly generators which sometimes need to import electricity. Regulatory policies will need to promote, and must not inhibit, this development. The government and the electricity supply industry must together devise a system which can handle a growing quantity of this embedded generation securely and efficiently".
  I should like to read from the debate which took place yesterday on combined heat and power, when the Parliamentary Under-Secretary of State for the Environment, Transport and the Regions, Mr Chris Mullin, said,
  "We want to ensure that CHP and other embedded generation is treated on the same basis as conventional generation. We also want to ensure that it has fair access to the wider networks at fair prices, and that it is fairly rewarded for the benefits that it brings to the network through its "focus on local solutions on sustainable energy".—[Official Report, Commons, 20/6/00: col. 318.]
  In the light of this important development, I hope that the Government will seriously consider the amendment. Unless we have something like this on the face of the Bill, the need to secure fair and open access to the growing amounts of embedded generation will not be secured.
  The related Amendment No. 193 deals with the more precise problem of net metering in the case of small, localised generation. The basis of net metering is that the same price is paid for any electricity received as is paid to the user for any electricity sent out. That would be particularly important for very small operations including, possibly, as the technology develops, operations on a domestic scale. So that too is an important aspect of the same problem. I beg to move.
  Lord Jenkin of Roding: In the course of trying to begin to make myself familiar with the Royal Commission report—it is a formidable document and one which will repay a great deal of study—I too was impressed with the passages on the importance of this growing feature of our electricity supply, embedded energy.
  The noble Lord, Lord Ezra, quoted one recommendation. I was particularly struck by the recommendation in paragraph 8.54, which says,
  "There appears to have been no research as yet into these problems";
  that is, that it requires a much more sophisticated distribution network if it is going to take account both of the large generators and of a large number of small generators. But no research has been conducted either by the National Grid Company or by any other body. The paragraph continues,
  "We recommend that the government takes responsibility for promoting, and ensuring sufficient funding is available for research into technologies that solve the problems of controlling electricity networks in which there is a high proportion of embedded and intermittent generation, and into the economic and institutional issues that will need to be resolved".
  My interest in this arises partly because we shall be coming, I hope shortly, to the question of renewable energy. Many renewable energy sources will qualify as embedded generation. I am astonished that there has been no research into the distribution consequences of the growth of embedded generation sources.
  Baroness Sharp of Guildford: I support the amendment of my noble friend Lord Ezra, and pick up the same theme of the need to support the development of renewable sources of energy.
  My noble friend mentioned, and we shall be debating later, the combined heat and power issues. I should like to mention another area which is growing fast, though not as fast in this country as it might; that is, small-scale solar power photovoltaics. In 1992 the Energy Technology Studies Unit (ETSU) produced a study which showed that, if units were suitably placed on roofs, two-thirds of the electricity in this country could be acquired from solar power.

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  There is absolutely no incentive for households to make use of such new technologies when at the moment they are charged 6p to 7p per unit for electricity, and, if they offer it to the grid, they are offered 2.5p to 4p back for it. It is important therefore that the net metering issue is brought to light and considered.
  The Americans are moving forward extremely fast in photovoltaic technology. Last year there was a 20 per cent increase in California in the use of photovoltaics and the Germans too have been introducing legislation to encourage it. This is a small amendment for which we are asking, but one that will provide a considerable incentive to help to develop the new technologies.
  Baroness Buscombe: We on these Benches have difficulty in supporting these amendments. We feel that they undermine what is otherwise a completely neutral position.
  Clause 49 imposes a simple obligation on the distributor who is, we must remember, the keeper of the monopoly distribution network. He is there to develop and maintain a system which is efficient, co-ordinated and economical, and to facilitate competition in supply and generation. Add anything else to that and we risk upsetting the balance. We therefore cannot support the amendments.
  Lord McIntosh of Haringey: I hope it was clear from my opposition to Amendment No. 191, which the noble Baroness, Lady Buscombe, moved a few minutes ago, that we do not agree with the Opposition on this, but that we recognise the importance of small-scale—typically embedded—generation to renewables and to the electricity market more broadly, and of course of combined heat and power.
  The Bill introduces changes to the regulatory structure of the electricity industry which will remove barriers to embedded generation, which Amendment No. 191 would have brought back again, and enable it to compete fairly on its own merits. That is the key to encouraging renewable and combined heat and power generation. For example, the separation of electricity supply and distribution, presently combined in the Public Electricity Suppliers, will change the way distribution systems are managed to the benefit of embedded generators. That is underpinned in the Bill by the explicit duty imposed on distributors to facilitate competition in generation, including embedded generation, as well as supply.
  It is also supported by the draft distribution licence conditions which, for example, place system entry and exit points on an equal footing and introduce a power for the regulator to direct distributors to publish long-term development plans, as transmission licence holders are already required to do. In addition, distributors will be obliged to offer terms for connection to embedded generators—something which is not a feature of the present legislation.
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  The aim is to put in place a framework so that embedded generators will be able to obtain full value for their energy output and any locational benefits they provide, and so that distribution companies will look at embedded generation on an equitable and transparent basis when considering any network augmentation.
  The Government committed themselves to addressing any continuing problems relating to the operation of distributed generation and its connection to the distribution system that are identified by a new industry-wide working group chaired by Ofgem and involving DTI, DETR and representatives of the industry.
  Given all those measures, we believe that, on the face of the Bill, in regulation, in licences and in every place where it is appropriate, we are taking practical steps to encourage embedded generation and we believe that that is more important and significant than the declaration which Amendment No. 192 would place on the face of the Bill. We believe that in practice it would not achieve anything that we are not already addressing.
  I turn to Amendment No. 193 on net metering. I make it clear that the Bill does not rule out net metering. However, we think that it is wrong in principle to prescribe a system of net metering, since it would ignore the real difference in value between the electricity that a customer supplies to the network and that which he takes from it. Any such general obligation would imply a degree of cross-subsidisation, which would have to be paid for by other consumers.
  It is, of course, open to electricity suppliers to offer net metering to their customers if they choose to do so. We understand that at least one company has already done this. We are glad about that and we welcome that initiative. But the way forward, from the point of view of the legislation, lies in the measures which benefit embedded generation, which I have already set out in some detail, and not in declarations of the sort provided by Amendment No. 193.
  I hope that the noble Lord, Lord Ezra, and the noble Baroness, Lady Sharp, will recognise that we are on the same side and that the Government are taking the practical steps.
  6.30 p.m.
  Lord Beaumont of Whitley: I am delighted to hear that the Government are taking these important steps, which will become more important as further efficient methods of generation of renewable energy are made available. I particularly refer to the article in this week's edition of New Scientist about the new breakthrough in the production of wind generation, using much smaller wind generators and much better methods of transmitting power over longer distances.
  Am I to understand from the Government that, in spite of their good intentions, they believe that these amendments would not only be superfluous but would in some way be deleterious to their aims? It appears to me that the inclusion of small-scale renewable

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  generation through net metering does not in any way imply, as the Government seem to be saying, the forcible application of net metering on an obligatory basis at a particular rate. The inclusion of small-scale renewable generation through net metering would involve a considerable amount of discretion about how it is done. I might be persuaded by the Government that it is unnecessary, but I am not at all persuaded that it would be deleterious to their objectives. I find it very difficult to accept both apparently contradictory arguments at the same time.
  Lord McIntosh of Haringey: If I may respond to the noble Lord, Lord Beaumont, I never used the word "deleterious". I said that nothing in Amendment No. 192 adds to the practical measures that we have in hand. I see no point or advantage in adding a declaration when the practical measures of policy contained on the face of the Bill, in regulation, in licences, are already in hand. As to—
  Lord Beaumont of Whitley: I absolutely accept that. It may be that the word "deleterious" is the wrong word to use. It was the word which leapt to my mind at the time. I was referring to the Government's opposition to Amendment No. 193, which we are discussing at the same time.
  Lord McIntosh of Haringey: The argument is that net metering may be appropriate in some circumstances. However, where a genuine difference exists in the value of input and output, the singling out of net metering for praise on the face of the Bill would have the effect of imposing cross-subsidies, which do not seem to us to be justified.
  Lord Ezra: I thank those who have participated in this interchange. I also thank the Minister for his response, and particularly for his reaffirmation of the Government's support of the major changes that are now taking place in electricity generation away from large, centralised stations to embedded localised Generation.
  However, I am sorry that the Government are not prepared to include in the Bill the proposed declaration. In my view, it would act as a coping stone for the various practical measures which the Minister has indicated are being taken. It could regularly be referred to as symbolising and indicating, in a few words, the Government's intention; the detail could then be found elsewhere. I should like to reconsider this issue to see whether the concept can be introduced elsewhere, which the Government may be prepared to accept at a later stage.
  I also regret the fact that net metering cannot be introduced. The amendment does not suggest that it should be imposed, but that it should be taken into account. The concept of net metering is a relatively new one. It is not yet practised in this country, but it is widely practised in other countries and has facilitated—the word that we use—these new developments, particularly at the very small end. Unless something like this is introduced, a lot of
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  technological development that is taking place here and elsewhere could be frustrated so far as this country is concerned. That is also a matter which I should like to reconsider. In the mean time, however, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 193 not moved.]
  Clause 49 agreed to.
  Clause 50 agreed to.
  Schedule 4 [Schedule to be substituted for Schedule 6 to the 1989 Act]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 194:
  Page 116, line 32, at end insert—
  ("Deemed contracts in certain cases
  2A.—(1) Where an electricity supplier supplies electricity to any premises otherwise than in pursuance of a contract, the supplier shall be deemed to have contracted with the occupier (or the owner if the premises are unoccupied) for the supply of electricity as from the time ("the relevant time") when he began so to supply electricity.
  (2) Where—

  (a) the owner or occupier of any premises takes a supply of electricity which has been conveyed to those premises by an electricity distributor;

  (b) that supply is not made by an authorised supplier; and

  (c) a supply of electricity so conveyed has been previously made by an electricity supplier,

  the owner or occupier shall be deemed to have contracted with the appropriate supplier for the supply of electricity as from the time ("the relevant time") when he began to take such a supply.
  (3) Nothing in sub-paragraph (2) shall be taken to afford a defence in any criminal proceedings.
  (4) The Authority shall publish a document containing provision for determining the "appropriate supplier" for the purposes of sub-paragraph (2).
  (5) The Authority may revise the current document published under sub-paragraph (4); and where it does so it shall publish the revised document.
  (6) The express terms and conditions of a contract which, by virtue of sub-paragraph (1) or (2), is deemed to have been made shall be provided for by a scheme made under this paragraph.
  (7) Each electricity supplier shall make (arid may from time to time revise), a scheme for determining the terms and conditions which are to be incorporated in the contracts which, by virtue of sub-paragraph (1) or (2), are to be deemed to have been made.
  (8) The terms and conditions so determined may include terms and conditions for enabling the electricity supplier to determine, in any case where the meter is not read immediately before the relevant time, the quantity of electricity which is to be treated as supplied by the supplier to the premises, or taken by the owner or occupier of the premises, during the period beginning with the relevant time and ending with—

  (a) the time when the meter is first read after the relevant time: or

  (b) the time when the supplier ceases to supply electricity to the premises, or the owner or occupier ceases to take a supply of electricity,

  whichever is the earlier.
  (9) A scheme under this paragraph may (subject to section 7B) make different provision for different cases or classes of cases, or for different areas, determined by, or in accordance with, the provisions of the scheme.
  (10) As soon as practicable after an electricity supplier makes a scheme under this paragraph, or a revision of such a scheme, he shall—

  (a) publish, in such manner as he considers appropriate for bringing it to the attention of persons likely to be affected by it, a notice stating the effect of the scheme or revision:

  (b) send a copy of the scheme or revision to the Authority and to the Council: and

  (c) if so requested by any other person, send such a copy to that person without charge to him.

  SECTIONS 24 TO 26: SUPPLEMENTARY

    Supplies of electricity illegally taken
    2B.—(1) Where any person takes a supply of electricity which is in the course of being conveyed by an electricity distributor, the distributor shall be entitled to recover from that person the value of the electricity so taken.
    (2) Where—

    (a) any person at premises at which a connection has been restored in contravention of paragraph 3(1) takes a supply of electricity which has been conveyed to those premises by an electricity distributor; and

    (b) the supply is taken otherwise than in pursuance of a contract made with an authorised supplier, or of a contract deemed to have been made with an electricity supplier by virtue of paragraph 2A above or paragraph 4S (former tariff customers) of Schedule 7,

    the distributor shall be entitled to recover from that person the value of the electricity so taken.
    (3) Each electricity distributor shall make, and from time to time revise, a scheme providing for the manner in which, and the persons by whom, the quantity of electricity taken in such circumstances as are mentioned in sub-paragraph (1) or (2) is to be determined for the purposes of that sub-paragraph.
    (4) Sub-paragraphs (9) and (10) of paragraph 2A shall apply in relation to a scheme under this paragraph as they apply in relation to a scheme under that paragraph.
    (5) In this paragraph "value", in relation to any electricity taken in such circumstances as are mentioned in sub-paragraph (1) or (2), means the amount which, if the electricity had been taken in such circumstances as are mentioned in sub-paragraph (2) of paragraph 2A, could reasonably be expected to have been payable in respect of the electricity under a contract deemed to have been made by virtue of that sub-paragraph.").
    The noble Lord said: In moving this amendment, I speak also to Amendments Nos. 201, 292, 299, 300, 303, 304, 312, 337, 338, 344, 346 and 347. This group includes Amendments Nos. 195 to 197, for which I imagine that the Opposition would prefer to put their case before I knock it down.
    The government amendments deal with provisions for deemed contracts and the determination of disputes. The provisions for deemed contracts are included in Amendments Nos. 194, 299, 337 and 338, which introduce provisions into the Electricity Act for deemed contracts such as already exist in the Gas Act. They provide that where a supply is made to premises without an agreed contact being in place between a customer and a supplier, a contract shall be deemed to be in place with the appropriate supplier. An example of a case in which this is necessary is when someone moves into premises without previously having made a contract with a supplier. In addition, they provide a right to a distributor to recover the value of electricity illegally taken from a distribution system through the civil process of debt recovery. This reminds me of the bedsit days of my youth!
    In addition, the Gas Act is amended to align it with the Electricity Act, in that the provisions which restrict deemed contracts to categories of customer whose demand is below a specified threshold are being repealed, making them applicable to all categories of customer.
    Amendments Nos. 201, 292 and 300 relate to disputes determination. These amendments update the existing provisions of the Electricity Act, so that disputes determination by the authority applies to the statutory obligations on distributors to provide a connection. At present, it applies to statutory obligations to supply by a public electricity supplier, which are being repealed. In addition, they amend the Gas Act to align with the electricity provisions so that disputes determination applies to all customers not just domestic customers.
    The consequential Amendments Nos. 303, 304, 312, 344 and 347 make some small, technical changes to the Bill, resulting from the abolition in the Electricity Act of the concept of "public electricity suppliers" and the separate definition of supplier and distributor. I beg to move.
    Baroness Buscombe: I shall do battle on Amendment No. 195 and, in so doing, speak also to Amendments Nos. 196 and 197. Amendments Nos. 195 and 196 would provide electricity distributors with rights of access to meters in the case of an emergency.
    Electricity suppliers will be responsible for providing meters at each point they supply and retrieving and processing the readings from them (described as "metering services" and "data services"). The supplier can appoint an agent to fulfil its responsibilities in respect of those services.
    While distributors will retain ownership of the thousands of meters currently in place and must offer suppliers terms for the provision and operation of meters, they will not have any right of access to their meters. The powers to enter premises for access to meters will be given to suppliers who will be able to exercise those powers themselves or through persons appointed by them. A distributor could be appointed for this purpose, but a supplier will not have to accept the distributor's terms and will be able to select another party to provide metering services.
    Where the supplier has not appointed the distributor as its agent for metering services, the distributor will not be able to deal with a faulty meter on the customer's premises. In that event a distributor will be able to disconnect the supply only in order to leave a safe situation, and ask the supplier—he would be in rather an unenviable position of explaining this to the customer—to arrange for its meter operator to deal with the meter; until this is done, the consumer will be without electricity. The amendments would enable distributors to enter premises in an emergency to inspect, repair and reinstall meters. In that way we believe that they are entirely practical.
    The purpose of Amendment No. 197 is to clarify that the protection of electricity supply equipment from distress will pass to the successor of the company

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    that installed that equipment. As presently drafted, Schedule 4 provides immunity from distress for equipment which is marked or branded with the name of an electricity company. As a result of the reforms in the electricity market, many of these assets will pass to different owners but remain in place for some time bearing the name of a predecessor in title. It is unclear whether the immunity from distress will pass to the successor company. The amendment deals with this point.
    6.45 p.m.
    Lord McIntosh of Haringey: I am grateful to the noble Baroness, Lady Buscombe, for her explanation of those amendments. I apologise for my flippant remarks at the beginning. The noble Baroness, Lady Buscombe, knows better than to take me seriously.
    I turn to Amendments Nos. 195 and 196. At present, the distribution arm of public electricity suppliers owns most of the meters in the country. We intend that in future suppliers and not distributors should be responsible for providing customers with meters and related services. Suppliers will not have to own the meters or provide services themselves, but may procure them from specialist metering firms or, as the noble Baroness, Lady Buscombe, said, from distributors. This policy aims to increase competition in metering and also ensure that customers have a "one-stop shop"; that is, they deal with the supplier for everything, rather than having to deal with different people for different aspects of their electricity service.
    Distributors will continue to be responsible for line and plant, and so it is right that they should have various rights of entry related to those, including emergency access. But there is no reason for them to have privileged access to meters, for which they are not responsible.
    It is important to remember that this is not an issue of safety. Of course it is usually the distributor who needs entry in an emergency and we have made provision for this. But if the fault is with an electric heater or cooker, there are no additional rights of entry enforceable by court warrants to inspect or replace these items, and similarly it is not necessary for a faulty meter. It is irrelevant that the distributor might happen to own it.
    Moreover, it is anti-competitive. It would retain a link between supply and distribution which runs against the thrust of the Bill in separating the two. Also, specialist metering firms, which may also provide meters to suppliers for use by consumers, do not directly get these rights, so why should we skew the competitive playing field against them?
    Of course, both specialist firms and distributors can benefit from a supplier's right of entry in relation to meters if they are authorised by the supplier, for example when the supplier has sub-contracted its metering requirements. But the responsibility for how those rights are exercised should remain with the supplier who has the responsibility.
    I turn to Amendment No. 197. The current drafting in Schedule 4 states that if electrical plant lines or meters are marked sufficiently to indicate an electricity
    320
    company as the owner, they cannot be treated as part of the landlord's property or be seized if, say, the landlord goes bankrupt. I think that it was the issues of seizure and distress that the noble Baroness, Lady Buscombe, was most concerned about.
    The drafting does not say that the name of the company which owns the relevant equipment must be marked, only that the mark should be sufficient to indicate that some electricity supplier or distributor is the owner. This seems sufficient to cover the case which might lie behind the amendment; namely, when equipment is marked with the name of a company which might no longer exist, for example a public electricity supplier, where ownership has passed to a successor supplier or distributor. Therefore I do not believe that this amendment is necessary.
    On Question, amendment agreed to.
    [Amendments Nos. 195 to 197 not moved]
    Schedule 4, as amended, agreed to.
    Clause 83 [The gas code]:
    Baroness Buscombe Baroness Buscombe moved Amendment No. 198:
    Page 81, line 18, at end insert—
    ("( ) In paragraph 12 (failure to notify connection or disconnection of service pipe). in sub-paragraph (1) after "meter" in both places where it occurs there is inserted "or gas device".
    ( ) In paragraph 13 (Failure to notify disconnection of meter)—

    (a) in sub-paragraphs (1) to (3) after "meter" in each place where it occurs there is inserted "or gas device", and

    (b) after sub-paragraph (4) there is inserted—

    "(5) In this paragraph and in paragraph 12, "gas device" means any device other than a meter forming part of' or used in conjunction with the metering installation at any premises."").
    The noble Baroness said: In moving Amendment No. 198, I wish to speak also to Amendments Nos. 199 and 200. These three amendments are technical amendments to clarify the legal uncertainty in the current provisions of the gas code in the Gas Act. They complement the authority's current activities in bringing greater competition in meter ownership in the gas market and in the carrying out of meter installation and maintenance activities. Encouraging competition in these areas will bring down prices for the benefit of consumers.
    Amendment No. 198 seeks to amend paragraphs 12 and 13 of the schedule. The two sub-paragraphs require persons carrying out work which involves removing a meter or connecting a meter to a service pipe to inform the supplier and the gas transporter concerned. The information in question is specified in regulations under paragraph 12. However, in any metering installation, there are other fittings than purely the meter and service pipe. In a domestic installation there will be a small pressure regulator and connecting pipes. For larger industrial and commercial installations there may also be pressure and temperature controls apparatus.
    In the new competitive environment it may be the case that different parties will own the meter and other parts of the apparatus. This amendment ensures that if work is carried out to any part of the metering installation other than the meter the same information

    321
    is given to the supplier and transporter in respect of that work as is currently given in respect of work involving the meter alone. This enables the supplier and transporter to ensure that their records of ownership and work carried out are kept up to date and helps to ensure the overall safe operation of the metering installation.
    Amendment No. 200 seeks to remove a barrier to the free transfer of title in meters when installed in consumers' premises. A failure to attend to this is likely to discourage new meter owners and so reduce the scope for competition in the market.
    The issue is that ownership in items such as gas meters can normally be transferred by what is known as "delivery"—that is, a physical or symbolic handing over of the meters—if at the relevant time they are in the possession of the party seeking to sell them. This is, however, not the case if at the relevant time they are in the possession of a third party, such as the hirer or consumer. In such a case, in order to transfer title the consent of the party in possession of the goods would be required. This is a considerable barrier to the transfer of title. Amendment No. 199 makes that consent unnecessary without changing the terms of the hiring agreement.
    The third amendment seeks to amend paragraph 29 of Schedule 2B. This paragraph provides that meters and gas fittings of gas transporters and suppliers, provided that they are marked with a sufficient mark indicating the owner, are not liable to be seized by creditors of the consumer in recovering debts, and are also not deemed to be the landlord's fixtures. The latter provision is of particular importance as otherwise the common law could deem the ownership in the meter to pass from the gas transporter to the owner of the property as soon as the meter was fixed to the property. I beg to move.
    Lord McIntosh of Haringey: I hope that I can reassure the noble Baroness, Lady Buscombe, that these amendments are not necessary.
    Amendment No. 198 would have the effect that a notice should be given if a "device" which is not a gas meter but "forms part of it" or is used "in conjunction with it" is to be disconnected. The present drafting would require such notice to be given only if the meter is to be disconnected. The amendment is unnecessary and also far too broad. It is unnecessary because if the device is part of the meter, disconnecting the device would automatically entail disconnecting the meter, thus triggering the existing notice provisions.
    The other part of the definition of "device" relates to something that is not part of the meter but used in conjunction with it. If it does not simply mean something that is necessary to the operation of the meter, how far does it go? A gas cooker is used in conjunction with a meter in some sense. Any reasonable interpretation of the word "meter" already covers what needs to be covered, and does not extend to cookers and the like. So the amendment is not only unnecessary but goes too far.
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    Amendment No. 199 is also unnecessary and would have effects which extend far beyond the provisions of the gas code, with which these amendments are concerned. The current wording of the gas code says that any gas "fittings" owned by gas transporters or suppliers cannot be treated as landlord's fixtures and cannot be subject to distress or taken in bankruptcy or other court proceedings. Amendment No. 199 seeks to extend this to cover fittings owned by anyone other than the consumer.
    The term "fittings" is defined by Section 48 of the Gas Act to include pipes and meters, and also apparatus and appliances for use by consumers for heating, lighting and other purposes. In other words, it covers both pipes and such things as cookers. Gas pipes are unlikely to be owned by anyone other than a transporter, supplier or the owner of the premises. So the amendment would be unlikely to have any effect in that regard.
    But when it comes to items such as cookers, the effect of the amendment would be that if the cooker was owned by, say, a gas appliances company which was providing it under a hire purchase agreement, it could not be seized—not even by the company which provided it. Equally, a gas appliance belonging to a landlord would be deemed not to be a landlord's fixture, notwithstanding that it was fixed or fastened to the premises. These are odd effects to seek to achieve.
    The purpose of the existing provision is simply to protect the property of gas transporters and suppliers. The amendment does not seem to benefit them and has the perverse consequences to which I have referred.
    Amendment No. 200 is also unnecessary, as well as being too broad. It would apply to all gas meters, including meters owned by the customer himself. But even if it were tighter than that, it is unnecessary. This is because the consent of consumers is not necessary to transfer ownership of meters or fittings owned by suppliers or transporters. For the sale of a gas meter which is in a consumer's premises, Section 29(4) of the Sale of Goods Act 1979 would simply require an acknowledgement by the consumer that the meter or fitting is held on behalf of the buyer rather than the seller, and this would constitute delivery of the goods by the seller. The contract that the consumer signs with the supplier could simply say that such acknowledgement will be deemed to have been given in the event of a sale of a meter, or, alternatively, that the payment of a bill on which the change of ownership is mentioned constitutes delivery.
    The Sale of Goods Act requires there to be a "delivery" of the goods by the seller, whether actual or constructive. This amendment would mean that the seller of a gas meter would have no way of making "delivery" of the meter to the buyer, and some alternative method would have to be prescribed. It would also mean that the position in respect of gas meters differed from that in respect of electricity meters.
    The gas code has been around for a number of years. The first two amendments simply cast doubt on generally accepted interpretations of terms to the

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    detriment of every other place where they are used. I hope that the noble Baroness will not press these amendments.
    Baroness Buscombe: I have listened with great care to what the Minister said. I simply cannot agree with him that these amendments are either unnecessary or too broad—not least because we have developed these proposals very much in consultation with the gas industry, which is deeply concerned about these issues. With great respect, we are not satisfied with the Minister's response and I should like to test the opinion of the Committee.
    6.56 p.m.
    On Question, Whether the said amendment (No. 198) shall be agreed to?
    Their Lordships divided: Contents, 44; Not-Contents, 114.

    Division No. 2

    CONTENTS

    Anelay of St Johns, B.

    Jopling, L.

    Astor of Hever, L. [Teller]

    Kingsland, L.

    Attlee, E.

    Knight of Collingtree, B.

    Blatch, B.

    Laird, L.

    Brougham and Vaux, L.

    Lamont of Lerwick, L.

    Buscombe, B.

    Lucas, L.

    Carnegy of Lour, B.

    Lyell, L.

    Crathorne, L.

    Mackay of Ardbrecknish, L.

    Dean of Harptree, L.

    Marlesford, L.

    Dixon-Smith, L.

    Naseby, L,

    Dundee, E.

    Northesk, E. [Teller]

    Ferrers, E.

    Oxfuird, V.

    Fookes, B.

    Reay, L.

    Freeman, L.

    Renton, L.

    Gardner of Parkes, B.

    Roberts of Conwy, L.

    Geddes, L.

    Rogan, L.

    Glentoran, L.

    Seccombe, B.

    Hanham, B.

    Skidelsky, L.

    Henley, L.

    Stodart of Leaston, L.

    Higgins, L.

    Strathclyde, L.

    Howe, E.

    Thomas of Gwydir, L.

    Jenkin of Roding, L.

    Wakeham, L.

    NOT-CONTENTS

    Acton, L.

    Christopher, L.

    Addington, L.

    Clarke of Hampstead, L.

    Ahmed, L.

    Cohen of Pimlico, B.

    Alli, L.

    Currie of Marylebone, L.

    Amos, B.

    David, B.

    Andrews, B.

    Davies of Coity, L.

    Archer of Sandwell, L.

    Davies of Oldham, L.

    Bach, L.

    Desai, L.

    Barnett, L.

    Dholakia, L.

    Bassam of Brighton, L.

    Dixon, L.

    Beaumont of Whitley, L.

    Donoughue, L.

    Berkeley, L.

    Dormand of Easington, L.

    Blackstone, B.

    Dubs, L.

    Blease, L.

    Elder, L.

    Borrie, L.

    Evans of Parkside, L.

    Bragg, L.

    Ezra, L.

    Brennan, L.

    Falconer of Thoroton, L.

    Brett, L.

    Falkland, V.

    Brooke of Alverthorpe, L.

    Farrington of Ribbleton, B.

    Brookman, L.

    Faulkner of Worcester, L.

    Burlison, L. [Teller]

    Filkin, L.

    Carter, L. [Teller]

    Fyfe of Fairfield, L.

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    Gale, B.

    MacKenzie of Culkein, L.

    Gibson of Market Rasen, B.

    Mackenzie of Framwellgate, L.

    Gladwin of Clee, L.

    Massey of Darwen, B.

    Goldsmith, L.

    Merlyn-Rees, L.

    Goodhart, L.

    Miller of Chilthorne Domer, B

    Goudie, B.

    Mitchell, L.

    Gould of Potternewton, B.

    Morris of Castle Morris, L.

    Graham of Edmonton, L.

    Newby, L.

    Grenfell, L.

    Nicol, B.

    Hardy of Wath, L.

    Patel of Blackburn, L.

    Harris of Greenwich, L.

    Phillips of Sudbury, L.

    Harris of Haringey, L.

    Pitkeathley, B.

    Harris of Richmond, B.

    Ramsay of Cartvale, B.

    Harrison, L.

    Razzall, L.

    Hayman, B.

    Rendell of Babergh, B.

    Hilton of Eggardon, B.

    Sawyer, L.

    Hollis of Heigham, B.

    Scotland of Asthal, B.

    Howells of St. Davids, B.

    Serota, B.

    Howie of Troon, L.

    Sharp of Guildford, B.

    Hoyle, L.

    Simon, V.

    Hughes of Woodside, L.

    Stone of Blackheath, L.

    Irvine of Lairg, L. (Lord Chancellor)

    Symons of Vernham Dean, B.

    Taverne, L.

    Islwyn, L.

    Tomlinson, L.

    Tope, L.

    Jenkins of Putney, L.

    Uddin, B.

    King of West Bromwich, L.

    Wallace of Saltaire, L.

    Kirkhill, L.

    Walmsley, B.

    Layard, L.

    Warner, L.

    Lea of Crondall, L.

    Warwick of Undercliffe, B.

    Lipsey, L.

    Whitaker, B.

    Lockwood, B.

    Whitty, L.

    Lofthouse of Pontefract, L.

    Wilkins, B.

    Macdonald of Tradeston, L.

    Williamson of Horton, L.

    McIntosh of Haringey, L.

    Woolmer of Leeds, L.

    McIntosh of Hudnall, B.

    Young of Old Scone, B.

    Resolved in the negative, and amendment disagreed to accordingly.
    7.6 p.m.
    [Amendments Nos. 199 and 200 not moved.]
    Clause 83 agreed to.
    Clause 51 agreed to.
    Schedule 5 [Electricity metering]:
    Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 201:
    Page 120, line 19, after (""provided";") insert—
    ("(bb) after sub-paragraph (2) there is inserted—
    "(2A) Section 23 of this Act shall apply in relation to any dispute arising under this paragraph between an electricity supplier and a customer.";").
    On Question, amendment agreed to.
    Schedule 5, as amended, agreed to.
    Clause 52 agreed to.
    Clauses 88, 53, 89, 54, 90, 55, 91 and 56 agreed to.
    Clause 92 [Information with respect to levels of performance]:
    [Amendment No. 202 not moved.]
    Clause 92 agreed to.
    Clause 57 agreed to.
    Clause 93 [Information to be given to customers]:
    [Amendment No. 203 not moved.]
    Clause 93 agreed to.
    Clause 58 [Financial penalties]:
    Lord Kingsland Lord Kingsland moved Amendment No. 204:
    Page 55, line 29, at beginning insert ("and that compliance by the licence holder cannot be secured by other means,").
    The noble Lord said: Clauses 58 and 94 introduce a power for the authority to impose financial penalties of,
    "such amount as is reasonable in all the circumstances of the case".
    on any licence holder that,
    "(a) has contravened or is contravening any relevant condition or requirement: or
    "(b) has failed or is failing to achieve any standard of performance prescribed under",
    the relevant Acts.
    The authority is obliged, prior to imposing a penalty, to give notice of its intentions to do so, and to set out the acts or omissions by the licence holder which have resulted in the contravention or failure, together with the relevant condition, requirement or standard of performance. In the event that the authority, having considered any objections or representations made by the licence holder in question, proceeds with the penalty, the authority must give at least 42 days' notice of payment.
    The authority is required, for example, by virtue of the proposed Section 30B, to prepare and publish a statement of policy with respect to the imposition of penalties and the determination of their amounts and undertake such consultation as it deems appropriate when preparing or revising the statement.
    Proposed Section 30C provides certain time limits on the imposition of penalties where no final or provisional order has been made in relation to a contravention or failure. The authority may not impose a penalty in respect of the contravention or failure unless the notice relating to the penalty was served on the licence holder within 12 months from the time of the contravention or failure. Where a final or provisional order has been made, the notice must be served within three months from the confirmation of the provisional order or the making of the final order or, when the provisional order is not confirmed, within six months from the making of the provisional order.
    An aggrieved licence holder may make an application to the court, which shall have the power to quash the penalty, substitute a lesser amount or substitute alternative dates for payment. The grounds on which the court may exercise its powers are only on the basis that the imposition of the penalty was not within the powers of the authority under, say, the proposed Section 30A; that the requirements of, say, proposed Section 30A have not been complied with; or that the date by which the penalty is to be paid is unreasonable.
    The Opposition's view is that this is an enormous concentration of power in the authority. The authority is already empowered to determine and impose licence conditions and standards of service; Clauses 58 and 94 add the power to levy a fine. The limitations which circumscribe a court's ability to intervene in an abuse of this power leave the power exercisable without
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    proper supervision. In the case of the authority, the powers of the "legislature", the "executive" and the "judiciary" are combined in one board with only one full-time member, and all its members are unelected. That is constitutionally unsound, especially in an activity where penalties are imposed.
    The Minister is well aware of the Opposition's view that the use of these powers is likely to introduce conflict, most obviously with the European Convention on Human Rights. The Clause 58 and Clause 74 procedures, which authorise the imposition by the regulator of potentially unlimited penalties on licence holders with a wide swathe of obligations, clearly constitutes the determination of a civil right or obligation within the meaning of Article 6 of the convention. The procedure may also constitute the determination of a criminal charge within Article 6.
    Since the procedure determines a civil obligation, Clauses 58 and 94 ought to offer a fair and public hearing before an independent and impartial tribunal. These clauses do not do so. The authority which determines whether to impose a penalty is not independent of the executive and, in any event, there is no provision for an oral hearing. As the Minister is aware, it is the Opposition's view that the right of appeal provided by Section 27E is a narrowly confined right and not a proper right of appeal, which at best offers similar grounds of review to those available on an application for judicial review. As such, it cannot operate to cure the deficiencies in the procedure before the authority.
    The powers granted by Clauses 58 to 94 also lead to multiple exposure by licence holders. The licence holder is likely to be exposed to penalties both under the Competition Act 1998 and under Clauses 58 and 94. Whereas the Competition Act provides a clear framework determining the levels of fines that will be imposed, Clauses 58 and 94 have no such structure. There may also arise an obligation to make compensation payments to customers where they have failed to achieve a certain standard of performance.
    Our amendments to these clauses seek to do the following. Amendment No. 204 relating to the electricity industry and Amendment No. 217 relating to the gas industry require the authority to be satisfied that compliance cannot be secured by other means before it imposes a penalty under the new Section 27A for electricity or 30A for gas.
    Amendment No. 205 for electricity and Amendment No. 218 for gas insert a defence into what is otherwise an offence of strict liability—that is to say, a defence that says that if there was no intention or recklessness and the licence holder took all reasonable steps to avoid the alleged contravention or failure to act, there should be no penalty imposed.
    This matter was debated in Committee in another place. If the Minister looks at columns 556 and 557 of Hansard, he will see that at one point in her contribution the Minister appeared to be suggesting that there should be no penalty where the contravention was genuinely inadvertent; but there are other parts of her contribution which suggest the

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    opposite. If it really is the Government's intention that no penalty should be imposed where the breach was truly inadvertent, I suggest, with the greatest possible respect to the Minister, that that intention should be on the face of the Bill.
    Amendments Nos. 210 to 214 with respect to electricity and Amendments Nos. 223 to 227 with respect to gas remove from the Bill the references to the expression "application procedure" and replace them with references to the rights of appeal under the new Sections 49B and 38B which the Opposition are trying to insert.
    Finally, Amendment No. 215 regarding electricity and Amendment No. 228 regarding gas insert new Sect ion 27G into the Electricity Act and new Section 30G into the Gas Act, requiring the authority to keep under review licence conditions which will give rise to penalties if breached. If they are insufficiently clear, in our view the authority must take appropriate steps to amend or revoke them. I beg to move.
    7.15 p.m.
    Lord Borrie: It may be helpful to the Committee if I speak at this point to Amendments Nos. 206 and 219 standing in my name and that of my noble friend Lord Currie of Marylebone. The amendments form part of the group that we are discussing.
    Our amendments propose to introduce an upper limit on the financial penalties envisaged in Clauses 58 and 94. The Liberal Democrat Front Bench has amendments covering similar ground, and will no doubt wish to speak to them. At present the only limitation on the penalty that may be imposed is—this phrase has been quoted many times today—that it should be,
    "reasonable in all the circumstances of the case".
    The lack of any upper limit is a matter of concern, because it may cause some unease, even some alarm among licensees because, apart from the phrase that I have just quoted, the amount of the penalty seems unlimited.
    The amendments represent one option for addressing the point by imposing an upper limit similar to that to be found in the Competition Act, passed as recently as 1998. On Second Reading of this Bill on 4th May, my noble friend the Minister said, as reported at col. 1175 of Hansard, that that Act was different, because it was based on European law, which is true, and that there was no reason to follow that. But in my view the Competition Act is an interesting, perhaps valid, precedent. There is a degree of overlap in the malpractices covered by that Act and by the Bill, and the gas and electricity regulator and the new authority created by the Bill have concurrent powers with those of the Director-General of Fair Trading to enforce the Competition Act.
    Indeed, in March this year the Director-General of Fair Trading and the specific industry regulators, including the Office of Gas and Electricity Markets—the immediate predecessor of the new authority to be created by the Bill—published guidance, which I have in my hand. It is only eight pages long. It helpfully
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    elucidates for anyone interested the factors that those regulators would take into account in assessing penalties under the Competition Act within the 10 per cent turnover maximum that that Act provides. In that guidance the regulator stated that the twin objectives of policy would be to reflect in the imposition of any penalty the seriousness of any infringement and to ensure that the threat of penalties would deter undertakings from breaking the law.
    It seems to me that when the new authority created by the Bill publishes, as the Bill requires it to do, its statement of policy on penalties, it is very likely to state very similar objectives; namely, to reflect the seriousness of the offence and the need to "incentivise" compliance and to use penalties as deterrents to malpractice.
    The new authority may also have regard to the experience of the European Commission over not just a few months of the Competition Act 1998, which came into effect only in March this year, but over 30 years, with that maximum penalty of 10 per cent of turnover. That experience demonstrates that in determining penalties the European Commission has—I summarise, of course—taken account, on the one hand, of the length and gravity of infringement, the behaviour of the parties and the profits that may have been made out of unlawful behaviour, and, on the other hand, of such mitigating factors as a cooperative attitude towards the investigations.
    Financial penalties under the Competition Act or under the Bill will need to reflect a very wide range of different circumstances, so the size of penalties in particular cases will vary considerably. But I rather doubt that any penalty would be above 10 per cent of turnover, because I doubt whether above 10 per cent of turnover could feasibly be,
    "reasonable in all the circumstances of the case".
    There might be a perception by the public, licensees and the industry generally that without a top limit the authority newly created by the Bill would have an unduly large amount of power and be unduly arbitrary, even though we may think differently. Therefore, as a matter of perception, it may be as well if, as with the Competition Act 1998, we insert into the Bill such a maximum as we suggest in the amendments, or such other maximum as the Government think appropriate.
    Baroness Sharp of Guildford: I rise to speak to Amendments Nos. 207 and 222, which are part of the group of amendments currently before the Committee.
    As the noble Lord, Lord Borrie, pointed out, our amendments are very similar to those that he and the noble Lord, Lord Currie of Marylebone, have put forward; they are twin amendments on the same issue. The main difference is that their amendments specify not only that there shall he a penalty cap of 10 per cent of an undertaking's turnover, but also that the turnover shall be that not only of the undertaking itself, but also of its affiliated and related undertakings. In this respect, the amendments of the

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    noble Lords are probably preferable to ours, because they are more specific and make it clear that it should be the broader, rather than the narrower undertaking.
    I should like to say a few words about the amendment and very much support the noble Lord's line of thinking, because, as he made clear, the purpose is to provide a cap on fines. The current terminology in Clause 58 is very open ended. It talks of,
    "a penalty of such amount as is reasonable in all the circumstances of the case".
    That was the point that the noble Lord, Lord Kingsland, made when explaining the purpose of the Opposition's amendments.
    When discussing the issue in Committee in the other place, the Minister of State for Energy and Competitiveness in Europe argued that the term "reasonable" was well recognised in English law and gave the authority more flexibility. I accept that, but it totally misses the point of the amendment, the purpose of which is not to suggest that all penalties should be set at 10 per cent of turnover, but that that should be the maximum penalty imposed.
    I take on board the fact that the authority has published its policy for assessing and imposing penalties and will review it and, in the process of review, consult very widely. As the noble Lord, Lord Borrie, pointed out, at present it is minded to have the 10 per cent limit, but in the measure as it stands no limit is imposed. That seems to me to be unreasonable in the circumstances of the case.
    The issue is one about which gas and electricity undertakings are extremely concerned. The CBI, the Electricity Association and Powergen have all expressed a wish to see a cap of some sort imposed. Powergen, indeed, has raised the possibility of being exposed to a multiple risk of penalties simultaneously from different sources—from the Office of Fair Trading and the regulator at the same time. That is probably over the top. Nevertheless, it argues that such regulatory risk translates itself into higher borrowing rates which, given the capital-intensive nature of the industry, have a knock-on effect on capital expenditure.
    As the noble Lord, Lord Borrie, made clear, the regulator has concurrent powers with the Director-General of Fair Trading. We on these Benches believe that the Competition Act 1998 provides a good precedent. That considered penalty, which is imposed on a company that has abused its position of power in relation to customers and suppliers, was debated at length in the context of that legislation. It seems to us to provide a very good precedent for this Bill.
    7.30 p.m.
    Lord Currie of Marylebone: I rise briefly to speak to the amendments in my name and that of my noble friend Lord Borrie. In practice, this ceiling on fines will not make any difference to the penalty actually levied, but it will make a difference to perceptions, as my noble friend so clearly indicated. I just flag up one important area in addition to those mentioned by my
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    noble friend: overseas investment. The British utilities sector, in particular electricity and gas, has benefited from inward investment. Such decisions are often made on the basis of relatively simple checklists, and the warning sign of no limit on penal fines can easily deter inward investors. I believe that that would be detrimental to the sector and the economy. Therefore, I support the amendment.
    Lord McIntosh of Haringey: All these amendments are concerned with financial penalties and enforcement but they cover a number of different topics within that broad heading. I should like to speak first to the government amendments and then respond to the other amendments which have been moved or spoken to.
    I turn first to government Amendments Nos. 208, 209, 216, 221, 222, 229, 230 and 231. Amendments Nos. 209, 216, 222 and 229, which form a group, are tabled in response to a concern raised during Second Reading by my noble friends Lord Borrie and Lord Currie. The concern was that the limit of 12 months for the imposition of a financial penalty from the date of contravention, where no enforcement action had been taken, would leave too little time for investigation of alleged malpractice and could provide a company being investigated with a view to the imposition of a financial penalty with an incentive to drag its feet in supplying information so as to avoid a penalty altogether.
    The Government have listened to that concern and take it very seriously. It is crucial that the financial penalties powers operate effectively. It is equally important that companies can operate in the knowledge that there will be some kind of statute of limitation on the authority's ability to probe past events. It is a matter of striking the right balance. That is why the Government have tabled amendments to Clauses 58 and 94. The amendments apply to situations where no enforcement order has been issued; that is, where the authority becomes aware of an alleged contravention in the past and wishes to investigate it with a view to imposing a financial penalty. The amendments make no change where an enforcement order has been issued in relation to the contravention. Clearly, in that case the authority will already have carried out its investigation and will have enough information to decide whether a penalty is justified.
    The effect of Amendments Nos. 209 and 222 is, therefore, to provide two separate triggers for the power to impose a financial penalty. First, as at present, the authority will be able to impose a financial penalty if within 12 months of the contravention it has issued a notice stating its intention to do so. Alternatively—this is the new point—it will also be able to impose a penalty so long as, within 12 months of the alleged contravention, it has issued a notice under Section 28(2) of the Electricity Act, or Section 38(1) of the Gas Act, requiring information from the licence holder for the purpose of exercising its enforcement functions (including the power to impose financial penalties) where it appears to the regulator

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    that a licence holder may be contravening, or has contravened, a licence condition or other relevant obligation.
    The amendment removes any incentive for companies to drag their feet in providing information to the authority. It does not alter the financial penalties provisions in any other way. In particular, it does not widen the scope of the powers, but is simply intended to ensure that the authority has long enough to investigate any alleged contravention and, where appropriate, impose a reasonable financial penalty in cases where 12 months is insufficient to gather enough information about the contravention.
    Amendments Nos. 216 and 229 are effectively consequential on Amendments Nos. 209 and 222. They extend the scope of the powers to require information. Therefore, they apply to the financial penalties provisions and to information requested in relation to alleged contraventions of individual standards of performance, as well as contraventions of relevant conditions and requirements. This is to ensure that the scope of the relevant information provisions matches that of the financial penalties provisions.
    The other government amendments to which I should like to speak are technical and consequential. Amendments Nos. 208 and 221 replace a reference to commencement of a subsection with a more accurate reference to commencement of a section of the Utilities Act 2000. Amendments Nos. 230 and 231 flow from amendments made to the Gas and Electricity Acts by Clauses 59 and 95, which relate to licence enforcement rather than financial penalties. Those amendments are designed to ensure consistency with the existing enforcement provisions. They have the effect that, where the authority decides to use its new discretion not to make an enforcement order, it will be required to give notice to the licence holder and publish a notice setting out its decision, in the same way as it would where it was precluded by its duties from taking enforcement action.
    I turn to the various other amendments that have been moved or spoken to. Amendments Nos. 204 and 217 seek to insert into the financial penalties provisions a requirement that the imposition of a penalty must be essential to secure compliance. This would seem to rule out the imposition of penalties for contravention of licence conditions, standards of performance and other statutory requirements where the licensee had—possibly under pressure—desisted before the proposed penalty was imposed. I remind the Committee what we are trying to achieve by introducing the powers to impose financial penalties. The crucial point to note is that under the current enforcement system the regulator is always one step behind the company. There is little to prevent a company breaching its obligations, provided it is not caught, and as a result the level of protection afforded to consumers is very poor. These amendments would reintroduce those weaknesses just as we have sought to eliminate them. They would reproduce some of the weaknesses in the financial penalties provisions inserted into the Gas Act by the party opposite.
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    At present, the regulator is under a duty to "make orders" to secure compliance with licence conditions and specified statutory obligations. The regulator must issue an order, subject to certain exceptions, if it appears to him that a supplier is contravening, or is likely to contravene, a licence condition or a specified statutory requirement. The key point about the existing enforcement regime is that it applies only to current and likely future breaches of obligations. This means that a company which is breaching its obligations but which ceases to do so when challenged cannot face further action, regardless of how long the contravention has been continuing or the harm it has done to consumers or competitors.
    If subsequently the company contravenes the same licence condition, the regulator is compelled to start enforcement action again. Every time a company is challenged, it has only to desist from the act or omission to avoid the consequences of noncompliance. The regulator is left chasing shadows. Under the Gas Act 1986, as amended, the regulator may impose a financial penalty on a licence holder of such amount as is reasonable in all the circumstances (which is the standard phrase) for contravention of licence conditions and other statutory obligations. However, the penalty can be imposed only as part of a final order aimed at securing compliance (as in the words of the opposition amendments). It therefore relates only to current and likely future breaches and suffers from the same flaw as the enforcement order process within which it is couched: and it provides little or no real deterrent. That is why it is necessary to introduce powers to impose penalties for past as well as current breaches of obligations. That means that the authority is able to ensure compliance on an ongoing basis and to deter future breaches rather than being left one step behind.
    Of course, everybody is worried about financial penalties. However, if companies do not contravene their licence conditions, no financial penalty will ever be imposed. I hope that that will always be the case. However, if the authority is to have these powers it must have the necessary tools to enforce them in all the conditions to which I have referred. To do anything else would be unfair to consumers.
    Amendments Nos. 205 and 218 provide a defence for the licence holder against the imposition of financial penalties where the licence holder can prove that the contravention did not occur as a result of intentional or reckless behaviour, or where the licence holder took all reasonable steps to avoid the contravention or failure.
    It has a similar effect to Section 36(3) of the Competition Act 1998 which provides that a penalty can be imposed only for breaching the prohibitions where the breach has occurred intentionally or negligently. Frankly, it is of no interest at all to the consumers, those who are on the receiving end of contraventions of licence conditions and statutory obligations, and failures to meet standards of performance, whether those contraventions occurred intentionally or recklessly, or whether they were down to other factors—particularly when the consumers

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    concerned cannot move to another service provider, as is the case where the electricity transmission and distribution companies, and gas transporters, are concerned. The fact is that utility companies provide vital services to industry and the public. The onus should be on the utility companies to strive to fulfil their obligations, and to overcome whatever difficulties they face in doing so. They should be making strenuous efforts to play by the rules they accepted when they entered the sector and to adhere to their obligations.
    Restricting financial penalties to cases of reckless or intentional contraventions, or cases where insufficient effort has been made to remedy the contravention, would send the wrong signals about the importance of these services and would risk omitting some serious contraventions from the scope of financial penalties. The amendments also ignore the nature of the powers we are providing. I stress that the authority will have a power, not a duty, to impose financial penalties. It will not be compelled to do so.
    When speaking about reasonableness, the noble Lord, Lord Kingsland, said that in Committee in another place Mrs Liddell appeared to suggest that there was no penalty if the contravention were inadvertent. She was explaining the point that the penalty has to be reasonable in all the circumstances. The fact of culpability—that is, where on the scale the inadvertence or negligence of the operator lies—is relevant to the amount of the penalty. The court is able to review whether the penalty is reasonable.
    On the noble Lord's point about multiple jeopardy, the Government do not accept that the powers to impose financial penalties will cause multiple jeopardy. It is important to remember that the financial penalty has to be reasonable in all the circumstances of the case. Any financial penalty would have to take into account compensation paid to customers or penalties imposed under the Competition Act in respect of the same conduct. Any penalty which did not take proper account of those issues would in itself be unreasonable.
    I turn to Amendments Nos. 206, 207, 219 and 220 to which the noble Lord, Lord Borrie, the noble Baroness, Lady Sharp, and the noble Lord, Lord Currie, spoke. There are minor variations in the formulation used in the two sets of amendments, as the noble Baroness pointed out, but they seek the same thing. The Government still take the view that what matters is the explicit requirement that the penalty must be reasonable. I think that the noble Lord, Lord Currie, veered in that direction. We have taken the view that a specific limit of this kind is not necessary.
    A penalty could indeed be very large, but only if the breach in question had been sufficiently serious, and had done enough harm, to warrant a large penalty. On the other hand, a minor contravention could not attract a penalty of anything like 10 per cent of turnover.
    There will be transparency in the arrangements. The authority will have to consult on and publish a statement of policy with regard to the imposition of
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    penalties; and to have regard to that statement when it imposes a penalty. And, of course, companies will be able to challenge both the imposition and the amount of any penalty in the courts. The Government believe that those factors represent genuine constraints on the level of any penalty and a genuine protection for licence holders.
    We take the view that a specific upper limit on financial penalties is not strictly necessary. Penalties are limited to that which is reasonable, and that is a genuine constraint. However, I have listened to the concerns expressed by those who have spoken in the debate. I recognise that some points have been made in favour of a limit. I recognise that there is persistent pressure for such a limit from the industry; and that even consumer bodies are not unanimous about our current proposals. I can see that there are issues here which merit serious consideration. I certainly agree that I shall consider the matter before the next stage.
    Finally, I turn to the group of amendments starting with Amendment No. 210 relating to the statutory right of review which is available under the Utilities Bill in relation to the imposition of financial penalties. These would have the effect, as did the group of amendments starting with Amendment No. 180, of replacing that right of review with a right of appeal to the High Court on grounds set out in proposed new Section 49B of the Electricity Act and Section 38B of the Gas Act as proposed by Amendments Nos. 183 and 188 respectively. It would provide for appeal to the High Court, or in Scotland the Court of Session, on the imposition and amount of a financial penalty and the payment scheduled for that penalty. The grounds for appeal would be material error as to the facts, material procedural error, an error of law or some other material illegality including unreasonableness or lack of proportionality. But the Government believe that the provision in the Bill for companies to challenge the imposition and amount of a financial penalty and the payment schedule for that penalty in the courts are entirely appropriate to the financial penalties provisions. I set out my arguments to that in response to Amendment No. 180.
    The Bill allows companies to apply to the High Court to challenge the decisions of the authority in relation to the imposition of a penalty. The High Court is clearly an independent tribunal for the purpose of Article 6 of the European Convention on Human Rights. Clauses 58 and 94 therefore comply with the European Convention on Human Rights in accordance with a number of decisions of the European Court of Human Rights, most notably the Bryan case. These cases take a composite approach looking to a combination of initial regulatory procedures and subsequent rights of appeal in order to ascertain Article 6 compliance.
    I shall try to avoid repeating the other arguments which I used in a lengthy speech in response to Amendment No. 180. I hope that these arguments will persuade noble Lords not to press the amendments.
    7.45 p.m.
    Lord Kingsland: I listened with interest to the introduction of his amendment by the noble Lord, Lord Borrie, and to the Minister's response. Superficially, a cap on penalties would be an improvement to the Bill. However, from the way the noble Lord, Lord Borrie, formulated his amendment, it is clear that he intends to include not only the company but also an aggregated turnover measure of any affiliate or related undertaking.
    If one considers the financial scale today of some of these utility companies, and the international complexity of their ownership, 10 per cent of the total turnover of some groups could involve a massive figure. I do not say that, on behalf of the Opposition, I would not be prepared to entertain a limit. However, with respect to the noble Lord, Lord Borrie, the provision needs more careful shaping.
    If the Bill includes a limit, there will be a tendency for the penalising authority to aim at that target. If the target is 10 per cent on a large utility company which is owned, perhaps, by an American corporate entity, the turnover could be in billions of pounds of which 10 per cent would be a vast figure. I say that in order to encourage debate on the matter rather than to agree or disagree on the issue. I believe that it is a good idea to consider the matter further and to return to it at Report stage.
    The Minister has encouraged me to reflect on two other matters. The first is the question of intention. It is a subject over which he ranged widely in the Financial Services and Markets Act. We contend that, if an act by a licensee is done neither intentionally nor recklessly nor negligently, that act should not attract a penalty; the act has been done innocently. The Minister said that that may be unfair to the consumer. One the other hand, to penalise a licensee in those circumstances may be very unfair to the licensee.
    In my submission, in those circumstances, the proper approach of the Government is to be as fair as possible to both parties. The Opposition can see no rational reason in such circumstances for being unfair to a licensee. If the penalty-attracting offence is inadvertent, imposing a penalty will never be a deterrent, so why impose it? Who are the Government intending to impress by imposing it? I ask the Minister to reflect on that between now and the Report stage.
    The final point to which I want to refer is the question of reasonableness. I was interested to hear the remarks made by the noble Baroness, Lady Sharp. "Reasonable in all the circumstances" is the test in the Bill. But the test in law, the test for an authority acting outside or beyond its authority, requires an action to be so unreasonable that no reasonable person would ever entertain it. So we have the difficulty of two contrasting tests of reasonableness: first, the test of reasonableness in the Bill, which is reasonable in all the circumstances; and, secondly, the test that a court will apply in order to intervene, which is so unreasonable that no reasonable person would entertain it.
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    What is so lacking in the Bill is some mechanism whereby a common definition of reasonableness can be achieved so that the court will inevitably intervene if the authority has not acted reasonably in all the circumstances. That is the legislative challenge which the noble Lord faces. He is so good at meeting challenges, I am sure that by the Report stage he will have met that challenge on the face of the Bill. I beg leave to withdraw my amendment.
    Amendment, by leave, withdrawn.
    [Amendment No. 205 not moved.]
    Lord Borrie Lord Borrie had given notice of his intention to move Amendment No. 206:
    Page 56, line 39, at end insert—
    ("(6A) No penalty imposed by the Authority under this section may exceed 10% of the aggregate turnover of the licence holder and any affiliate or related undertaking of the licence holder (determined in accordance with such provisions as may be specified in an order made by the Secretary of State).
    (6B) In this section—
    "affiliate" means any holding company (which has the meaning set out in sections 736, 736A and 736B of the Companies Act 1985) of the licence holder, any subsidiary (which has the meaning set out in sections 736, 736A and 736B of the Companies Act 1985) of the licence holder or any subsidiary of a holding company of the licence holder: and
    "related undertaking" means any undertaking (which has the meaning set out in section 259 of the Companies Act 1985) in which the licence holder has a participating interest (which has the meaning set out in section 260 of the Companies Act I985)."").
    The noble Lord said: I want to thank the noble Lord, Lord Kingsland, for his questioning but helpful comments and to thank my noble friend the Minister for his considerate response.
    [Amendment No. 206 not moved.]
    [Amendment No. 207 not moved.]
    Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 208 and 209:
    Page 56, line 45, leave out ("that subsection") and insert ("section 58 of the Utilities Act 2000").
    Page 57, line 18, leave out from ("failure") to end of line 21 and insert ("later than the end of the period of 12 months from the time of the contravention or failure, unless before the end of that period—

    (a) the notice under section 27A(2) relating to the penalty is served on the licence holder under section 27A(6), or

    (b) a notice relating to the contravention or failure is served on the licence holder under section 28(2).").

    On Question, amendments agreed to.
    [Amendments Nos. 210 to 215 not moved.]
    Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 216:
    Page 59, line 20, at end insert—
    ("( ) In section 28(1) of the 1989 Act (power to require information, etc.), for the words from "the Director" in the first place they appear, to "42B below" there is substituted "the Authority that a licence holder—

    (a) may be contravening, or may have contravened, any relevant condition or requirement; or

    337

    (b) may be failing, or may have failed, to achieve any standard of performance prescribed under section 39 or 39A,

    the Authority may, for any purpose connected with such of its functions under section 25 or 27A to 27F".").
    On Question, amendment agreed to.
    Clause 58, as amended, agreed to.
    Clause 94 [Financial penalties]:
    [Amendments Nos. 217 to 220 not moved.]
    Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 221 and 222:
    Page 96. line 9. leave out ("that subsection") and insert ("section 94 of the Utilities Act 2000").
    Page 96, line 30, leave out from ("failure") to end of line 33 and insert ("later than the end of the period of 12 months from the time of the contravention or failure, unless before the end of that period—

    (a) the notice under section 30A(2) relating to the penalty is served on the licence holder under section 30A(6), or

    (b) a notice relating to the contravention or failure is served on the licence holder under section 38(1).").

    On Question, amendments agreed to.
    [Amendments Nos. 223 to 228 not moved.]
    Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 229:
    Page 99, line 2, at end insert—
    ("( ) In section 38(1) of the 1986 Act (power to require information, etc.) —

    (a) for "Director" in each place where it appears, there is substituted "Authority",

    (b) after "requirement" there is inserted "or may be failing, or may have failed, to achieve any standard of performance prescribed under section 33A or 33AA,";

    (c) for the words from "his functions" to "signed by him" there is substituted "its functions under section 28 or 30A to 30F in relation to that matter, by notice in writing";

    (d) for "him" there is substituted "it".").

    On Question, amendment agreed to.
    Clause 94, as amended, agreed to.
    Clause 59 [Licence enforcement]:
    Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 230:
    Page 59, line 28, leave out ("and (4)") and insert (", (4) and (6)").
    On Question, amendment agreed to.
    Clause 59, as amended, agreed to.
    Baroness Amos: I beg to move that the House do now resume. In moving the Motion, I suggest that the Committee stage begin again not before 8.55 p.m.
    Moved accordingly, and, on Question, Motion agreed to.
    House resumed.

Local Authority (Stocks and Bonds) (Amendment) Regulations 2000 Uncertified Securities (Amendment) Regulations 2000
7.55 p.m.
Lord McIntosh of Haringeyrose to move, That the draft regulations laid before the House on 12th May be approved [19th Report from the Joint Committee].
The noble Lord said: My Lords, the two instruments before us are part of a series of four that are necessary to enable the full merger between CREST, the computer system that settles transactions in equities and corporate bonds, and the Central Gilts Office (CGO), the computer system that settles transactions in gilts and other public sector securities. The merger was one of the key recommendations of the Bank of England's Securities Settlement Priorities Review and was widely endorsed by the financial markets because of the efficiency gains, the reduction in systemic risk and the improvement in the UK's competitive position which it is expected to bring.
In view of this widespread support and the highly technical nature of much of the legislation, I do not propose to detain the House with either a lengthy apologia for the merger or a detailed exposition of every bit of the regulations. However, there are a couple of points where the House may welcome a slightly fuller explanation.
The first of these relates to the new Regulation 36A of the Uncertificated Securities Regulation which is intended to clarify the meaning of "actual notice" for the purpose of the regulations as a whole. To understand the background to this regulation, it is necessary to understand that CREST operates what is known as an "assured payments" mechanism. This means that securities are transferred only if the requisite payment is guaranteed and, equally, payments are only made if the securities are transferred. A group of major banks—the settlement banks—plays a key part in this process by undertaking on behalf of their customers to make assured payments for security transfers. In other words, they will provide intra-day credit. To insure against risk, a settlement bank will normally take a floating charge over a customer's securities, supported by a power of attorney under which it is able to direct CREST to transfer the securities from the customer's account to its own account in certain closely defined circumstances.
The settlement banks have put it to the Government that they may be at a disadvantage using a power of attorney in CREST as compared with someone using a power of attorney outside CREST. They have suggested that the Uncertificated Securities Regulations would be interpreted as imposing more limitations on the actions of CRESTCo, which operates the CREST system.
The Government believe it unlikely that the courts would interpret the regulations in this restrictive way. However, it is important to clarify this as far as possible and this is done by the proposed amendment

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made by Regulation 36A. This says that if there is a dispute between a customer and a settlement bank as to whether the customer's obligation has been discharged, and hence as to whether the power of attorney is still in force, it will be up to the parties involved to resolve the matter and to submit notice to CRESTCo. CRESTCo itself will be under no obligation to make further investigations and will be entitled to rely on the settlement bank's instructions.
The second area where the House may welcome some explanation concerns the new Regulation 36B of the Uncertificated Securities Regulations. This provides that issuers of securities whose terms of issue specify that they may only be held in uncertificated form do not have to comply with the provisions in the regulations which relate to holdings in certificated form.
The main purpose of this regulation is to clarify the ability under the regulations to settle what are known as CREST depositary interests. These are English law securities issued by CRESTCo which represent interests in foreign securities held by it in overseas central securities depositories. They are in effect a mechanism which enables CRESTCo to settle foreign securities and for UK investors to buy and sell such securities through the CREST system.
Because CREST depositary interests are a rather specialised type of security, the Government believe that it is appropriate to exempt them from those provisions of the regulations which could require them to maintain a record of the units held in certificated form and to have procedures from converting from one form to another. That means that the investors will not need to fill in a stock transfer form in order to transfer them and will not have the option of receiving a share certificate.
That is not quite so much a departure from current practice as it may appear because complete dematerialisation is already a feature of the gilts market and will remain so in the future. As the House will have noted, the new regulation exempts certain specific public sector securities from the relevant provisions of the regulations as well. Because of that, and because of the need to ensure consistency of treatment, the Government consider it appropriate for any security whose terms of issue specify that it may be held only in dematerialised form to be similarly exempt. That will clarify the ability of corporate issuers to issue new securities in completely dematerialised form and thus to have the same freedom that hitherto only the Government have had.
Before I finish, perhaps I should say a brief word about the Local Authority (Stocks and Bonds) (Amendment) Regulations. These are entirely technical in nature and are intended to allow stocks issued under the Local Authority (Stocks and Bonds) Regulations 1974 to transfer through the CREST system after the merger. They are being dealt with under the affirmative resolution procedure because the power to amend them by the more usual negative resolution procedure was removed by statute in 1988.
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I apologise for detaining the House but inevitably these are long and complicated issues. I hope that I have highlighted those which may be of general interest. I beg to move.
Moved, That the draft regulations laid before the House on 12th May be approved [19th Report front the Joint Committee].—(Lord McIntosh of Haringey.)
The Earl of Northesk: My Lords, I am grateful to the Minister for his explanation of these two regulations. In essence, we have no objection to them. However, by your Lordships' leave, I should like to ask one or two questions that flow quite naturally from them.
In common with my noble friend Lord Kingsland, with respect to issues on the face of the Utilities Bill, I find that our debates on the Financial Services and Markets Act are still fresh in my memory. That being so, does the Minister expect that further regulations will need to be tabled in the event that the proposed merger between the London and Frankfurt exchanges proceeds and Xetra is adopted as the settlement system? I hope that I gathered from his explanation that that may not be necessary. I also acknowledge that this is something of a "how long is a piece of string" question. None the less, it would perhaps be a little odd to make these regulations, only to have to make new ones to supersede them within the space of a few months.
One other point occurs to me. A knock-on benefit of the regulations should be to improve the competitiveness and efficiency of the City. Indeed, as I understand it, CREST has cut transaction charges by 5 per cent in advance of the implementation of these changes. I am sure that none of us will have any argument with that. However, I hope that the Treasury, and the Chancellor in particular, are well seized of how important levels of stamp duty are to the City's continuing competitiveness.
Thus, does the Minister accept that, although some savings and efficiencies in transaction costs will of course arise as a result of the implementation of the regulations, those will be relatively modest compared to what many perceive to be the more pressing need to reduce stamp duty? I concede that the point is perhaps a little tangential to the subject matter of the regulations. None the less, I look forward to the Minister's replies.
Lord Razzall: My Lords, I share the views of the noble Earl in welcoming the regulations. Obviously, it is important that the full merger between CREST and the Central Gilts Office takes place.
Effectively I should like to ask the Minister one question. He indicated, as, indeed, did another place, that the regulations and their form, which inevitably is complicated, were welcomed generally by the City. Is he aware of reservations expressed by anyone in the City with regard to the regulations?
Lord McIntosh of Haringey: My Lords, perhaps, first, I may answer the noble Lord, Lord Razzall. The only reservations of which I am aware are those of the

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settlement banks. I hope that through the introduction of Regulation 36A the Government have convinced them that their fears are no longer relevant. I believe that to be the case.
The noble Earl, Lord Northesk, asked me whether the proposed merger between the London Stock Exchange and the Deutsche Börse affects CREST. That matter is not entirely clear because the deal is not entirely clear. However, both the London Stock Exchange and Deutsche Börse have made it clear that their merger will not affect settlement systems initially and that subsequent changes will be undertaken only following member consultation.
The noble Earl asked me about Xetra. However, Xetra is a trading and not a settlement system, and therefore is not affected by the regulations.
Finally, I turn to stamp duty. I recognise that it is what he calls politely "tangential", and of course the merger has no direct implications for the levying of stamp duty. However, the Government keep the level of stamp duty under review at all times, as they do all comparable matters.
On Question, Motion agreed to.

Army, Air Force and Naval Discipline Acts (Continuation) Order 2000
8.5 p.m.
The Minister of State, Ministry of Defence (Baroness Symons of Vernham Dean)rose to move, That the draft order laid before the House on 4th May be approved [18th Report from the Joint Committee].
The noble Baroness said: My Lords, your Lordships will be aware that Parliament is asked to consider an order of this nature in most years. It has a simple purpose: to continue in force for a further year the Army and Air Force Acts 1955 and the Naval Discipline Act 1957. Those three Acts provide the statutory basis for discipline in the Armed Forces.
Given that the Acts fulfil that purpose, it is hardly necessary for me to emphasise the importance that the Government attach to this order as the means of ensuring that the legislation remains in force. Therefore, this evening I ask your Lordships to approve the order, which was discussed in Committee in another place on 16th May.
Each annual continuation order may be regarded as a stepping stone between the quinquennial Armed Forces Bills. The quinquennial Bills provide the means for both renewing and reviewing the three service discipline Acts. The next Armed Forces Bill is due to be introduced in the forthcoming Session.
I need to make one observation about the order. My noble and learned friend the Attorney-General gave an undertaking on behalf of the Government to your Lordships' House on 2nd November last year. That was that when Ministers move regulations which are subject to the affirmative procedure, such as this order, they will always inform the House whether they are
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satisfied that the instrument is compatible with the rights provided under the European Convention on Human Rights.
That is by analogy with the procedure for primary legislation set out in Section 19 of the Human Rights Act 1998. That provides that the Minister in charge of the Bill will certify that the Bill concerned is compatible with the convention rights or, if he or she is not satisfied that it is, that he or she nevertheless wishes the Bill to proceed. There is no requirement in the legislation similarly to certify statutory instruments. Nevertheless, the Government have undertaken to give their view on compatibility in relation to those, subject to the affirmative procedure.
The continuation order which your Lordships are being invited to approve may not appear to raise issues of convention rights. It is a brief document with a mechanistic purpose. However, we need to consider that purpose, which, as I said, is to continue the life of three Acts. Of course, those three Acts have been amended quite extensively in the present Session by the Armed Forces Discipline Act. That had the quite specific purpose of addressing concerns about whether aspects of the service discipline Acts were compatible with the convention. However, the main provisions of the Act are not due to come into force until this October. Therefore, the service discipline Acts are not in their entirety compatible with the convention; nor is this order which renews them.
The Armed Forces Discipline Act is aimed at dealing with the most important convention points in the service legislation. We are satisfied that it has done so in a way that preserves the essential characteristics of the discipline system. Of course, we debated that at some length in your Lordships' House.
We are now completing our trawl of the body of service legislation to see whether any residual convention issues remain to be dealt with. Any that need still to he addressed will not be in such vital areas as those addressed in the Armed Forces Discipline Act because those areas naturally were the focus of our initial survey of the existing legislation. In any event, the most appropriate vehicle for further changes that may be needed would appear to be in the quinquennial Armed Forces Bill.
Nevertheless, as I have already stated, the Government consider it essential that the order should be approved as it provides the necessary parliamentary authority for continuing the services' system of discipline. The system serves the Armed Forces well—I believe that there is common ground in your Lordships' House on that—but that does not mean that the legislation underpinning the system is incapable of improvement.
The Government have made clear their wish to improve the structure of the legislation to enable it better to meet the needs of the services and the way in which they operate today. In the 1998 Strategic Defence Review, the Government for the first time expressed the view that,

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"there would be advantages to be gained from combining the three Service Discipline Acts into a single Act. Those differences which the Services need to retain for operational reasons would be kept hut reduced to the absolute minimum".
Those words were prompted by the realisation that the present legislation does not provide the best framework for discipline when the services work together in fully joint environments, as is increasingly the case. We are considering how best to give effect to the intention to develop a tri-service Act, bearing in mind that, as was also stated in the Strategic Defence Review,
"It would he a substantial and complex undertaking which will take some years to complete".
We are contemplating an exercise of rather greater ambition than merely putting the three existing Acts together into a single cover. We are looking at creating new legislation that will be greater than the sum of the existing parts. In the mean time, we have been taking stock of the intended consolidation of the legislation. In some minds, that has been confused with the creation of a tri-service Act. That confusion was evident from some of the remarks made in your Lordships' House during the passage of the Armed Forces Discipline Bill.
Consolidation would merely bring up to date the existing three separate Acts. In normal circumstances, that would be a worthwhile objective in itself, given the age and heavily amended state of the current legislation. Many of your Lordships know that work on consolidation has been under way for some years under the previous administration and the present one. It predates by some years the Strategic Defence Review and the intention to create a single tri-service Act.
The intention to move towards a tri-service Act has given us cause to consider whether to complete the consolidation project. Consolidation and the triservice Act would mean significant upheaval for the services. In both cases, it would mean not only having to adjust to new primary legislation, but the complete revision of all the extensive regulations and manuals that flow from primary legislation.
We are firmly of the view that it would not be a productive use of resources to go through that upheaval twice in a few years. Arguably it would even be counter-productive, because committing staff to implementing the effects of consolidation would divert them from work on the tri-service Act. As I announced in an answer last month, we have therefore decided to defer the consolidation and subsume it within the more fundamental exercise of creating the tri-service Act. That will provide the soundest foundation for service legislation in the 21st century.
As I have explained, the need for a tri-service Act derives from the importance of having a better disciplinary framework in those many circumstances in which the services work together. The operations in Sierra Leone have been a further demonstration of how effectively our Armed Forces operate together, notwithstanding any improvement that we may wish to include in the legislative framework.
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I should like to conclude by paying tribute to the sterling qualities that have been so much in evidence in the personnel of all our forces deployed in West Africa in the past few weeks. That has been a particularly graphic example of what we have come to expect. Discipline, resolve and initiative are amply displayed wherever our personnel serve, in single service or joint environments, however challenging the circumstances. I know that those qualities are fully valued in all parts of the House.
I invite your Lordships to improve—or, rather, approve—the order.
Moved, That the draft order laid before the House on 4th May be approved. [18th Report from the Joint Committee]—(Baroness Symons of Vernham Dean.)
8.15 p.m.
Earl Attlee: My Lords, I thank the Minister for explaining the need for her order and its desirability. I am sure that it does not need any improvement. I welcome her comments about the ECHR compatibility aspects of the order. I remind the House that I have an interest in these matters.
We normally have a substantial debate on this order, but, as the Minister said, we have discussed service discipline matters at length under the Armed Forces Discipline Bill. We remain unconvinced about the need for that legislation and we shall see how it works in practice.
The Minister referred to the quinquennial review, which is due next year. We expect further ECHR-related amendments. We shall look closely at the operation of the service discipline Acts. We agree with the need for tri-service legislation, which the Minister mentioned. My only slight concern is that it might result in a delay in consolidation. I am sure that the Minister expects us to pursue those matters when we deal with the quinquennial review—and indeed that she is looking forward to us doing so.
Overcommitment remains a problem. It was a major challenge to the previous government and the situation is no different for this Government. I hope that the problem will keep the Minister awake at night. It certainly worries us and we shall continue to press her on it.
The Minister lavished praise on our Armed Forces. We should like to echo that praise—and perhaps better still, to amplify it. We should admire the motivation of our servicemen. They are not in an ordinary job. It is paid employment, but it is more of a way of life or a vocation. Over the past decade, we have begun to regard service in the Armed Forces as just another job. That is a serious mistake. The nature of their duties means that members of Her Majesty's Armed Forces rightly hold a special place at the heart of the nation. That is why we fully support the Motion.
Lord Wallace of Saltaire: My Lords, we, too, welcome the order. I strongly approve of the need for regular parliamentary approval. I found myself in Ankara at a conference with several Turkish MPs in March and saw their looks of astonishment and horror

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as I described the process of the House going through the Armed Forces Discipline Bill, adapting courts martial to the requirements of the European Convention on Human Rights. That is some distance from what the Turkish armed forces have yet fully understood as the implications of becoming fully European.
I also had some interesting conversations last week in the Baltic states, when I met the Earl of Carlisle, whom we deeply miss. I also met a number of British Army officers in training teams. They were training the Baltic battalion and the other new forces of those new nations. I was struck by how difficult it is to change ideas about discipline in post-Soviet armed forces. It made them reflect on the importance of self-discipline, training and mutual confidence between officers and other ranks as the basis of an effective armed force. That is one of the most difficult things to instil in those who come from a former Soviet background.
My only hesitation is about the length of time that I understand that we may have to wait before we have a tri-service discipline Bill. We are moving rapidly towards tri-service operations with helicopters and in many other areas. The forces are working much more closely together. If I understood the Minister correctly, we may be facing a new quinquennial Act next year without a tri-service Bill at the same time.
The Government nowadays expect people in universities to do things in three to four weeks, even if extensive research is required. So I am puzzled as to why the Government should allow the armed services three to four years to go through a process which I should not have thought would be that complicated. May we have an assurance that the process of a new quinquennial Act and a consolidated but also reformed tri-service Act should not necessarily be one after the other to a great extent?
Baroness Symons of Vernham Dean: My Lords, I thank both noble Lords for their welcome of the continuation order. I should say to the noble Lord, Lord Wallace of Saltaire, that we tackled the most obvious areas of difficulty in terms of compatibility with the convention in the Armed Forces Discipline Act.
I stress to both noble Lords that there may be a degree of what one might describe as tidying up in the quinquennial Act. We are going through in enormous detail all the three discipline Acts to look at every single aspect of compatibility. I am not yet in a position to give your Lordships any indication of how much of such tidying up will be necessary.
I agree with the noble Lord, Lord Wallace of Saltaire, that the confidence between officers and other ranks is extremely important. The reason why the British Army is welcomed so much in areas where peacekeeping is the primary function being undertaken is because officers and other ranks work so very well together. Discipline is in the very life-blood of the British Armed Forces.
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I hope that I shall be forgiven my earlier slip. The Government are always happy to consider any improvement to legislation as the noble Earl will know because, on occasions, he has been able to persuade me.
Earl Attlee: My Lords, even secondary legislation?
Baroness Symons of Vernham Dean: My Lords, if the noble Earl wishes to come and see me and give me any ideas about secondary legislation, I shall be delighted to entertain those ideas.
But both noble Lords concentrated their remarks on the tri-service Act and whether that was going to postpone the consolidation. I tried to get that point across in my opening remarks. It is extremely important to impress this upon both noble Lords because I do not want there to be any misunderstanding. A tri-service Act is not simply taking forward the consolidation which was begun under the previous administration and continued under this Administration. It is not a matter of putting the three Acts together into a single cover.
I want to stress to both noble Lords that it creates a new structure of discipline, allowing the services to apply discipline more effectively in fully tri-service environments. Our Armed Forces are currently operating in those environments. We are looking at whether we can ensure that the same penalty for any indiscipline will be applied across all three services. That is not always the case at the moment and it leads to incidents where there is perceived unfairness; where officers or men from different parts of the Armed Forces are treated differently for the same misdemeanour or infringement of forces discipline. Therefore, that must be looked at.
But the new Act will, of course, maintain any of the essential differences which there are between the three services. It will be an extremely complex piece of legislation. I hope that both noble Lords will have the stamina to get through it when it reaches this House.
I should say to the noble Earl, Lord Attlee, that there is a problem as regards over-stretch in the Armed Forces, but I do not accept what he said about over-commitment. The Government have done what they said they would do. I know that the noble Earl has had doubts about some of those issues; for example, Sierra Leone. I remember noble Lords on the Benches opposite said that we would not be withdrawing from Sierra Leone when we said we would. We have fulfilled what we said we would do, certainly in respect of Sierra Leone. I remind the noble Earl that this year has been the best year for recruitment in the Army for 10 years. There is a problem with retention and we are working extremely hard to improve that record.
I agree wholeheartedly with what the noble Earl said. The Army is not just another job. I do not think that we need any greater reminder of the Army not just being another job than on the day when Brigadier Saunders has been buried. He was a man who was going about his lawful business, unarmed, and was so cruelly attacked and murdered simply because of the

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job he did. There is no doubt in the Government's mind but that the Army, Navy and Air Force are not just any profession; they command particular respect and consideration because of the danger in which their members often find themselves. I commend the order to the House.
On Question, Motion agreed to.

Horticultural Development Council (Amendment) Order 2000
8.24 p.m.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Baroness Hayman)rose to move, That the draft order laid before the House on 18th May be approved [20th Report from the Joint Committee].
The noble Baroness said: My Lords, the Horticultural Development Council was established by the Horticultural Development Council Order 1986. It is an executive non-departmental public body funded by a statutory levy on growers of horticultural produce. The main function of the council is to commission research and development on behalf of the horticulture industry, excluding apples, pears and hops.
The council raises around £3.6 million per year from the levy. Expenditure on research and development is proportional to the amount of levy raised from growers in each crop sector. Selection of research products gives due consideration to environmental benefits as well as to the needs of the industry, being directed at crop protection; reduction of input costs and chemical usage; increased efficiency and yield; and improved quality.
The HDC was subject to statutory review in 1999 when agriculture Ministers agreed that the HDC should continue for another five years. During the consultation process Ministers agreed that the levy on small growers was a burden and uneconomic for the council to collect. That has led to the amendment to the Horticultural Development Council Order which is before us today.
The amending order makes two changes to the statutory levy. There are two levies: one for mushroom growers with which I shall deal later; and another for growers of other horticultural produce. That latter levy is based on a percentage of the net sales of horticultural crops and is set at 0.5 per cent. Growers with an annual net turnover of horticultural produce below £25,000 are exempted from the levy. The figure of £25,000 was set in the original 1986 legislation. Under the 1999 statutory review it was agreed that the minimum threshold should be raised to £50,000 with effect from the levy year commencing 1st October 2000. The revised threshold would reduce levy income by around £125,000 per annum. It would have minimal effect on the research and development programme and lead to a switch of saved administrative costs to that programme. Around 660
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businesses would be released from the obligation to pay the levy at an average per business of around £190 a year.
The second change in the amendment order covers the maximum rate of levy that could be paid by mushroom growers. The mushroom levy is assessed on spawn purchased for use in compost. The order provides for a maximum levy of 7p per litre of spawn purchased which is currently applied. The amendment increases the maximum rate for mushroom growers to 15p per litre of spawn. That increase will provide the HDC with the flexibility to propose an increase to the mushroom levy if it becomes necessary to raise additional funds to meet additional research requirements. All available funds collected from the mushroom levy are at present fully committed and there are serious new disease problems facing the industry. The mushroom industry has been consulted and is content, although it does not want to see an increase within the new ceiling in the near future. However, increases are allowed only following industry consultation and with the collective approval of agriculture Ministers. On that basis, I commend the order to the House.
Moved, That the draft order laid before the House on 18th May be approved [20th Report from the Joint Committee].—(Baroness Hayman.)
On Question, Motion agreed to.

Royal Parks (Trading) Bill
8.28 p.m.
Lord McIntosh of Haringey: My Lords, I beg to move that this Bill be now read a second time.
The activities of illegal traders are a blight on the face of our magnificent Royal Parks and detract from their enjoyment by thousands of visitors. The purpose of this short Bill is to give my right honourable friend the Secretary of State for Culture, Media and Sport the powers to deal effectively with the problem.
The peace and beauty of our Royal Parks are well known to and appreciated by Londoners and visitors. The Royal Parks Agency maintains them to a high standard. They are kept clean and are well presented. They are a showpiece of excellence in the heart of our capital city. The activities of illegal traders detract from that.
Anyone who sells goods in a Royal Park must have the permission of my right honourable friend the Secretary of State. The Government ensure that what is on sale is of a high quality and at a reasonable price. Recognised catering firms are authorised to sell refreshments in all the royal parks. In addition to providing a quality service to the public, part of the income goes to the Royal Parks Agency for the upkeep of the parks.
The activities of illegal traders undermine every aspect of this arrangement. Many noble Lords will be only too well aware of the present position. Between spring and autumn the Central Royal parks, and St James's Park in particular, are dotted at every turn

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with individuals operating carts from which they sell hot dogs or ice-creams at exorbitant prices and with little, if any, regard for health and hygiene. It is difficult to pollute the fresh air in the Royal Parks but these traders more than achieve it with the unpleasant odours which waft from their carts. The image of the Royal Parks is tarnished both at home and abroad. More importantly, the products offered by the illegal traders are a threat to the health of visitors, exorbitant prices take advantage of the unwary and authorised traders and the Royal Parks are deprived of income. This is the problem which the Government are determined to deal with. We have been unable to do that effectively so far because current powers have proved to be inadequate.
The Royal Parks and Other Open Spaces Regulations 1997 require that anyone wishing to trade in one of the parks must obtain the written permission of the Secretary of State. If a person acts in contravention of the regulations, including that for trading within the parks, he or she commits an offence under the Parks Regulation (Amendment) Act 1926. At present the courts may impose a fine of up to £200 after conviction for such an offence. Fines, however frequently imposed by the courts, have failed to act as a deterrent compared with the money which can be made from unlicensed trading.
The Bill seeks to combat the current abuses by introducing the new concepts of "park trading regulations" and "park trading offences". These labels will apply to parts of the existing regulations, which will then attract the enhanced powers of seizure, forfeiture and level of fine in the Bill. Breach of a regulation that has not been designated as a "park trading regulation" will remain an offence but the authorities will not be able to use the powers in the Bill in that respect.
The problem of unlicensed trading in the parks has got worse in recent years. Until recently the City of Westminster faced the same problems of illegal trading on the streets of the city, where fines were failing to be a deterrent. Parliament provided the City of Westminster with more effective powers in the City of Westminster Act 1999. These allow the City of Westminster to seize property used in the commission of unlicensed trading. This puts an immediate stop to the illegal act. The courts also have greater powers; on conviction, the court may impose a fine up to level 3, which is currently £1,000, and may determine whether any property relating to the offence is to be forfeited.
The City of Westminster Act is working very effectively, so effectively that as a consequence the level of illegal trading in the Royal Parks has increased, as illegal traders have moved increasingly into the Royal Parks, where the sanctions are less effective. It is important that Parliament now provides similarly effective powers for the Royal Parks.
I turn now to the specific provisions of the Bill. It creates various powers to regulate illegal trading in the Royal Parks and other open spaces covered by the Parks Regulation (Amendment) Act 1926. The powers
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in the Bill are broadly comparable to the powers provided to deal with unlicensed traders in the City of Westminster.
Clause 1 of the Bill, as I indicated earlier, allows the Secretary of State to designate particular provisions of any regulations made under the Parks Regulation (Amendment) Act 1926, as "park trading regulations". This designation will be achieved by regulations made under the 1926 Act. Any failure to comply with a park trading regulation will, from then on, be a "park trading offence".
Clause 2 provides a penalty not exceeding level 3 (currently £1,000) on the standard scale for failure to comply with or contravention of regulations made under Clause 1 of the Bill. Clause 4 provides a power of seizure by a constable of non-perishable items used in connection with illegal trading. Clause 5 allows the Secretary of State, in specific circumstances, to retain and dispose of things seized. Clause 6 provides a power to order forfeiture of things seized, exercisable by a magistrates' court in the event of conviction.
The Government are grateful for the support they received for the Bill in another place from the Conservative and Liberal Democrat Front Benches.
The principles and purposes of the Bill are straightforward. We seek to deal with a criminal activity which has increased considerably in recent years, to the detriment of the Royal Parks and the health, the pocket and the comfort of visitors. The additional powers we seek are reasonable and have been shown to work fairly and effectively in the City of Westminster. The gap left by the illegal traders will be filled by additional catering kiosks provided by the authorised concessionaire. I commend the Bill to the House.
Moved, That the Bill be now read a second time.—(Lord McIntosh of Haringey.)
8.35 p.m.
Lord Brougham and Vaux: My Lords, I thank the noble Lord the Minister for introducing this long overdue Bill so clearly this evening. I said "long overdue" as someone who lives in London and who is a regular user of our wonderful parks, with all the lovely gardens, the wildlife and other amenities. I have to congratulate here the Royal Parks Agency on the wonderful job that it does. I am regularly sickened to the stomach by the most revolting smell from the unlicensed street traders selling the most unattractive looking hotdogs that one could ever wish to see.
The problem has become much more serious since Westminster City Council, as the Minister said, acquired the power to confiscate and destroy trolleys and stocks of unlicensed street traders. Many of them have moved into the parks, and I am told that in St James's Park alone up to 40 illegal traders are regularly operating. There is no control over prices or, what is even more important, over standards of hygiene; and the activities of these illegal traders damage the business of the approved concessionaires.

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The Royal Parks Police have no powers. They can move these traders on but cannot prevent them from returning almost immediately. Most of these people are of foreign origin and speak very little, if any, English. The other day I saw a tourist ask for directions from one of these people and the reply that they got was a shrug of the shoulders.
Some months ago there was a fly-on-the-wall TV programme about these traders. It showed some unpleasant shots: in one of them the food fell on to the footpath and was picked up to be cooked and sold to the next unsuspecting customer. A few years ago some people took my dog for a walk and, having purchased a hotdog in one of the parks, they gave some of it to the dog, who was very ill for the next few days. I hate to think how many tourists have suffered the same fate.
This Bill, I am told, is the same as that which was introduced in another place by my right honourable friend Mr Peter Brooke last year. Regrettably, the Bill was blocked by Mr Eric Forth, as were other Bills, and he had another go at Third Reading a few weeks ago.
Ibis Bill has my 100 per cent support. I am told by the Royal Parks Agency and the Royal Parks Police that they also fully support it as it is and do not wish to see it amended. All the powers that they need are in it.
I have a few points for the Minister, of which I have already given him notice. I should like to repeat these points so that they are on the official record. I should like to ask, first, whether the Bill can achieve its Third Reading and Royal Assent before 24th July, which, I am told, is the day earmarked for the Bill. Secondly, I hope that the Victoria Tower Gardens are covered by this Bill. My last problem or concern is: where will the traders go once this Bill becomes law? My worry is that they will go to the east side of the river by the London Eye. Anyone who walks there, as I do, can see for themselves a number of illegal vendors selling their wares or performing to raise money. Some days there seem to be more traders than tourists, and it is all becoming very unattractive. Could the Minister ask the local authority to look into this, as it is a popular tourist area and does not give a good impression to visitors?
My last question is: when is the commencement date? In other words, when can the police start to clamp down? Is it the date of Royal Assent or do orders have to lie for 40 days after Royal Assent before the police can get to work? The sooner we get Royal Assent and the orders are laid, the better. I urge the House to support this Bill and not even to try to amend it. I can but quote from a letter from the Deputy Chief Officer, whose permission I have to quote it. The letter says:
"The past four years have been difficult in policing terms, for the Royal Parks Constabulary have been unable to deal effectively with unlicensed Street traders, and the powers enshrined in the Royal Parks (Trading) Bill are the only practical means of addressing the problems. I ask you to support the Bill and would urge you to generate support among their Lordships".
I concur with these statements, and I wish the Bill well.
8.39 p.m.
Viscount Falkland: My Lords, we on these Benches absolutely support the Bill. I congratulate the Minister
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on the tribute he made to the Royal Parks which are a pride to London. They are known world-wide for the recreation, peace and quiet, and beauty that they provide. As has been said by the Minister, and indeed, by the noble Lord, Lord Brougham and Vaux, the smell and offence given by the cooking, if one can call it such, which is done by illegal traders, creates a disturbance which does nothing for the parks.
Indeed, the authorised traders contribute by paying for the authority which they hold to trade. That is approved by the Secretary of State. Unauthorised traders contribute nothing. They leave rubbish, which has to be cleaned up. There are many traders and many who want to trade. It must, therefore, be a profitable business. We have all seen the queues of people standing behind the contraptions, which steam away and create offensive odours. One wonders how people can be in such dire need of refreshment that they need to give such people their custom. However, they do so. My only wish is that the Bill passes into law quickly and without delay. If it does not, all kinds of sinister things may happen. As we have seen in the past, once this is seen by unlawful traders as a lucrative source of income, rivalries between traders ensue, with undesirable social consequences.
There is nothing further to say; everything has been said. I hope that the dates mentioned by the noble Lord, Lord Brougham and Vaux, can be met and that we shall have that assurance from the Minister.
8.41 p.m.
Baroness Anelay of St Johns: My Lords, perhaps the only note of dissent tonight will be from me. I do not think that quite everything has been said on the Bill, as was stated by the noble Viscount. I have one or two new points to make. I shall, therefore, detain the House a little longer.
I have to remark also that in a spirit of co-operation, we agreed to have, most unusually, a Second Reading of a Bill during the dinner hour. At that stage I was not aware that the business which preceded this—that is, the orders—would be as lengthy as it was. In saying that, I make absolutely no criticism of anybody who spoke, Ministers or otherwise. The orders were important. The questions that were put and the answers given by the Ministers were absolutely vital. However, one only has to look at the clock to realise that an important Bill has been left with short shrift.
Lord McIntosh of Haringey: My Lords, I thank the noble Baroness for giving way. This debate is not time limited. The only decision the House has taken is not to resume before 8.55 p.m. If the noble Baroness wishes to speak for 20 minutes, she is at perfect liberty to do so.
Baroness Anelay of St Johns: My Lords, tempting though the offer is, I have never spoken for 20 minutes, and I do not intend to start tonight. My point is simply that the agreement was that this business be taken during the dinner hour and that it would be completed within that period. That was the basis upon which I

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agreed to take it. It is a matter which I shall bear carefully in mind when I am approached with regard to other such business.
I turn to the Bill. I join other noble Lords in welcoming the terms of the Bill. It addresses an issue which has recently caused much public concern; that is, the problem of illegal trading in the Royal Parks. This was a matter which was discussed by the House last year during debates on the Greater London Authority Bill and on an Unstarred Question on the future of the Royal Parks. That debate was initiated by my noble friend Lord St John of Fawsley, who is disappointed that he is unable to contribute his expertise tonight. Noble Lords will be aware that there is a special occasion at Windsor Castle and will not be surprised that his presence is required there.
I made it clear on each occasion that we on these Benches would support measures to clamp down on illegal trading in the Royal Parks, provided, of course, that such legislation addressed the problem in an appropriate, effective and fair manner. We believe that the Bill attempts to do just that. We therefore support it.
We hope that the Bill will have the effect of bringing powers in relation to Royal Parks and other open spaces broadly into line with those possessed by local authorities when they deal with illegal trading activities in the surrounding streets. As the Minister stated, the Royal Parks are a precious resource for Londoners and tourists alike. They form a ribbon of green across London and are, indeed, the lungs of the city, giving us all somewhere we can take shelter from the pressures of city life. We all pay tribute to the Royal Parks Agency for its work in keeping the parks as places of excellence for all of us to enjoy.
Other noble Lords referred in detail to the problem as it exists. I do not intend to repeat those points. I am grateful to my noble friend Lord Brougham and Vaux for giving such a clear description of the problem from his own expert view as a resident who has suffered the smells and has viewed what can happen. We are aware of the dangers for tourists and Londoners alike who buy food that may well not be proper to eat and may be contaminated.
The Minister referred to one issue that has caused the problem to become worse in recent years. I refer to the action rightly taken by Westminster City Council to deal effectively with unlicensed vendors on its streets. As the Minister pointed out, the result of that has simply been that the unlicensed vendors have plied their trade elsewhere; in other words, in the Royal Parks.
The second issue and new point to which I wish to refer is a matter which occurred last year which made the problem even worse than expected; namely, the decision of a Divisional Court of the Queen's Bench Division of the High Court in May in the case of Kol Curri v. Westminster City Council. Mr Justice Ognall, sitting with the noble and learned Lord the Lord Chief Justice, decided that when an unlicensed
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vendor sells goods on Crown land, only the owner of the trolley can be prosecuted under food safety laws, not the person selling the food.
In giving judgment to the Court, Mr Justice Ognall said:
"I reach these conclusions with a degree of regret, and certainly of reluctance. I am mindful that this analysis may make it easy for peripatetic entrepreneurs to assert in this sort of situation that they are no more than salesmen, and thus to escape prosecution or conviction".
I quote from the transcript of the case. He was absolutely right in his forecast. The decision meant that unlicensed hotdog sellers—or sellers of any food or other items—are virtually immune from prosecution because the proprietors can rarely, if ever, be found. If one reads the transcript of that judgment, one obtains a clear picture of the nature and scale of the problem in the Royal Parks.
When Mr Kol Curri was stopped on 3rd July 1997 in St James's Park, he was trading in hotdog sausages from his mobile trolley. It is said that the trolley itself, the food being sold and the appellant's clothing, appeared to fall below hygiene standards as set out in food safety legislation. That seems an understatement.
The importance of this is that Mr Kol Curri, an Albanian with limited command of English, was being organised by others. He was their agent. The owners of the trolleys, who were not from Albania, were called Bill and Dave. One therefore assumes they might be from closer to home. They were paying Mr Kol Curri between £20 and £50 per week depending on sales. He worked only part time. They were taking about £1,000 per day profit per trolley. They were the ones making the killing, perhaps.
It is against the background of that kind of trade that we believe the Bill tries to tackle the problem in the right way. It is important that a solution is to be found in having recourse not just to heavy fines but to other methods. It is important to have a deterrent.
The Minister referred to Clause 4 which gives park constables the right to seize all non-perishable goods used as part of the illegal trading activity. That provision is important.
There are other matters and questions one could justifiably ask about the provisions in the Bill. I refer, for example, to what happens to the perishable goods. None of us, I am sure, enjoys the thought of large piles of half-cooked burgers and onions being dumped in the Royal Parks. However, I shall not put those questions to the Minister tonight simply because, like other noble Lords, I welcome the Bill and wish it a fair wind. Like others, I do not do so because I am a killjoy. Like many, I believe that one can enjoy a very good hotdog or beefburger. However, I recognise that it is important to protect tourists and Londoners alike from being exploited by unlicensed traders in the Royal Parks. I wish the Bill speedy progress through the House.
8.50 p.m.
Lord McIntosh of Haringey: My Lords, I am grateful to all noble Lords who have taken part in this short debate and for the unreserved enthusiasm they expressed for this Bill.

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When I say "short debate", let me repeat to the noble Baroness, Lady Anelay, that I am grateful to her for agreeing to take the Second Reading in the dinner hour; as she said, it is unusual. I am sorry that she was approached without being told that orders were being taken at the same time. However, I want to assure her again that the fact that the orders were taken did not limit the amount of time available for the Second Reading of this Bill. It simply meant that this business began that much later in the evening. If that was inconvenient, I apologise to her.
It is true that the provisions of this Bill were debated in the context of the Greater London Authority Bill, and that last year the noble Baroness, Lady Anelay, and I took part in those debates. This matter was debated also in an Unstarred Question asked by the noble Lord, Lord St John of Fawsley, and we are sorry that he is not in his place today.
First, I want to deal with the questions raised by the noble Lord, Lord Brougham and Vaux. He asked when the Bill will come into effect. The answer is, immediately on Royal Assent. But orders have to be laid after that under the 1926 Act and cannot come into effect for 40 sitting days. Clearly, the earlier the Bill receives Royal Assent, the better, and the earlier we can conclude Committee stage, the better. If the suggestion of the noble Lord, Lord Brougham and Vaux, that there should be no amendments in Committee, is followed by the Opposition Front Benches, the order of commitment can be discharged and the Third Reading can be held very shortly thereafter. That will certainly advance the time by which the Bill will come into effect. I hope that the noble Lord will seek to persuade his Front Bench that that is the right way to proceed.
The noble Lord asked whether the Bill applies to Victoria Tower gardens. It does, and there is a particularly offensive hotdog seller right next to the Victoria Tower. The noble Lord asked also where the traders will go and what is to be done at the London Eye. I too have observed that illegal traders have found the London Eye a place of attraction. It is covered by the London Local Authorities Act 1990, which provides powers of seizure and forfeiture for unlicensed trading. I hope that the authority, which I assume to be Southwark council, will take action under that Act to deal with the problem there if indeed it shifts from the Royal Parks.
The noble Baroness, Lady Anelay, made a valid point in relation to who is guilty of an offence. As she will know, Clause 3 of the Bill ensures not only that the individual trader can be charged with an offence, but also a corporate body; and the officers of that corporate body, who are defined in the Bill, will be prosecuted under the Act.
The noble Baroness asked what happened to perishable goods that were not seized, although she did not want an answer. Traders are invited to take their perishable goods away. I believe that they take away the ice cream cones and probably the hotdogs and rolls. But if they do not, the goods are destroyed at the place to which the carts are taken. I am glad to say that
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there is good co-operation between Westminster and the Royal Parks. The carts will be taken to Westminster yard.
I am grateful to all noble Lords for everything they have said about the Bill. I commend the Bill to the House.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Utilities Bill
8.53 p.m.
House again in Committee.
Baroness Sharp of Guildford Baroness Sharp of Guildford moved Amendment No. 230A:
After Clause 59, insert the following new clause—

Utilities Bill

  Determination of performance standards)
  DETERMINATION OF PERFORMANCE STANDARDS BY AUTHORITY
  After section 43 of the 1989 Act there is inserted—
  "Determination of performance standards by Authority.
  43A.—(1) The Authority may from time to time—

  (a) determine such standards of performance in connection with the selling of electricity by suppliers to consumers as, in its opinion, ought to be achieved by them and is consistent with their licence conditions;

  (b) arrange for the publication, in such form and in such manner as it considers appropriate, of the standards so determined; and

  (c) arrange for the publication, in such form and in such manner as it considers appropriate, or an assessment of which suppliers, in its opinion, are failing to meet those standards.

  (2) Where a supplier has failed to reach the standards set out in this section, the Authority may order that supplier to pay compensation to the consumers affected.
  (3) It shall be the duty of every electricity supplier to conduct his business in such a way as can reasonably be expected to lead to his achieving the standards set under this section."").
  The noble Baroness said: In moving Amendment No. 230A, I shall speak also to Amendments Nos. 231A, 266A, 266B and 267A.
  This group of amendments relates to the misselling of gas and electricity. They derive from the concern of the citizens advice bureaux throughout the country at the large number of misselling cases with which they have had to deal. Two different sets of problems are dealt with by the amendments. The first set arises from the choice consumers now face from the multiplicity of and from knowingly or unknowingly being switched from one supplier to another and then having difficulty cancelling contracts. In particular, the CABs are concerned about vulnerable people being pressured and misled into switching suppliers. The second set of problems arise from landlords selling gas and electricity supplies at inflated prices.
  Let me deal first with the problems that arise from the sheer multiplicity of suppliers. A range of different problems arise. First, there is a problem of suppliers being switched without consent. A number of

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  examples can be given. For example, a citizens advice bureau in London recently reported the case of a client on jobseeker's allowance who came into the bureau because he had suddenly started to receive electricity bills from a different company. He was emphatic that he had not signed up with the new supplier because he had been out of the country for approximately nine months visiting his family in Bangladesh.
  Another citizens advice bureau in the north of England reported the case of a client who found that his supplier had been switched after he signed a form which he was told was to confirm that his meter had been read. This is a difficult issue where people are switched from one supplier to another without realising that they have given their consent or, in some cases, without giving consent at all.
  Other cases arise where vulnerable people are treated inappropriately. A citizens advice bureau in the North West reported that a client who was profoundly deaf and with limited speech was visited by a doorstep salesman who wanted her to change supplier. She did not understand what she was being asked to do and felt that she was misled into changing supplier. It then took almost three months to restore her original supplier and sort out the billing problems that arose from the transfer.
  Another example arose in London, where a client of one of the bureaux with severe mental illness was misled into signing a paper confirming the visit of a sales agent but which was in fact a contract. The client was paying for fuel direct—an arrangement that would have been jeopardised had the bureau not intervened.
  Further problems arise with the cancelling of contracts. The citizens advice bureaux have seen a significant number of clients who are finding it difficult to cancel contracts in line with their right to do so. One bureau in the South East reported a client who had come into the bureau after finding it impossible to cancel the contract to switch supplier within the cooling-off period. The company continued to send him bills and made it extremely difficult for him to cancel the contract.
  Finally, there is the issue of poor administration. Again, there are examples of people having difficulties. A man over 85 years of age and partially blind and deaf had chosen an alternative electricity supplier. His existing supplier confirmed the cancellation of his contract in the spring of 1999. He then came into the citizens advice bureau seven months later, since he had not received any bills from anybody and was becoming extremely worried about the accumulation of his bills. His new supplier had no record of the fact that it was supplying him.
  In another example, a bureau in the north of England reported the case of a client who, having changed suppliers, continued to receive bills from both the old and new suppliers for nearly a year. He eventually visited the CAB in frustration, having received debt recovery actions from one of the
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  suppliers. All these examples illustrate the difficulties being faced by people these days in relation to these matters.
  In theory, the providers' licence conditions are intended to prevent companies from using such improper sales techniques. The licences are intended to provide a simple way of cancelling a contract when a customer changes his mind after further consideration. But, in practice, the regulator has taken action to enforce compliance under the licence conditions on only two occasions.
  The CAB advised over 140,000 people on utilities issues in the year 1998 to 1999. Many of those clients are low income earners and may be among groups who experience discrimination and consequent disadvantage through, for example, age and disability. It is particularly important for these clients that the sales techniques of gas and electricity providers should not exploit the complexity of and unfamiliarity with the products they are offering.
  If the licence conditions were being effectively enforced by Ofgem, these problems of misselling would not have to be raised so often with the citizens advice bureaux. Ofgem has recently said that it will come down very hard on companies who break the licence conditions. However, it is not clear what trigger will be used to initiate such action. It needs to be made clear to all concerned parties that the regulator will ensure that sanctions are put in place in relation to misselling. The CAB evidence indicates the necessity for such sanctions.
  The purpose of the first two of these amendments is to put this matter right. Their aim is to beef up the regulator's powers; to ensure that GEMA, in its new form, sets minimum performance standards; to ensure that they are published; and to ensure that a naming and shaming procedure is in place for those undertakings which do not meet minimum performance standards. In addition, they provide for compensation to be paid to those who have suffered. Those are the issues which arise from the problems of choice and the misselling of electricity.
  The second set of amendments arises from the on-selling of gas and electricity. The current provisions preventing landlords from selling on such services at inflated prices have failed, due to inadequate enforcement powers. If this overcharging is to be brought to an end, the provisions will have to be reformed and strengthened. Amendments Nos. 266A, 266B and 267A are aimed at probing this particular issue. The amendments are intended to allow the regulator or the trading standards official to pursue resale problems in cases where tenants are unable to pursue the problems themselves. I beg to move.
  Lord McIntosh of Haringey: Like the noble Baroness, Lady Sharp, I shall first discuss Amendments Nos. 230A and 231A and then move on to the other three amendments.
  I was glad to have the opportunity of hearing about the examples which the citizens advice bureaux have given of bad practice in the supply of utilities.

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  However, I have to say that there is nothing in the noble Baroness's amendment which is necessary to increase the powers to impose standards of performance under existing sections of the Electricity Act or under the new clauses to be inserted into that Act and the Gas Act by this Bill. Section 39 of the Electricity Act (as amended by Schedule 6 to the Bill) will allow the authority to set standards of performance
  "in connection with the activities of electricity suppliers so far as affecting customers or potential customers of theirs".
  This clearly encompasses any standards of performance which could be set under the clauses proposed in these amendments. In addition, the noble Baroness will recall that earlier today we dealt with the question of deemed contracts when there is a change of supplier.
  The existing clauses in the Bill require the authority to consult before setting standards of performance, so that there will be an opportunity for organisations concerned about misselling to suggest standards of performance in this area. That, of course, includes citizens advice bureaux and the examples which the noble Baroness, Lady Sharp, has provided in this debate. I am sure that Ofgem will have heard what the noble Baroness has said.
  In addition, there already are licence conditions on how companies sell electricity. The regulator is under a duty to take enforcement action when these conditions are breached. In future, contraventions of the conditions could also lead to the imposition of financial penalties on the licence holder concerned.
  With regard to publication powers that are proposed as part of the new clauses, Clauses 20(4) and 20(5) place the Gas and Electricity Consumer Council under a duty to publish such statistics as it thinks appropriate relating to levels of performance in relation to standards of performance, including any standards of performance concerned with misselling. This duty is unqualified by any consideration of the harm that such publication may cause to the companies concerned.
  I do not minimise the concerns behind these amendments. It is clear from the examples given by the noble Baroness, Lady Sharp, that much is to be desired in relation to the way in which some electricity companies supply electricity to their consumers. However, the Bill provides for no fewer powers than she would add to it by these two amendments.
  I also recognise the motivation behind Amendments Nos. 266A, 266B and 267A, but I do not believe that in practice they would improve the lot of those whom they are designed to assist.
  Let me outline what would happen under the Bill, as drafted, if a customer discovered that he or she was being overcharged by a landlord. It is very difficult, of course, to get people to complain in the first place. Landlords are in positions of authority over tenants and many tenants have difficulty getting past the first barrier of expressing a desire to complain. If a consumer is prepared to take action personally, the powers under Clauses 72 and 101 allow recovery of the
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  sums which have been overpaid, plus interest. If a consumer feels that he needs assistance because he is afraid to raise it with his landlord, the correct body to approach would be the new Gas and Electricity Consumer Council, rather than the authority or trading standards officers. That does not mean that the citizens advice bureaux, local authority advice bureaux and others do not provide a very valuable service.
  The council has a duty to investigate complaints and will be able to insist that the reseller, in this case the landlord, provides it with information relevant to the complaint. It will seek a satisfactory outcome by making representations to the reseller. But if this was unsuccessful and the consumer took his landlord to court, it would be open to him to utilise arguments, reports and so on prepared by the council as part of his legal case. I hope that that will occur only in extreme circumstances and that it will not occur often. However, those powers exist.
  The Gas Consumers' Council has in the past played an active and successful role in advising tenants on their rights in maximum resale price matters. There is, for example, a booklet which is sent to tenants who are considering making a complaint which can be passed to landlords. The Gas Consumers' Council has corresponded with resellers on behalf of consumers. The new council will pick up this important work on behalf of consumers both of gas and electricity but with the valuable new ability to insist that the reseller provides information relevant to the complaint.
  There is no need to revise Clauses 72 and 101 for the purpose of giving the council a role in maximum resale prices. It has this role already by virtue of the powers and functions set out in the Bill. We do not see any need to enable the council itself to receive overpayments on behalf of consumers. It is enough that the council has the duty to investigate complaints and to make representations and provide other assistance on behalf of the consumer. The remit of the council includes exempt as well as licensed suppliers, and so covers landlords, who are likely to be the suppliers in this sort of case.
  Also, conditions can be placed on exemptions similar to licence conditions. Failure to comply with exemption conditions could lead to the withdrawal of the exemption. For example, a caravan site which overcharged caravan owners could lose its exemption and its power to intervene between the supplier and the ultimate consumer. A landlord who continued to supply without a licence or exemption would be committing a criminal offence. We have not concluded our consideration of what conditions should be applied to exemptions but they will almost certainly include an obligation to supply information on request to the consumer council in relation to any complaint it is investigating. I hope that if a consumer sought assistance from the authority or from trading standards officers or from the CAB, he would be redirected towards the consumer council.
  I entirely accept the motivation behind the amendments. I am grateful—the consumer council and the authority will also be grateful—for the specific

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  examples which the noble Baroness, Lady Sharp, adduced in support of the amendments. However, I hope that she will accept that the powers that she seeks are already available.
  Baroness Sharp of Guildford: I am grateful to the Minister for his detailed reply on these two issues. One of the problems that has arisen in relation to misselling is that while it is recognised that Ofgem has powers, it has used them little to date. It would be good to see it using those enforcement powers rather more rigorously than it has. The new consumer council will have stronger powers of publication and I hope that it will use those powers to name and shame those who missell.
  It is a jungle for all consumers. I do not know whether other noble Lords have, like me, been rather amazed at the number of offers that are available and are not clear about what represents good value and what does not represent good value. One can see that this is a big problem, particularly for the more vulnerable groups in society.
  As regards misselling, the Minister is quite right to say that there is an imbalance between the position of the landlord who is selling the product at an excessive price and that of the tenant whose only recourse is to go to court. It is good to hear that the new consumer council will have increased powers in relation to such landlords. I hope that publicity will be given to those powers and that the CAB will keep the consumer council informed of events. I also hope that the consumer council will ensure that those who offer advice in the CABs are aware of those powers. In view of the reassurances I have been given, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 95 [Licence enforcement]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 231:
  Page 99, line 6, leave out ("and (4)") and insert (",(4) and (6)").
  The noble Lord said: I spoke to this amendment with Amendment No. 204. I beg to move.
  On Question, amendment agreed to.
  Clause 95, as amended, agreed to.
  [Amendment No. 231A not moved.]
  Clause 60 agreed to.
  Clause 96 agreed to.
  9.15 p.m.
  Clause 61 [Obligation in connection with electricity from renewable sources]:
  Lord Kingsland Lord Kingsland moved Amendment No. 232:
  Page 62, line 7, leave out from beginning to ("an") in line 8 and insert ("electricity suppliers").
  The noble Lord said: In moving Amendment No. 232, I shall speak also to Amendments Nos. 233 and 234. These are probing amendments in regard to obligations in relation to renewables.
  Clause 62 allows a renewable obligation to be created; it leaves it open to the Secretary of State to decide upon whom and for what the obligation is imposed. These amendments seek to remove that discretion and to make all suppliers liable to meet the obligation. I should emphasise that the motive for these amendments does not in any way undermine the Opposition's commitment to the measures being introduced to achieve environmental goals and to supporting the development of renewable sources generation.
  As currently drafted, the renewables obligation will favour those companies which operate at both ends of the supply chain, owning both supply and generation facilities. Smaller supply companies by contrast, including the innovative new entrants who have brought so much to the market place, could be squeezed out. Vertically integrated companies have the additional generation margin to fund such investment and, by doing so, they could gain significant commercial advantages. In effect, the current approach will compromise the commercial position of independent supply businesses compared with the vertically integrated players.
  These amendments will ensure that the renewables obligation is applied equally to all suppliers; and that the application of the obligation will not distort competition between suppliers. I beg to move.
  Lord Jenkin of Roding: Amendment No. 235, which stands in my name, is grouped with the amendments of my noble friend Lord Kingsland. The Minister will remember that I raised the issue of the renewables obligation at Second Reading and that I promised amendments; this is the first of the amendments to which I have put my name. I shall not repeat the arguments that I used at Second Reading, but I cannot be quite as brief as my noble friend has been in moving his amendment.
  I should like to remind the Committee of what lies behind the amendment. If generators from renewable sources are to meet the targets the Government have set—we shall come to the question of the targets in a moment—they must be able to do two things: they must be able to borrow to finance investment in existing technology for renewables; and they must be able to finance the research and development which will be necessary if the additional sources of renewable energy are to become effective. The fear of those concerned with this issue is that, as it is drafted, the new scheme in the Bill will achieve neither of those objectives.
  Since we last debated the Bill we have had the report of the Royal Commission, which was referred to by the noble Lord, Lord Ezra. Although I cannot claim to have studied it in detail in the couple of days that I have had it in my hands, I have read the parts of it which deal with renewables. The Royal Commission makes some fairly strong recommendations—not least at paragraph 7.106, which states:
  "We recommend that longer-term targets be set for expanding the contribution from renewable sources well beyond the 10 per cent of electricity supplies to cover a much larger share of primary energy demand".

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  The main thrust of the Royal Commission's report is that we will not achieve the reductions in CO2 unless we take a good deal more vigorous action as a nation and set an example to Europe—and one of those examples is in developing renewables. In Box 7D, in the same chapter, there is an interesting and helpful description of the proposed renewables obligation. It reinforces the point that,
  "To enable companies to plan ahead the period of the obligation is expected to apply until at least 2025".
  There is a distinction to be drawn between the period of the obligation and the terms of the contracts which the suppliers may negotiate with those who provide energy from renewable sources, and, over the page, it goes on to draw a distinction. It draws attention to the Government's own classification of new and renewable energy technologies.
  Those that are near term include biomass residues—which I mentioned in the debate on Second Reading—as well as landfill gas, onshore wind, hydro and what is known as passive solar. As regards the medium term, offshore wind and energy crops are added to the list. In the longer term we reach some of the proposals mentioned in the earlier amendment: fuel cells, photovoltaics, wave and photoconversion. In the very long term we shall see hydrogen, tidal barrage and geothermal hot dry rock.
  These technologies are not going to be developed quickly. Indeed, the essence of the conclusions of the Royal Commission is that a great deal of work needs to be done before such longer-term sources of renewable energy will be able to make a contribution.
  Another document I have received since we debated the matter on Second Reading is a letter from the noble Lord, Lord McIntosh. It took a little time to get a copy of it into my hands. I do not think that it was his fault, but only a full month after he signed it did I eventually secure a copy—on the third or fourth request. He made two points, with one of which I totally agree:
  "As we advance towards the Government's target, currently cheaper sources will almost certainly be insufficient to meet the obligation. The Government is currently considering the responses to its consultation on the energy crop scheme" —
  I also mentioned that scheme and I have now received a copy of the consultation.
  Perhaps I may say at this point that only 14 days were allowed between publication of that document from MAFF and the closing date of the consultation—from 14th to 27th April. It has become a habit of the present Government; namely, to publish a consultation and then to ask for responses in a wholly unrealistic timescale. Nevertheless, the consultation is complete. I shall continue with my quotation from the Minister's letter:
  "The scheme is likely to direct support towards readily exploitable crops such as short-rotation coppice and miscanthus. This will provide the foundation for a substantial increase in the contribution of these crops to meeting the renewables obligations".
  The letter goes on to say:
  "I should note that the Government is also considering the case for supplementary support for longer-term sources, such as energy crops and offshore wind, in the context of the 2000 spending review".
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  Clearly, we shall need to wait for the Chancellor's statement before we learn any more about that.
  My amendment seeks to give reality to what seem to me to be quite unexceptionable ambitions. Unless an assurance is given of offtake of renewable energy by electricity suppliers, those wishing to invest in renewables simply will not be able to raise the money to fund their investment.
  The Minister's letter turned to that argument. Perhaps I may quote from it once more:
  "You argued for a renewables obligation which required electricity suppliers to source a specified proportion of renewables from biomass at a fixed price on long term contracts—very similar, in fact, to the existing non-fossil fuel obligation. The Government has very deliberately taken the decision to move away from such picking of technologies"—
  I ask the Committee to note that phrase—
  "and instead to adopt a market-based approach, in keeping with the Bill's market-based reforms of electricity regulation as a whole. This will allow the market to identify the most economic methods of achieving the Government's renewables target, to the benefit of the environment, consumers and the economy as a whole".
  However, that argument is very seriously flawed. With one breath the Government say that they are willing to use grant aid—a scheme is promoted and is the subject of consultation—to support renewables. But what is grant aid if it is not a form of picking winners in order to be able to distribute the grants? Yet in the succeeding breath the Government say that they cannot pick different technologies, as required in my amendment, because it would interfere with the market. I hope the Minister will take note that there is a complete logical inconsistency in that proposition. Both grant aid and picking technologies amount to public expenditure. That is because the Treasury has ruled that any additional electricity costs associated with climate change rather than with electricity supply have to be treated as costs.
  The question is: which method will deliver the greatest amount of CO2 reduction per pound of public expenditure. The additional administration of setting up a grants structure, together with the normal market response of industries which are dependent on grant aid—which leads to a form of cost inflation—is inherently unlikely to deliver better value for money. I am not in the least surprised to learn from the trade press that there have been calls for the DTI to find, not £50 million, but £150 million per annum for renewable energy grant aid. How many schools or doctors could be funded with that kind of money?
  In contrast, my amendment places the additional cost of renewable energy fairly and properly where it belongs: on the electricity consumer. That accords with the well-established and widely respected "polluter pays" principle. It sends the right price signals about energy usage direct to consumers, exactly as was envisaged in the Government's own policy statements in New and Renewable Energy: Prospects for the 21st Century. The document states:
  "The Government believes that the additional cost of generation from renewable sources, whilst kept to a minimum, should be met directly or indirectly by electricity consumers. This would ensure that the costs of addressing environmental problems caused by electricity are met by those who create the demand".

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  That is completely right and proper. Yet, with great respect, that is not the scheme in the Bill. It would be the scheme were the Bill to be amended in the light of my proposal.
  I am sure that Ministers will be aware that the availability of near-market generating capacity is limited. The Government will be pushed for time to get the requisite reductions from renewable sources to meet their 10 per cent commitment. The near-market technology is limited by availability of resources and by the very considerable problem of planning consents, about which the Royal Commission has a number of useful things to say.
  In anything but the short term, there will have to be further contributions from biomass and from offshore wind if there is to be any chance of meeting the Government's targets. It takes four or five years to plan, finance, build and bring on stream a significant new electricity generating station. It is likely that, without an obligation to purchase electricity from these technologies from the outset, sufficient time will not be available to bring the generation on line and the Government's target will not be met. If it is not, we shall be in breach of our obligations under the Kyoto accord.
  The Government have recognised over and over again that the purchase contract lies at the heart of the financing of renewable energy. Perhaps I may quote another government publication which makes that point extremely clear. In financing renewable energy projects, published earlier this year, the Government state:
  "The contract is the cornerstone of most renewables projects. The power purchaser must be creditworthy. Lenders will want the contract term to extend beyond the term of the loan. The contract will be assessed by the lenders for its economics and conditions that might cause early terminations—lenders will want the ability to cure any defaults rather than face termination".
  Again, that is absolutely right—but, with great respect, that is not what is in the Bill. I find it depressing that the Government have committed themselves to the two propositions that I have quoted from their own publications, and both are ignored in the Bill.
  It must be recognised that, if we are to make any progress in achieving our renewables obligations, there must be longer term contracts, and there must be discrimination between the different forms of renewables. At the present stage, the prices at which the different forms of renewables can put electricity into the market are very different.
  The Government must look at this again. I do not say that my amendment is the only way of dealing with the matter, but I say with all the force that I can command, reinforced by the Royal Commission, which supports the new system, that it must be on the right terms. It is not on the right terms, and my amendment is one of the ways that could put that right.
  9.30 p.m.
  Baroness Sharp of Guildford: From these Benches we give our support to the noble Lord, Lord Jenkin of Roding, and his amendment. The noble Lord speaks a great deal of sense. He is absolutely right that we stand very little chance of meeting our Kyoto commitment to the 10 per cent renewable target by 2010 unless we move very quickly. We do not have the capacity in place. It takes a long time to get it in place, and we need mechanisms to encourage its being put in place.
  From the point of view of UK Inc. it is vital that we increase our ability to build renewable energy capacity and develop the industry. Other countries, such as Germany and Denmark, are forging ahead in this area, and we in the UK have been very laggardly. An amendment such as that proposed by the noble Lord is precisely what we need.
  Lord McIntosh of Haringey: When the noble Lord, Lord Kingsland, says that nothing in his amendments is intended to restrict the growth of supply from renewable sources, I accept what he says, but Amendments Nos. 232, 233 and 234 would have the effect of restricting that supply. They would remove the option to place an obligation only on certain categories of supplier and require it to be placed on all suppliers.
  I recognise that concerns have been expressed that the use of the flexibility to impose an obligation on some suppliers and not others could introduce unfair market distortions, but the Government's intention is quite the opposite. It is to ensure that the market works properly. Flexibility may be important in ensuring that inappropriate barriers are not placed in the way of new entry to the market.
  If we had exactly those barriers that we would have if the amendments were inserted, how would we deal with new entrants to the markets? Clearly, we cannot impose a full renewable obligation on day one, not least because entrants would have no market share from which to calculate the size of their obligation. We are still consulting on that point. There is one option—it is only an option, and we shall be canvassing views on it—which would be to exempt them from the obligation altogether in their first year of operation. Whatever may be the case, the working of a market of this kind will not be possible if these artificial restrictions, particularly on new entry into the market, are to be imposed.
  I find it ironic that I should be the one defending the market mechanism against noble Lords opposite. I do so because we believe that the market mechanism is the right way to approach the issue of renewables, as it is the right way to approach the other issues of consumer protection which form the basis of the Bill. The amendments that the noble Lord has put down would certainly restrict the market; they would restrict new entry to the market by creating unacceptable barriers to new entry.
  I turn now to the noble Lord, Lord Jenkin of Roding. His amendment is in some conflict with his very eloquent speech, to which I pay tribute. The

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  amendment seeks to impose a feature of the old-style, non-fossil fuel obligations—fixed, long-term supply contracts between suppliers and generators—which the Government simply cannot accept. It runs counter to the entire thrust of the new obligation to move away from this sort of rigid imposition and allow market participants to sort out for themselves the most effective way of meeting the obligation.
  There is nothing in Clause 61 or elsewhere in the Bill to prevent long-term contracts with renewable generators. Clearly, these contracts will be made in some cases. The difference is that it will be the market, not the Government, which decides the right terms of the contract. If the amendment in the name of the noble Lord, Lord Jenkin, were accepted, it would impose conditions for long-term contracts that might outlive the technology described so eloquently by the noble Lord. The noble Lord said that government policy did not address long-term technologies, such as biomass. However, in the context of our market-based approach we believe that the longer-term renewable technologies will also benefit.
  As electricity suppliers move towards the 10 per cent target, they are likely to experience insufficient availability of cheaper renewables and will look increasingly to offshore wind and energy crops, for example, to meet their obligations. These energy sources cannot be bought in over night. It would be prudent for energy suppliers to look ahead now to ensure that the technologies are brought forward on a timescale, and in sufficient quantities, to meet their needs.
  The noble Lord, Lord Jenkin, referred to the climate change levy. One possibility is to draw some funding from that levy. That was one of the issues referred to in yesterday's article in the Financial Times. Last year the Chancellor announced that £50 million from the climate change levy would be allocated to increase funding for energy efficiency, to promote the development of new sources of renewable energy and to encourage research and development and the take-up of low carbon technologies and energy-saving measures through a carbon trust. In November 1999 the Chancellor announced the trebling of support for energy efficiency measure from £50 million to £150 million to allow for the introduction of a system of 100 per cent first-year capital allowances for energy-saving instruments. Individual funding allocations have not yet been settled. The Government also made an announcement to exempt from the levy energy generated from new forms of renewable energy, such as solar and wind power and good quality combined heat and power plants.
  In addition to our plans to impose an obligation on licensed electricity suppliers to supply a specified proportion of their power from renewable sources, the Government are actively considering top-up financial support for offshore wind energy and energy crops, possibly in the form of capital grants. This reflects both the higher costs of those technologies and the importance of bringing them forward if we are to meet the renewables targets in 2010 and beyond.
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  The noble Lord, Lord Jenkin, appears to believe that there is some conflict between this grant aid and the rest of our policies. No. There is a big difference between direct support for research and development and the long-term framework of the renewables obligation. I am much more sympathetic to the motivation behind the amendment in the name of the noble Lord, Lord Jenkin, than the amendment moved by the noble Lord, Lord Kingsland, which would have a very damaging effect on the renewables obligation. I am afraid that the approach of going back to the long-term contract of the non-fossil fuel obligation is not the right way to proceed.
  Lord Ezra: In view of the fact that the Minister respects the motivation behind the amendment in the name of the noble Lord, Lord Jenkin, who says that he does not necessarily stick to the wording of his amendment, is it not possible to introduce into the order some preference for long-term contracts, bearing in mind the nature of the activity that we are talking about? The noble Lord, Lord Jenkin, is absolutely right. The thrust of the Royal Commission's report is that it will be extremely difficult for us to meet the targets which the Government have rightly set. This matter requires a good deal of long-term planning and thinking. While there is perhaps too much rigidity in the wording of the amendment, is it not possible to emphasise in the order the importance of providing long-term support for the renewables sector?
  Lord McIntosh of Haringey: I am very dubious about the role of long-term contracts, although I am insistent about the long-term nature of our policies. After all, the renewables obligation is intended to last until 2025. Rather than respond positively in the way suggested, I invite the noble Lords, Lord Ezra and Lord Jenkin, to talk to me and my officials between now and Report stage so that where there is common ground those matters can be thrashed out and we can see whether progress can be made.
  Lord Jenkin of Roding: Before my noble friend withdraws his amendment, perhaps I may say that I have been half encouraged by the response and very encouraged by the support of the noble Lord, Lord Ezra, and the noble Baroness, Lady Sharp.
  As I said, I am not wedded to the wording of the amendment. However, I wish to emphasise that if one could encourage big industry to come in on this aspect—I do not refer to the little man with his rubbish heap or the family which happens to have a hydro facility—it could result in good, embedded energy. We want to encourage the big players, perhaps from overseas as well as our own people, to make this a major part of their investment. They are not encouraged by grants because they always recognise that they can be switched off at any moment. They are looking for an environment which will encourage them to put their money into the investment and into research and development.

  369
  The Minister invited some of us to have meetings with him. It would be exceedingly churlish of me not to take that up with enthusiasm; and I do. Perhaps we can explore that.
  Lord McIntosh of Haringey: I do not want to be exclusive. The noble Lord refers to "some of us". If other noble Lords, including the Opposition Front Bench, wish to discuss these matters, I shall be pleased to do so with them as well.
  Lord Jenkin of Roding: I am sure that we should all like to come along. I should like to bring one or two of my advisers who have helped and guided me on this issue. I have not moved my amendment; therefore I do not need to withdraw it. It has been a short and useful debate. I am grateful to the Minister for the amount of trouble he has taken with his reply.
  Lord Kingsland: I shall be delighted to talk to the Minister about my amendment. However, after what I shall say he may not pleased to talk to me.
  I think it unfair of the Minister to assert that my amendment is anti-competitive. On the contrary, it seeks to ensure that the small entrepreneur is fairly treated in relation to the rest of the market. It is a competition-enhancing rather than competition-constricting amendment. The Minister was clear about his rejection of it. In those circumstances, I should like to test the opinion of the Committee.
  9.42 p.m.
  On Question, Whether the said amendment (No. 232) shall be agreed to?
  Their Lordships divided: Contents, 29; Not-Contents, 76.

  Division No. 3

  CONTENTS

  Anelay of St Johns, B.

  Jopling, L.

  Astor of Hever, L.

  Kingsland, L.

  Attlee, E.

  Knight of Collingtree, B.

  Blatch, B.

  Laird, L.

  Bridgeman, V. [Teller]

  Lamont of Lerwick, L.

  Brougham and Vaux, L.

  Lyell, L.

  Buscombe, B.

  Moynihan, L.

  Carnegy of Lour, B.

  Northbrook, L.

  Oxfuird, V.

  Crathorne. L.

  Palmer, L.

  Ferrers, E.

  Patten, L.

  Fookes, B.

  Roberts of Conwy, L.

  Geddes, L.

  Stodart of Leaston, L.

  Henley, L. [Teller]

  Wade of Chorlton, L.

  Jenkin of Roding, L.

  Willoughby de Broke, L.

  NOT-CONTENTS

  Acton, L.

  Bassam of Brighton, L.

  Alderdice, L.

  Berkeley, L.

  Alli, L.

  Borrie, L.

  Amos, B.

  Bragg, L.

  Andrews, B.

  Brennan, L.

  Archer of Sandwell, L.

  Brett, L.

  Bach, L.

  Brooke of Alverthorpe, L

  370

  Brookman, L.

  Hunt of Kings Heath, L.

  Burlison, L.

  Islwyn, L.

  Carter, L.[Teller]

  Lea of Crondall, L.

  Christopher, L.

  Lipsey, L.

  Clarke of Hampstead, L.

  Lockwood, B.

  Cocks of Hartcliffe, L.

  Macdonald of Tradeston, L.

  Cohen of Pimlico, B.

  McIntosh of Haringey, L.

  Crawley, B.

  McIntosh of Hudnall, B.

  Currie of Marylebone, L.

  MacKenzie of Culkein, L.

  David, B.

  Mackenzie of Framwellgate, L.

  Davies of Coity, L.

  Mar and Kellie, E.

  Dormand of Easington, L.

  Massey of Darwen, B.

  Dubs, L.

  Mitchell, L.

  Evans of Parkside, L.

  Morris of Castle Morris, L.

  Ezra, L.

  Nicol, B.

  Farrington of Ribbleton, B.

  Phillips of Sudbury, L.

  Faulkner of Worcester, L.

  Ramsay of Cartvale, B. [Teller]

  Fyfe of Fairfield, L.

  Rendell of Babergh, B.

  Gale, B.

  Sawyer, L.

  Gibson of Market Rasen, B.

  Scotland of Asthal, B.

  Goldsmith, L.

  Sharp of Guildford, B.

  Gould of Potternewton, B.

  Simon, V.

  Grenfell, L.

  Thomas of Gresford, L.

  Hardy of Wath, L.

  Tomlinson, L.

  Harris of Haringey, L.

  Tope, L.

  Harris of Richmond, B.

  Tordoff, L.

  Harrison, L.

  Walpole, L.

  Hilton of Eggardon, B.

  Warner, L.

  Howells of St. Davids, B.

  Whitaker, B.

  Hoyle, L.

  Whitty, L.

  Hughes of Woodside, L.

  Wilkins, B.

  Resolved in the negative, and amendment disagreed to accordingly.
  9.52 p.m.
  [Amendments Nos. 233 to 235 not moved.]
  Lord Hardy of Wath Lord Hardy of Wath moved Amendment No. 236:
  Page 62, line 28. after ("sources") insert ("or from the application of clean coal technology").
  The noble Lord said: In moving Amendment No. 236, I wish to speak also to Amendment No. 238. I do not intend to detain the Committee very long but some significant points need to be made.
  The Government deserve congratulations on their commitment to making a proper contribution to clean coal technology. Indeed, a number of other affluent countries would do well to do so and the world would benefit from emulating our record. However, the Government's targets are ambitious. Not all British projects are dispatched effectively. I think, for example, of the repairs to the escalator on the Victoria line at King's Cross Station which seem to be taking a long time. If some of our renewable projects took as long as that, we should be in dire straits in fulfilling our obligations. But I am more optimistic about that.
  We must consider that, although we have seen enormous reductions in the British mining industry, that which remains is exceedingly successful. The latest production figures for Richard Budge's pits—he owns the vast majority of them, as the noble Lord, Lord Ezra, will be aware—build on the contribution that the National Coal Board made under his chairmanship. The productivity rates are astonishing. Some coal faces produce 7,000 tonnes of coal a shift. A coal face maintained at that level would be a super-pit, with a 2 million tonne level of production.
  The noble Lord, Lord Jenkin, will recall our slight exchange last week on this. I have never been in favour of burning coal in a filthy manner. I am in favour of clean coal technology. I was bitterly critical of the previous administration, who put an end to substantial research. That research should be renewed with vigour because, although we may be reducing our coal burn and no longer puffing out noxious gases into the environment, making those changes will do us and the globe very little good if other huge coal-producing countries continue the practices that we have stopped. Given the amount of coal that will be burned in China, India and a number of other countries over the next five or 10 years, the world is clearly crying out for the new technology. We have a commercial opportunity to develop clean coal technology rapidly in Britain. It would be very useful for us and there would be international opportunities.
  The other reason for the Government to take a favourable view on the issue is to ensure a belt and braces approach. I am more optimistic than some in the Opposition about the development of some renewables, but that could take a little time. If it takes a little longer than the Government and the industry hope, there may well be a tendency, as the target dates are reached, to take an excessively generous view of particular approaches to renewable production. It should be possible to move rapidly on biomass and we ought to make a more vigorous effort to harness the power of water, but I am uneasy about wind, largely because, although a great deal is said about it, the amount of energy produced by the wind farms now operating is surprisingly small. I pointed out in the House last week a proposed wind farm near the Yorkshire coast which would not go down well with most local people, would not enhance our landscape and would produce as much energy in a year as Drax power station, which is fitted with flue gas desulphurisation, produces in six days.
  The noble Lord, Lord Jenkin, referred to planning consent. Those of us who have lived in coalfield areas know that in the 1980s the previous government virtually forced local authorities in areas where there were coal reserves to give planning permission for opencast mining. That caused enormous fury. As deep mined pits were closed, local people had to put up with opencast mining. I am not saying that there is no role for it—it has cleared a lot of dereliction in South Yorkshire—but no government of whatever complexion should seek to ride roughshod over the local population on issues such as wind farms. There may be a place for them offshore and onshore. But as a conservationist, I find the prospect of seeing huge numbers of birds destroyed by the windmill, as would certainly happen because of the sucking-in action which would develop, distasteful. If those windmills are built on lines of migration, the slaughter would be distasteful, especially given the relatively low energy yield which would then result.
  I hope that the Government will accept that clean coal technology should proceed apace, not merely for ourselves but because it will help to give the world a
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  capacity to meet the obligations which the United Kingdom is pursuing and which other countries also need to meet. I beg to move.
  10 p.m.
  Baroness Buscombe: I rise to speak to Amendment No. 241. That amendment concerns the granting of power to the Secretary of State to make different orders for different classes of supplier. We propose here that that power should be invoked only in a way which will not distort competition.
  Lord Ezra: I support the two amendments dealt with so eloquently by the noble Lord, Lord Hardy of Wath. In fact, I have a later amendment which deals with the same subject. It may be for the convenience of the Committee, and perhaps abbreviate the time that we must spend, if I deal now with that too.
  I agree entirely with the thrust of the remarks of the noble Lord, Lord Hardy, as regards clean coal technology. We have a very successful coal enterprise. It is much reduced compared with earlier days; nevertheless, it is successful and efficient. We have massive coal reserves and there are even greater coal reserves in the Far East and other developing countries.
  The problem that we have is how to burn and use that coal to minimum environmental disadvantage. Clean coal technology offers a way of doing that if we can establish the process.
  The Government have recently provided much needed short-term support for the coal industry. But long-term support must also be provided. That should take the form of stimulating the development of clean coal technology which can be done only if contracts are placed for that technology. Therefore, I fully support the case which has been made by the noble Lord, Lord Hardy, that that should he included in the obligation.
  Techniques for clean coal technology have been successfully proven in laboratories, and some countries—not Great Britain, unfortunately—have development plants in operation. We really need to get such plants going. I have been working for many years to bring that about. While at the coal board, I gave support to the Grimethorpe project in the 1970s, which some may remember, which was subsequently closed down.
  More recently, in 1998, I introduced a Bill,
  "to extend the obligation to generate electricity from certain fuel sources".
  The purpose of that Bill was to extend the non-fossil fuel obligation, which we then had, to include certain fossil fuel projects which could contribute to environmental improvement and, specifically, clean coal technology. Although that Bill successfully passed through this House and was supported in another place by the then Minister for Energy, as well as by the Select Committee on Trade and Industry, it foundered, as do the bulk of Private Member's Bills at the present time in the other place for reasons with which most of us are familiar.

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  The Utilities Bill provides a further opportunity for creating the circumstances which could lead to one or more clean coal projects in the UK. Unless there is specific support for those projects or there is a commitment to take their production, they will not come about.
  The problem for Britain will become very serious when the nuclear plants are closed down (in the period 2010–20); the whole balance of CO2 emissions will be altered by that fact. We must prepare for that now. We should be developing all the resources we can. The noble Lord, Lord Hardy, is absolutely right. While everything possible is being done to develop other renewable sources, we have here potential for the coal industry to make its contribution so long as the technologies can be developed.
  So I should like to ask the Government to consider the problem in this context. I do not suppose for one minute that the amendments that the noble Lord, Lord Hardy, and I have moved this evening will be agreed; we merely put down a marker. We say, "This is an issue which should be further considered". This is one of the remaining opportunities for introducing a new technology into coal usage. I very much hope that, one way or another, we shall seize it.
  Lord Jenkin of Roding: I hesitate to join in a debate with two such acknowledged experts on the coal industry but, for my sins, for part of my career I was both a shadow Minister and a Minister for energy and I had to deal with the coal industry at that time. I remember 25 years ago visiting the Coal Research Establishment just outside Cheltenham. There I came across a man who was working very hard on the underground gasification of coal. I do not know whether that was a "clean" technology—we did not think of it in those terms. I remember putting my arm round his shoulders and saying, "Do you realise, my friend, that you have the whole of the future of the coal industry on your shoulders?" It was quite clear that we were not going to go on burning large tonnages of coal on the surface.
  The noble Lord is absolutely right; it is another country. The resources of coal are huge. I remember discussing this issue with the then head of the energy department in Beijing, Mr Qu Che Ping. They were hoping to burn 1,200 million tonnes of coal, and I said to him, "My friend, you really cannot do that". This was some years ago, long before Kyoto and indeed before Rio. They are changing their view; they are realising that that actually is not on. They are now buying more nuclear energy. We have not said anything much about nuclear energy, but if there is clean coal technology which really can generate energy without polluting the earth, clearly that needs to be encouraged and promoted.
  The Royal Commission report talks a lot about what I call—although it does not—the sequestration of carbon dioxide, where the CO2 is extracted from the flue gases and put back down. The commission prefers it to be put back down under the sea, where it can
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  remain in perpetuity: it is taken out of the atmosphere. It does not know yet whether that is economic. Clearly more work needs to be done in order to achieve what is needed. I agree that if we are to meet these renewable obligations, everything has to be encouraged. I very much agree with the noble Lord, Lord Ezra, that this needs longer-term backing and preferably contracts if it is to be achieved.
  Lord McIntosh of Haringey: Perhaps I may speak first on Amendments Nos. 236 and 238, which would provide that obligations under the renewable powers could be met by clean coal as well as renewables. Let me start by saying that we certainly are supporters of clean coal. We have a substantial support programme for clean coal technology.
  The Government's policy is to encourage the development of cleaner coal technologies for application both at home and overseas. I entirely take the point made by my noble friend Lord Hardy, that research and development on cleaner coal technology will not only benefit the British coal industry but also provide huge export potential for very much larger coal industries in other countries.
  The policy is being implemented in a six-year programme, which started in April 1999, linking research and development with technology transfer and export promotion. The broad aim of the programme is to provide a catalyst for UK industry to develop cleaner coal technologies and to obtain an appropriate share of the growing world market for the technologies.
  The programme will encourage collaboration between UK industry and universities in the development of the technologies and expertise. It is expected that projects worth over £60 million in R&D will be generated as a result of the DTI's contribution of £12 million over three years. Through this programme the DTI will be able to contribute to a global strategy to contain the growth of carbon dioxide (CO2), a recognised greenhouse gas, in developing countries in collaboration with the IEA and OECD countries.
  The principal aim of the programme is to develop advanced power generation as recommended by the industry-led Foresight Task Force and to help industry meet the Foresight technology targets. Other aims are to encourage fundamental coal science research in support of the Foresight technology targets and to examine the potential for developing the UK coal-bed methane resource and underground coal gasification technology, to which the noble Lord, Lord Jenkin, referred.
  The Foresight investigation into cleaner coal technology identified a case for plant demonstration from 2005. This is the issue of the demonstration plant to which the noble Lord, Lord Ezra, referred and to which he has devoted a substantial part of his distinguished career. The Government undertook a detailed review of its cleaner coal technology programme and published their conclusions in April 1999 in Energy Paper 67. The Government undertook

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  to maintain strong support for cleaner coal R&D with DTI funding of £12 million, to which I have already referred.
  Government support for demonstration projects is not seen as a priority at present, for two main reasons. First, a number of commercially proven cleaner coal technologies are available to the electricity industry from a number of technology suppliers and licensees in both the UK and overseas. These do not need to be demonstrated again on a commercial scale and subsidised by the UK taxpayer. Information about these technologies, their technical characteristics and economics is well known to the UK electricity industry should it choose to invest in them. Government support is focused on supporting R&D to develop more advanced technologies capable of offering substantial improvements in efficiency and environmental performance.
  Secondly, the UK has a number of moderately efficient generating units which offer the electricity industry the option of incremental improvements to existing plant. These include the strategic installation of flue gas desulphurisation in the most heavily used stations rather than investing in new plant. Although the environmental benefits from that are not as good as those obtainable from currently available cleaner coal plant, the difference in cost is not sufficiently great to justify the very large difference in costs between the two approaches.
  I have expressed, I hope in some detail, our support for cleaner coal. However, it does not follow from that that we can support the amendments. We must bear in mind the fact that coal is not renewable and the Government do not consider that it could be considered as an alternative to renewables. The amendment would spread the number of technologies which would be available for the renewable obligation. That would dilute the renewable obligation rather than add to it. At present, we have the renewable obligation, the 10 per cent obligation and the expenditure on and research into clean coal on top of that. The renewable provisions are intended to meet environmental objectives. The effect of the amendments would tend to work in the opposite direction, either by displacing renewables directly or by imposing competing demands on the purse of the electricity consumers. We therefore regret that we are unable to support the amendment.
  On the other hand, Amendment No. 241 addresses a discrepancy in the Bill. There are provisions in the clauses on energy efficiency, standards of performance and licence modification which place requirements on the Secretary of State or the authority relating to avoiding distorting competition when exercising the powers. It is reasonable that renewables should be treated in that way.
  Amendment No. 241 goes too far by ruling out any distortion in competition. We envisage the possibility of some difference in the obligations on new suppliers, which I referred to in discussing the previous amendments, although noble Lords opposite did not care for that. As elsewhere in the Bill, we think that we
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  should be exercising powers so that no supplier should be unduly disadvantaged in competing with other suppliers.
  I accept the principle of the amendment, but I ask the noble Baroness, Lady Buscombe, not to move it. We shall come back with our own amendment at Report stage.
  10.15 p.m.
  Lord Ezra: I listened with pleasure to the enumeration of the ways in which the Government are helping forward research and development in relation to clean coal technology. However, I was disconcerted by the fact that they take a different view from my own and that of the noble Lord, Lord Hardy, on when we should see a large-scale plant in operation in the UK. Until we have that, we will not have got anywhere with clean coal technology—a technology that is well known.
  While more research is desirable and research always leads somewhere, the time comes when we must start producing what the research points to. Unless we can have a production plant here of sufficient size, we shall not obtain the overseas orders; they will go to those countries where such plants exist.
  Furthermore, we are offered the opportunity through the obligation to introduce an element of clean coal technology. I do not agree that this proposal will dilute the obligation; indeed, it would add to and strengthen it. It would mean that we are looking widely at all our energy resources to see how we can improve the atmospheric situation. I wonder whether the noble Lord will discuss this issue with the other matters we shall he discussing to see whether we can make headway perhaps in another direction and achieve what appears to be a common objective.
  Lord McIntosh of Haringey: I am sure that this will be on the agenda for the meetings in which we have already said we will take part with interested parties.
  Lord Hardy of Wath: I am grateful to my noble friend. Obviously the Government are sympathetic. But there is a need for demonstration. I trust that we can discuss that matter and that it will receive favourable consideration. Given the response of my noble friend, we have taken the matter as far as we can at this stage. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Lord Ezra Lord Ezra moved Amendment No. 237:
  Page 62, line 32, at end insert—
  ("(3A) The renewables obligation shall ensure that 5% of Great Britain electricity requirements shall be met from renewables by the end of the year 2003 and 10% by 2010.").
  The noble Lord said: Amendment No. 237 relates to the renewable obligation which we have been discussing at considerable length. It aims to have printed on the face of the Bill the Government's 10 per cent objective for an increase in renewables by the year 2010.
  We were told in informal discussions that there is no need for this amendment; that the Government are fully committed to this objective. We know that they are. But we believe that the issue is of such considerable importance that it should find its place on the face of the Bill. I beg to move.
  Lord Jenkin of Roding: I added my name to that of the noble Lord, Lord Ezra, and in doing so I have one clear objective in mind. I have already referred to the need to finance the development of renewable resources. Generators must be able to borrow. One of the ways in which it will be possible to engender in lenders the confidence that this area has a future is by including the renewable targets on the face of the Bill. They would then be part of the law of the land. Lenders would be able to point to that and say, "That is what is going to happen" and would find themselves able to lend the money to the people who wanted to invest it.
  Lord McIntosh of Haringey: Amendment No. 237 seeks to fix the government targets for renewable electricity in statute. The Bill gives the Secretary of State power to place obligations on electricity suppliers and sets the framework for those obligations. This amendment seeks to establish a general target on the basis of which the level of the obligations would be set. The two would not, of course, be the same because some renewables, such as large-scale hydro, will count towards the Government's target but will not count towards an obligation.
  Let me make it clear, although I perhaps do not need to in the light of what the noble Lord, Lord Ezra said, that there is no question of the Government going back on their commitment to achieve 5 per cent renewable electricity by 2003 and 10 per cent by 2010, provided that the cost to consumers is acceptable. The only issue before us is whether it would be right to put such figures on the face of the Bill.
  We have said that we shall consult further about how the powers under this clause will be exercised. We need to consult on the profile that, so as to reach our target, the obligation will impose on the buy-out mechanism and on the cost to consumers of achieving the obligation. To get the profile right will not be a straightforward matter. We can be sure of doing so only if we listen carefully to the responses from the wide body of expertise in the electricity industry, including the renewables industry, as well as to the views of consumers, who will be paying for it through their electricity bills.
  We believe that the provision which the amendment would introduce, namely, that the obligations will ensure a particular target, is wrong in principle and that it therefore has no place in the Bill. However, that does not mean that we resile at all from our commitment to renewable energy.
  Amendment No. 247 refers to recycling buy-out receipts. That is an option which has advantages and disadvantages. The primary advantage is that it is an
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  additional incentive to meet the obligation by supplying renewables. One disadvantage is that it could push the price that suppliers are prepared to pay for renewable electricity above the price cap set by the buy-out mechanism, which would impose additional costs on consumers.
  The important point for us now is that the Government need to consult further on whether this or another mechanism is the right one. The order-making powers of Clause 61 allow a system of the kind that the amendment addresses, and that is where it should be—in secondary legislation, not on the face of the Bill.
  Amendment No. 248 refers to using buy-out receipts as additional support for renewables. We cannot accept that argument. It would undermine the objective of recycling the receipts in the first place, which is to limit the cost to consumers in the event that renewable generation turns out to be more costly than we expect. Of course, the recycling of buy-out receipts to finance specific technologies will create a further subsidy for renewables at a price much greater than we originally intended when the buy-out price was set. If we get the buy-out price and the incentives right, the level of buy-out receipts should be fairly small, which would not be a good way to support renewables.
  Therefore, with no derogation from our commitment to renewable energy, I regret that we cannot accept these amendments.
  Lord Ezra: If we are to have a discussion about renewables, I suppose we can widen the agenda to take on board these points.
  With regard to the other amendments with which I did not specifically deal, although the Minister did, the Secretary of State is due to make orders dealing with how these repayments should be made. Perhaps we can also discuss whether the ideas that are being formulated fit in with the proposals contained in these two amendments. Having said that, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 238 not moved.]
  Clause 61 agreed to.
  Clause 62 [Orders wider section 32: supplementary]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 239:
  Page 63, line 46, after ("32(6)") insert ("or in the definition of "renewable sources" in section 32(8)").
  The noble Lord said: This is a series of minor government amendments which, with one exception, do not make substantive changes to the renewable powers in the Bill, but make technical adjustments and enable the provisions to be more effectively applied. The one exception is Amendment No. 240 to Clause 62. This states that an order may provide that, to a specified level, underachievement or overachievement in a particular period of a supplier's obligation may be carried forward into a subsequent period. I believe that that is known as "banking and borrowing".
  The Government are considering whether to use this power to allow for a small percentage of a supplier's under or over-achievement of his obligation in a given period (probably a year) to be carried forward into the following period. This would help to avoid potential volatility in the market for renewable electricity that might otherwise take place at the end of a period, as suppliers attempt to clear their positions. It will not allow a supplier to escape his obligation. We intend to consult further on how the power should be used.
  Amendment No. 239 provides that an order under Clause 61 may determine how the proportion of fossil-derived material in waste that may count towards a renewables obligation is to be calculated.
  Amendments Nos. 242 and 243 provide that a "green certificate" may be issued to a supplier as well as to a generator to provide the flexibility which may be necessary.
  Amendments Nos. 245 and 246 provide that a different "buy-out price" may be set for different periods within the overall period of a renewables order and may be adjusted for inflation.
  Amendments Nos. 251 to 255 provide necessary flexibility in the order-making power under Clause 66 so that an order making transitional arrangement to preserve the existing non-fossil fuel obligation contracts can he made at the same time as the implementation of the new electricity trading arrangements.
  Amendment No. 256 allows for an order under Clause 66 to make different provision for Scotland from that for England and Wales. I beg to move.
  On Question, amendment agreed to.
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 240:
  Page 64, line 12, at end insert—
  ("( ) An order may, in relation to any specified period ("the current period")—

  (a) provide that evidence of electricity supplied in a later period may, when available, be counted towards discharging the renewables obligation for the current period;

  (b) provide that evidence of electricity supplied in the current period may, in a later period, be counted towards discharging the renewables obligation for that period;

  (c) specify how much later the later period referred to in paragraph (a) or (b) may be;

  (d) specify a maximum proportion of the renewables obligation for any period which may be discharged as mentioned in paragraph (a) or (b);

  (e) specify a maximum proportion of electricity supplied in any period evidence of which may be counted towards discharging the renewables obligation for a different period.").

  On Question, amendment agreed to.
  [Amendment No. 241 not moved.]
  Clause 62, as amended, agreed to.
  Clause 63 [Green certificates]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 242 and 243:
  Page 64, line 35, at end insert ("or to an electricity supplier").
  Page 64, line 37, after ("station") insert ("or, in the case of a certificate issued to an electricity supplier, a generating station specified in the certificate").
  The noble Lord said: These amendments were spoken to with Amendment No. 239. I beg to move them en bloc.
  On Question, amendments agreed to.
  Clause 63, as amended, agreed to.
  Clause 64 [Alternative way of discharging renewables obligation: payments]:
  Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 244:
  Page 65, line 6, at end insert—
  ("(2) The Secretary of State shall have regard both to the costs of production of differing sources of renewable electricity and to the implications of fulfilment of the renewables target when setting the differing sums which are to be regarded as discharging the renewables obligation under this section.").
  The noble Lord said: In view of what has been said already about a meeting, I can deal with this matter briefly. I listened with interest to what the Minister said on the previous group of amendments.
  Amendment No. 244 is intended to recognise, and therefore to ask the authorities to recognise, that renewables, certainly in the earlier years, will have many different price levels. The amendment suggests that a distinction should be drawn between what one might call the low cost and the higher cost renewables. There should not be a "one suit fits all" situation.
  In the light of what the Committee has just agreed to in a government amendment, that may already be taken into account. However, it is certainly something that needs to be discussed. Those who will have to operate the system and the "buy-out" provision—if I may describe it as that—would think it unfair that the same level of price should be fixed, whatever the gap between the normal energy price, as it were, and the higher price of the renewables.
  I also wish to give notice—I may write to the Minister on this matter—that a number of other issues have been raised with me by a rather splendid body called the Association of Electricity Producers, which represents some of the very small producers of electricity as well as some of the rather large producers. It has been involved in negotiations with officials in the DTI and has had some difficulty in getting its points effectively listened to. The association has some very interesting points as to how it could make this market work more flexibly and more effectively. I should like to draw the Minister's attention to those points as well. I beg to move.
  10.30 p.m.
  Lord McIntosh of Haringey: I am happy to add this to the agenda for our meeting. I do not fully understand the amendment. The fact that the Secretary of State was contemplating setting different buy-out prices for different technologies would imply,

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  of necessity, that he was having regard to the different costs of different technologies. By the same token, it is not conceivable that the Secretary of State would set different prices without regard to the implications for the level of renewables generation likely to be achieved as a result. But perhaps we can tease out this matter better off-line than in the Chamber.
  Lord Jenkin of Roding: With that assurance, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 245 and 246:
  Page 65, line 10, leave out ("and") and insert—
  ("( ) for different such sums in relation to different periods;").
  Page 65, line 14, at end insert ("and
  ( ) for any such sum to be adjusted from time to time for inflation by a method specified in the order (which may refer to a specified scale or index or to other specified data of any description, including such a scale or index or such data in a form not current when the order was made, but in a subsequent form attributable to revision or any other cause and taking effect afterwards).").
  The noble Lord said: I spoke to these amendments with Amendment No. 239. I beg to move.
  On Question, amendments agreed to.
  [Amendments Nos. 247 and 248 not moved.]
  Clause 64, as amended, agreed to.
  [Amendment No. 249 not moved.]
  Lord Ezra Lord Ezra moved Amendment No. 250:
  After Clause 65, insert the following new clause—

  OTHER PROVISIONS RELATING TO ORDERS UNDER SECTION 32 OF 1989 ACT
  (" . In making an order and other arrangements under sections 32, 32A, 32B and 32C of the 1989 Act the Secretary of State may also make provision for—

  (a) electricity generated by any form of combined heat and power stations;

  (b) heat or chilled water produced in association with electricity.").

  The noble Lord said: This amendment seeks to include combined heat and power in the obligation. The reason is that, first, the Government are fully committed to the concept of combined heat and power. I need only quote from the debate which took place yesterday in the other place to indicate what has already been contributed so far to the way in which energy has been saved and the environment improved by the combined use of heat and power. The Minister, Mr Chris Mullin, said:
  "The…combined heat and power capacity has already doubled in the past 10 years. It is now reducing energy costs by more than £500 million annually and cutting CO2 by approximately 5 million tonnes of carbon a year".
  In the course of his remarks he dealt with the question of how the Government will stimulate the further use of CHP under the Utilities Bill. He said:
  "I can confirm that the Government are taking powers under the Utilities Bill to set energy efficiency standards of performance obligations on energy suppliers to encourage and assist consumers to use less energy. For the avoidance of doubt, let me say that CHP is defined as a form of energy efficiency".
  So it comes into that part of the Bill. He went on to say,
  "The Government can also set specific CHP obligations, if they wish to do so. At present, we do not envisage that being necessary."—[Official Report, Commons, 20/6/00; cols. 317–19.]
  because of the other measures.
  The purpose of my amendment is to make absolutely sure that the Government have the power to include CHP in the obligation. According to Mr Mullin, that is the case. Perhaps that could be confirmed. I do not press for that to be done immediately but this is a reserve power to be used if the Government's targets for increasing the use of CHP up to the year 2010 are not achieved. It is against that background that I beg to move.
  Lord McIntosh of Haringey: Joined-up government requires that I should tell the Committee that what Chris Mullin, as a Minister in the Department of the Environment, Transport and the Regions, said yesterday in another place is endorsed by my remarks this evening on behalf of the Department of Trade and Industry. However, because I have not in fact read Chris Mullin's speech, I should prefer to be a little cautious here. I am sure that I will be able to confirm it, but it would be better if I gave that confirmation to the noble Lord, Lord Ezra, in writing rather than did so immediately.
  The amendment would provide that the renewables powers under Clause 61 could be used to support combined heat and power as well as renewable generation. The Government fully understand the importance of the contribution that CHP can make—here I may well repeat what was said by Chris Mullin—to our environmental and energy efficiency objectives. We have made provision for it.
  However, different approaches are required for CHP and renewables, reflecting their different market positions. CHP is not itself necessarily renewable. It is rather an established technology where what we need to ensure is that there is a level playing field in which it can compete. In the case of renewables, on the other hand, we are looking for the development of new technologies to deliver in the long term electricity which can be produced without damaging emissions of greenhouse gases. It is quite simply a matter of encouraging the new technologies which will protect the planet for our children. This is reflected in the structure for renewables provided for in Clauses 61 to 66.
  As I have already described when speaking to Amendments Nos. 192 and 193, other parts of the Bill provide the right framework for CHP by removing barriers to embedded generation. There are additional measures in the Bill which will assist CHP. Fossil-derived CHP can by no stretch of the imagination be

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  considered renewable but CHP which does use renewable sources may count towards the renewables obligation. Thus renewables in general may count towards our new energy efficiency targets under Clauses 69 and 98.
  All this amounts to a major programme of focused measures to assist CHP. But I do not think that it would be helpful to regard CHP and renewables as somehow interchangeable and deserving of identical treatment. Both are important. However, as I have said, our objectives in the two areas, though related, are distinct. That is why I ask the noble Lord, Lord Ezra, not to press this amendment.
  Lord Ezra: On the assumption that once the Minister has read the remarks made by his colleague yesterday in another place he will confirm that he agrees with what was said, I am willing to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 66 [Supplementary]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 251 to 256:
  Page 65, line 28, at end insert—
  ("(za) providing for section 32 of the 1989 Act to have effect, before its substitution by section 61 of this Act, with modifications specified in the order (but if this power is exercised the modifications must include the omission of subsections (3) and (4) of section 32):").
  Page 65, line 29, leave out ("as that section had effect immediately") and insert ("made").
  Page 65, line 39, at end insert——
  ("( ) The power in subsection (1)(b) may be exercised both before the coming into force of section 61 and afterwards.").
  Page 66, line 19, at end insert—
  ("but while subsections (3) and (4) of section 32 of the 1989 Act remain in force an order may not provide for anything which would be an offence under section 32(3) to be treated as a relevant requirement").
  Page 66, line 25, leave out ("as saved by an order under this section") and insert ("made before the coming into force of section 61 of this Act").
  Page 66, line 30, at end insert—
  ("( ) An order under this section may make different provision for different areas.").
  On Question, amendments agreed to.
  Clause 66, as amended, agreed to.
  Clause 67 [Modification of licences: electricity trading arrangements]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 257:
  Page 66, line 35, leave out ("1989 Act") and insert ("Electricity Act 1989").
  The noble Lord said: In moving Amendment No. 257, I shall speak at the same time to Amendments Nos. 259 and 351. Once it has been spoken to, I shall respond also to Amendment No. 258 which is grouped with these amendments.
  The government amendments are technical amendments necessary to provide that Clause 67 commences at Royal Assent. Clause 67 gives the Secretary of State powers to change electricity licences
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  in order to implement the new electricity trading arrangements in England and Wales. Commencement at Royal Assent is essential so that the powers can he used in time to bring the new trading arrangements into effect in the autumn. The planned start date for the new arrangements is 21st November. I beg to move.
  Lord Kingsland: I shall speak to Amendment No. 258, which has a simple text. It replaces the expression,
  "where he considers it necessary or expedient",
  with the expression,
  "to the extent that it is necessary".
  Clause 67 is a very important clause. It gives the Secretary of State wide powers to modify licences. The circumstances in which he can do so are said to be,
  "where he considers it necessary or expedient".
  What exactly is meant by "expedient"? I can understand when the Secretary of State might think it necessary to make modifications. But, strictly speaking, we ought to read into the expression "necessary or expedient", "necessary or unnecessary but expedient". So we are told that there are circumstances where it is unnecessary to make modifications, but nevertheless it is expedient.
  As a good Conservative, I have always been brought up to believe that if it is not necessary to do something, it is necessary not to do it. So I do not recognise circumstances in which it is unnecessary to do something but nevertheless expedient. Would the Minister kindly like to speculate on what "expedient" might mean in the context of this important clause?
  Lord McIntosh of Haringey: My starting-point for responding to this amendment is, I hope, the common ground that we are both in favour of the new electricity trading arrangements. The noble Lord nods. That is very helpful. I am grateful for the way in which the noble Lord has spoken to his amendment.
  However, I do not see how the amendment is consistent with support for the reforms. Its aim is to narrow the scope of the powers under Clause 67. But the provision has been carefully drafted precisely to ensure that we have the scope to introduce the new arrangements without giving the Secretary of State overweening powers in other areas.
  What the amendment would do is put at risk the timely interpretation of the new arrangements by opening the possibility of new lines of legal attack on the use of the powers.
  Exercise of the powers is bound to be a matter of judgment, and the judgment has to be that of the Secretary of State. The clause as drafted makes that entirely clear. By removing the reference to the Secretary of State, the amendment would remove that clarity. By substituting "necessary" for "necessary or expedient", the amendment invites challenge as to what lies on which side of the boundary between the two adjectives.

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  I shall not take up the challenge of the noble Lord, Lord Kingsland, to define "expedient or necessary". The whole point about the provision as drafted is that it is for the Secretary of State to decide what is expedient and necessary, and he is subject in the end to the provisions of administrative law.
  I hope that the amendment does not reflect a fear that somehow the Government will decide to use the powers for some purpose other than introducing the new trading arrangements. That would be completely unfounded. In the cause of avoiding the possibility of legal challenge to the new trading arrangements, I hope that the noble Lord will not press his amendment.
  Lord Kingsland: Before the noble Lord sits down, I entirely accept that it is necessary to include a clause of this kind in the Bill for the purposes which the Minister has clearly outlined. However, that is not the issue. The issue is: to what extent should the Secretary of State's power be constrained on the face of the Bill?
  If one holds a licence, one is likely to have acquired it by spending a sum of money; and to have spent a great deal more to comply with its terms. If the Secretary of State suddenly says, "Even though you have acquired this licence, I now have to change the terms on which it was acquired", one is entitled to know as clearly as possible how widely he can cast his changes.
  My worry about "expedient" is that it is an expression that is almost not susceptible of judicial review. A licence is economically, if not in law, tantamount to an item of property, albeit constrained by a term of years.
  10.45 p.m.
  Lord McIntosh of Haringey: I do not think that that is the case. I oppose the amendment on the primary ground that it would remove the phrase,
  "where [the Secretary of State] considers it necessary".
  But I will think about the "necessary or expedient" issue, without any commitment, between now and Report.
  Lord Kingsland: I am much obliged to the Minister.
  On Question, amendment agreed to.
  [Amendment No. 258 not moved.]
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 259:
  Page 67, line 25, leave out ("commencement of this section"") and insert ("passing of the Utilities Act 2000."
  (2) This section shall come into force on the passing of this Act.").
  On Question, amendment agreed to.
  On Question, Whether Clause 67, as amended, shall stand part of the Bill?
  Lord Ezra: The clause gives the Secretary of State powers to make licence modifications relating to the
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  new electricity trading arrangements. The reason why my noble friend Lady Sharp of Guildford and I have indicated our intention to oppose the Question that Clause 67 stand part of the Bill is to draw attention to the serious problems which the smaller generators are likely to face, particularly involving renewables and combined heat and power, as a result of the proposed balancing and settlement code, which forms a crucial part of the new electricity trading arrangements.
  The present arrangements under the electricity pool provide a relatively benign environment for smaller companies. They place few demands on participants in terms of fulfilment of the existing levels of activity. For example, a wind generator expecting to produce a level of output that in the event it could not provide would not be penalised in the pool for non-delivery.
  However, NETA introduces an entirely different trading philosophy. In future participants would be expected to enter into prior contracts for the physical delivery of electricity, and they would be penalised to the extent that they could not produce all the electricity committed under their contract, or if they produced an excess amount. The operator would receive a low price for excesses—this is called the system sell price—and pay a high price to buy back shortfalls, known as the system buy price.
  Given that it is virtually impossible for, say, a wind farm to predict its output, it cannot safely contract in advance to sell it. It is therefore seriously exposed to the penalties under NETA. Larger companies, with their much larger scale of operations, can reduce these risks very substantially.
  The question is how, if at all, NETA's objective can be preserved for the bulk of operators, particularly the large ones, with some mitigation for the smaller ones, particularly those producing renewables and operating CHP, which cannot, by the very nature of their business, forecast accurately their production.
  I have written to the Minister about this, and have made a suggestion, which is that for specified generators, which would include those based on renewables and CHP, there would be a third price, to be known as the system average price—the average of the buy and the sell prices. It would not remove all the difficulties which smaller operators would face but it would reduce them substantially. I have indicated to the noble Lord how it might be done. The proposal would not involve an amendment to the Bill but would be part of the settlements code. I have provided the Minister with some wording and indicated where it might be inserted into the code. I should be glad to know whether the noble Lord is prepared to consider that proposition.
  Lord McIntosh of Haringey: I am most grateful to the noble Lord for writing to me with his proposal to amend the balancing and settlements code. I do not know whether Members of the Committee have seen that code; it is a terrifying document of incredible complexity about six or seven centimetres thick. The noble Lord has concerns about the effect of imbalance pricing on renewable and combined heat and power

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  generators; in particular, those with an unpredictable output. The Government are consulting on the code and will consider the noble Lord's proposal carefully in that context along with other responses.
  The consultation closes on 14th July and I am not in a position to give more than a preliminary reaction to the proposal. We are conscious of the concerns that have been raised, particularly in relation to unpredictable output. For that reason we have developed mechanisms for aggregation which will allow a licence-exempt generator to share the risk of imbalance with other generators, thereby reducing the overall risk to itself. We are confident that the mechanism is a practical one and that smaller generators will find it of significant benefit in minimising imbalance charges. We have consulted on raising the licence exemption threshold from 50 to 100 megawatts which will increase the number of generators for which the aggregation option is available.
  The Government will make an announcement on the results of the consultation. We are determined that the new trading arrangements should correct the distortions in the current market arrangements identified in the 1998 White Paper. A significant distortion is the failure of the market properly to reward flexible plant. The new arrangements will ensure that it is properly rewarded. I should note that that includes renewable and combined heat and power plant. But it must follow that plant that lacks flexibility or predictability will be less well rewarded. The mechanism for achieving that is precisely the imbalance arrangements targeted by the noble Lord's proposal. Therefore, there are difficulties about the noble Lord's proposal to which this is only a first reaction. The noble Lord's proposal will be considered, together with others, very carefully. If we have more to discuss with the noble Lord we shall certainly seek an opportunity to do so.
  Lord Ezra: I thank the noble Lord for his helpful response.
  Clause 67, as amended, agreed to.
  Lord Borrie Lord Borrie moved Amendment No. 260:
  After Clause 67, insert the following new clause—

  ARRANGEMENTS FOR SUPPLIERS OF LAST RESORT
  (" .—(1) In this section "last resort supplier" means a supplier required by or under that supplier's licence to supply electricity where circumstances have arisen which would entitle the Director to revoke or suspend the licence of another supplier otherwise than with the agreement of that other supplier.
  (2) The Secretary of State may by regulations make modifications of any enactment (including an enactment contained in this Act) for the purpose of implementing, or facilitating the operation of, arrangements relating to last resort suppliers.
  (3) The power of the Secretary of State to make regulations under this section shall he exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.
  (4) The power of the Secretary of State under subsection (2) may not be exercised after the end of the period of one year beginning with the commencement of that subsection.
  (5) After section 15A of the 1989 Act there is inserted—

  ARRANGEMENTS FOR SUPPLIERS OF LAST RESORT

    Licence modifications rehiring to arrangements for suppliers last resort.
    15B.—(1) In this section "last resort supplier" means a supplier required by or under that supplier's licence to supply electricity where circumstances have arisen which would entitle the Director to revoke or suspend the licence of another supplier otherwise than with the agreement of that other supplier.
    (2) The Secretary of State may, in accordance with this section, modify the conditions of a particular licence granted under section 6(1)(c) and 6(2) where he considers it necessary or expedient to do so for the purpose of implementing, or facilitating the operation of, arrangements relating to last resort suppliers.
    (3) The power to modify licence conditions under subsection (2) includes power to make incidental or consequential, or transitional, modifications.
    (4) Before making modifications under this section the Secretary of State shall consult the holder of any licence being modified and such other persons as he considers appropriate.
    (5) Any consultation undertaken by the Secretary of State before the commencement of this section shall he as effective, for the purposes of subsection (4), as if undertaken after; that commencement.
    (6) The Secretary of State shall publish any modifications under this section in such manner as he considers appropriate.
    (7) The power of the Secretary of State under this section may not he exercised after the end of the period of one year beginning with the commencement of this section."").
    The noble Lord said: We have already discussed today in Committee that from time to time, and inevitably under the more competitive conditions that now exist, a supplier may fail and cease to trade and his licence must be suspended or revoked. Without some kind of special provision there is a risk that customers will be left without the supply of a vital fuel. As far as concerns gas, the Gas Act 1986 provides adequately for such a situation by ensuring that another supplier, or supplier of last resort, is appointed to take on the old supplier's customers. Those customers are deemed by the regulator (as the Act puts it) to have a contract with the supplier of last resort.
    This very day in Committee the Government, through their amendments to Clause 31 and Schedule 4, have created a similar arrangement in the supply of electricity. However, there is a risk of failure of supplier before the relevant clauses of this Bill commence and the new licence arrangements come into force, which I believe—the Minister will correct me if I am wrong—will be the spring of 2001. With regard to gas customers, safeguards exist, but for a period there is uncertainty for electricity customers.
    In electricity, the present arrangements allow for the regulator to nominate a supplier of last resort, but they depend on customers taking the initiative to sign up for supply with the second supplier or supplier of last resort. If they do not do so, they can be disconnected and the supplier of last resort could have problems claiming his proper charges. Hence the amendment would enable the Secretary of State to create interim licence arrangements and obligations based on deemed contracts. That would assist in situations of failure by the original supplier before the new standard licence arrangements can take effect under the Bill. The Secretary of State would have power to modify licences to create more robust supplier of last resort arrangements.
    It is a modest amendment. It is time limited until new licence arrangements come into effect. I hope that the Government will look favourably upon it. I beg to move.
    Lord McIntosh of Haringey: I well understand the point the noble Lord makes: that the supplier of last resort arrangements which we have already been debating should be expedited ahead of the implementation of other licensing aspects of the Bill.
    We accept the importance of making arrangements for the appointment and financing of suppliers of last resort. That is why we have made provisions in the Bill—we discussed some of them today; the noble Lord referred to them—and draft standard licence conditions to replicate the arrangements which already exist in gas. As I am sure the noble Lord is aware from his position with Ofgem, we have consulted publicly on them.
    We have had full competition in electricity supply for more than a year. If there had been an urgent requirement for licence conditions to establish arrangements for a supplier of last resort, the Director-General for Electricity Supply would have been able to use his existing powers under Section 11 of the Electricity Act to modify electricity licences in an appropriate way.
    I accept that he could not have included a levy to recover the costs of the person appointed as supplier of last resort. But alternative arrangements could if necessary have been found to address that point pending passage of the Bill. As referred to in earlier discussion, the levy is a last resort of last resort of last resort.
    In any case, the Government do not believe that the amendment will make any significant practical difference. So far as I am aware, we are all agreed on what the supplier of last resort measures should be. We intend to establish these, along with the other standard conditions of licences, as soon as possible. I hope that the noble Lord will not press the amendment.
    Lord Borrie: I am grateful to the Minister. At this hour of the night I can do no more than read his remarks in Hansard and consider whether I need to pursue the matter; or whether, as he suggests, it is not essential, necessary or expedient to press it further. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 68 [Help for disadvantaged groups of electricity customers]:
    On Question, Whether Clause 68 shall stand part of the Bill?
    Lord Ezra: With debate on Clause 68 I should like to speak also to Clause 97. These two clauses deal with help for disadvantaged groups of electricity and gas consumers and therefore touch on the question of fuel poverty.
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    Fuel poverty affects some 4 million to 5 million households out of a total of 22 million. It is, therefore, a major problem. It arises from a combination of inadequate housing and low incomes. The Government have taken a number of measures to improve energy efficiency at the lower end of the housing spectrum. The new home energy efficiency scheme aims to insulate 250,000 houses a year.
    The energy efficiency standards and performance scheme, which is dealt with in the Bill, will add further to energy efficiency, especially in low income households. But, as stated in the latest report of the Royal Commission on Environmental Pollution, to which much reference has been made today, there is a pressing need for a further expansion of government programmes for raising energy efficiency and increasing warmth in low income homes. At the present rate, it would take some 20 years to deal with the problem, assuming that it gets no larger. We need to have an objective of dealing with the problem in not more than five years.
    While much needed home energy improvement has been carried out, the low income aspect of fuel poverty also needs to be dealt with. All pensioner households are now entitled to £150 fuel payment each winter. While that is helpful, something more fundamental is required. At Second Reading I referred to the law recently introduced in France to provide disadvantaged consumers with specially low-priced fuel. I was advised by the Minister that that was not possible in Britain.
    However, I believe that there is another way of achieving this result. TXU, which was formerly Eastern Electricity, has produced an imaginative scheme for assisting pensioners and persons on income support. This is known as the "Staywarm" scheme and has been piloted in the Barnsley area, where it has been estimated that some 300,000 people are in receipt of income support.
    The basis of the scheme is to guarantee to those who sign up gas and electricity at the lowest price in the area. An estimate would be made of their likely annual requirements based on the size of the house and the numbers in the family. A weekly payment would be calculated and would be paid irrespective of the amount of fuel actually used. Thus, if there were a really hard winter there would be no need for these low income households to deprive themselves of warmth. They could use as much as was necessary to keep them warm and pay no more for it.
    TXU estimates that such a scheme could save users approximately £120 on the typical energy cost of £500 a year and there would be a guarantee of warmth whatever the weather. They consider that they can achieve this desirable result through reducing the debt risk as a result of regular payments.
    At a meeting which I had with them, they advised me that the prices charged under the scheme could be still further reduced if the DSS could be persuaded to deduct the weekly payment from benefit and transmit it to the company. That would eliminate all risk of bad

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    debt and substantially reduce the costs of the operation, generating savings which TXU would be ready to pass straight on to the user.
    It seems to me that this is a very imaginative scheme which needs to be encouraged. There is a way in which the DSS, without adding any government expenditure, could help. TXU realises that other supply companies would want to follow the same scheme in other parts of the country and it is quite prepared to accept the competition. Therefore, I suggest that the scheme should receive serious consideration in order to overcome the problem of households on low incomes freezing in winter.
    11 p.m.
    Lord McIntosh of Haringey: Once again, the noble Lord, Lord Ezra, has approached the Committee stage in a constructive way. He has expressed general support for Clause 68 and therefore I shall not embark on a general defence of it. The noble Lord advocated a particular project, the TXU "Staywarm" tariff and made a suggestion about it and it is that to which I shall respond.
    It is correct that it is an innovative approach both to energy retailing and to providing assistance to the fuel poor with their energy costs by offering them a very low tariff. The pilot of the "Staywarm" scheme was launched on 17th May by Helen Liddell, the Minister for Energy and Competitiveness in Europe, and therefore our involvement with it is well established.
    Because the noble Lord has done so, I shall not set out the details of the scheme, except in so far as the payment is concerned. Ideally, customers will pay by direct debit but a weekly or fortnightly cash facility will be available via post offices. The pilot, which is taking place in Yorkshire in an area between Leeds and Sheffield, is intended to find out what are the best methods for attracting customers.
    The noble Lord, Lord Ezra, now suggests that there should be direct payment by the DSS in developing the new scheme. The problem which we have not resolved at present is that that would involve considerable manual processing by the Department of Social Security. There is a DSS scheme called Fuel Direct, which presently is used as a last resort for benefit claimants who are in need of protection against disconnection or court action. It is available only to people who receive income support and jobseeker's allowance (income-based).
    Fuel Direct is a manual addition to the benefits payments system. If it, or direct payment to TXU Staywarm, were to become a standard feature, it would involve substantial costs to the DSS, particularly in new computer systems. The DSS would also be obliged to make the facility available to others. Clearly, it could not be for TXU's exclusive use.
    Staywarm offers assistance to a wide range of low-income households, many of whom are on benefits which are not paid by the Benefits Agency and would not be included in the Fuel Direct payment arrangements. Ofgem has a specific working group as part of its follow-up to the Social Action Plan whose
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    remit is to consider whether and how Fuel Direct might be simplified and extended. That work will feed into the ministerial group on fuel poverty, which includes a DSS Minister.
    I suggest that the additional evidence given by the noble Lord, Lord Ezra, in his suggestions should be fed into that ministerial group. I shall undertake for that to be done in the hope that the difficulties that I have outlined can be overcome at some point in the future.
    Lord Ezra: I thank the noble Lord for his positive response that my suggestion will be taken forward. With that, I beg leave to withdraw the Motion.
    Clause 68 agreed to.
    Clause 97 [Help for disadvantaged groups of gas customers]:
    [Amendments Nos. 261 and 262 not moved.]
    Clause 97 agreed to.
    Clause 69 [Energy efficiency requirements for electricity distributors and suppliers]:
    Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 263 and 264:
    Page 69, line 20, leave out ("specified in or determined") and insert ("to be determined by the Authority").
    Page 69, line 28, leave out from beginning to ("must") in line 29 and insert ("Where the Secretary of State specifies in an order under this section an overall energy efficiency target in relation to electricity distributors and electricity suppliers on whom obligations are imposed under the order, the Authority shall determine energy efficiency targets under the order in the manner it considers best calculated to result in the achievement of the overall energy efficiency target so specified.
    (3A) The energy efficiency targets determined by the Authority for the purposes of an order under this section").
    On Question, amendments agreed to.
    Clause 69, as amended, agreed to.
    Clause 98 [Energy efficiency requirements for gas transporters and suppliers]:
    Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 265 and 266:
    Page 103, line 21, leave out ("specified in or determined") and insert ("to be determined by the Authority").
    Page 103, line 29, leave out from beginning to ("must") in line 30 and insert ("Where the Secretary of State specifies in an order under this section an overall energy efficiency target in relation to gas transporters and gas suppliers on whom obligations are imposed under the order, the Authority shall determine energy efficiency targets under the order in the manner it considers best calculated to result in the achievement of the overall energy efficiency target so specified.
    (3A) The energy efficiency targets determined by the Authority for the purposes of an order under this section").
    On Question, amendments agreed to.
    Clause 98, as amended, agreed to.
    Clauses 70 and 71 agreed to.
    Clause 72 [Maximum prices for reselling electricity]:
    [Amendments Nos. 266A and 266B not moved.]
    Clause 72 agreed to.
    [Amendments Nos. 267 and 267A not moved.]
    Clause 101 agreed to.
    [Amendment No. 268 not moved.]
    Clause 75 [Gas transporters]:
    [Amendments Nos. 269 to 273 not moved.]
    Clause 75 agreed to.
    Clause 76 [Restriction on use of certain pipe-lines for providing a supply of gas]:
    Baroness Buscombe Baroness Buscombe moved Amendment No. 274:
    Page 74, line 34, at end insert ("having regard to any guidelines drawn up by the Authority from time to time in consultation with gas transporters and to the provisions of section 7(8)(b)").
    The noble Baroness said: The aim of Amendments Nos. 274 and 275 is to clarify the provisions of Section 10 of the Gas Act 1986, which applies to the laying of pipes by owners or occupiers of premises. That area of the gas connections market has become known in the industry as the self-lay market, providing consumers with an alternative to the gas transporters supplying and laying the pipes. Gas transporters are required to connect such pipes to their system, provided that they are satisfied that the pipe laid is fit for the purpose.
    Section 10(6) of the Gas Act 1986 provides a swift transfer mechanism for the ownership of the pipe and rights and liabilities relating to it by vesting the pipe in the transporter at the time of connection. That reduces the costs involved in otherwise transferring legal ownership.
    In many cases, the owner or occupier will not lay the pipe himself, but will engage a self-lay contractor. The aim of the amendments is to make it clear that the vesting provisions apply equally to a pipe laid by a self-lay contractor on behalf of the owner or occupier. I beg to move.
    Lord McIntosh of Haringey: I am grateful to the noble Baroness, Lady Buscombe, for restricting my speaking notes on this group, but I should say a word about the purpose of Clauses 75, 76 and 77. I shall try to do so without referring to the amendments that have not been moved.
    The provisions will end the geographical exclusivity of gas transportation licences, which was an important, if technical policy. I shall explain geographical exclusivity and its effects in a moment, but first I shall summarise the Government's two-fold motivation for the policy: to reduce barriers to entry, thus increasing competition and driving down prices to the benefit of consumers; and to assist with compliance with the European Union gas directive.
    Public gas transporter—PGT—licences are currently geographically exclusive. Under Section 7(2)(a) of the Gas Act 1986, any given area may be within the authorised area of only one PGT and only that PGT may convey gas through pipes to premises in that area. In other words, we have a series of local monopolies. The main purpose of Clause 75, which has been agreed to, is to end geographical exclusivity by removing the requirement that PGT licences may not include areas that are specified in the licences of other PGTs.
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    It is no surprise that transporters object to that policy. It will increase competition for them and we hope that it will reduce the prices they can charge. Incumbent monopolies do not like that sort of thing but the Government want consumers to benefit from increased competition.
    Amendments Nos. 274 and 275 seek to amend Clause 76 which concerns the transitional issue of how to deal with pipes laid by transporters outside their authorised areas in the past. At present, gas transporters may have other transporters' pipes passing through their authorised areas in order to get gas to the other side. Such "pass-through" pipes cannot currently be used by their owners to give a supply of gas to premises.
    Now that Clause 75 will end exclusivity of authorised areas, the pass-through pipe could conceivably become a threat to the incumbent transporter. We feel that this could be unfair. Clause 76 therefore provides that the consent of the first transporter is required if a pass-through pipe which was built before the abolition of geographical exclusivity is to be used for giving a supply. If the first transporter refuses consent or fails to give it, the authority may intervene and override that refusal.
    As a general rule, we are trying to place broad duties on the authority but then not be too prescriptive about how it carries them out. Therefore we have not put on the face of the Bill detailed considerations about when to override a refusal to give consent. Amendment No. 274 would change that, reverting to the highly specific tests currently found in subsection (8)(b) of Section 7 of the Gas Act to which the noble Baroness, Lady Buscombe, referred. The clause as drafted is flexible enough to allow the authority to respond to changing circumstances. If the amendment were to be accepted, that flexibility would disappear.
    Amendment No. 75 relates to Clause 77. That deals with some of the consequences of the abolition of geographical exclusivity. It covers the procedures to be followed when one transporter wishes to lay pipes within 23 metres of another transporter's pipes and inserts a new version of what is known as the 23-metre rule into Section 22A of the Gas Act.
    Clause 77 provides important safeguards to deal with the consequences of the removal of geographical exclusivity, which Amendment No. 275 would remove, leaving in place the current provisions of Section 7, which are inappropriate to deal with overlapping authorised areas. I am afraid that the Government cannot accept those amendments.
    11.15 p.m.
    Baroness Buscombe: I thank the Minister for his response. There is no question that this area is causing great concern in the industry. I shall read carefully in Hansard what the noble Lord said and we may consider returning to this on Report. On that basis, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 76 agreed to.
    Clause 77 [Construction of pipe-lines by gas transporters]:
    [Amendment No. 275 not moved.]
    Clause 77 agreed to.
    Clause 78 agreed to.
    Clause 79 [Gas transporters' duty to make a connection]:
    Baroness Buscombe Baroness Buscombe moved Amendment No. 276:
    Page 76, line 8, at end insert—
    ("( )In subsection (1)(b) after "premises" there is inserted "or by a person other than the transporter acting on behalf of the owner or occupier".").
    The noble Baroness said: In moving this amendment, I shall speak also to Amendments Nos. 277 to 280. The amendments seek to clarify certain consequences of subsections (4) and (5) of Clause 79 which were inserted as amendments in Committee in another place.
    Once the pipe is connected, the gas transporter will take over all responsibilities for the maintenance and subsequent renewal of the pipe. It will also take over responsibility, subject to any indemnity it may reasonably require, for any remedial reinstatement of the highway, should that be needed.
    The amendments do not seek to alter that situation. However, gas transporters enjoy certain powers which are not available to private individuals when excavating streets. In particular, planning permission to lay the pipe is deemed to be granted and gas transporters do not need to obtain individual streetwork licences to break open the street, lay the pipe and retain it in the street.
    These amendments seek to clarify that, once the transporters have connected the pipe, any issues over whether planning permission or a street works licence should have been obtained or complied with by the owner or occupier will cease to affect the transporter, but will not affect the ability of the planning authority or the highway authority to take action against the owner or occupier.
    This provision avoids the need for long-term indemnities from the owner or occupier or contractors which would otherwise inhibit competition in the laying of surface pipes. I beg to move.
    Lord McIntosh of Haringey: Am I right in thinking that the noble Baroness was speaking only to Amendments Nos. 276 and 280 or was she speaking to the whole group—the ones in between?
    Baroness Boscombe: I apologise to the Minister. I was speaking to Amendments Nos. 276, 277, 278, 279 and 280.
    Lord McIntosh of Haringey: I am grateful. Amendments Nos. 276, 278 and 279 all cover the same ground, and I am afraid that they are all completely unnecessary. The current drafting of the Gas Act differentiates between pipes laid by a transporter and pipes laid by the owner or occupier of premises. It would be absurd to interpret the existing words as
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    meaning that the householder has physically to dig the hole and lay the pipes with his own hands. That would be to deny the vast majority of people—that is to say those who are not gas pipeline experts—the opportunity to exercise the right in subsection (1)(b) of section 10 of the Gas Act to have a pipe laid by them connected to a transporter's main. And of course making this obvious interpretation explicit here would call into doubt any other instances which were not amended in the same way.
    Amendment No. 277 would be ineffectual. In summary, the amendment means that anyone who asks to be connected to the gas main could be asked by the transportation company for an indemnity in case the transporter lays the connecting pipe badly and it leaks, leading to an explosion which destroys the building next door. It is obvious that such a requirement would not be reasonable; indeed, nobody could reasonably demand an indemnity in respect of work he carries out himself. The amendment makes no substantive change to the clause.
    In order to explain why that is the case, I have to explain the existing provision in Clause 79. At present there are two ways for someone to get his premises connected to a gas main. The first is to request a gas transporter to lay appropriate pipes and make the connection, which transporters are required to do by subsection (2)(a) of section 10 of the Gas Act, if the premises are within 23 metres of an existing main.
    The second is for the owner of the premises to arrange to have pipes laid and then require the transporter simply to connect these new pipes to the main. These pipes are known as "self-lay" pipes, and the transporter's duty to connect them is covered by subsection (2)(b). Currently, once these pipes are connected to the gas main, all rights in them vest in the transporter. In the past, certain self-lay operators have not properly reinstated the ground they have dug up in order to lay the pipe. Some transporters have refused to repair or maintain the reinstatement, as they say that only the rights in the pipe are vested in them, and not the liabilities.
    We felt that local authorities and similar bodies should not be in any doubt as to which company to chase up in circumstances where the pipe has been laid badly. Licensed gas transporters have to have systems in place for dealing with repairs to their pipes, and so it is simpler for local authorities to go straight to the transporter and not to be bounced between various people. So subsections (4) and (5) of Clause 79 have the effect that liabilities as well as rights vest in the transporter on connection of self-lay pipes.
    However, it is very unfair to transporters, simply to load them up with all sorts of liabilities which are beyond their control; so subsection (2) of Clause 79 inserts a new subsection (3A) into Section 10 of the Gas Act, allowing transporters to insist that self-lay operators sign a contract containing reasonable indemnities in respect of any faults connected with the laying of the pipe.
    So now local authorities will know who to approach—namely, the transporter—and the transporter will be protected by contracts; and if the

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    self-lay operator refuses to accept reasonable terms, the transporter can simply refuse to connect the new pipes to the mains. The gas and electricity markets authority will determine any disputes as to what is reasonable.
    I turn to Amendment No. 280. We want local authorities not to have to chase between different people. It is therefore our policy that the transporter takes on the liabilities with reasonable indemnities. The situation should be no different when a self-lay operator fails to obtain, say, a streetworks licence. The local authority should be able to go straight to the transporter, which should have protected itself with appropriate due diligence and contractual indemnities.
    A failure by a self-lay operator to obtain or comply with permissions not required by transporters would have no impact on the transporter in respect of any criminal liability, which would remain with the self-layer. Any civil liabilities would be covered by indemnities. Since transporters could maintain and operate the pipes under their statutory powers, no streetworks licence would be necessary for them and they would not acquire a duty to pay ongoing fees for such a licence.
    The amendment is too detailed. It relates to an issue which arises rarely, if at all, and for which a perfectly sensible solution already exists in the ability of transporters to impose reasonable terms indemnifying themselves.
    Baroness Buscombe: I thank the Minister for his response to the amendments. Obviously, I am disappointed. However, I shall read carefully in Hansard what he has said. On that basis, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendments Nos. 277 to 280 not moved.]
    Clause 79 agreed to.
    Clauses 99 and 100 agreed to.
    Clause 102 agreed to.
    Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 281:
    After Clause 102, insert the following new clause—

  GENERAL RESTRICTIONS ON DISCLOSURE OF INFORMATION
  (".—(1) Information which—

  (a) has been obtained under or by virtue of the provisions of this Act. Part I of the 1986 Act or Part I of the 1989 Act; and

  (b) relates to the affairs of any individual or to any particular business,

  shall not be disclosed during the lifetime of the individual or so long as the business continues to be carried on, except as provided below.
  (2) Subsection (1) does not apply to a disclosure made with the consent of the individual or the person for the time being carrying on the business.
  (3) Subsection (1) does not apply to a disclosure if—

  (a) it is made for the purpose of facilitating the performance of any functions of the Secretary of State, the Authority, the Council or the Competition Commission under the 1986 Act, the 1989 Act or this Act;

  (b) it is required by a notice under section 38(1A) of the 1986 Act or section 28(2A) of the 1989 Act;

  (c) it is made by a licence holder and is required to be made by a condition of his licence: or

  (d) it is made by one licence holder to another and is required by that other licence holder for purposes connected with the carrying on of relevant activities.

  (4) Subsection (1) does not apply to any disclosure of information made—

  (a) for the purpose of facilitating the performance by a person or body mentioned in subsection (5) of any function under an Act or instrument specified in subsection (6);

  (b) for the purpose of facilitating the performance by the Comptroller and Auditor General, the Health and Safety Commission or the Health and Safety Executive of any of his or its functions;

  (c) for the purpose of facilitating the exercise by the Secretary of State of any power conferred by the Financial Services Act 1986 or by the enactments relating to companies, insurance companies or insolvency;

  (d) for the purpose of facilitating the performance of the functions of an inspector appointed under the enactments relating to companies;

  (e) for the purpose of facilitating the performance by an official receiver of his functions under the enactments relating to insolvency or by a recognised professional body for the purposes of section 391 of the Insolvency Act 1986 of its functions as such a body;

  (f) in connection with the investigation of any criminal offence or for the purposes of any criminal proceedings:

  (g) for the purposes of any civil proceedings brought under or by virtue of the 1986 Act, the 1989 Act, this Act or any Act or instrument specified in subsection (6) below; or

  (h) in pursuance of a Community obligation.

  (5) The persons and bodies specified for the purposes of subsection (4)(a) are—

  (a) a Minister of the Crown;

  (b) the Competition Commission:

  (c) the Director General of Fair Trading;

  (d) the Director General of Telecommunications;

  (e) the Director General of Water Services;

  (f) the Director General of Electricity Supply for Northern Ireland;

  (g) the Director General of Gas for Northern Ireland;

  (h) the Rail Regulator;

  (i) the Civil Aviation Authority:

  (j) the Insolvency Practitioners Tribunal;

  (k) the Coal Authority: and

  (l) a local weights and measures authority in Great Britain.

  (6) The Acts and instruments specified for the purposes of subsection (4)(a) and (g) are—

  (a) the Trade Descriptions Act 1968;

  (b) the Fair Trading Act 1973;

  (c) the Consumer Credit Act 1974;

  (d) the Estate Agents Act 1979;

  (e) the Competition Act 1980;

  (f) the National Audit Act 1983;

  (g) the Telecommunications Act 1984;

  (h) the Airports Act 1986:

  399

  (i) the Insolvency Act 1986;

  (j) the Consumer Protection Act 1987;

  (k) the Control of Misleading Advertisements Regulations 1988;

  (l) the Water Act 1989, the Water Industry Act 1991 or any of the other consolidation Acts (within the meaning of section 206 of the Water Industry Act 1991);

  (m) the Electricity (Northern Ireland) Order 1992

  (n) the Railways Act 1993;

  (o) the Coal Industry Act 1994;

  (p) the Gas (Northern Ireland) Order 1996;

  (q) the Competition Act 1998.

  (7) The Secretary of State may by order modify subsection (3), (4),(5) or (6).
  (8) Nothing in subsection (1) above is to be construed either as limiting the matters which may be—

  (a) published under section 33DA or 35 of the 1986 Act or section 42AA or 48 of the 1989 Act;

  (b) made public by the Authority as part of a notice under section 26; or

  (c) included in, or made public as part of, a report of the Authority, the Council or the Competition Commission under any provision of this Act, Part I of the 1986 Act or Part I of the 1989 Act;

  or as applying to information which has been so published or has been made public as part of such a notice or such a report.
  (9) A person who discloses any information in contravention of this section is guilty of an offence and liable—

  (a) on summary conviction, to a fine not exceeding the statutory maximum;

  (b) on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine or to both.

  (10) In this section—
  "licence holder" means the holder of a gas licence or an electricity licence; and
  "relevant activities", in relation to a licence holder means activities he is authorised by his licence to carry on (including, in the case of a gas transporter, the activities mentioned in section 7(1)(b) and (c) of the 1986 Act).
  (11) Information obtained by the Authority in the exercise of functions which are exercisable concurrently with the Director General of Fair Trading under Part I of the Competition Act 1998 is subject to sections 55 and 56 of that Act (disclosure) and not to subsections (1) to (10) of this section.
  (12) The power to make an order under subsection (7) is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.").
  On Question, amendment agreed to.
  Clause 3 [Transfer to Authority and Council of functions, property etc.]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 282 and 283:
  Page 2, line 3, leave out from ("Directors")") to ("are") in line 4.
  Page 2, line 23, at end insert—
  ("( ) Subsection (6) has effect in relation to property, rights or liabilities to which it applies in spite of any provision (of whatever nature) which would prevent or restrict the transfer of the property, rights or liabilities otherwise than by that subsection.").
  On Question, amendments agreed to.
  Clause 3, as amended, agreed to.
  Schedule 3 [Further provision about transfers of functions, property etc.]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments No. 284 to 286:
  Page 114, line 44, leave out ("or the Council").
  Page 115, line 35, leave out ("instruments, contracts and legal proceedings") and insert ("any document").
  Page 115, line 45, leave out ("IX") and insert ("XI").
  On Question, amendments agreed to.
  Schedule 3, as amended, agreed to.
  Clause 103 [Interpretation]:
  [Amendment No. 287 not moved.]
  Clause 103 agreed to.
  11.30 p.m.
  Clauses 104 and 105 agreed to.
  Schedule 6 [Minor and consequential amendments]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 288 to 312:
  Page 120, line 32, at end insert ("and for "public gas transporters" in each place where it appears, there is substituted "gas transporters"").
  Page 121, leave out line 1.
  Page 121, line 9, after ("In") insert ("section 19(6)(a), paragraph 5(2) of Schedule 2B and").
  Page 121, line 27, at end insert—
  (" . In section 24(8) (interpretation of sections 24 to 26 of the 1986 Act) for "and 26 below" there is substituted ", 26 and 26A".").
  Page 121, line 27, at end insert—
  (". In section 27A(1) (determination of certain disputes) for "domestic customer" there is inserted "customer of a person authorised by a licence or exemption to supply gas".").
  Page 121, line 38, leave out ("24 of the Utilities Act 2000".") and insert ("(Sections 24 to 26: supplementary)(4)(b) of the Utilities Act 2000 (order to comply with a direction under section 24 of that Act)".").
  Page 121, line 44, at end insert ("as in the Authority's opinion ought to be achieved in individual cases").
  Page 122, leave out lines 9 and 10 and insert—
  ("15. In section 38 (power to require information etc.)—

  (a) in subsection (1A) for "4 or 4A above" there is substituted "4AA, 4AB or 4A": and

  (b) in subsection (3) after "document" insert "or record".").

  Page 122. leave out lines 11 and 12.
  Page 122, line 12, at end insert—
  (" . In section 46(3), for "his authorised area" there is substituted "any authorised area of his.").
  Page 122, line 25, after ("inserted") insert (""23,").
  Page 122, line 32, at end insert—
  (" . In Schedule 2B (the gas code), in paragraph 8—

  (a) sub-paragraphs (4), (5) and (6) shall be omitted:

  (b) in sub-paragraph (8) the words from "but this" to the end shall cease to have effect;

  (c) in sub-paragraph (11)—

  (i) for the words from "a revision" to "such an election" there is substituted "or a revision of such a scheme"; and

  (ii) in paragraphs (a) and (b), for ", revision, election or withdrawal" there is substituted "or revision".").

  Page 122, leave out lines 38 to 40 and insert—
  ("23.—(1) Section 23 (determination of disputes) is amended as follows.
  (2) For subsections (1) to (2) there is substituted—
  "(1) This section applies (in addition to any disputes to which it applies by virtue of any other provision of this Act) to any dispute arising under sections 16 to 21 between an electricity distributor and a person requiring a connection.
  (1A) A dispute to which this section applies—

  (a) may be referred to the Authority by either party, or with the agreement of either party, by the Council; and

  (b) on such a reference, shall be determined by order made either by the Authority or, if the Authority thinks fit, by an arbitrator (or in Scotland an arbiter) appointed by the Authority.

  (1B) The practice and procedure to be followed in connection with any such determination shall be such as the Authority may consider appropriate.
  (1C) No dispute arising under sections 16 to 21 which relates to the making of a connection between any premises and a distribution system may be referred to the Authority after the end of the period of 12 months beginning with the time when the connection is made.
  (2) Where a dispute arising under sections 16 to 21 between an electricity distributor and a person requiring a connection falls to be determined under this section, the Authority may give directions as to the circumstances in which, and the terms on which, the distributor is to make or (as the case may be) to maintain a connection pending the determination of the dispute."
  (3) After subsection (4) there is inserted—
  "(4A) A person making an order under this section shall include in the order his reasons for reaching his decision with respect to the dispute.").
  (4) After subsection (6) there is inserted—
  "(7) Section 16(4)(a) does not apply to the references in this section to making a connection."").
  Page 123, line 2, leave out ("24 of the Utilities Act 2000".") and insert ("(Sections 24 to 26: supplementary)(4)(b) of the Utilities Act 2000 (order to comply with a direction under section 24 of that Act)".").
  Page 123, line 3, at end insert—
  (" .—(1) Section 28 (power to require information etc.) is amended as follows.
  (2) After subsection (2) there is inserted—
  "(2A) Where a licence has been or is to be revoked or suspended, or has expired or is about to expire by effluxion of time, and it appears to the Authority, having regard to the duties imposed by section 3A, 3B or 3C, to be requisite or expedient to do so for any purpose connected with the revocation, suspension or expiry, the Authority may, with the consent of the Secretary of State, by notice in writing—

  (a) require the licence holder to produce, at a time and place specified in the notice, to the Authority, or to any person so specified, any records which are specified or described in the notice and are in the licence holder's custody or under his control; or

  (b) require the licence holder to furnish to the Authority, or to any person specified in the notice, such information as may be specified or described in the notice, and specify the time, the manner and the form in which any such information is to be furnished.".

  (3) In subsection (3), after "documents" there is inserted "or records"
  (4) In subsection (4), after "subsection (2)" there is inserted "or (2A)".
  (5) In subsection (5)—

  (a) after "document" there is inserted "or record";

  (b) after "subsection (2)" there is inserted "or (2A)".

  (6) In subsection (6), after "subsection (2)" there is inserted "or (2A)".").
  Page 123, line 8, leave out ("paragraphs (a) and (c)") and insert ("paragraph (a)").
  Page 123, line 10, after ("transmission";") insert—
  ("( ) in paragraph (c) for "supply" there is substituted "distribute";").
  Page 123, line 33, at end insert ("as in the Authority's opinion ought to be achieved in individual cases."").
  Page 123, line 38, at end insert—
  ("( ) in subsection (2)(a) and (c) for "public electricity suppliers" there is substituted "electricity suppliers";
  ( ) in subsections (3) and (4) for "a public electricity supplier" there is substituted "an electricity supplier.").
  Page 123, line 44, at end insert—
  ("( ) in subsection (2) for "public electricity suppliers" there is substituted "electricity suppliers";
  ( ) in subsection (3) for "public electricity supplier" there is substituted "electricity supplier".").
  Page 123, line 44, at end insert—
  (" . In section 42 (information with respect to levels of performance)—

  (a) in subsection (1) for "public electricity suppliers" there is substituted "electricity suppliers";

  (b) in subsection (2) for "public electricity supplier" there is substituted "electricity supplier";

  (c) in subsection (3) for "a public electricity supplier" there is substituted "an electricity supplier".").

  Page 123, leave out lines 47 and 48.
  Page 124, leave out line 2.
  Page 124, line 9, at end insert—
  ("( ) In the definition of "electrical plant" after "transmission" there is inserted "distribution".").
  Page 124, line 22, at end insert—
  ("( ) The definition of "private electricity supplier", the definition of "public electricity supplier" and the definition of "tariff customer" shall be omitted.").
  The noble Lord said: These amendments were spoken to earlier. With the leave of the Committee, I shall move them en bloc. I beg to move.
  On Question, amendments agreed to.
  Schedule 6, as amended, agreed to.
  Schedule 7 [Transitional provisions and savings]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 313:
  Page 126, line 3, leave out Part I and insert—

  PART I SEPARATION OF ELECTRICITY SUPPLY AND DISTRIBUTION
  Application and purpose of Part I
  1.—(1) This paragraph applies to any holder of an existing supply licence under section 6(1)(c) or (2) of the 1989 Act whose activities, immediately before the passing of this Act, include both—

  (a) the supply of electricity to premises; and

  (b) the distribution of electricity for the purpose of giving a supply to premises or enabling a supply to be so given.

  (2) This Part of this Schedule has effect for the purpose of enabling the existing supply licence held by such a licence holder to have effect on and after the day on which section 6(2) of the 1989 Act (as substituted by section 29 above) comes into force as if it were a distribution licence under section 6(1)(c) and a supply licence under section 6(1)(d), each granted to different persons.
  (3) Those persons must be—

  (a) the licence holder and one of his associates nominated for the purpose of holding whichever of the licences mentioned in sub-paragraph (2) is not to be retained by the licence holder; or

  (b) any two associates of the licence holder nominated by him for the purpose of holding those licences.

  (4) If immediately before the passing of this Act a person to whom this paragraph applies holds two or more existing supply licences, sub-paragraph (2) applies in relation to such one or more of those licences as the licence holder may, with the approval of the Secretary of State, nominate.
  (5) If immediately before the passing of this Act a person to whom this paragraph applies—

  (a) generates electricity in pursuance of an existing generation licence; and

  (b) transmits electricity in pursuance of an existing transmission licence,

  the provisions of this Part of this Schedule also have effect, if that person makes either or both of the nominations mentioned in sub-paragraph (6), for either or both of the purposes mentioned in sub-paragraph (6)(a) and (6)(b).
  (6) Those purposes are securing that on and after the day on which section 6(2) of the 1989 Act (as substituted by section 29 above) comes into force—

  (a) the licence holder's existing generation licence has effect as if it were a generation licence granted to an associate of his nominated by him for the purpose; and

  (b) the licence holder's existing transmission licence has effect as if it were a transmission licence granted to an associate of his nominated by him for the purpose.

  (7) An associate nominated for the purposes of sub-paragraph (6)(a) may not be nominated for the purposes of sub-paragraph (3)(a), (3)(b) or (6)(b).
  Nominations and transfer schemes
  2.—(1) Before such date as the Secretary of State may direct, a person to whom paragraph 1 applies may (subject to paragraph 3)—

  (a) make a nomination for the purposes of paragraph (a) of paragraph 1(3) and make a scheme for the division of all his property, rights and liabilities between himself and the associate nominated under that paragraph; or

  (b) make two nominations for the purposes of paragraph (b) of paragraph 1(3) and make a scheme for the division of all his property, rights and liabilities between himself and the associates so nominated;

  and in this Part of this Schedule the person who makes such a scheme is referred to as "the supplier".
  (2) A scheme under sub-paragraph (1) (referred to in this Part of this Schedule as "a transfer scheme") may—

  (a) define the property, rights and liabilities to be allocated to a nominated associate—

  (i) by specifying or describing the property, rights and liabilities in question;

  (ii) by referring to all (or all but as much as may be excepted) of the property, rights and liabilities comprised in a specified part of the supplier's undertaking; or

  (iii) partly in the one way and partly in the other;

  (b) provide that any rights or liabilities specified or described in the scheme shall be enforceable either by or against any one or more of the persons between whom the supplier's property, rights and liabilities are being divided;

  (c) impose on any of those persons an obligation to enter into such written agreements with, or execute such other instruments in favour of the other such person or, where sub-paragraph (1)(b) applies, either or both of the other such persons as may be specified in the scheme; and

  404

  (d) make such supplemental, incidental and consequential provision as the supplier considers appropriate.

  (3) Without prejudice to the generality of sub-paragraph (2)(d), a transfer scheme may, in relation to transfers or transactions effected in pursuance of the scheme, make provision, either generally or for specified purposes—

  (a) for the transfers or transactions to be regarded as taking place in a specified order; and

  (b) for the nominated associate or, where sub-paragraph (1)(b) applies, either or both of the nominated associates to be treated as the same person in law as the supplier.

  (4) An obligation imposed by a provision included in a transfer scheme by virtue of sub-paragraph (2)(c) shall he enforceable by civil proceedings by the person or persons to whom it is owed for an injunction or for interdict or for any other appropriate relief or remedy.
  (5) A transaction of any description which is effected in pursuance of a provision included in a transfer scheme by virtue of sub-paragraph (2)(c)—

  (a) shall have effect subject to any statutory requirements for transactions of that description to be registered in any statutory register; but

  (b) subject to that, shall be binding on all other persons, notwithstanding that it would, apart from this sub-paragraph, have required the consent or concurrence of any other person.

  In this sub-paragraph "statutory requirements" means requirements imposed by or under any Act or any Act of the Scottish Parliament.
  (6) Where a lease of any land is granted in pursuance of a provision included in a transfer scheme by virtue of sub-paragraph (2)(c), any right of pre-emption or other like right affecting that land—

  (a) shall not become exercisable by reason of the grant of the lease; but

  (b) shall have effect as if the lessee were the same person in law as the lessor.

  3.—(1) If the supplier is a supplier to whom paragraph 1(5) applies, he may, before such date as the Secretary of State may direct—

  (a) make such nomination or nominations as he thinks fit for either or both of the purposes mentioned in paragraph 1(6); and

  (b) include the associate or associates so nominated among the persons between whom his property, rights and liabilities may be divided by the transfer scheme.

  (2) Paragraph 2 applies to a transfer scheme dividing property, rights and liabilities between persons including persons nominated for the purposes of paragraph 1(6) with the substitution—

  (a) in sub-paragraph (2)(c) for the words from "the other such" to "both"; and

  (b) in sub-paragraph (3)(b) for the words from "the" (in the first place it appears) to "both",

  of the words "any one or more".
  4. The Secretary of State may, on the application of a person to whom this paragraph applies, direct that paragraphs I and 2 are to apply to his existing supply licence (or such of his existing supply licences as may be nominated under paragraph 1 (4)) as if—

  (a) in paragraph 1(2) for "a distribution licence" there were substituted "two distribution licences"

  (b) in paragraph 1(3) for "one" there were substituted "two" and for "two" there were substituted "three";

  (c) in paragraph 2(1)(a) for "a nomination" and "associate" there were substituted respectively "two nominations" and "associates"; and

  (d) in paragraph 2(1)(6) for "two" there were substituted "three".

  Secretary of State's powers in relation to transfer schemes
  4A.—(1) A transfer scheme shall not take effect unless it is approved by the Secretary of State.
  (2) The Secretary of State may if he thinks fit, before approving a transfer scheme, make such modifications of the scheme as he considers appropriate for the purpose of securing that the scheme makes only such provision as he considers to be requisite or expedient for the purposes of this Part of this Schedule.
  (3) The powers of the Secretary of State under this paragraph may in particular be exercised with a view to ensuring that a proposed transfer scheme does not operate against the public interest.
  (4) It shall be the duty of the supplier to provide the Secretary of State with all such information and other assistance as he may require for the purposes of or in connection with the exercise of any function conferred on him by sub-paragraph (1) and (2).
  Effect of transfer scheme
  4B.—(1)Subject to the provisions of paragraph 4E, on the effective date for a transfer scheme, all property, rights and liabilities—

  (a) to which immediately before that day the supplier was entitled or subject; and

  (b) which are allocated to a nominated associate by the transfer scheme,

  shall become by virtue of this paragraph property, rights and liabilities of that associate.
  (2) For the purposes of this Part of this Schedule, the "effective date", in relation to a transfer scheme, is the day on which section 6(2) of the 1989 Act (as substituted by section 29 above) comes into force or such earlier day as the Secretary of State may direct for the purposes of the scheme.

  Supplementary provisions as to transfers
  4C.—(1) The provisions of Schedule 10 to the 1989 Act (supplementary provisions as to transfers) shall apply to any transfer which is effected by paragraph 4B—

  (a) with the modifications made by sub-paragraphs (2) and (3); and

  (b) to the extent mentioned in those provisions as modified by those sub-paragraphs;

  and paragraph 4B shall have effect subject to those provisions as so modified.
  (2) For the purpose of its application to a transfer effected by paragraph 4B, Schedule 10 to the 1989 Act shall apply as if—

  (a) paragraphs 2(4) and (5), 3 and 6(2) and in paragraphs 4(4)(b) and 8(1) and (2) the words "or of a direction under paragraph 2(4) above" were omitted;

  (b) any reference to transfers effected in pursuance of a transfer scheme were references to transfers effected by paragraph 4B;

  (c) any reference to the transferor were a reference to the supplier;

  (d) any reference to a transfer of all property, rights and liabilities comprised in a specified part of the transferor's undertaking were a reference to a transfer of all (or all but as much as may be excepted) of the property, rights and liabilities comprised in a specified part of the supplier's undertaking;

  (e) any reference to a transferee of a specified part or any other part of the transferor's undertaking were a reference to a transferee of a specified part or any other part of the supplier's undertaking; and

  (f) any reference to the transfer date were a reference to the effective date for the transfer scheme.

  (3) For the purposes of sub-paragraph (2)(a),(b), (d) and (e), any property, rights or liabilities retained by the supplier in pursuance of the transfer scheme shall be deemed to be transferred to the supplier by paragraph 4B in pursuance of the scheme.

  Shares issued in pursuance of a transfer scheme
  4D. Any shares issued to the supplier or to an associate of his by a transferee in pursuance of the transfer scheme—

  (a) shall be of such nominal value as may be specified in or determined under the scheme;

  (b) shall be issued or allotted on such terms as may be so specified or determined; and

  (c) shall be issued as fully paid and treated for the purposes of the Companies Act 1985 as if they had been paid up by virtue of the payment to the transferee in cash of their nominal value and, if the scheme so provides, such premium as may be so specified or determined.

  Statutory accounts
  4E.—(1) This paragraph has effect for the purposes of any statutory accounts of a transferee, that is to say, any accounts prepared by the transferee for the purpose of any provision of the Companies Act 1985 (including group accounts).
  (2) Subject to sub-paragraph (3), the value or amount to be assigned to any asset or liability which is vested in the transferee by virtue of paragraph 4B shall be—

  (a) the value or amount (if any) assigned to the asset or liability for the purposes of the corresponding statement of accounts prepared by the supplier in respect of the last complete accounting year of the supplier to end before the commencement day; or

  (b) if the asset or liability is part only of an asset or liability to which a value or amount is so assigned, so much of that value or amount as may be determined by or under the transfer scheme; or

  (c) if no value or amount is given by paragraph (a) or (b) or the value or amount so given is inappropriate in all the circumstances of the case, such value or amount as may be determined, on the basis of the supplier's accounting records, by or under the transfer scheme.

  (3) The amount to be included in respect of any item shall be determined as if so much of anything done by the supplier (whether by way of acquiring, revaluing or disposing of any asset or incurring, revaluing or discharging any liability, or by carrying any amount to any provision or reserve, or otherwise) as may be determined by or under the transfer scheme had been done by the transferee.
  (4) Without prejudice to the generality of the preceding provisions of this paragraph, the amount to he included from time to time in any reserves of the transferee as representing the transferee's accumulated realised profits shall be determined as if such proportion of any profits realised and retained by the supplier as is determined by or under the transfer scheme had been realised and retained by the transferee.
  (5) In this paragraph, in relation to the supplier—
  "accounting records" means accounting records kept by the supplier in pursuance of section 221 of the Companies Act 1985;
  "complete accounting year" means a financial year of the supplier determined in accordance with section 223 of that Act.

  Consequential modifications of rating provisions
  4F.—(1) This paragraph applies where any transfer effected by paragraph 6 is a transfer of a hereditament which, immediately before the commencement day is a hereditament which falls within—

  (a) the description set out in Part 2 of the Schedule to the Central Rating List (England) Regulations 2000; or

  (b) the description set out in Part 2 of the Schedule to the Central Rating List (Wales) Regulations 1999.

  (2) The Secretary of State may by order make such modifications of that Part of that Schedule, and of the Electricity Supply Industry (Rateable Values)(England) Order 2000 or the

  407
  Electricity Supply Industry (Rateable Values)(Wales) Order 2000, as may appear to him necessary or expedient as a consequence of the transfer.
  (3) An order under this paragraph which is made after the commencement day may have effect as from that day or any later day.
  (4) Where, by virtue of sub-paragraph (3), an order under this paragraph has effect from a day earlier than that on which it is made, any necessary alteration shall be made with effect from that earlier day to any central rating list in which the hereditament is shown.
  (5) An order under this paragraph shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

  Interpretation
  4G. In this Part of this Schedule—
  "effective date" has the meaning given by paragraph 4B(2);
  "existing" in relation to an electricity licence, means in force immediately before the passing of this Act;
  "the supplier" means the person who makes a transfer scheme;
  "transferee" means the transferee under a transfer effected by paragraph 4B;
  "transfer scheme" means a scheme under paragraph 2.
  4H.—(1) For the purposes of this Part of this Schedule a company is an associate of the supplier if—

  (a) the company is a wholly owned subsidiary of the supplier;

  (b) the supplier is a wholly owned subsidiary of the company; or

  (c) the company and the supplier are both wholly owned subsidiaries of another company;

  and the company is registered under the Companies Act 1985 as a company limited by shares.
  (2) The references in sub-paragraph (2) to a wholly owned subsidiary shall be construed in accordance with section 736 of the Companies Act 1985.").
  The noble Lord said: In rising to move Amendment No. 313, I shall speak also to Amendments Nos. 314 to 316 and 352. This is a short group with long amendments. They introduce transitional provisions.
  Amendment No. 313 is a technical amendment which deals with the practicalities of separating electricity supply and distribution businesses. Its aim is to facilitate the legal separation of supply and distribution businesses required by the Bill. It gives those suppliers who will also be carrying out distribution activities an option to make transfer schemes to allocate property, rights and liabilities between new companies. There is no duty to use a scheme, which we think would be inappropriate given the diverse nature of the market and the different levels of operational separation which have already been achieved.
  Transfer schemes will be subject to the Secretary of State's approval. Our overall objective has been to introduce flexibility to take account of the more complex ownership and structure of the electricity sector now. We also wished to ensure that schemes recognised the interests of third parties.
  Through consultation with industry, we have sought in this amendment to provide for various possibilities for companies to restructure their businesses compatible with the regulator's requirements on business separation.
  Amendment No. 314 provides for the Secretary of State to make licensing schemes in respect of electricity and gas licences. These schemes are needed in order to ensure continuity of existing licences when the licensing provisions of the Bill come into force.
  Amendment No. 315 provides that, at the point where Section 18 of the Electricity Act is repealed by Clause 44 of the Bill, customers who are taking a tariff supply under that section from a public electricity supplier can be deemed to be subject to a contract with the supplier who is a successor to the public electricity supplier in question. Amendment No. 316 contains transitional provisions that define the "first financial year" of the authority and the new council; set out the periods to be covered by the initial forward work programmes of the two bodies; and set out the arrangements for producing the final annual reports of the outgoing directors general and Gas Consumers' Council.
  Amendment No. 352 makes provision that a commencement order made by the Secretary of State may contain transitional provisions and savings relating to the provisions being brought into force by the order. I beg to move.
  On Question, amendment agreed to.
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 314 to 317:
  Page 127, line 41, at end insert—

PART II SECRETARY OF STATE'S LICENSING SCHEMES

  Existing electricity supply licences
  41.—(1) This paragraph applies to any holder of an existing supply licence under section 6(1)(c) or (2) ("the supplier") who has made a transfer scheme under paragraph 2 which has been approved by the Secretary of State.
  (2) As soon as practicable after the date specified in the Secretary of State's direction under paragraph 2(1) and in any event before the day on which section 6(2) of the 1989 Act (as substituted by section 29) comes into force, the Secretary of State shall make a scheme providing—

  (a) for the supplier's existing supply licence to have effect as mentioned in paragraph 1(2); and

  (b) if the supplier has nominated an associate or associates for either or both of the purposes of paragraph 1(6), for either or both of his existing generation and transmission licences to have effect as mentioned in paragraph 1(5).

  (3) In making a scheme under this paragraph, the Secretary of State shall have regard to the provisions of the supplier's transfer scheme.
  (4) In this paragraph "existing", in relation to a licence, means in force immediately before the passing of this Act.
  4J.—(1) The Secretary of State shall as soon as practicable after the passing of this Act make a scheme providing for existing licences under section 6(1)(c) which—

  (a) are held by a person whose activities include both of those mentioned in paragraph 1(1); and

  (b) are not the subject of a scheme under paragraph 41.

  to have effect on and after such date as the scheme may specify as if it were—

  (a) a distribution licence and a supply licence, each granted to the holder of the existing licence;

  (b) a distribution licence; or

  409

  (c) a supply licence.

  (2) In this paragraph "existing", in relation to a licence, means in force immediately before the date mentioned in subparagraph (1).
  4K.—(1) The Secretary of State shall as soon as practicable after the passing of this Act make a scheme, in relation to existing licences under section 6(1)(c) other than licences which—

  (a) are the subject of a scheme under paragraph 41; or

  (b) fall within paragraph 4J(1),

  providing for each such licence to have effect on and after such date as the scheme may specify as if it were a supply licence under section 6(1)(d).
  (2) In this paragraph "existing", in relation to a licence, means in force immediately before the date mentioned in sub-paragraph (1).
  4L.—(1) The Secretary of State shall as soon as practicable after the passing of this Act make a scheme, in relation to existing licences under section 6(2), providing for each such licence to have effect on and after such date as the scheme may specify as if it were—

  (a) a supply licence under section 6(1)(d); or

  (b) an exemption from section 4(1)(c) of the 1989 Act granted under section 5 of that Act (exemptions from prohibition).

  (2) In this paragraph "existing", in relation to a licence, means in force immediately before the date mentioned in subparagraph (1).
  4M.—(1) Subject to sub-paragraph (2), a scheme under paragraph 4I, 4J, 4K or 4L shall secure that each condition which by virtue of section 32(1) is a standard condition for the purposes of licences of the appropriate type is incorporated in any licence to be treated by virtue of the scheme as a supply licence or a distribution licence and, where the scheme makes the provision mentioned in paragraph 41(2)(b), in any licence to be treated as a generation licence or as a transmission licence.
  (2) Such a scheme may provide that each licence, and in the case of a scheme under paragraph 4L each exemption, which is to be treated as granted by virtue of the scheme (including both the terms and conditions of the licence or exemption which are derived from the existing licence and, in the case of a licence, the standard conditions which would otherwise he incorporated by virtue of sub-paragraph (1)) shall have effect with—

  (a) such incidental, consequential and supplementary amendments as appear to the Secretary of State to be necessary or expedient; and

  (b) such other amendments (if any) as may be agreed between the Secretary of State and the holder of the existing licence from which the licence or exemption is derived.

  (3) Such a scheme may—

  (a) make such transitional provision as appears to the Secretary of State to be necessary or expedient; and

  (b) make different provision for different cases or classes of cases determined by, or in accordance with, the provisions of the scheme.

  (4) As soon as practicable after making such a scheme the Secretary of State shall publish, as respects each different case or class of case—

  (a) the text of each licence which is to be treated as a licence granted by virtue of the scheme; and

  (b) in the case of a scheme under paragraph 4L, the text of any exemption which is to be treated as granted by virtue of the scheme.

  (5) Any text so published shall be treated as authoritative unless the contrary is shown.

  Existing generation and transmission licences
  4N.—(1) The Secretary of State may, before the day on which section 29 comes into force, make one or more schemes for securing (subject to sub-paragraph (2)) that, on and after that day, the standard conditions which by virtue of section 32(1) are standard conditions for the purposes of licences of the appropriate type are incorporated in each generation licence and each transmission licence which is in force immediately before that day.
  (2) A scheme under this paragraph may provide that the terms and conditions of any existing licence to which it relates (including the standard conditions which would otherwise be incorporated by virtue of sub-paragraph (1)) shall have effect with—

  (a) such incidental, consequential and supplementary amendments as appear to the Secretary of State to be necessary or expedient; and

  (b) such other amendments (if any) as may be agreed between the Secretary of State and the holder of the licence.

  (3) A scheme under this paragraph may—

  (a) make such transitional provision as appears to the Secretary of State to be necessary or expedient; and

  (b) make different provision for different cases or classes of cases determined by, or in accordance with, the provisions of the scheme.

  (4) As soon as practicable after making such a scheme the Secretary of State shall publish, as respects each different case or class of case, the text on the commencement of section 29 of each licence to which the scheme relates as it has effect by virtue of the scheme.
  (5) Any text so published shall be treated as authoritative unless the contrary is shown.

  Existing gas licences
  4O.—(1) The Secretary of State may, before the day on which section 80(2) comes into force, make one or more schemes for securing (subject to sub-paragraph (2)) that on and after that day the standard conditions which by virtue of section 80(2) are standard conditions for the purposes of gas licences of any type are incorporated in each gas licence of that type which is in force immediately before that day.
  (2) A scheme under this paragraph may provide that the terms and conditions of any existing licence to which it relates (including both the terms and conditions of that licence and the standard conditions which would otherwise be incorporated by virtue of sub-paragraph (1)) shall have effect with—

  (a) such incidental, consequential and supplementary amendments as appear to the Secretary of State to be necessary or expedient; and

  (b) such other amendments (if any) as may be agreed between the Secretary of State and the holder of the licence.

  (3) Such a scheme may—

  (a) make such transitional provision as appears to the Secretary of State to be necessary or expedient; and

  (b) make different provisions for different cases or classes of cases determined by, or in accordance with, the provisions of the scheme.

  (4) As soon as practicable after making a scheme under this paragraph, the Secretary of State shall publish, as respects each different case or class of case, the text on the commencement of section 80(2) of each gas licence to which the scheme relates.
  (5) Any text so published shall be treated as authoritative unless the contrary is shown.

  Effect of licensing schemes
  4P.—(1) On the day on which a scheme under this Part of this Schedule comes into operation, the licences to which it relates shall have effect as provided for by the scheme.
  (2) The modification under paragraph 4M(2). 4N(2) or 40(2) of part of what would otherwise be a standard condition of—

  411

  (a) a licence to be treated as granted by virtue of a scheme under paragraph 4I, 4J or 4K; or

  (b) a licence to which a scheme under paragraph 4L, 4N or 40 relates.

  shall not prevent any other part of the condition which is not so modified being regarded as a standard condition for the purposes of Part I of the 1989 Act or Part I of the 1986 Act, as the case may be.

  Provision of information by licence holders
  4Q.—(1) It shall be the duty of each holder of a licence under the 1986 Act to provide the Secretary of State with all such information and other assistance as he may require for the purposes of or in connection with the exercise of any function conferred on him by paragraph 4O in relation to such licences.
  (2) It shall be the duty of each holder of a licence under the 1989 Act to provide the Secretary of State with all such information and other assistance as he may require for the purposes of or in connection with the exercise of any function conferred on him by this Part of this Schedule in relation to such licences.

  Consultation hr Secretary of State
  4R The Secretary of State shall not exercise any function conferred on him by this Part of this Schedule except after consultation with—

  (a) the Authority; and

  (b) such holders of licences under the 1986 Act or such holders of licences under the 1989 Act as he considers appropriate.").

  Page 127, line 41, at end insert—

PART III ELECTRICITY LICENSING

  Former tariff customers
  4S.—(1) This paragraph applies where immediately before the commencement date a public electricity supplier ("the supplier") is supplying tariff customers with electricity.
  (2) The supplier's supply successor shall be deemed to have contracted with those customers for the supply of electricity as from that day.
  (3) The express terms and conditions of a contract which, by virtue of sub-paragraph (2), is deemed to have been made by the supplier shall be provided for by the scheme under this paragraph which relates to that supplier.
  (4) Before such date as the Secretary of State may direct, the supplier shall make a scheme for determining the terms and conditions which are to be incorporated in the contracts which, by virtue of sub-paragraph (2), are to be deemed to have been made by the supplier.
  (5) A scheme under this paragraph may (subject to section 7B of the 1989 Act)—

  (a) make different provisions for different cases or classes of cases, or for different areas, determined by, or in accordance with, the provisions of the scheme; and

  (b) make such supplemental, incidental, consequential and transitional provisions as the supplier considers appropriate.

  (6) A scheme under this paragraph shall not take effect unless it is approved by the Authority; and the Authority may modify such a scheme before approving it.
  (7) If, in relation to such a scheme—

  (a) the supplier fails, before the date specified under subparagraph (4), to submit the scheme for the approval of the Authority; or

  (b) the Authority decides not to approve the scheme that has been submitted by the supplier (either with or without modifications),

  the Authority may itself make the scheme.
  (8) It shall be the duty of the supplier to provide the Authority with all such information and other assistance as it may require for the purposes of or in connection with the exercise of any function conferred by sub-paragraph (6) or (7).
  (9) The Authority shall not exercise any function conferred by sub-paragraph (6) or (7) except after consultation with the supplier.
  (10) A scheme made under this paragraph shall be published in the London and Edinburgh Gazettes before the commencement date and shall come into operation on that date; and conclusive evidence of a scheme so made may be given in all courts of justice and in all legal proceedings whatever by the production of a copy of either of those Gazettes purporting to contain it.
  (11) In this paragraph—
  "commencement date" means the date on which section 44 comes into force; and
  "supply successor", in relation to a public electricity supplier, means the person who becomes an electricity supplier by virtue of a scheme made by or in relation to that public electricity supplier under Part II of this Schedule.").
  Page 128, line 7, at end insert—

  First financial rears of Authority and Council
  .—(1) In this paragraph "the body" means the Authority or the Council.
  (2) If the period beginning with the day on which the body is established and ending with the next 31st March is six months or more, the first financial year of the body is that period.
  (3) If the period mentioned in sub-paragraph (2) is less than six months, the first financial year of the body is the period beginning with the day on which the body is established and ending with 31st March in the following year.

  First forward work programmes of Authority and Council
  . The Authority's first forward work programme required by section 4(1) shall relate to the financial year following its first financial year.
  .—(1) The Council's first forward work programme required by section 4(1) shall be published within the period of three months beginning with the day on which the Council is established.
  (2) That forward work programme shall relate to the Council's plans for the period beginning with the day on which it is published and ending with the last day of the Council's first financial year (and section 4 shall apply accordingly).

  Last annual reports of the Directors
  .—(1) After the abolition of the offices of Director General of Gas Supply and Director General of Electricity Supply, any duty of either Director to make an annual report, in relation to any calendar year for which such a report has not been made, shall be carried out by the Authority.
  (2) The period between the abolition of those offices and the end of the preceding calendar year (if less than 12 months) shall be treated as the calendar year for which the last annual reports are required.
  (3) If that period is nine months or more, the Authority shall make the last annual reports as soon as practicable after the end of that period.
  (4) If that period is less than nine months the last annual reports shall be made no later than the first report of the Authority under section 5(1).
  (5) In this paragraph "annual reports" means reports required by section 39(1) of the 1986 Act and section 50(1) of the 1989 Act.

  Last annual report of the Gas Consumers' Council
  .—(1) After the abolition of the Gas Consumers' Council, any duty of the Gas Consumers' Council to make an annual report, in relation to any calendar year for which such a report has not been made, shall be carried out by the Council.
  (2) The period between the abolition of the Gas Consumers' Council and the end of the preceding calendar year (if less than 12 months) shall he treated as the calendar year for which the last annual report is required.
  (3) If that period is nine months or more, the Council shall make the last annual report as soon as practicable after the end of that period.
  (4) If that period is less than nine months the last annual report shall be made no later than the first report of the Council under paragraph 6 of Schedule 2.
  (5) In this paragraph "annual report" means a report required by section 41 of the 1986 Act.").
  Page 128, line 7, at end insert—

  Investigations being carried out under the 1986 Act
  .—(1) This paragraph applies to any matter—

  (a) being investigated by the Director General of Gas Supply under section 31 of the 1986 Act (duty to investigate certain matters) immediately before the repeal by this Act of that section;

  (b) being investigated by the Gas Consumers' Council under section 32 of the 1986 Act immediately before the commencement of section 22(1) above;

  (c) being investigated by that Council under section 32A of the 1986 Act immediately before the repeal by this Act of that section;

  (d) being investigated by that Council under section 33 of the 1986 Act (power to investigate certain matters) immediately before the commencement of section 23(1) above.

  (2) If the matter being investigated is a matter which appears to the Council to be a matter which is or amounts to a complaint to which section 32 of the 1986 Act (as substituted by section 22(1) above) applies, the Council shall treat the matter as if it were a complaint referred to it under that section.
  (3) In any other case the Authority shall either—

  (a) agree with the Council that the Council is to investigate the matter under section 33 of the 1986 Act (as substituted by section 23(1) above); or

  (b) make such further investigations of the matter, and take such action, as it considers appropriate.

  (4) Where the Council or the Authority is required by virtue of sub-paragraph (2) or (3) to investigate a matter, it may treat anything done by the Director General of Gas Supply or the Gas Consumers' Council in investigating that matter as if done for the purposes of its own investigation.
  (5) The Director General of Gas Supply and the Gas Consumers' Council shall give the Authority and the Council such information or assistance as may be necessary to enable them to of carry out their functions under this paragraph.

  Investigations being carried out under the 1989 Act
  .—(1) This paragraph applies to any matter—

  (a) being investigated by the Director General of Electricity Supply or a consumers committee under section 45 of the 1989 Act (investigation of enforcement matters) immediately before the repeal by this Act of that section;

  (b) being investigated by a consumers' committee under section 46 of the 1989 Act (duty of consumers' committees to investigate certain matters) immediately before the commencement of section 22(2) above.

  (2) If the matter being investigated is a matter which appears to the Council to be a matter which is or amounts to a complaint to which section 46 of the 1989 Act (as substituted by section 22(2) above) applies, the Council shall treat the matter as if it were a complaint referred to it under that section.
  (3) In any other case the Authority shall either—

  (a) agree with the Council that the Council is to investigate the matter under section 46A of the 1989 Act (as inserted by section 23(2) above); or

  414

  (b) make such further investigations of the matter, and take such action, as it considers appropriate.

  (4) Where the Council or the Authority is required by virtue of sub-paragraph (2) or (3) to investigate a matter, it may treat anything done by the Director General of Electricity Supply or a consumers' committee in investigating that matter as if done for the purposes of its own investigation.
  (5) The Director General of Electricity Supply and the consumers' committees shall give the Authority and the Council such information or assistance as may be necessary to enable them to carry out their functions under this paragraph.").
  The noble Lord said: With the leave of the Committee, I shall move Amendments Nos. 314 to 317 together. I beg to move.
  On Question, amendments agreed to.
  Schedule 7, as amended, agreed to.
  Schedule 8 [Repeals]:
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 318 to 349:
  Page 128, line 12, column 3, leave out from first ("the") to the end of line 15 and insert—

  ("East Midlands Region Electricity Consumers' Committee, the Eastern Region Electricity Consumers' Committee, the Office of the Director General of Electricity Supply, the Gas Consumers' Council, the Office of the Director General of Gas Supply, the London Region Electricity Consumers' Committee, the Merseyside and North Wales Region Electricity Consumers' Committee, the Midlands Region Electricity Consumers' Committee, the North Eastern Region Electricity Consumers' Committee, the North Western Region Electricity Consumers' Committee, the North of Scotland Region Electricity Consumers' Committee, the South Eastern Region Electricity Consumers' Committee, the South of Scotland Region Electricity Consumers' Committee, the South Wales Region Electricity Consumers' Committee, the South Western Region Electricity Consumers' Committee and the Southern Region Electricity Consumers' Committee.")

  Page 128, line 23, column 3, at beginning insert—

  ("In Part II of Schedule 1, the entry for the Gas Consumers' Council.")

  Page 128, line 24, column 3, after ("the") insert ("Chairman of a consumers' committee appointed under section 2 of the Electricity Act 1989, the Chairman of the Gas Consumers' Council, the").

  Page 128, line 28, column 3, at beginning insert—

  ("In Part II of Schedule 1, the entry for the Gas Consumers' Council.")

  Page 128, line 29, column 3, after ("the") insert ("Chairman of a consumers' committee appointed under section 2 of the Electricity Act 1989, the").

  Page 128, line 37, column 3, at end insert—

  ("In section 6A(1), the words "after consultation with the Director".")

  Page 129, line 5, column 3, at end insert ("in the licence"").

  Page 129, line 5, column 3, at end insert—

  ("In section 8(1), the words "and sections 23(2), 26(1A) and 27(2) below".")

  Page 129, line 8, column 3, at end insert—

  ("In section 22A(1), in paragraph (b) the words "in that area" (in both places where they appear) and the word "and" preceding paragraph (c).")

  Page 129, line 11, column 3, leave out ("the word "33BB"") and insert ("subsection (5)(aa) and (b), subsection (7A), the word "33BB" in subsection (8) and subsection (9)").

  Page 129, line 12, column 3, at end insert—

  ("Section 30(2)(b) (and the word "or" preceding it).")

  Page 129, line 13, column 3, leave out ("32") and insert ("31")

  Page 129, line 24, column 3, after ("words") insert (""notifications and directions under").

  Page 129, line 30, column 3, at end insert—

  ("Section 40.")

  Page 129, line 30, column 3, at end insert—

  ("Section 41.")

  Page 129, column 3, leave out lines 31 to 33 and insert—

  ("Section 42.")

  Page 129, line 33, column 3, at end insert—

  ("In section 47(7), the words from "and the" to the end.")

  Page 129, line 36, column 3, leave out ("Section 48(4).") and insert ("In section 48, subsections (3) and (4).").

  Page 129, line 40, column 3, after ("2B,") insert ("paragraph 7(2) and").

  Page 129, line 46, column 3, at end insert ("and paragraph 8(4), (5) and (6)").

  Page 129, line 46, column 3, at end insert ("and in paragraph 8(8) the words from "but this" to the end").

  Page 129, line 46, column 3, at end insert—

  ("In Schedule 3, paragraph 20.")

  Page 129, line 46, column 3, at end insert—

  ("In Schedule 7, paragraph 15(2).")

  Page 130, line 8, column 3, at end insert—

  ("In section 10(1)(a), the words "a public electricity supplier or".")

  Page 130, line 13, column 3, at end insert—

  ("In section 25(5), paragraphs (b) and (c).")

  Page 130, line 29, column 3, at end insert—

  ("Section 57.")

  Page 130, line 29, column 3, at end insert—

  ("In section 64(1), the

  definition of "private electricity supplier", the definition of "public electricity supplier" and the definition of "tariff customer".")

  Page 130, line 32, column 3, at end insert—

  ("In Schedule 3, paragraph 21")

  Page 130, line 32, column 3, at end insert—

  ("In Schedule 7, in paragraph 1(7) the words from "as if- to the end.")

  Page 130, line 32, column 3, at end insert —

  ("In Schedule 7, in paragraph 5(3) the words "a public electricity supplier or by", in paragraph 6(1) the words "a public electricity supplier or", paragraph 6(5), paragraph 10(3) and in paragraph 13 the definition of "electricity supplier".")

  Page 130, line 42, column 3, at end insert—

  ("Section 8(2).")

  Page 130, column 3, leave out lines 46 and 47 and insert ("31, 32, 33, 36, 41, 42(1)(a) and (2)(a), 48, 49 and 50").
  The noble Lord said: With the leave of the Committee, I beg to move Amendments Nos. 318 to 349 en bloc.
  On Question, amendments agreed to.
  Schedule 8, as amended, agreed to.
  Clause 106 agreed to.
  Clause 107 [Short title, commencement and extent]:
  Lord Kingsland Lord Kingsland moved Amendment No. 350:
  Page 109, line 20, leave out ("Utilities") and insert ("Gas and Electricity").
  The noble Lord said: This Bill originally contained four public utilities—gas, electricity, telecommunications and water. It now contains only two. In my submission, it would be more accurate to describe this Bill in your Lordships' House as the Gas and Electricity Bill. I beg to move.
  Baroness Sharp of Guildford: I rise to say that on these Benches we have some sympathy with this amendment.
  Lord McIntosh of Haringey: Everyone involved in the industry, consumer groups and other interest groups has become accustomed to the title "Utilities Bill". To change it would serve no purpose and would confuse some of those who have had the patience to pursue our debate. We estimate that to amend the short title consistently throughout the Bill a further

  417
  13 amendments would have to be moved in addition to the amendment to Clause 107 itself. We oppose this amendment.
  Lord Kingsland: I am naturally disappointed by the Minister's reply. I am very tempted to divide the House but, on mature reflection, I shall ask the Minister to think further about his rather categoric answer.
  Lord McIntosh of Haringey: No, I shall not think further about my categoric answer.
  Lord Kingsland: Nevertheless, I still invite him to do so, because we shall return to this matter at Report stage. Meanwhile, I beg leave to withdraw the amendment.
  418
  Amendment, by leave, withdrawn.
  Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 351 to 352:
  Page 109, line 21, after ("section") insert ("and section 67)").
  Page 109, line 23, at end insert—
  ("(2A) An order under subsection (2) may contain transitional provisions and savings relating to the provisions being brought into force by the order.").
  The noble Lord said: With the leave of the Committee, I beg to move Amendments Nos. 351 to 352 en bloc.
  On Question, amendments agreed to.
  Clause 107, as amended, agreed to.
  House resumed: Bill reported with amendments.
  House adjourned at twenty minutes before midnight.

  Lord Hoffmann
  Lord Hoffmann
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